How to Sell Firearms Online… And Do it Legally
Business owners that are interested in selling firearms via a website, need to understand give essential legal requirements before they can get started. In this article, we’ll cover those five requirements, and provide some helpful pointers for navigating those requirements along the way.
Rule 1: You Must Have a Valid FFL
The Gun Control Act of 1968 law effectively prohibits the shipment of firearms across state lines to anyone except a licensed FFL dealer who can then complete the transaction.
Technically speaking, non-licensed individuals can sell firearms within most jurisdictions, however, only FFL dealers can sell commercially or cross state lines. The legal difference between a private seller and a commercial dealer largely has to do with the origin of the firearm being sold. If the gun is from your private collection, you’re a private seller. However, if your ‘private collection’ is being replenished by wholesalers, then you’re a commercial firearms dealer.
“You need an FFL before you can sell firearms commercially, whether online or in-person.”
That’s a long-winded way of saying, if you’re trying to make a full or even part-time living selling firearms, you need an FFL.
The Bottom Line: You need an FFL before you can sell firearms commercially, whether online or in-person.
Rule 2: The Customer’s Local Laws Apply, Not Yours
Guns are subject to federal and state law age and other state specific purchase restrictions. When selling a firearm online, the applicable state law is that of the purchaser, not the state law where you, the seller are located. For example, if you are selling a handgun to a customer in Illinois, the customer must be 21 years old (because the state requirement in Illinois is 21), despite the fact that your state may only require a purchaser to be 18 years old. Similarly, selling a high capacity magazine in some states is illegal, whereas it’s legal in others. While ultimately the local FFL will be your second set of eyes on state and local laws, it’s a good idea to limit potentially illegal sales on the front-end so as to avoid problems and refund requests.
Tip: To prevent underage customers from purchasing a weapon you should consider adding age verification software to your website. There are a number of easy to integrate shopping cart plugin options ranging from free to fairly pricey, but more robust. Ultimately, an underage purchaser wouldn’t be able to pick up the weapon from the FFL anyway, so by using an age verification tool on the front-end you’ll save yourself a lot of hassle in dealing with refund requests.
The Bottom Line: The customer’s local laws apply, not yours, when selling firearms online.
Rule 3: Ship to a Local FFL, Not the Customer
Once a customer places an order on your website, you cannot simply ship the gun directly to the consumer. Instead, after your customer orders from you, you’ll need to ship the gun to a local licensed firearms dealer, who will (typically for a small fee to the customer) provide it to the customer under the terms required by that state or locality, including any required background checks or waiting periods.
“Online Gun Dealers: Avoid scammers by confirming a recipients FFL is valid before shipping firearms.”
You can use a database like FFL Gun Dealers to compile a list of FFL dealers for your shopping cart, or allow your customers to select their local gun dealer and confirm the validity of their FFL via the ATF’s FFL EZ-Check tool.
The Bottom Line: You cannot ship a gun purchased online directly to the consumer, it must be shipped to a local FFL
Rule 4: Ship via Private Carriers
If you’ve been in the firearms industry for any length of time, you’re probably already well aware of the U.S. Postal Service’s restrictions on shipping handguns. What you may not realize, however, is that if you’re using a pre-built online shopping cart to market your weapons, they are often pre-set to ship to the cheapest carrier which often includes the USPS.
Assuming you’ve got the carrier issue sorted out, you also need to know that most private carriers have specific requirements for shipping firearms. These include: shipping express with signature required, shipping the firearm separate from any ammunition or other items, and shipping in a non-identifiable box. Not only are these requirements of the carrier, but also prudent steps to avoid theft of your firearms during shipping.
Tip: Before setting up your online store, make sure that the eCommerce platform you select allows you to choose your shipping providers, or at a minimum exclude the US Postal Service. And when setting up your shipping process, purchase boxes that don’t have a company logo or otherwise reveal what’s inside.
The Bottom Line: Shipping handguns via USPS is illegal. Use one of the private carriers like UPS or FedEx to handle your shipping, and pay attention to their tips for how to securely ship firearms.
Rule 5: Integrate with a 2nd Amendment Friendly Payment Processor
You might think that Square, PayPal or your local bank would be thrilled to meet your business’ credit card processing needs. Unfortunately, however, that’s not the case. In fact, firearms sales are a prohibited business type with most credit card processors, which is spelled out in their fine print. For example…
PayPal: “You may not use the PayPal service for activities that … relate to transactions involving … ammunition, firearms, or certain firearm parts or accessories…”
Square: “Prohibited Goods and Services include … Sales of (i) firearms, firearm parts or hardware, and ammunition; or (ii) weapons…”
Stripe: “The following categories of businesses and business practices are prohibited from using the Stripe Service… Regulated Products and Services:… age restricted goods or services, weapons and munitions…”
Unfortunately, most credit card processors, or more accurately their commission based salespeople, don’t inform firearms business owners of these restrictions when applying, so many firearms or ammo businesses are initially accepted for credit card processing. A few weeks or months after beginning to accept payments online, however, their merchant account is abruptly terminated and the online firearms dealer’s funds are frozen.
“Online Gun Dealers: Using Square, Stripe or PayPal is a good way to get your funds frozen. #2ndAmendmentFriendly”
The Bottom Line: Apply with a 2nd Amendment friendly credit card processor from the get go, to avoid frozen funds and terminated accounts.
If you’re like most entrepreneurs, you’re anxious to get your business started as soon as possible and that means start selling today. However, if you plan to sell firearms online, it’s smart to do a little homework ahead of time, and setup your business to comply with the five legal guidelines above, rather than having to backtrack and figure out how to integrate these requirements after you’ve already started selling.
We aren’t a law firm, and this isn’t legal advice. If you’re starting out accepting ecommerce firearms credit card payments, the above advice is a good starting place, but is by no means all the information you need. So don’t rely on this information as legal advice.