[Congressional Record Volume 170, Number 115 (Thursday, July 11, 2024)]
[Senate]
[Pages S4557-S4563]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DURBIN (for himself, Mr. Whitehouse, Mr. Blumenthal, Ms. 
        Hirono, Mr. Booker, Mr. Welch, Mrs. Shaheen, Mr. Reed, Mr. 
        Schatz, and Mr. Cardin):
  S. 4706. A bill to modernize the business of selling firearms; to the 
Committee on the Judiciary.

                                S. 4706

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Federal 
     Firearm Licensee Act''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
Sec. 4. Repeal of temporary Brady provision.
Sec. 5. Physical security of licensee premises.
Sec. 6. Business inventory firearms.
Sec. 7. Electronic records.
Sec. 8. Notification of default transfers.
Sec. 9. Multiple firearm sales records and reports.
Sec. 10. Safety devices and warnings to purchasers.
Sec. 11. Inspections.
Sec. 12. Authority with regards to license issuance and renewal.
Sec. 13. Increased licensing fees.
Sec. 14. Elimination of obligatory stay of effective date of license 
              revocation.
Sec. 15. Elimination of relief for dealers indicted for a crime 
              punishable by imprisonment for a term exceeding one year.
Sec. 16. Elimination of relief while Federal disability relief 
              application pending.
Sec. 17. Presumption of knowledge of State law in sale of long guns to 
              residents of another State.
Sec. 18. Increased penalties for knowing transfer of firearm without 
              conducting a background check.
Sec. 19. Unlawful acts upon incurring Federal disability or notice of 
              license suspension, revocation, or denied renewal.
Sec. 20. Regulation of facilitators of firearm transfers.
Sec. 21. Dealer and employee background checks.
Sec. 22. Liability standards.
Sec. 23. Civil enforcement.
Sec. 24. Removal of bar on civil proceedings if criminal proceedings 
              terminated.
Sec. 25. Repeal of certain limitations.
Sec. 26. Authority to hire additional industry operation investigators 
              for Bureau of Alcohol, Tobacco, Firearms, and Explosives.
Sec. 27. Report on implementation of this Act.
Sec. 28. Annual licensed dealer inspections report and analysis.
Sec. 29. Deadline for issuance of final regulations.

     SEC. 2. FINDINGS.

       Congress finds the following:
       (1) A growing body of evidence demonstrates that firearm 
     dealers' sales practices affect the probability of firearms 
     getting to criminals and that policies designed to hold 
     firearm sellers accountable can curtail the diversion of 
     firearms to criminals.
       (2) Federal laws governing firearm dealers--
       (A) have not been updated in more than 30 years;
       (B) contain safeguards that protect dealers who engage in 
     illegal practices from adverse enforcement action;
       (C) frustrate law enforcement efforts to curb firearm 
     trafficking and violence; and
       (D) are, thus, inadequate to meet the realities of the 21st 
     century.
       (3)(A) The Tiahrt Amendments, for one--
       (i) severely limit the authority of the Bureau of Alcohol, 
     Tobacco, Firearms, and Explosives (commonly known as the 
     ``ATF'') to disclose crime firearm trace data to the public;
       (ii) prevent--
       (I) the collection of valuable information; and
       (II) the establishment of effective policies to prevent 
     illegal firearms from being used in crimes; and
       (iii) impede enforcement of the firearm laws by--
       (I) requiring most background check records to be destroyed 
     within 24 hours; and
       (II) barring the Government from requiring owners of 
     firearm shops to conduct annual inventory audits.
       (B) Repealing the Tiahrt Amendments would support law 
     enforcement efforts and give the public vital information 
     needed to craft the most effective policies against illegal 
     firearms.
       (4) Additionally, Federal law imposes no requirements that 
     firearm dealers physically secure their highly valuable and 
     lethal inventory. The number of firearm thefts from licensed 
     firearm dealers has increased more than the number from any 
     other source. Between 2013 and 2017, the number of firearms 
     stolen in firearm-dealer burglaries more than doubled and the 
     number of firearms stolen in firearm-dealer robberies 
     tripled.

     SEC. 3. DEFINITIONS.

       Section 921(a) of title 18, United States Code, is amended 
     by adding at the end the following:
       ``(38) The term `facilitator' means any person engaged in 
     the business of hosting a commercial marketplace in which 
     offers for firearm sales, purchases, or other transfers are 
     allowed to be made, except that such a person shall not be 
     considered to be a facilitator with respect to any 
     transaction that is made through the use of a website or 
     mobile application owned or operated by the person if--
       ``(A) the transaction violates the terms of service of the 
     website or mobile application; and
       ``(B) the person has made a good faith effort to enforce 
     the terms of service by, at a minimum, auditing firearms 
     transactions on a quarterly basis to ensure compliance with 
     this chapter.
       ``(39) The term `occasional' means, with respect to 
     transactions, fewer than 5 transactions in a 12-month period.
       ``(40) The term `personal collection' includes any firearm 
     obtained only for the personal use of an individual and not 
     for the purpose of selling or trading, except that a firearm 
     obtained through inheritance shall not be considered part of 
     a personal collection until the firearm has been possessed 
     for 1 year.
       ``(41) The term `business inventory firearm' means, with 
     respect to a person, a firearm required by law to be recorded 
     in the acquisition and disposition logs of any firearms 
     business of the person.
       ``(42)(A) The term `frame' means the part of a handgun, or 
     a variant thereof, that provides housing or a structure for 
     the primary

[[Page S4558]]

     energized component designed to hold back the hammer, 
     striker, bolt, or similar component prior to initiation of 
     the firing sequence (such as a sear or the equivalent), even 
     if pins or other attachments are required to connect such 
     component to the housing or structure.
       ``(B) The term `receiver' means the part of a rifle, 
     shotgun, or projectile weapon other than a handgun, or a 
     variant thereof, that provides housing or a structure for the 
     primary component designed to block or seal the breech prior 
     to initiation of the firing sequence (such as a bolt, 
     breechblock, or the equivalent), even if pins or other 
     attachments are required to connect such component to the 
     housing or structure.
       ``(C) For purposes of this paragraph, the term `variant' 
     means a weapon utilizing a similar frame or receiver design 
     irrespective of new or different model designations or 
     configurations, characteristics, features, components, 
     accessories, or attachments. For example, an AK-type firearm 
     with a short stock and a pistol grip is a pistol variant of 
     an AK-type rifle, an AR-type firearm with a short stock and a 
     pistol grip is a pistol variant of an AR-type rifle, and a 
     revolving cylinder shotgun is a shotgun variant of a 
     revolver.''.

     SEC. 4. REPEAL OF TEMPORARY BRADY PROVISION.

       (a) In General.--Section 922 of title 18, United States 
     Code, is amended by striking subsection (s).
       (b) Conforming Amendments.--Chapter 44 of title 18, United 
     States Code, is amended--
       (1) in section 922--
       (A) in subsection (t)--
       (i) in paragraph (3)(C)(ii), by striking ``(as defined in 
     subsection (s)(8))''; and
       (ii) by adding at the end the following:
       ``(A) For purposes of this subsection, the term `chief law 
     enforcement officer' means the chief of police, the sheriff, 
     or an equivalent officer or the designee of any such 
     individual.''; and
       (B) in subsection (y)(2), in the matter preceding 
     subparagraph (A), by striking ``, (g)(5)(B), and 
     (s)(3)(B)(v)(II)'' and inserting ``and (g)(5)(B)'';
       (2) in section 924(a)(5), by striking ``subsection (s) or 
     (t) of section 922'' and inserting ``section 922(t)''; and
       (3) in section 925A, in the matter preceding paragraph (1), 
     by striking ``subsection (s) or (t) of section 922'' and 
     inserting ``section 922(t)''.

