Gunmakers, with sales slumping at home, ready for eased export rules

Kevin G. Hall
Mcclatchy Washington Bureau

WASHINGTON – U.S. gunmakers are on the verge of getting something they’ve wanted for a very long time: a streamlined process for exporting their handguns and rifles, including AR-15 assault-style weapons that have been the focus of national debate.

Under a long-awaited rule the Trump administration is expected to propose very soon, a large number of commercially available rifles and handguns would move off a munitions list controlled by the State Department and onto a different one at the business-friendly Commerce Department.

Whether that means gendarmes in Marseilles or policia in Barcelona will be packing Smith & Wesson pistols anytime soon is yet to be seen, but it and other iconic American brands like Sturm Ruger and the eventual owners of privately held Remington Outdoor are expected to benefit from any new policy.

Opponents of relaxing the export rules argue that decision could come back to haunt the United States if the weapons end up in the wrong hands. Gun manufacturers counter that the changes don’t eliminate regulation, but would let them conduct business overseas more easily.

“U.S. manufacturers are hamstrung by the overly restrictive license requirements under (current law),” said Michael Bazinet, spokesman for the National Shooting Sports Foundation, a lobbying and trade association for gun makers, based in Newtown, Connecticut. “Lengthy delays in the licensing process, and certain cases requiring congressional notification, cause U.S. firearm and ammunition exporters to lose business.”

Sales slump: Gunmakers are already hurting from slumping domestic gun sales since President Donald Trump took office. The NSSF hopes foreign sales – to sportsmen, collectors and police agencies – could grow by as much as 20 percent under less cumbersome rules, which it has aggressively lobbied for over almost a decade. In 2017, the trade group spent more than $3.3 million lobbying the federal government, according to the Center for Responsive Politics, on this and other issues.

Right now the market for exports of commercially available rifles and handguns is relatively small, dwarfed by sales of sophisticated military hardware and limited in part by the fact that many countries restrict the ability of their citizens to own firearms.

Overseas shipments of revolvers and pistols totaled just under $117 million last year, while shipments of target-shooting rifles totaled about $17.1 million; exports of AR-15s and other assault-style weapons (known technically as centerfire auto-load rifles) came to $13.3 million, according to the International Trade Commission. Abroad, U.S. gun companies compete against established names such as Austria’s Glock and Italy’s Beretta.

Effort began under Obama: The initiative to relax rules covering the export of firearms, including what are commonly called assault-type weapons such as the AR-15 and rapid fire semi-automatic handguns, actually didn’t originate with the Trump administration. It has been contemplated since 2010, under then-President Barack Obama. But after the December 2012 Sandy Hook school shooting in Connecticut, which left 20 children and six adults dead, work on the issue came to a screeching halt.

The Trump administration – in part to fulfill a campaign pledge by Donald Trump to boost U.S. manufacturing writ large – jumpstarted the process, and by last September the changes seemed to be on a fast track.

It’s unclear whether the deadly Oct. 1, 2017, mass murder on the Las Vegas strip, where gunman Stephen Paddock killed 58 and injured 851 by firing more than 1,100 rounds from his hotel window at people attending a nearby live musical festival, slowed the review process, though the rule was expected by the end of 2017. More mass shootings have followed, including the Feb. 14 attack at a high school in Parkland, Florida, which killed 17 and injured as many more.

Admittedly, any changes to the process are complicated to negotiate: The State Department must propose a new rule that eliminates some of the weapons on the U.S. Munitions List over which it has authority, and the Commerce Department must simultaneously draft new language to add those weapons to the Commerce Control List.

Adding to the difficulty is that this administration has been historically slow to fill midlevel positions across the federal government. Some of the planned changes are waiting for a sign-off from deputy directors and office heads who are yet to be put in place almost 15 months after Donald Trump’s inauguration, people familiar with the process said.

Sources familiar with the rules changes under consideration said one big improvement would be a more flexible process for export licensing for those guns on the Commerce Department’s list. An exporter could sell different products within a range, caliber or quantity over a window of, say, six months with one license. As long as the products were variations of the same gun, multiple licenses would no longer be needed.

