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Auctioneers often hear the phrase “Engaged in the business” when it comes to firearms. The reason is simple: If you are, you need to be licensed and if not, you don’t. The license we’re referring to is a [Class 1] Federal Firearms License.

So what does it mean to be engaged in the business of selling firearms at auction? The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) uses a multiple criteria test to answer that question; if an auctioneer does any one of these things, he is likely engaging in the business:

  1. Possess firearms belonging to others

  2. Taking firearms into your actual (or constructive) possession — to your home, office, auction house, fairgrounds, legion hall, etc. or having someone under your direction and/or control take possession of the firearms — thus facilitating possession and control of the firearms away from the owner/seller.

  3. Buy and sell firearms, as a business

  4. Buying firearms with the intent to resell or establishing a business for the intent to buy and sell firearms, or possibly even simply persistently buying and selling firearms.

  5. Hold oneself out as a dealer in firearms

  6. Portray oneself as a dealer in firearms — with advertising including signage, website, mailers, social media or conversation with the general public; appearing to be (or acting like) a firearm [gun] dealer to the public. Inviting the public generally to buy/sell/consign firearms from/with you.

  7. Make a living in dealing in firearms

  8. Earning a substantial portion of one’s income from the purchase and resale of firearms; devoting a significant amount of time buying and selling firearms producing a material amount of income.

  9. Repeatedly assist the same seller with the sale of their firearms

  10. Selling firearms for the same seller more than once in the same calendar year, or selling firearms for the same seller “every year” or otherwise on any type of regular or predictable schedule.

  11. Conduct a firearm consignment auction, or take firearm consignments

  12. Conduct an auction with firearms from one seller and any other consignments from any other sellers. This includes the situation where the firearms are all from one seller, and the other consignments are exclusively non-firearm property; taking possession and/or control of firearms from multiple sellers.

Those who hold a Federal Firearms License can engage in the business of selling firearms. Those who do not hold a Federal Firearms License cannot engage in the business of selling firearms. It’s just about that simple.

Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, RES Auction Services and Goodwill Columbus Car Auction. He serves as Distinguished Faculty at Hondros College of Business, Executive Director of The Ohio Auction School, an Instructor at the National Auctioneers Association’s Designation Academy and Faculty at the Certified Auctioneers Institute held at Indiana University.