     SEC. 5. PHYSICAL SECURITY OF LICENSEE PREMISES.

       (a) Security Plan Submission Requirement.--
       (1) In general.--Section 923(d)(1)(G) of title 18, United 
     States Code, is amended--
       (A) by striking ``, the applicant'' and inserting the 
     following: ``--
       ``(i) the applicant'';
       (B) by striking the period ad the end and inserting ``; 
     and''; and
       (C) by adding at the end the following:
       ``(ii) the applicant--
       ``(I) submits with the application a security plan that 
     describes how the applicant will secure, in accordance with 
     the regulations issued under section 926(d), the premises 
     from which the applicant will conduct business under the 
     license (including in the event of a natural disaster or 
     other emergency); and
       ``(II) certifies that, if issued such a license, the 
     applicant will comply with the plan described in subclause 
     (I).''.
       (2) Written approval required before license renewal.--
     Section 923(d)(1) of title 18, United States Code, is 
     amended--
       (A) in subparagraph (F), by striking ``and'' at the end;
       (B) in subparagraph (G), as amended by paragraph (1), by 
     striking the period at the end and inserting ``; and''; and
       (C) by adding at the end the following:
       ``(H) in the case of an application to renew a license to 
     deal in firearms--
       ``(i) the license is not suspended;
       ``(ii) no license issued to the applicant under this 
     chapter has been revoked; and
       ``(iii) the Attorney General has inspected the premises and 
     provided written approval of the security plan submitted by 
     the applicant under subparagraph (G)(ii)(I).''.
       (3) Applicability to existing dealers whose license will 
     expire .--
       (A) In general.--If, not later than 1 year after the date 
     on which regulations are prescribed under section 926(d) of 
     title 18, United States Code (as added by subsection (c) of 
     this section), a person described in subparagraph (B) of this 
     paragraph submits to the Attorney General a security plan 
     described in clause (ii)(I) of section 923(d)(1)(G) of that 
     title (as added by paragraph (1) of this subsection), the 
     security plan shall be considered to have been submitted in 
     accordance with such section 923(d)(1)(G).
       (B) Person described.--A person described in this 
     subparagraph is a person--
       (i) who, on the date of enactment of this Act, is a 
     licensed dealer (as defined in section 921(a)(11) of title 
     18, United States Code); and
       (ii) whose license to deal in firearms issued under chapter 
     44 of title 18, United States Code, will expire on or after 
     the date that is 1 year after the date on which regulations 
     are prescribed under section 926(d) of that title (as added 
     by subsection (c) of this section).
       (b) Annual Compliance Certification Requirement.--
       (1) In general.--Section 923 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(m) Annual Certification.--
       ``(1) In general.--Each licensed manufacturer, licensed 
     importer, and licensed dealer shall--
       ``(A) annually certify to the Attorney General that each 
     premises from which the licensee conducts business subject to 
     license under this chapter is in compliance with the 
     regulations prescribed under section 926(d); and
       ``(B) in the case of a licensed dealer, include with the 
     certification under subparagraph (A)--
       ``(i) the results of a reconciliation of the resale 
     firearms then in the business inventory of the licensee 
     against the resale firearms in the business inventory of the 
     licensee at the time of the most recent prior certification 
     (if any) under this paragraph; and
       ``(ii) all dispositions and acquisitions of resale firearms 
     in the year covered by the certification, identifying and 
     reporting any missing firearm.
       ``(2) Civil penalty.--The Attorney General shall impose a 
     civil penalty of not more than $5,000 on, and may suspend the 
     license issued under this section to, a licensee who fails to 
     comply with paragraph (1).''.
       (2) Applicability.--In the case of a person who, on the 
     date of enactment of this Act, is a licensee referred to in 
     section 923(m) of title 18, United States Code (as added by 
     paragraph (1)), such section 923(m) shall apply to the person 
     on and after the date that is 1 year after the date on which 
     regulations are prescribed under subsection (d) of section 
     926 of that title (as added by subsection (c)(1)).
       (c) Regulations.--
       (1) In general.--Section 926 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(d) Securing Premises From Theft.--The Attorney General 
     shall prescribe such regulations as are necessary to ensure 
     that any premises at which a licensee referred to in section 
     923(m) conducts business is secure from theft, which shall 
     include requiring--
       ``(1) compliance with the security plan submitted by the 
     licensee pursuant to section 923(d)(1)(G)(ii)(I), if 
     applicable;
       ``(2) the use of locked metal cabinets and fireproof safes;
       ``(3) security systems, video monitoring, and anti-theft 
     alarms;
       ``(4) security gates, strong locks, and site hardening;
       ``(5) concrete bollards and other access controls, if 
     necessary; and
       ``(6) the use of any other security-enhancing features 
     appropriate for the specific circumstances of the 
     licensee.''.
       (2) Applicability.--The regulations prescribed under 
     section 926(d) of title 18, United States Code, as added by 
     paragraph (1), shall not apply to a person who, on the date 
     of the enactment of this Act, is a licensee referred to in 
     section 923(m) of that title, until the date that is 1 year 
     after the date on which the regulations are prescribed.

     SEC. 6. BUSINESS INVENTORY FIREARMS.

       (a) Requirement to Transfer Firearm in Personal Collection 
     to Business Inventory Before Disposition.--Section 923(c) of 
     title 18, United States Code, is amended--
       (1) by striking the second sentence and inserting the 
     following: ``Nothing in this chapter shall be construed to 
     prohibit a licensed manufacturer, licensed importer, or 
     licensed dealer from maintaining a personal collection of 
     firearms.'';
       (2) by striking the third sentence; and
       (3) by adding at the end the following: ``Any firearm 
     disposed of by a licensee shall be from the business 
     inventory of the licensee.''.
       (b) Licensee Firearms Inventory.--Section 923(g) of title 
     18, United States Code, is amended by adding at the end the 
     following:
       ``(8)(A) Each quarter, a licensee shall conduct a physical 
     check of the firearms inventory of the business of the 
     licensee licensed under this chapter and report to the 
     Attorney General and appropriate local authorities any 
     firearm that is lost, stolen, or unaccounted for.
       ``(B) The Attorney General shall prescribe regulations to 
     implement the requirements under subparagraph (A), which 
     shall require, at a minimum, that a licensee record, for each 
     firearm in the inventory of the licensee--
       ``(i) the date of receipt of the firearm;
       ``(ii) the name, address, and license number, if 
     applicable, of the person from whom the firearm was received;
       ``(iii) the name of the manufacturer and, if applicable, 
     importer of the firearm;
       ``(iv) the model, serial number, type, and caliber or gauge 
     of the firearm; and
       ``(v) the date of the sale or other disposition of the 
     firearm.
       ``(C) Nothing in this paragraph shall be construed to 
     prohibit the Attorney General from, at any time, requiring 
     the regular or one-time submission of the inventory records 
     of a licensee to ensure that the licensee is in compliance 
     with this chapter.''.
       (c) Repeal of Limitations on Imposition of Requirement That 
     Firearms Dealers Conduct Physical Check of Firearms 
     Inventory.--
       (1) Fiscal year 2013.--The fifth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated and Further Continuing 
     Appropriations Act, 2013 (18 U.S.C. 923 note; Public Law 113-
     6; 127 Stat.

