[Code of Federal Regulations]
[Title 27, Volume 2]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 27CFR555.105]

[Page 183-186]
 
            TITLE 27--ALCOHOL, TOBACCO PRODUCTS AND FIREARMS
 
   CHAPTER II--BUREAU OF ALCOHOL, TOBACCO, FIREARMS, AND EXPLOSIVES, 
                          DEPARTMENT OF JUSTICE
 
PART 555_COMMERCE IN EXPLOSIVES--Table of Contents
 
               Subpart F_Conduct of Business or Operations
 
Sec. 555.105  Distributions to nonlicensees, nonpermittees, and limited 
permittees.

    (a) Distributions to nonlicensees and nonpermittees prior to May 24, 
2003. (1) This section will apply in any case where distribution of 
explosive materials to the distributee is not otherwise prohibited by 
the Act or this part.
    (2) Except as provided in paragraph (a)(3) of this section, a 
licensed importer, licensed manufacturer, or licensed dealer may 
distribute explosive materials to a nonlicensee or nonpermittee if the 
nonlicensee or nonpermittee is a resident of the same State in which the 
licensee's business premises are located, and the nonlicensee or 
nonpermittee furnishes to the licensee the explosives transaction 
record, ATF F 5400.4, required by Sec. 555.126. Disposition of ATF F 
5400.4 will be made in accordance with Sec. 555.126.

[[Page 184]]

    (3) A licensed importer, licensed manufacturer, or licensed dealer 
may sell or distribute explosive materials to a resident of a State 
contiguous to the State in which the licensee's place of business is 
located if the purchaser's State of residence has enacted legislation, 
currently in force, specifically authorizing a resident of that State to 
purchase explosive materials in a contiguous State and the purchaser and 
the licensee have, prior to the distribution of the explosive materials, 
complied with all the requirements of paragraphs (a)(2), (a)(5), and 
(a)(6) of this section applicable to intrastate transactions occurring 
on the licensee's business premises.
    (4) A permittee may dispose of surplus stocks of explosive materials 
to a nonlicensee or nonpermittee if the nonlicensee or nonpermittee is a 
resident of the same State in which the permittee's business premises or 
operations are located, or is a resident of a State contiguous to the 
State in which the permittee's place of business or operations are 
located, and if the requirements of paragraphs (a)(2), (a)(3), (a)(5), 
and (a)(6) of this section are fully met.
    (5) A licensed importer, licensed manufacturer, or licensed dealer 
selling or otherwise distributing explosive materials to a business 
entity must verify the identity of the representative or agent of the 
business entity who is authorized to order explosive materials on behalf 
of the business entity. Each business entity ordering explosive 
materials must furnish the distributing licensee prior to or with the 
first order of explosive materials a current certified list of the names 
of representatives or agents authorized to order explosive materials on 
behalf of the business entity. The business entity ordering explosive 
materials is responsible for keeping the certified list current. A 
licensee may not distribute explosive materials to a business entity on 
the order of a person whose name does not appear on the certified list.
    (6) Where the possession of explosive materials is transferred at 
the distributor's premises, the distributor must in all instances verify 
the identity of the person accepting possession on behalf of the 
distributee before relinquishing possession. Before the delivery at the 
distributor's premises of explosive materials to an employee of a 
nonlicensee or nonpermittee, or to an employee of a common or contract 
carrier transporting explosive materials to a nonlicensee or 
nonpermittee, the distributor delivering explosive materials must obtain 
an executed ATF F 5400.8 from the employee before releasing the 
explosive materials. The ATF F 5400.8 must contain all of the 
information required on the form and by this part. (See examples in 
Sec. 555.103(a)).
    (7) A licensee or permittee disposing of surplus stock may sell or 
distribute commercially manufactured black powder in quantities of 50 
pounds or less to a nonlicensee or nonpermittee if the black powder is 
intended to be used solely for sporting, recreational, or cultural 
purposes in antique firearms as defined in 18 U.S.C. 921(a)(16), or in 
antique devices as exempted from the term ``destructive device'' in 18 
U.S.C. 921(a)(4).
    (b) Distributions to holders of limited permits on and after May 24, 
2003. (1) This section will apply in any case where distribution of 
explosive materials to the distributee is not otherwise prohibited by 
the Act or this part.
    (2) A licensed importer, licensed manufacturer or a licensed dealer 
may distribute explosive materials to a holder of a limited permit if 
such permittee is a resident of the same State in which the licensee's 
business premises are located, the holder of the limited permit presents 
in person or by mail ATF Form 5400.4, Limited Permittee Transaction 
Report (LPTR), and the licensee completes Form 5400.4 in accordance with 
Sec. 555.126(b). In no event will a licensee distribute explosive 
materials to a holder of a limited permit unless the holder presents a 
Form 5400.4 with an original unaltered and unexpired Intrastate Purchase 
of Explosives Coupon (IPEC), ATF Form 5400.30, affixed. The coupon must 
bear the name, address, permit number, and the coupon number of the 
limited permittee seeking distribution of the explosives.
    (3) A holder of a limited permit is authorized to receive explosive 
materials from a licensee or permittee whose premises are located in the 
same State of residence in which the premises of