Under a shift to Commerce’s control, gun makers would “be able to respond better to market fluctuations for commercial sales in foreign countries, as well as compete on a more level playing field for foreign government and police contracts,” said Bazinet, from the gunmakers trade association.

Commerce said in a statement to McClatchy said it already has a framework in place to oversee the export process: an export-control enforcement office, an export-licensing agency and an end-use verification program that currently govern export of 12-gauge shotguns, optical sighting devices for firearms and crime-control equipment.In the last fiscal year, which ended Sept. 30, the agency’s Bureau of Industry and Security reported conducting 1,089 in-person checks in 58 countries to verify the identity of buyers of weapons already under Commerce jurisdiction.

Those who argue against making it easier for U.S. weapons manufacturers to sell overseas maintain that the exported weapons could wind up being used against Americans in conflicts abroad.

“The bigger picture is with the loosening of controls, it adds a lot more opportunities for U.S. guns to get into the hands of people who would misuse them, including people the United States is fighting against,” said Colby Goodman, an arms-control expert at the Center for International Policy, a left-leaning think tank that tracks and analyzes U.S. security and defense assistance across the globe.

Administration officials bristle at this suggestion.

“This transfer will not create opportunities to put weapons in the hands of bad actors,” Rich Ashooh, assistant secretary of commerce for export administration, insisted in a statement to McClatchy. “The proposed changes will allow the Commerce Department to use its expertise and resources through its in-agency law enforcement unit, and its robust end-use verification program.”

The Walmart test: How do the feds decide which gun sales will be regulated by Commerce and which by the State Department? Call it the Walmart test.

“If this is a firearm that is generally commercially available, if it is something you can buy at a Walmart, then it should be controlled on the CCL (Commerce list). And anything that is a military grade, not publicly available firearm would remain,” explained a State Department official.

That test now may exclude more weapons than it used to. In the aftermath of the Parkland and Las Vegas shootings, some retail stores such as Dick’s Sporting Goods have stopped selling assault-style weapons. Dick’s and Walmart both raised the minimum age to purchase guns to 21 post-Parkland, where 19-year-old alleged shooter Nikolas Cruz had purchased a shotgun at Dick’s and had used an AR-15 in the assault on the high school. Walmart said it was also removing from its retail websites weapons that resemble assault rifles.

Once the rules are officially proposed in the Federal Register, a public comment period of at least 60 days follows before the administration can issue final language.

Last May, 144 GOP lawmakers signed a letter to then-Secretary of State Rex Tillerson and Commerce Secretary Wilbur Ross, calling on the Trump administration to hurry up and relax the rules.

“The very basis of this effort is the common sense notion that products intended only for military use should be subject to the highest standards of security and oversight, while regulation of products with general commercial applications should not unnecessarily hinder American business and innovation,” they wrote.

The letter was sent five weeks before gunman James Hodgkinson, a liberal activist from Belleville, Illinois, opened fire at House members and aides last June 14 during a baseball practice in the Virginia suburbs. Among the wounded was House Majority Whip Steve Scalise, R-La., who also happened to be the first signatory on the letter to Tillerson and Ross. Scalise spokesman Chris Bond said the congressman has not changed his position on loosening export controls on firearms.

A handful of Democratic senators have been trying to throw a wrench in the process, however. They worry that AR-15s and other rifles could surface in places such as the Philippines, where President Rodrigo Duterte has encouraged armed citizens to carry out extra-judicial killings.

“These are weapons that are more difficult to protect from transfer ((to unfriendly operatives)) because they’re small,” Sen. Ben Cardin, D-Md., warned in an interview.

The five senators succeeded in late October in getting the Government Accountability Office to assess the risks of transferring the export controls over firearms to the Commerce Department. The GAO, the audit arm of Congress, agreed to look at funding levels, expertise and end-use monitoring requirements.

Its report was expected in February but appears delayed along with the proposed rule changes under consideration.