[[Page S4559]]

     248) is amended by striking ``and any fiscal year 
     thereafter''.
       (2) Fiscal year 2012.--The matter under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated and Further Continuing 
     Appropriations Act, 2012 (Public Law 112-55; 125 Stat. 609) 
     is amended by striking the seventh proviso.
       (3) Fiscal year 2010.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated and Further Continuing 
     Appropriations Act, 2010 (Public Law 111-117; 123 Stat. 3129) 
     is amended by striking ``or any other''.
       (4) Fiscal year 2009.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Omnibus Appropriations Act, 2009 (Public 
     Law 111-8; 123 Stat. 575) is amended by striking ``or any 
     other''.
       (5) Fiscal year 2008.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated Appropriations Act, 2008 
     (Public Law 110-161; 121 Stat. 1904) is amended by striking 
     ``or any other''.
       (6) Fiscal year 2006.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title I of 
     the Science, State, Justice, Commerce, and Related Agencies 
     Appropriations Act, 2006 (Public Law 109-108; 119 Stat. 2296) 
     is amended by striking ``or any other''.
       (7) Fiscal year 2005.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title I of 
     division B of the Consolidated Appropriations Act, 2005 
     (Public Law 108-447; 118 Stat. 2860) is amended by striking 
     ``or any other''.
       (8) Fiscal year 2004.--The seventh proviso under the 
     heading ``salaries and expenses'' under the heading ``Bureau 
     of Alcohol, Tobacco, Firearms and Explosives'' in title I of 
     division B of the Consolidated Appropriations Act, 2004 
     (Public Law 108-199; 118 Stat. 53) is amended by striking 
     ``or any other''.

     SEC. 7. ELECTRONIC RECORDS.

       (a) Records Retention and Submission.--Section 923(g) of 
     title 18, United States Code, is amended--
       (1) in paragraph (1)(A)--
       (A) in the first sentence, by inserting before the period 
     at the end the following: ``, except that, notwithstanding 
     any other provision of law, on and after the date that is 1 
     year after the date of enactment of the Federal Firearm 
     Licensee Act, records prepared by a licensee under this 
     chapter of the sale or other disposition of firearms, 
     including each firearms transaction record, and the 
     corresponding record of receipt of such firearms, shall be 
     retained at the business premises readily accessible for 
     inspection under this chapter until the business is 
     discontinued''; and
       (B) by striking the second sentence;
       (2) in paragraph (5)(A), by inserting ``or electronically 
     as may be'' after ``submit on a form''; and
       (3) in paragraph (7), by inserting ``, electronically,'' 
     after ``orally''.
       (b) Records Databases.--Section 923(g) of title 18, United 
     States Code, as amended by section 6, is amended by adding at 
     the end the following:
       ``(9)(A) Not later than 3 years after the date of enactment 
     of this paragraph, the National Tracing Center of the Bureau 
     of Alcohol, Tobacco, Firearms, and Explosives shall establish 
     and maintain electronic, searchable databases of all records 
     regarding the importation, production, shipment, receipt, 
     sale, or other disposition of firearms required to be 
     submitted by licensees to the Attorney General under this 
     chapter.
       ``(B) Each licensee under this chapter may provide the 
     National Tracing Center with electronic access, consistent 
     with the requirements of this paragraph, to all records 
     within the possession of the licensee that are required to be 
     kept under this chapter.
       ``(C) The National Tracing Center--
       ``(i) shall have remote access to query, search, or 
     otherwise access the electronic databases described in 
     subparagraph (A); and
       ``(ii) with the permission of a State, or political 
     subdivision of a State, may query, search, or otherwise 
     access the databases of the firearms registration system or 
     pawnbroker records system of the State or political 
     subdivision.
       ``(D) The National Tracing Center may query, search, or 
     otherwise access the electronic databases described in 
     subparagraph (A) only to obtain information related to any 
     Federal, State, local, tribal, or foreign criminal 
     investigation.
       ``(E) The electronic databases established under 
     subparagraph (A)--
       ``(i) shall be electronically searchable by date of 
     disposition, license number, and the information identified 
     on each firearm or other firearm descriptor, including the 
     manufacturer, importer, model, serial number, type, and 
     caliber or gauge;
       ``(ii) shall not be electronically searchable by the 
     personally identifiable information of any individual, 
     without a warrant authorizing such a search; and
       ``(iii) shall include in search results the entire contents 
     of the relevant records kept by the licensee.''.
       (c) Video Recordings of Sales and Transfers.--Section 
     923(g) of title 18, United States Code, as amended by 
     subsection (b), is amended by adding to the end the 
     following:
       ``(10) In accordance with regulations promulgated by the 
     Attorney General, each licensed dealer operating a location 
     at which firearms are sold to a person not licensed under 
     this chapter shall--
       ``(A) maintain video surveillance of all areas within each 
     premises where firearms in the business inventory of the 
     licensee are sold or transferred;
       ``(B) retain records of the surveillance, including any 
     sound recording obtained from the surveillance, for a period 
     of not less than 90 days; and
       ``(C) post a sign in a conspicuous place and at each public 
     entrance to the retail location, in block letters not less 
     than 1 inch in height, stating that the premises are under 
     video surveillance.''.
       (d) Increased Penalties for Licensee Violations Relating to 
     Acquisition and Disposition Records.--Section 924(a)(3) of 
     title 18, United States Code, is amended--
       (1) by redesignating subparagraphs (A) and (B) as clauses 
     (i) and (ii), respectively, and adjusting the margins 
     accordingly;
       (2) by moving the matter following clause (ii) (as so 
     redesignated) 2 ems to the right;
       (3) in the matter following clause (ii) (as so 
     redesignated), by striking ``one year'' and inserting ``5 
     years'';
       (4) by inserting ``(A)'' after ``(3)''; and
       (5) by adding at the end the following:
       ``(B) If the conduct described in clause (i) or (ii) of 
     subparagraph (A) is in relation to an offense under 
     subsection (a)(6) or (d) of section 922, the licensed dealer, 
     licensed importer, licensed manufacturer, or licensed 
     collector shall be fined under this title, imprisoned not 
     more than 10 years, or both.''.
       (e) Elimination of Limitation on Centralizing Records.--
     Section 926(a) of title 18, United States Code, is amended, 
     in the matter following paragraph (3)--
       (1) in the first sentence, by striking ``records required 
     to be maintained under this chapter or any portion of the 
     contents of such records, be recorded at or transferred to a 
     facility owned, managed, or controlled by the United States 
     or any State or any political subdivision thereof, nor 
     that''; and
       (2) in the second sentence, by striking ``Secretary's'' and 
     inserting ``Attorney General's''.
       (f) Electronic Recordkeeping Adoption and Implementation.--
     Section 926 of title 18, United States Code, as amended by 
     section 5, is amended by adding at the end the following:
       ``(e) Facilitation of Electronic Recordkeeping.--The 
     Attorney General--
       ``(1) shall facilitate and incentivize the conversion to, 
     and adoption of, electronic recordkeeping solutions by 
     licensees that enable electronic completion and submission to 
     the Attorney General of all records required to be maintained 
     under this chapter;
       ``(2) shall facilitate--
       ``(A) digital capture of paper records of licensed dealers; 
     and
       ``(B) the integration and indexing of data onto a platform 
     accessible by law enforcement authorities for purposes of 
     investigating a violent crime or crime gun trace;
       ``(3) shall facilitate, with respect to the electronic 
     databases established under section 923(g)(9)(A)--
       ``(A) remote access to electronic records of licensed 
     dealers by law enforcement authorities for purposes of 
     investigating a violent crime or crime gun trace; and
       ``(B) access by licensed dealers to only their own records; 
     and
       ``(4) may not remotely access or search electronic records 
     of licensed dealers without a warrant authorizing such a 
     search.''.

     SEC. 8. NOTIFICATION OF DEFAULT TRANSFERS.

       Section 922(t)(1) of title 18, United States Code, is 
     amended--
       (1) in subparagraph (C), by striking ``and'' at the end;
       (2) in subparagraph (D), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding at the end the following:
       ``(E) in the case of a transfer conducted pursuant to 
     subparagraph (B)(ii) or clause (ii) or (iii) of subparagraph 
     (C), the licensee notifies the Attorney General, not later 
     than the close of business on the day on which the firearm is 
     transferred, that the firearm has been transferred to the 
     person.''.

