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Statement of Need: The current firearms regulations permit a corporation, partnership, trust or other legal entity to submit applications to ATF to acquire firearms registered under the National Firearms Act (NFA) without a responsible person of such an entity having to meet requirements currently in place for individuals that seek to ensure that prohibited persons do not gain access to NFA firearms (i.e., undergo a background check, provide a certificate of a CLEO).

Summary of the Legal Basis: This rulemaking is in response to a petition for rulemaking. No aspect of this rulemaking is required by statute or court order

Alternatives: The Agency is soliciting public comment on how the application process can be made more efficient and effective.

Anticipated Costs and Benefits: Total annual costs are estimated at $14.9 million and encompass costs to legal entities associated with the application, ATF processing costs, and costs to local and State agencies in providing the CLEO certificate. There will be public safety benefits as the provisions will enable ATF to ensure that responsible persons within legal entities are not prohibited from possessing NFA firearms under Federal, State, or local law

Risks: This proposed rule may prevent a prohibited person, who is a responsible person in a legal entity, from obtaining an NFA firearm and using it to commit a violent crime.