If you’re considering starting a firearms-related business or looking to expand your operations, one of the first steps is obtaining the correct Federal Firearms License (FFL). FFLs are issued by the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) and allow individuals and businesses to engage in specific activities related to firearms and ammunition. But not all FFLs are the same—there are different types designed to meet various business models. In this guide, we’ll break down the different FFL types, clarify the difference between an 01 FFL vs. 07 FFL, and explain what a Class 3 FFL is.
What is a Federal Firearms License (FFL)?
The FFL system was created to regulate the manufacture, sale, and distribution of firearms in the United States. To legally operate a firearms business or engage in firearms manufacturing, an FFL is required. There are several FFL types, each with its own set of permissions and restrictions, designed for different kinds of businesses or activities.
Types of FFLs
The ATF offers several different types of FFLs, and choosing the right one depends on your business needs. Here’s a breakdown of the most common FFL types:
01 FFL – Dealer in Firearms Other Than Destructive Devices
An 01 FFL is the most common type of license for firearms dealers. It allows for the sale of firearms and gunsmithing services, excluding destructive devices (like grenades or rocket launchers).
- Who is it for? Retail gun shops, pawn shops that sell firearms, and anyone offering gunsmithing services.
- What does it allow? The purchase and sale of firearms, excluding destructive devices and NFA (National Firearms Act) items like silencers or automatic weapons.
- Limitations: This license does not cover manufacturing firearms or dealing in NFA items.
02 FFL – Pawnbroker in Firearms Other Than Destructive Devices
This license is similar to the 01 FFL but is designed specifically for pawn shops.
- Who is it for? Pawnshops that deal in firearms.
- What does it allow? Firearms sales and loans involving firearms, excluding destructive devices.
03 FFL – Collector of Curios and Relics
If you’re interested in collecting historical firearms, the 03 FFL (often called a C&R license) is ideal. This license is for individuals, not businesses, and allows you to buy and sell collectible firearms that are over 50 years old or designated by the ATF as a “curio or relic.”
- Who is it for? Private collectors of antique or collectible firearms.
- What does it allow? Purchase and possession of C&R firearms across state lines without needing to go through a licensed dealer.
06 FFL – Manufacturer of Ammunition for Firearms
If your business focuses on making ammunition rather than firearms, the 06 FFL is the one for you.
- Who is it for? Businesses that manufacture ammunition.
- What does it allow? The production and sale of ammunition, but not the manufacture of armor-piercing rounds.
- Limitations: Does not allow for the manufacture of firearms or destructive devices.
07 FFL – Manufacturer of Firearms Other Than Destructive Devices
The 07 FFL allows for the manufacture and sale of firearms, including the assembly and customization of firearms.
- Who is it for? Firearm manufacturers and custom firearm builders.
- What does it allow? Manufacture and sale of firearms, including NFA items (like silencers and short-barreled rifles) with the appropriate Class 3 SOT (Special Occupational Taxpayer) registration.
- Limitations: Requires an additional Class 3 SOT registration to deal in NFA items.
08 FFL – Importer of Firearms and Ammunition
An 08 FFL is necessary if you want to import firearms or ammunition into the United States.
- Who is it for? Businesses involved in importing firearms and ammunition.
- What does it allow? Importing firearms, ammunition, and destructive devices.
09 FFL – Dealer in Destructive Devices
A 09 FFL allows you to deal in destructive devices such as grenades, bombs, and other military-grade weapons.
- Who is it for? Businesses involved in selling destructive devices.
- What does it allow? The sale and transfer of destructive devices.
10 FFL – Manufacturer of Destructive Devices
Similar to the 09 FFL but for manufacturers, the 10 FFL allows for the creation of destructive devices, ammunition, and explosives.
- Who is it for? Manufacturers of military-grade destructive devices.
- What does it allow? Manufacture, sale, and distribution of destructive devices and explosives.
11 FFL – Importer of Destructive Devices
This license is required for those importing destructive devices into the United States.
- Who is it for? Importers of military-grade destructive devices and weapons.
- What does it allow? Importation of destructive devices and military weapons.
Class 3 FFL and NFA Items
A Class 3 FFL doesn’t exist on its own but refers to a special tax that dealers or manufacturers must pay if they wish to engage in the sale of NFA items like suppressors, short-barreled rifles (SBRs), short-barreled shotguns (SBS), and fully automatic firearms. To sell these items, you must have an 01 or 07 FFL and register as a Class 3 SOT.
- Who needs a Class 3 FFL? Dealers or manufacturers selling NFA-regulated items.
- What does it allow? Sales and transfers of suppressors, SBRs, SBSs, and other NFA items.
01 FFL vs. 07 FFL: Which is Right for You?
If you’re trying to decide between an 01 FFL and an 07 FFL, the decision comes down to whether you want to sell firearms or manufacture them.
- 01 FFL: Ideal for gun stores and businesses that simply want to buy and sell firearms. This license is the most straightforward option for a traditional retail gun business.
- 07 FFL: If you plan to assemble, customize, or manufacture firearms, the 07 FFL is a better option. This license also allows you to deal in NFA items if you add the Class 3 SOT registration.
Which FFL is Right for Your Business?
Choosing the right FFL depends entirely on your business model. For a basic retail gun shop, the 01 FFL will cover your needs. However, if you’re planning to manufacture or work with NFA items, an 07 FFL with a Class 3 SOT is the way to go. By understanding the different FFL types, you can ensure your business stays compliant with federal regulations and has the flexibility to grow in the future.