     SEC. 9. MULTIPLE FIREARM SALES RECORDS AND REPORTS.

       (a) Expanding Reporting Requirement to Certain Long Guns.--
     Section 923(g)(3)(A) of title 18, United States Code, is 
     amended--
       (1) in the first sentence, by striking ``pistols, or 
     revolvers, or any combination of pistols and revolvers'' and 
     inserting ``pistols, revolvers, semiautomatic rifles or 
     shotguns, or rifles or shotguns capable of accepting a high 
     capacity magazine, or any combination of such weapons''; and
       (2) by inserting after the first sentence the following: 
     ``In the preceding sentence, the term `high capacity 
     magazine' means a magazine capable of holding more than 10 
     rounds of ammunition, and includes a magazine that may be 
     readily converted to hold more than 10 rounds of 
     ammunition.''.
       (b) Requirement to Retain Instant Criminal Background Check 
     Records for 90 Business Days.--Section 922(t)(2)(C) of title 
     18, United States Code, is amended--
       (1) by striking ``destroy'' and inserting ``retain for not 
     less than 90 business days'';
       (2) by striking ``(other than the identifying number and 
     the date the number was assigned)''; and

[[Page S4560]]

       (3) by inserting before the period at the end the 
     following: ``solely for purposes related to discovering 
     misuse or avoidance of the national instant criminal 
     background check system or ensuring its proper operation''.
       (c) Attorney General Reports of Multiple Sales by Non-
     licensees.--Section 923(g)(3) of title 18, United States 
     Code, is amended--
       (1) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (2) by inserting after subparagraph (A) the following:
       ``(B)(i) The Attorney General shall prepare a report of 
     multiple dispositions of firearms to persons not licensed 
     under this chapter, which shall include the names and 
     identifying information of transferees appearing in the 
     records retained under section 922(t)(2)(C) on 2 or more 
     occasions in any period of 5 consecutive business days.
       ``(ii) The report described in clause (i) shall be prepared 
     on a form substantially similar to the form created pursuant 
     to subparagraph (A) and include the names and addresses of 
     the licensees who requested the background checks under 
     subsection (t).
       ``(iii) The Attorney General shall forward the report 
     described in clause (i) to the office designated pursuant to 
     subparagraph (A) and to the departments of State police or 
     State law enforcement agencies of the State or local law 
     enforcement agencies of the local jurisdictions in which the 
     sales or other dispositions took place, not later than the 
     close of business on the date of the most recent such sale or 
     other disposition.''.
       (d) Records Retention to Investigate Crime Guns.--Section 
     923(g)(3)(C) of title 18, United States Code, as redesignated 
     by subsection (c)(1) of this section, is amended--
       (1) in the first sentence--
       (A) by inserting ``a firearm involved in a crime or'' after 
     ``Except in the case of forms and contents thereof 
     regarding''; and
       (B) by striking ``, and shall destroy each such form and 
     any record of the contents thereof no more than 20 days from 
     the date such form is received'' and inserting ``and shall 
     retain each such form and any record of the contents of the 
     form for not less than 180 days after the date on which the 
     form is received''; and
       (2) by striking the second sentence.

     SEC. 10. SAFETY DEVICES AND WARNINGS TO PURCHASERS.

       Section 922(z) of title 18, United States Code, is 
     amended--
       (1) by inserting ``and Warnings to Purchasers'' after 
     ``Secure Gun Storage or Safety Device'';
       (2) by striking ``handgun'' each place it appears and 
     inserting ``firearm''; and
       (3) by adding at the end the following:
       ``(4) Warnings to purchasers.--
       ``(A) In general.--A licensed dealer operating a physical 
     retail location shall post conspicuously within the licensed 
     premises all warnings required to be provided to firearms 
     purchasers under applicable State and local law.
       ``(B) Materials.--
       ``(i) Development and distribution by attorney general.--
     The Attorney General shall--

       ``(I) develop materials regarding suicide prevention, 
     securing firearms from loss, theft, or access by a minor or 
     prohibited person, and straw purchasing; and
       ``(II) provide the materials developed under subclause (I) 
     to each licensed dealer.

       ``(ii) Dissemination by dealers.--A licensed dealer shall 
     disseminate the materials described in clause (i) upon 
     transfer of a firearm to a person not licensed under this 
     chapter.''.

     SEC. 11. INSPECTIONS.

       (a) Mandated Annual Inspections of High-risk Licensed 
     Dealers and Quinquennial Inspections of Other Licensed 
     Dealers.--Section 923(g)(1)(B) of title 18, United States 
     Code, is amended--
       (1) in clause (ii), by redesignating subclauses (I) and 
     (II) as items (aa) and (bb), respectively, and adjusting the 
     margins accordingly;
       (2) by redesignating clauses (i), (ii), and (iii) as 
     subclauses (I), (II), and (III), respectively, and adjusting 
     the margins accordingly;
       (3) by inserting ``(i)'' after ``(B)''; and
       (4) by adding at the end the following:
       ``(ii)(I) The Attorney General--
       ``(aa) not less frequently than annually, shall inspect or 
     examine the inventory, records, and business premises of each 
     licensed dealer whom the Attorney General determines to be a 
     high-risk dealer, based on considerations that include 
     whether--
       ``(AA) during the preceding 5 years, the dealer reported a 
     lost or stolen firearm;
       ``(BB) during the preceding 10 years, the dealer was issued 
     a report of violation, received a warning letter, or was the 
     subject of a warning conference; or
       ``(CC) during the preceding year, multiple firearms were 
     determined to have been used in a crime under Federal, State, 
     or local law within 3 years after sale by the dealer; and
       ``(bb) may appoint an attorney to ensure that high-risk 
     dealers comply with all applicable firearm sales laws.
       ``(II) An attorney appointed under subclause (I)(bb) may, 
     with respect to high-risk dealers, use in-store observation, 
     monitor records, conduct random and repeated sales integrity 
     tests, and design and offer instructional programs providing 
     best practices sales training to all employees involved in 
     firearm sales until the attorney certifies to the Attorney 
     General that the high-risk dealer has complied with all 
     applicable firearm sales laws for 3 consecutive years.
       ``(III) Not later than 180 days after the date on which an 
     inspection or examination under subclause (I) reveals a 
     violation of this section or any regulation prescribed under 
     this chapter, and not later than 180 days after a security 
     inspection conducted under paragraph (6)(B)(i) of this 
     subsection, the Attorney General shall conduct an inspection 
     or examination to determine whether the violation identified 
     in the preceding inspection or examination has been cured.
       ``(IV) Not less frequently than once every 5 years, the 
     Attorney General shall inspect or examine the inventory, 
     records, and business premises of each licensed dealer that 
     the Attorney General has not determined to be a high-risk 
     dealer under subclause (I).''.
       (b) Elimination of Limit on Inspection of Licensee 
     Records.--Section 923(g)(1)(B)(i)(II) of title 18, United 
     States Code, as redesignated by subsection (a), is amended--
       (1) by striking ``--'' and all that follows through 
     ``(bb)''; and
       (2) by striking ``with respect to records relating to a 
     firearm involved in a criminal investigation that is traced 
     to the licensee''.
       (c) Mandated Security Inspection of Dealers Reporting Lost 
     or Stolen Firearms.--Section 923(g)(6) of title 18, United 
     States Code, is amended--
       (1) by inserting ``(A)'' after ``(6)''; and
       (2) by adding at the end the following:
       ``(B)(i) If the Attorney General receives a report under 
     subparagraph (A) from a licensed dealer, the Attorney General 
     shall conduct an independent inspection of the security of 
     the premises at which the theft occurred, which shall include 
     an inspection of the measures taken to implement the security 
     plan submitted by the licensed dealer under subsection 
     (d)(1)(G)(ii).
       ``(ii) On completion of a security inspection under clause 
     (i), the Attorney General shall provide the licensed dealer 
     with--
       ``(I) a notice of any violation by the licensed dealer of 
     any security requirements prescribed under section 926(d); 
     and
       ``(II) recommendations for improving security of the 
     premises involved.''.
       (d) Elimination of Limit on Inspection of Other Premises.--
     Section 923(j) of title 18, United States Code, is amended by 
     striking the sixth sentence.

