07 FFLs, ITAR FEE Question?

[338Shooter]

I know there are a few 07s on here. As a manufacturer do you have to pay the $2250 annual ITAR fee to the state department even if you don't export anything?

 

[CAR-AR-M16]

From the ATF Handbook, Chapter 7 (http://www.atf.gov/firearms/nfa/nfa_handbook/chapter7.pdf)

7.1.3 Registration by firearms manufacturers with the U.S. Department of State.
The State Department has the responsibility of enforcing the provisions of the Arms Export Control Act (AECA) relating to the export of firearms and other defense articles on the U.S. Munitions List. Nevertheless, any person engaged in the U.S. in the business of manufacturing or exporting firearms or other defense articles is required to register with the State Department’s Directorate of Defense Trade Controls (DDTC). The regulations expressly state that “Manufacturers who do not engage in exporting must nevertheless register.” Form DSP-9 (Registration Statement) and a transmittal letter must be submitted to DDTC by the registrant with a check or money order payable to the State Department of one of the fees prescribed by State Department regulations.


I know several 07/02's who say that they have never paid the ITAR fee and their ATF examiners didn't know if they had to or not, but that doesn't mean they don't have to. I would be afraid of having to come up with several years worth of back-fees if I was an 07/02 who hasn't been paying. Just my opinion and YMMV.

 

[Fyrtwuck]

7.1.3 Registration by firearms manufacturers with the U.S. Department of State.
The State Department has the responsibility of enforcing the provisions of the Arms Export Control Act (AECA) relating to the export of firearms and other defense articles on the U.S. Munitions List.


I interpret this part to say NO. It only applies to export of firearms.


I spoke to an ATF agent in person at the last Tulsa gun show who told me that if you were not importing/exporting, he could see no logical reason to pay it.

But, then again, with the ATF, who knows?

 

[CAR-AR-M16]

7.1.3 Registration by firearms manufacturers with the U.S. Department of State.
The State Department has the responsibility of enforcing the provisions of the Arms Export Control Act (AECA) relating to the export of firearms and other defense articles on the U.S. Munitions List.


I interpret this part to say NO. It only applies to export of firearms.


I spoke to an ATF agent in person at the last Tulsa gun show who told me that if you were not importing/exporting, he could see no logical reason to pay it.

But, then again, with the ATF, who knows?

You are skipping the part that says "The regulations expressly state that “Manufacturers who do not engage in exporting must nevertheless register.” The key point is that ATF does not regulate or enforce it, because it is a state department issue. The ATF is not going to come after you for not paying because it is not something they enforce. I agree that it is stupid to require manufactureres to pay if they do not export anything, but we are talking about the government and their rules/regulations are all about getting every penny out of everyone's pocket. Making sense is the least of their worries.

 

[jeffsoward]

It's pretty ugly and if DDTC chose to begin diggin through all of the 07 registrations, they could probably wipe out half the deficit;
ITAR
§ 122.3 Registration fees.
(a) A person who is required to register
may do so for a period up to 2
years upon submission of a completed
Form DS–2032, transmittal letter, and
payment of a fee as follows:
1 year ................................................................. $1,750.00
2 years ............................................................... $3,500.00
(this fee schedule is contradictory to DDTC and has gone up dramatically. It started as $250 year.)
(b) Expiration of registration. A registrant
must submit its request for registration
renewal at least 30 days prior
to the expiration date.
(c) Lapse in registration. A registrant
who fails to renew a registration and,
after an intervening period, seeks to
register again must pay registration
fees for any part of such intervening
period during which the registrant engaged
in the business of manufacturing
or exporting defense articles or defense
services.

Now, it's sort of open to interpretation. It states that a "registrant" fails to renew "AND" seeks to re-register, so the lapse/back-fees may not be applicable.
ITAR states plainly;
(c) Purpose. Registration is primarily
a means to provide the U.S. Government
with necessary information on
who is involved in certain manufacturing
and exporting activities. Registration
does not confer any export
rights or privileges. It is generally a
precondition to the issuance of any license
or other approval under this subchapter.

 

[338Shooter]

I know last year the fee went up from 1750 to 2250. This is the same sort of discussion I've seen a thousand times on the web searching for an answer to this. Half of the group says you have to and the other have is either not sure or don't believe you have to. I've also heard from several 07ffls that don't pay it. I'm not sure it is enforced until you apply for permits or whatever to export your goods, but I'm like CAR-AR-M16, I don't want to pay the back fees and penalties if they decide to crack down.

 

[jeffsoward]

no kidding.