[[Page 185]]

the holder of the limited permit are located on no more than 6 separate 
occasions during the one-year period of the permit. For purposes of this 
section, the term ``6 separate occasions'' means six deliveries of 
explosive materials. Each delivery must--
    (i) Relate to a single purchase transaction made on one ATF F 
5400.4;
    (ii) Be referenced on one commercial invoice or purchase order; and
    (iii) Be delivered to the holder of the limited permit in one 
shipment delivered at the same time.
    (4) A holder of a user permit may dispose of surplus stocks of 
explosive materials to a licensee or holder of a user permit, or a 
holder of a limited permit who is a resident of the same State in which 
the premises of the holder of the user permit are located. A holder of a 
limited permit may dispose of surplus stocks of explosive materials to 
another holder of a limited permit who is a resident of the same State 
in which the premises of the distributor are located, if the transaction 
complies with the requirements of paragraph (b)(2) of this section and 
Sec. 555.126(b). A holder of a limited permit may also dispose of 
surplus stocks of explosive materials to a licensee or holder of a user 
permit if the disposition occurs in the State of residence of the holder 
of the limited permit. (See Sec. 555.103.)
    (5) Each holder of a limited permit ordering explosive materials 
must furnish the distributing licensee prior to or with the first order 
of the explosive materials a current list of the names of employees 
authorized to accept delivery of explosive materials on behalf of the 
limited permittee. The distributee ordering explosive materials must 
keep the list current and provide updated lists to licensees and holders 
of user permits on a timely basis. A licensed importer, licensed 
manufacturer, licensed dealer, or permittee, selling or otherwise 
distributing explosive materials to a holder of a limited permit must, 
prior to delivering the explosive materials, obtain from the limited 
permittee a current list of persons who are authorized to accept 
deliveries of explosive materials on behalf of the limited permittee. A 
licensee or permittee may not deliver explosive materials to a person 
whose name does not appear on the list.
    (6)(i) Delivery at the distributor's premises. Where possession of 
explosive materials is transferred directly to the distributee at the 
distributor's premises, the distributor must obtain an executed Form 
5400.4 in accordance with Sec. 555.126(b) and must in all instances 
verify the identity of the person accepting possession on behalf of the 
distributee by examining an identification document (as defined in Sec. 
555.11) before relinquishing possession.
    (ii) Delivery by distributor. Where possession of explosive 
materials is transferred by the distributor to the distributee away from 
the distributor's premises, the distributor must obtain an executed Form 
5400.4 in accordance with Sec. 555.126(b) and must in all instances 
verify the identity of the person accepting possession on behalf of the 
distributee by examining an identification document (as defined in Sec. 
555.11) before relinquishing possession.
    (iii) Delivery by common or contract carrier hired by the 
distributor. Where a common or contract carrier hired by the distributor 
will transport explosive materials from the distributor to a holder of a 
limited permit:
    (A) The limited permittee must, prior to delivery of the explosive 
materials, complete the appropriate section on Form 5400.4, affix to the 
Form 5400.4 one of the six IPECs he has been issued, and provide the 
form to the distributor in person or by mail.
    (B) The distributor must, before relinquishing possession of the 
explosive materials to the common or contract carrier:
    (1) Verify the identity of the person accepting possession for the 
common or contract carrier by examining such person's valid, unexpired 
driver's license issued by any State, Canada, or Mexico; and
    (2) Record the name of the common or contract carrier (i.e., the 
name of the driver's employer) and the full name of the driver. This 
information must be maintained in the distributor's permanent records in 
accordance with Sec. 555.121.

[[Page 186]]

    (C) At the time of delivery of the explosive materials, the common 
or contract carrier, as agent for the distributor, must verify the 
identity of the person accepting delivery on behalf of the distributee, 
note the type and number of the identification document (as defined in 
Sec. 555.11) and provide this information to the distributor. The 
distributor must enter this information in the appropriate section on 
Form 5400.4.
    (iv) Delivery by common or contract carrier hired by the 
distributee. Where a common or contract carrier hired by the distributee 
will transport explosive materials from the distributor to a holder of a 
limited permit:
    (A) The limited permittee must, prior to delivery of the explosive 
materials, complete the appropriate section on Form 5400.4, affix to the 
Form 5400.4 one of the six IPECs he has been issued, and provide the 
form to the distributor in person or by mail.
    (B) Before the delivery at the distributor's premises to the common 
or contract carrier who will transport explosive materials to the holder 
of a limited permit, the distributor must:
    (1) Verify the identity of the person accepting possession for the 
common or contract carrier by examining such person's valid, unexpired 
driver's license issued by any State, Canada, or Mexico; and
    (2) Record the name of the common or contract carrier (i.e., the 
name of the driver's employer) and the full name of the driver. This 
information must be maintained in the distributor's permanent records in 
accordance with Sec. 555.121.
    (7) A licensee or permittee disposing of surplus stock may sell or 
distribute commercially manufactured black powder in quantities of 50 
pounds or less to a holder of a limited permit, nonlicensee, or 
nonpermittee if the black powder is intended to be used solely for 
sporting, recreational, or cultural purposes in antique firearms as 
defined in 18 U.S.C. 921(a)(16), or in antique devices as exempted from 
the term ``destructive device'' in 18 U.S.C. 921(a)(4).

(Approved by the Office of Management and Budget under control number 
1140-0075)

[ATF No. 1, 68 FR 13788, Mar. 20, 2003, as amended by ATF No. 2, 68 FR 
53513, Sept. 11, 2003]