     SEC. 12. AUTHORITY WITH REGARDS TO LICENSE ISSUANCE AND 
                   RENEWAL.

       (a) Denial Authority.--Section 923 of title 18, United 
     States Code, is amended--
       (1) in subsection (c)--
       (A) by inserting ``(1)'' before ``Upon'';
       (B) in the first sentence, by inserting ``, subject to 
     paragraph (2),'' after ``the Attorney General shall''; and
       (C) by adding at the end the following:
       ``(2) The Attorney General shall deny an application 
     submitted under subsection (a) or (b) if the Attorney General 
     determines that--
       ``(A) issuing the license would pose a danger to public 
     safety; or
       ``(B) the applicant--
       ``(i) is not likely to comply with the law; or
       ``(ii) is otherwise not suitable to be issued a license.''; 
     and
       (2) in subsection (d)(1)--
       (A) in the matter preceding subparagraph (A), by striking 
     ``shall'' and inserting ``or renewal thereof shall, subject 
     to subsection (c)(2),'';
       (B) in subparagraph (C), by striking ``not willfully 
     violated'' and inserting ``no uncured violations''; and
       (C) in subparagraph (F)--
       (i) in clause (ii), by striking ``and'' at the end; and
       (ii) by adding at the end the following:
       ``(iv) each employee employed in the business--

       ``(I) will be at least the minimum age at which individuals 
     may possess a firearm in the locality in which the business 
     will be conducted; and
       ``(II) is not prohibited from being transferred a firearm, 
     or transporting, shipping, or receiving firearms or 
     ammunition, in interstate or foreign commerce by subsection 
     (d), (g), or (n) (as applicable) of section 922 or by State, 
     local, or Tribal law; and''.

       (b) Authority to Revoke or Suspend Licenses.--Section 923 
     of title 18, United States Code, is amended--
       (1) in subsection (e)--
       (A) in the first sentence, by inserting ``or suspend'' 
     after ``revoke''; and
       (B) in the third sentence, by striking ``Secretary's'' and 
     inserting ``Attorney General's''; and
       (2) in subsection (f)--
       (A) in paragraph (1)--
       (i) by inserting ``or suspended'' after ``revoked'' each 
     place it appears; and
       (ii) by inserting ``or suspension'' after ``revocation'' 
     each place it appears;
       (B) in paragraph (2)--
       (i) by striking ``, or revokes'' and inserting ``, revokes, 
     or suspends''; and
       (ii) by striking ``or revocation'' and inserting ``, 
     revocation, or suspension''; and
       (C) in paragraph (3)--
       (i) by inserting ``or suspend'' after ``revoke'' each place 
     it appears; and
       (ii) by striking ``or revocation'' and inserting ``, 
     revocation, or suspension''.
       (c) Authority to Promulgate Rules.--Section 926(a) of title 
     18, United States Code, is amended, in the matter preceding 
     paragraph (1), by striking ``only''.
       (d) Repeal of Riders Limiting Use of Funds to Deny Licenses 
     Due to Lack of Business Activity.--
       (1) Fiscal year 2013.--The matter under the heading 
     ``salaries and expenses'' under the

[[Page S4561]]

     heading ``Bureau of Alcohol, Tobacco, Firearms and 
     Explosives'' in title II of division B of the Consolidated 
     and Further Continuing Appropriations Act, 2013 (18 U.S.C. 
     923 note; Public Law 113-6; 127 Stat. 247) is amended by 
     striking the sixth proviso.
       (2) Fiscal year 2012.--The matter under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated and Further Continuing 
     Appropriations Act, 2012 (Public Law 112-55; 125 Stat. 609) 
     is amended by striking the ninth proviso.

     SEC. 13. INCREASED LICENSING FEES.

       (a) Fees for Licensed Importers, Manufacturers, and Dealers 
     in Firearms and Importers and Manufacturers of Ammunition.--
     Section 923(a) of title 18, United States Code, is amended--
       (1) in paragraph (1)--
       (A) in subparagraph (A), by striking ``$1,000'' and 
     inserting ``$2,000'';
       (B) in subparagraph (B), by striking ``$50'' and inserting 
     ``$100''; and
       (C) in subparagraph (C), by striking ``$10'' and inserting 
     ``$20'';
       (2) in paragraph (2)--
       (A) in subparagraph (A), by striking ``$1,000'' and 
     inserting ``$2,000''; and
       (B) in subparagraph (B), by striking ``$50'' and inserting 
     ``$100''; and
       (3) in paragraph (3)--
       (A) in subparagraph (A), by striking ``$1,000'' and 
     inserting ``$2,000''; and
       (B) in subparagraph (B)--
       (i) by striking ``$200'' and inserting ``$400''; and
       (ii) by striking ``$90'' and inserting ``$180''.
       (b) Fees for Licensed Collectors.--Section 923(b) of title 
     18, United States Code, is amended by striking ``$10'' and 
     inserting ``$20''.

     SEC. 14. ELIMINATION OF OBLIGATORY STAY OF EFFECTIVE DATE OF 
                   LICENSE REVOCATION.

       Section 923(f)(2) of title 18, United States Code, is 
     amended, in the second sentence, by striking ``shall upon the 
     request of the holder of the license'' and inserting ``may, 
     upon a showing by the holder of the license of good cause,''.

     SEC. 15. ELIMINATION OF RELIEF FOR DEALERS INDICTED FOR A 
                   CRIME PUNISHABLE BY IMPRISONMENT FOR A TERM 
                   EXCEEDING ONE YEAR.

       (a) In General.--Section 925 of title 18, United States 
     Code, is amended--
       (1) by striking subsection (b); and
       (2) by redesignating subsections (c) through (f) as 
     subsections (b) through (e), respectively.
       (b) Conforming Amendments.--
       (1) Chapter 44 of title 18, united states code.--Chapter 44 
     of title 18, United States Code, is amended--
       (A) in section 922--
       (i) in subsection (d), in the second sentence--

       (I) by striking ``licensed importer, licensed manufacturer, 
     licensed dealer, or licensed collector who pursuant to 
     subsection (b) of section 925 is not precluded from dealing 
     in firearms or ammunition, or to a''; and
       (II) by striking ``subsection (c) of section 925'' and 
     inserting ``section 925(b)'';

       (ii) in subsection (l), by striking ``925(d) of this 
     chapter'' and inserting ``925(c)''; and
       (iii) in subsection (r), by striking ``925(d)(3) of this 
     chapter'' and inserting ``925(c)(3)''; and
       (B) in section 925(f), by striking ``subsection (d)'' and 
     inserting ``subsection (c)''.
       (2) Foreign military sales act.--Section 38(b)(1)(B)(i) of 
     the Foreign Military Sales Act (22 U.S.C. 2778(b)(1)(B)(i)) 
     is amended by striking ``925(e)'' and inserting ``925(d)''.
       (3) NICS improvement amendments act of 2007.--Section 
     101(c)(2)(A)(iii) of the NICS Improvement Amendments Act of 
     2007 (34 U.S.C. 40911(c)(2)(A)(iii)) is amended by striking 
     ``925(c)'' and inserting ``925(b)''.
       (4) Atomic energy act of 1954.--Section 161A(b) of the 
     Atomic Energy Act of 1954 (42 U.S.C. 2201a(b)) is amended by 
     striking ``925(d)'' and inserting ``925(c)''.

     SEC. 16. ELIMINATION OF RELIEF WHILE FEDERAL DISABILITY 
                   RELIEF APPLICATION PENDING.

       Section 925(b) of title 18, United States Code, as so 
     redesignated by section 15(a) of this Act, is amended by 
     striking the fourth sentence and inserting the following: 
     ``This subsection shall not be construed to prohibit the 
     Attorney General from, on a showing by a licensee of good 
     cause, permitting the licensee to continue operations while 
     an application for relief from disabilities is pending.''.

     SEC. 17. PRESUMPTION OF KNOWLEDGE OF STATE LAW IN SALE OF 
                   LONG GUNS TO RESIDENTS OF ANOTHER STATE.

       Section 922(b)(3) of title 18, United States Code, is 
     amended by striking ``in the absence of evidence to the 
     contrary,''.

     SEC. 18. INCREASED PENALTIES FOR KNOWING TRANSFER OF FIREARM 
                   WITHOUT CONDUCTING A BACKGROUND CHECK.

       Section 922(t)(5) of title 18, United States Code, is 
     amended by inserting before the period at the end the 
     following: ``in the case of the first violation and, in the 
     case of a subsequent violation, shall immediately suspend or 
     revoke any license issued to the licensee under section 923 
     and impose on the licensee a civil fine equal to $20,000''.

     SEC. 19. UNLAWFUL ACTS UPON INCURRING FEDERAL DISABILITY OR 
                   NOTICE OF LICENSE SUSPENSION, REVOCATION, OR 
                   DENIED RENEWAL.

       (a) Restrictions.--Section 922 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(aa) Unlawful Acts Upon Incurring Federal Disability or 
     Notice of License Suspension, Revocation or Denied Renewal.--
       ``(1) In general.--It shall be unlawful for a licensed 
     importer, licensed manufacturer, licensed dealer, licensed 
     collector, or licensed facilitator who incurs a disability 
     imposed by Federal laws with respect to the acquisition, 
     receipt, transfer, shipment, transportation, or possession of 
     firearms or ammunition during the term of a license issued 
     under this chapter or while an application to renew such a 
     license is pending, or who has been notified by the Attorney 
     General that a license issued to the licensee under this 
     chapter has been suspended or revoked or that an application 
     of the licensee to renew such a license has been denied, to--
       ``(A) transfer a business inventory firearm--
       ``(i) into the personal collection of the licensee; or
       ``(ii) to any person other than a licensee under this 
     chapter or a Federal, State, or local law enforcement agency; 
     or
       ``(B) receive a business inventory firearm.
       ``(2) Waiver.--Upon a showing by a licensee of good cause, 
     the Attorney General may issue a written waiver of paragraph 
     (1) if the licensee authorizes the Attorney General to 
     inspect the records and inventory of the licensee at any time 
     to ensure that the licensee is in compliance with this 
     chapter.''.
       (b) Penalties.--Section 924(a) of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(9) Whoever knowingly violates section 922(aa) shall be 
     fined under this title, imprisoned for not more than 1 year, 
     or both.''.
       (c) Notice Requirement.--Section 923(f)(1) of title 18, 
     United States Code, is amended, in the first sentence, by 
     inserting before the period at the end the following: ``and 
     setting forth the provisions of Federal law and regulation 
     that prohibit a person not licensed under this chapter from 
     engaging in the business of dealing in firearms and the 
     restrictions set forth in section 922(aa)''.

     SEC. 20. REGULATION OF FACILITATORS OF FIREARM TRANSFERS.

       (a) Licensing.--Section 923(a) of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(4) If the applicant is a facilitator of firearm sales, 
     purchases, or other transfers, a fee of $1,000 per year.''.
       (b) Completed Facilitated Sales.--Section 923 of title 18, 
     United States Code, as amended by section 5, is amended by 
     adding at the end the following:
       ``(n) Duties of Facilitators.--
       ``(1) In general.--A licensed facilitator shall--
       ``(A) inform each prospective seller using the commercial 
     marketplace of the licensed facilitator that any offer for 
     firearm sales, purchases, or other transfers made using the 
     commercial marketplace may be completed only with the 
     assistance of a licensed importer, licensed manufacturer, or 
     licensed dealer, who must take possession of the firearm 
     directly from the transferor for the purpose of complying 
     with section 922(t);
       ``(B) require each prospective firearm seller using the 
     commercial marketplace of the licensed facilitator to 
     complete each firearm sale, purchase, or other transfer as 
     described in subparagraph (A); and
       ``(C) maintain records of any sale, purchase, or other 
     transfer described in subparagraph (A), which shall include--
       ``(i) the date of the offer;
       ``(ii) the name of the offeror;
       ``(iii) the name and the licensee number of the licensee 
     that will take possession of the firearm directly from the 
     transferor; and
       ``(iv) the model, serial number, type, and caliber or gauge 
     of the firearm involved.
       ``(2) Advance identification of licensed dealer.--A 
     licensed facilitator may require a prospective seller, as a 
     condition of using the commercial marketplace of the licensed 
     facilitator, to, before offering a firearm for sale, identify 
     a licensed dealer that will take possession of the firearm 
     and complete the sale.
       ``(3) Licensee compliance.--On taking possession of a 
     firearm sold, purchased, or otherwise transferred in a 
     commercial marketplace of a licensed facilitator, a licensee 
     shall comply with all requirements of this chapter as if the 
     licensee were transferring the firearm from the inventory of 
     the licensee to the unlicensed transferee.''.
       (c) Liability.--Section 924(h) of title 18, United States 
     Code, is amended--
       (1) by inserting ``(1)'' before ``Whoever''; and
       (2) by adding at the end the following:
       ``(2) Whoever, having accepted an offer to transfer 
     ownership of a firearm using a commercial marketplace of a 
     licensed facilitator in order to complete a firearm 
     transaction as described in subsection (n)(1), knowingly 
     transfers the firearm to a person not licensed under this 
     chapter without a licensed importer, licensed manufacturer, 
     or licensed dealer first taking possession of the firearm for 
     the purpose of complying with section 922(t)--
       ``(A) except as provided in subparagraph (B), shall be 
     fined under this title, imprisoned for not more than 1 year, 
     or both; or
       ``(B) if transfer of the firearm to, or receipt of the 
     firearm by, the transferee violates subsection (d), (g), or 
     (n) of section 922, or the firearm is used to commit a crime 
     of violence (as defined in section (c)(3) of this section) or 
     drug trafficking crime (as defined in subsection (c)(2) of 
     this section), shall be

[[Page S4562]]

     fined under this title, imprisoned not more than 10 years, or 
     both.''.
       (d) Conforming Amendments.--Chapter 44 of title 18, United 
     States Code, is amended--
       (1) in section 922--
       (A) in subsection (a)--
       (i) in paragraph (1)--

       (I) in subparagraph (A), by striking ``or'' at the end;
       (II) in subparagraph (B), by adding ``or'' at the end; and
       (III) by adding at the end the following:

       ``(C) except a licensed facilitator, to engage in the 
     business of hosting a commercial marketplace in which offers 
     for firearm sales, purchases, or other transfers are allowed 
     to be made;''; and
       (ii) in paragraph (6)--

       (I) by striking ``or licensed collector'' and inserting 
     ``licensed collector, or licensed facilitator''; and
       (II) by striking ``or collector'' and inserting 
     ``collector, or facilitator''; and

       (B) in subsection (m), by striking ``or licensed 
     collector'' and inserting ``licensed collector, or licensed 
     facilitator'';
       (2) in section 923--
       (A) in subsection (c)(1), as so designated by section 12 of 
     this Act, in the first sentence, by inserting ``or facilitate 
     firearm sales, purchases, or other transfers'' before 
     ``during the period stated in the license'';
       (B) in subsection (g)(1)(A)--
       (i) in the first sentence, by striking ``and licensed 
     dealer'' and inserting ``licensed dealer, and licensed 
     facilitator''; and
       (ii) in the last sentence, by inserting ``licensed 
     facilitator,'' before ``or any licensed importer''; and
       (C) in subsection (j), in the first sentence, by striking 
     ``or licensed dealer'' and inserting ``licensed dealer, or 
     licensed facilitator''; and
       (3) in section 924(a)(3), as amended by section 7--
       (A) in subparagraph (A), in the matter preceding clause 
     (i), by striking ``or licensed collector'' and inserting 
     ``licensed collector, or licensed facilitator''; and
       (B) in subparagraph (B), by striking ``or licensed 
     collector'' and inserting ``licensed collector, or licensed 
     facilitator''.

     SEC. 21. DEALER AND EMPLOYEE BACKGROUND CHECKS.

       (a) Requirements.--
       (1) Background checks required before issuance or renewal 
     of dealers license.--Section 923(c)(1) of title 18, United 
     States Code, as so designated by section 12 of this Act, is 
     amended by inserting after the first sentence the following: 
     ``Notwithstanding the preceding sentence, the Attorney 
     General may not issue or renew a license unless the Attorney 
     General has contacted the national instant criminal 
     background check system established under section 103 of the 
     Brady Handgun Violence Prevention Act (34 U.S.C. 40901) to 
     determine whether it would be unlawful for the applicant, or 
     any employee of the applicant identified by the applicant on 
     the application as trusted with the possession or receipt of 
     any firearm, to be transferred or receive a firearm, and the 
     system has notified the Attorney General that the information 
     available to the system does not demonstrate that the 
     transfer to or receipt of a firearm by the applicant or any 
     such employee would violate subsection (d), (g), or (n) (as 
     applicable) of section 922 or State, local, or Tribal law 
     where the business premises of the applicant subject to the 
     license is located.''.
       (2) Background check required before firearm possession by 
     dealer employee.--Section 923(g) of title 18, United States 
     Code, as amended by section 7 of this Act, is amended by 
     adding at the end the following:
       ``(11) A licensed dealer may not allow an employee to 
     possess a firearm at a premises from which the licensed 
     dealer conducts business subject to license under this 
     chapter, unless--
       ``(A) the employee is at least the minimum age required by 
     State and local law to possess or receive a firearm;
       ``(B) the licensed dealer has contacted the national 
     instant criminal background check system established under 
     section 103 of the Brady Handgun Violence Prevention Act (34 
     U.S.C. 40901) to determine whether transfer of a firearm to, 
     or receipt of a firearm by, the individual would be unlawful; 
     and
       ``(C) the system has notified the licensee that the 
     information available to the system does not demonstrate that 
     the transfer of a firearm to, or receipt of a firearm by, the 
     individual would violate subsection (d), (g), or (n) (as 
     applicable) of section 922 or State, local, or Tribal law.''.
       (b) Authority of NICS System to Respond to Licensed Dealer 
     Request for Criminal Background Check of Employee or 
     Applicant for Employment.--Section 103(b)(2) of the Brady 
     Handgun Violence Prevention Act (34 U.S.C. 40901(b)(2)) is 
     amended--
       (1) in the heading, by striking ``Voluntary'' and inserting 
     ``Compulsory''; and
       (2) in subparagraph (A), by striking ``voluntarily''.
       (c) Authority of NICS System to Search National Data 
     Exchange.--Section 103(e)(1) of the Brady Handgun Violence 
     Prevention Act (34 U.S.C. 40901(e)(1)) is amended by adding 
     at the end the following:
       ``(L) Search of national data exchange database.--The 
     system established under this section shall include a search 
     of the database of the National Data Exchange when conducting 
     a background check under this section.''.

     SEC. 22. LIABILITY STANDARDS.

       (a) Liability in Licensing.--Section 923 of title 18, 
     United States Code, is amended--
       (1) in subsection (d)(1)(D), by striking ``willfully'' and 
     inserting ``knowingly''; and
       (2) in subsection (e), by striking ``willfully'' each place 
     it appears and inserting ``knowingly''.
       (b) Liability in Penalties.--Section 924 of title 18, 
     United States Code, is amended--
       (1) in subsection (a)(1)(D), by striking ``willfully'' and 
     inserting ``knowingly''; and
       (2) in subsection (d)(1), by striking ``willful'' and 
     inserting ``knowing''.

     SEC. 23. CIVIL ENFORCEMENT.

       (a) Fines for Engaging in the Business Without a License.--
     Section 924(n) of title 18, United States Code, is amended--
       (1) by inserting ``(1)'' after ``(n)''; and
       (2) by adding at the end the following:
       ``(2) If the Attorney General finds that a person has 
     engaged in conduct that constitutes a violation of section 
     922(a)(1)(A), the Attorney General shall--
       ``(A) transmit to the person a written notice specifying 
     the violation, which shall include a copy of the provision of 
     law violated; and
       ``(B) impose on the person a civil penalty in an amount 
     that is not less than $2,500 and not more than $20,000.''.
       (b) Tiered Penalties for Repeated Violations of Regulations 
     by Licensed Dealers.--Section 924 of title 18, United States 
     Code, is amended by adding at the end the following:
       ``(q) Penalties Relating to Violations of Regulations by 
     Licensed Dealers.--
       ``(1) In general.--If the Attorney General finds a licensed 
     dealer to be in violation of a regulation prescribed under 
     section 926, the Attorney General shall--
       ``(A) if the violation is not a result of gross negligence 
     by the licensed dealer--
       ``(i) in the case of the first such violation by the 
     licensed dealer, if not preceded by a violation to which 
     subparagraph (B) applies, transmit to the licensed dealer a 
     written notice specifying the violation, which shall include 
     a copy of the regulation violated;
       ``(ii) in the case of the second such violation by the 
     licensed dealer, if not preceded by a violation to which 
     subparagraph (B) applies, impose a civil penalty in an amount 
     that is not less than $2,500 and not more than $20,000;
       ``(iii) in the case of the third such violation by the 
     licensed dealer, if not preceded by a violation to which 
     subparagraph (B) applies, suspend the license to deal in 
     firearms issued to the licensed dealer under this chapter 
     until the violation ceases;
       ``(iv) in the case of the fourth such violation by the 
     licensed dealer, whether or not preceded by a violation to 
     which subparagraph (B) applies, revoke the license; or
       ``(v) in the case of any such violation by the licensed 
     dealer, if preceded by a violation to which subparagraph (B) 
     applies, apply the penalty authorized under this subsection 
     that is 1 level greater in severity than the level of 
     severity of the penalty most recently applied to the licensed 
     dealer under this subsection; or
       ``(B) if the violation is a result of gross negligence by 
     the licensed dealer--
       ``(i) in the case of the first such violation by the 
     licensed dealer, impose a civil penalty in an amount that is 
     not less than $2,500 and not more than $20,000;
       ``(ii) in the case of the second such violation by the 
     licensed dealer--

       ``(I) impose a civil penalty in an amount equal to $20,000; 
     and
       ``(II) suspend the license to deal in firearms issued to 
     the licensed dealer under this chapter until the violation 
     ceases; or

       ``(iii) in the case of the third such violation by the 
     licensed dealer, revoke the license to deal in firearms 
     issued to the licensed dealer under this chapter.
       ``(2) Suspension of license.--In the case of any violation 
     described in paragraph (1), if the Attorney General finds 
     that the nature of the violation indicates that the continued 
     operation of a firearms business by the licensed dealer 
     presents an imminent risk to public safety, the Attorney 
     General shall, notwithstanding paragraph (1), immediately 
     suspend the license to deal in firearms issued to the 
     licensed dealer under this chapter and secure the firearms 
     inventory of the licensed dealer, until the violation ceases, 
     unless the appropriate penalty under paragraph (1) is 
     revocation of the license, in which case the Attorney General 
     shall immediately revoke the license and secure the firearms 
     inventory of the licensed dealer.''.

     SEC. 24. REMOVAL OF BAR ON CIVIL PROCEEDINGS IF CRIMINAL 
                   PROCEEDINGS TERMINATED.

       Section 923(f) of title 18, United States Code, is amended 
     by striking paragraph (4).

     SEC. 25. REPEAL OF CERTAIN LIMITATIONS.

       (a) Limitations Related to Use of Firearms Trace Data.--
       (1) Fiscal year 2012.--The matter under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated and Further Continuing 
     Appropriations Act, 2012 (18 U.S.C. 923 note; Public Law 112-
     55; 125 Stat. 609) is amended by striking the sixth proviso.
       (2) Fiscal year 2010.--The sixth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated Appropriations Act, 2010 
     (Public Law 111-117; 123 Stat. 3128) is amended by striking 
     ``beginning in

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     fiscal year 2010 and thereafter'' and inserting ``in fiscal 
     year 2010''.
       (3) Fiscal year 2009.--The sixth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Omnibus Appropriations Act, 2009 (Public 
     Law 111-8; 123 Stat. 575) is amended by striking ``beginning 
     in fiscal year 2009 and thereafter'' and inserting ``in 
     fiscal year 2009''.
       (4) Fiscal year 2008.--The sixth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title II of 
     division B of the Consolidated Appropriations Act, 2008 
     (Public Law 110-161; 121 Stat. 1903) is amended by striking 
     ``beginning in fiscal year 2008 and thereafter'' and 
     inserting ``in fiscal year 2008''.
       (5) Fiscal year 2006.--The sixth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title I of the 
     Science, State, Justice, Commerce, and Related Agencies 
     Appropriations Act, 2006 (Public Law 109-108; 119 Stat. 2295) 
     is amended by striking ``with respect to any fiscal year''.
       (6) Fiscal year 2005.--The sixth proviso under the heading 
     ``salaries and expenses'' under the heading ``Bureau of 
     Alcohol, Tobacco, Firearms and Explosives'' in title I of 
     division B of the Consolidated Appropriations Act, 2005 
     (Public Law 108-447; 118 Stat. 2859) is amended by striking 
     ``with respect to any fiscal year''.
       (7) Fiscal year 2023.--Section 644 of division J of the 
     Consolidated Appropriations Resolution, 2003 (5 U.S.C. 552 
     note; Public Law 108-7; 117 Stat. 473) is amended by striking 
     ``or any other Act with respect to any fiscal year''.
       (b) Limitations Relating to Consolidating and Centralizing 
     Records.--The first proviso under the heading ``salaries and 
     expenses'' under the heading ``Bureau of Alcohol, Tobacco, 
     Firearms and Explosives'' in title II of division B of the 
     Consolidated and Further Continuing Appropriations Act, 2012 
     (18 U.S.C. 923 note; Public Law 112-55; 125 Stat. 609) is 
     amended by striking ``or hereafter''.
       (c) Requirement to Destroy Instant Criminal Background 
     Check Records Within 24 Hours.--Section 511 of division B of 
     the Consolidated and Further Continuing Appropriations Act, 
     2012 (34 U.S.C. 40901 note; Public Law 112-55; 125 Stat. 632) 
     is amended--
       (1) by striking ``--'' and all that follows through 
     ``(1)''; and
       (2) by striking the semicolon and all that follows and 
     inserting a period.

     SEC. 26. AUTHORITY TO HIRE ADDITIONAL INDUSTRY OPERATION 
                   INVESTIGATORS FOR BUREAU OF ALCOHOL, TOBACCO, 
                   FIREARMS, AND EXPLOSIVES.

       The Attorney General may hire 650 industry operation 
     investigators for the Bureau of Alcohol, Tobacco, Firearms, 
     and Explosives, to be distributed among the various field 
     divisions to match the number and distribution of persons 
     licensed under chapter 44 of title 18, United States Code, in 
     addition to any personnel needed to carry out this Act and 
     the amendments made by this Act and any industry operation 
     investigators authorized by other law.

     SEC. 27. REPORT ON IMPLEMENTATION OF THIS ACT.

       Not later than 2 years after the date of enactment of this 
     Act, the Attorney General shall submit to Congress and 
     publish on the website of the Department of Justice a written 
     report on the implementation of this Act and the amendments 
     made by this Act, including any steps needed to complete the 
     implementation, which shall identify any additional resources 
     that are required to--
       (1) conduct regular inspections under chapter 44 of title 
     18, United States Code; and
       (2) ensure that this Act and the amendments made by this 
     Act are enforced against noncompliant federally licensed 
     firearms dealers in a timely manner.

     SEC. 28. ANNUAL LICENSED DEALER INSPECTIONS REPORT AND 
                   ANALYSIS.

       (a) In General.--Not later than 2 years after the date of 
     enactment of this Act, and annually thereafter, the Attorney 
     General shall submit to Congress and publish on the website 
     of the Department of Justice a report that contains the 
     information described in subsection (b) with respect to--
       (1) the preceding 2-year period, in the case of the first 
     report; or
       (2) the preceding year, in the case of each subsequent 
     report.
       (b) Contents.--Each report under subsection (a) shall 
     state, with respect to the applicable reporting period--
       (1) the number of inspections or examinations conducted of 
     Type 01, Type 02, and Type 07 Federal firearm licensees 
     (dealers, pawnbrokers, and manufacturers, respectively) by 
     each field division of the Bureau of Alcohol, Tobacco, 
     Firearms, and Explosives, including by the number of 
     inspections or examinations of high-risk dealers and non-
     high-risk dealers (as those terms are used in clause (ii) of 
     section 923(g)(1)(B) of title 18, United States Code, as 
     added by section 11 of this Act);
       (2) the number of security inspections under subparagraph 
     (B) of section 923(g)(6) of title 18, United States Code, as 
     added by section 11 of this Act, prompted by dealer reports 
     of lost or stolen firearms under subparagraph (A) of such 
     section 923(g)(6), as so designated by section 11 of this 
     Act, and the number of follow-up security inspections 
     conducted during the 6-month period following a security 
     inspection revealing a violation;
       (3) the average amount of time spent on--
       (A) inspections or examinations of high-risk dealers (as 
     described in paragraph (1));
       (B) inspections or examinations of non-high-risk dealers 
     (as described in paragraph (1));
       (C) security inspections (as described in paragraph (2)); 
     and
       (D) follow-up security inspections (as described in 
     paragraph (2)); and
       (4) an analysis of the most frequently cited violations and 
     corrective actions or penalties imposed in each inspection or 
     examination described in paragraph (1) or security inspection 
     described in paragraph (2), including--
       (A) the number of licenses recommended to be suspended or 
     revoked;
       (B) the number of licensees sent notices of suspension or 
     revocation;
       (C) the number of hearings requested by licensees on 
     receipt of a notice of suspension or revocation;
       (D) the number of suspension or revocation hearings 
     initiated during a prior 12-month period that remain ongoing 
     during the 12-month period covered by the report; and
       (E) the decision ultimately rendered in each such matter by 
     the Director of the Bureau of Alcohol, Tobacco, Firearms, and 
     Explosives.

     SEC. 29. DEADLINE FOR ISSUANCE OF FINAL REGULATIONS.

       Not later than 2 years after the date of enactment of this 
     Act, the Attorney General shall prescribe all regulations 
     required to carry out this Act and the amendments made by 
     this Act.

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