27 CFR 555.103 Transactions among licensees/permittee

[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: 27CFR555.103]

[Page 180-183]

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. 555.103 Transactions among licensees/permittees and transactions
among licensees and holders of user permits.

(a) Transactions among licensees/permittees prior to May 24, 2003.
(1) General.

[[Page 181]]

(i) A licensed importer, licensed manufacturer or licensed dealer
selling or otherwise distributing explosive materials (or a permittee
disposing of surplus stock to a licensee or another permittee) who has
the certified information required by this section may sell or
distribute explosive materials to a licensee or permittee for not more
than 45 days following the expiration date of the distributee's license
or permit, unless the distributor knows or has reason to believe that
the distributee's authority to continue business or operations under
this part has been terminated.
(ii) A licensed importer, licensed manufacturer or licensed dealer
selling or otherwise distributing explosive materials (or a permittee
disposing of surplus stock to another licensee or permittee) must verify
the license or permit status of the distributee prior to the release of
explosive materials ordered, as required by this section.
(iii) Licensees or permittees desiring to return explosive materials
to a licensed manufacturer may do so without obtaining a certified copy
of the manufacturer's license.
(iv) Where 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
licensee or permittee, or to an employee of a common or contract carrier
transporting explosive materials to a licensee or permittee, the
distributor delivering explosive materials must obtain an executed ATF F
5400.8, Explosives Delivery Record, from the employee before releasing
the explosive materials. The ATF F 5400.8 must contain all of the
information required on the form and required by this part.

Example 1. An ATF F 5400.8 is required when:
a. An employee of the purchaser takes possession at the
distributor's premises.
b. An employee of a common or contract carrier hired by the
purchaser takes possession at the distributor's premises.
Example 2. An ATF F 5400.8 is not required when:
a. An employee of the distributor takes possession of the explosives
for the purpose of transport to the purchaser.
b. An employee of a common or contract carrier hired by the
distributor takes possession of the explosives for the purpose of
transport to the purchaser.

(2) License/permit verification of individuals. (i) The distributee
must furnish a certified copy (or, in the case of a user-limited, the
original) of the license or permit. The certified copy need be furnished
only once during the current term of the license or permit. Also, a
licensee need not furnish certified copies of licenses to other licensed
locations operated by such licensee.
(ii) The distributor may obtain any additional verification as the
distributor deems necessary.
(3) License/permit verification of business organizations. (i) A
business organization may (in lieu of furnishing a certified copy of a
license) furnish the distributor a certified list which contains the
name, address, license number and date of license expiration of each
licensed location. The certified list need be furnished only once during
the current term of the license or permit. Also, a business organization
need not furnish a certified list to other licensed locations operated
by such business organization.
(ii) A business organization must, prior to ordering explosive
materials, furnish the licensee or permittee a current certified list of
the representatives or agents authorized to order explosive materials on
behalf of the business organization showing the name, address, and date
and place of birth of each representative or agent. A licensee or
permittee may not distribute explosive materials to a business
organization on the order of a person who does not appear on the
certified list of representatives or agents and, if the person does
appear on the certified list, the licensee or permittee must verify the
identity of such person.
(4) Licensee/permittee certified statement. (i) A licensee or
permittee ordering explosive materials from another licensee or
permittee must furnish a current, certified statement of the intended
use of the explosive materials, e.g., resale, mining, quarrying,
agriculture, construction, sport rocketry,

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road building, oil well drilling, seismographic research, to the
distributor.
(ii) For individuals, the certified statement of intended use must
specify the name, address, date and place of birth, and social security
number of the distributee.
(iii) For business organizations, the certified statement of
intended use must specify the taxpayer identification number, the
identity and the principal and local places of business.
(iv) The licensee or permittee purchasing explosive materials must
revise the furnished copy of the certified statement only when the
information is no longer current.
(5) User-limited permit transactions. A user-limited permit issued
under the provisions of this part is valid for only a single purchase
transaction and is not renewable (see Sec. 555.51). Accordingly, at the
time a user-limited permittee orders explosive materials, the licensed
distributor must write on the front of the user-limited permit the
transaction date, his signature, and the distributor's license number
prior to returning the permit to the user-limited permittee.
(b) Transactions among licensees/permittees on and after May 24,
2003. (1) General. (i) A licensed importer, licensed manufacturer or
licensed dealer selling or otherwise distributing explosive materials
(or a holder of a user permit disposing of surplus stock to a licensee;
a holder of a user permit; or a holder of a limited permit who is within
the same State as the distributor) who has the certified information
required by this section may sell or distribute explosive materials to a
licensee or permittee for not more than 45 days following the expiration
date of the distributee's license or permit, unless the distributor
knows or has reason to believe that the distributee's authority to
continue business or operations under this part has been terminated.
(ii) A licensed importer, licensed manufacturer or licensed dealer
selling or otherwise distributing explosive materials (or a holder of a
user permit disposing of surplus stock to another licensee or permittee)
must verify the license or permit status of the distributee prior to the
release of explosive materials ordered, as required by this section.
(iii) Licensees or permittees desiring to return explosive materials
to a licensed manufacturer may do so without obtaining a certified copy
of the manufacturer's license.
(2) Verification of license/user permit. (i) Prior to or with the
first order of explosive materials, the distributee must provide the
distributor a certified copy (or, in the case of a user-limited, the
original) of the distributee's license or user permit. However,
licensees or holders of user permits that are business organizations may
(in lieu of a certified copy of a license or user permit) provide the
distributor with a certified list that contains the name, address,
license or user permit number, and date of the license or user permit
expiration of each location.
(ii) The distributee must also provide the distributor with a
current list of the names of persons authorized to accept delivery of
explosive materials on behalf of the distributee. 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 distributor may not transfer possession of explosive materials
to any person whose name does not appear on the current list of names of
persons authorized to accept delivery of explosive materials on behalf
of the distributee. Except as provided in paragraph (b)(3) of this
section, in all instances the distributor must verify the identity of
the distributee, or the employee of the distributee accepting possession
of explosive materials on behalf of the distributee, by examining an
identification document (as defined in Sec. 555.11) before
relinquishing possession.
(iii) A licensee or holder of a user permit ordering explosive
materials from another licensee or permittee must provide to the
distributor a current, certified statement of the intended use of the
explosive materials, e.g., resale, mining, quarrying, agriculture,
construction, sport rocketry, road building, oil well drilling,
seismographic research, etc.
(A) For individuals, the certified statement of intended use must
specify the name, address, date and place of

[[Page 183]]

birth, and social security number of the distributee.
(B) For business organizations, the certified statement of intended
use must specify the taxpayer identification number, the identity and
the principal and local places of business.
(C) The licensee or holder of a user permit purchasing explosive
materials must revise the furnished copy of the certified statement only
when the information is no longer current.
(3) Delivery of explosive materials by common or contract carrier.
When a common or contract carrier will transport explosive materials
from a distributor to a distributee who is a licensee or holder of a
user permit, the distributor must take the following actions before
relinquishing possession of the explosive materials:
(i) 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
(ii) 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.
(4) User-limited permit transactions. A user-limited permit issued
under the provisions of this part is valid for only a single purchase
transaction and is not renewable (see Sec. 555.51). Accordingly, at the
time a user-limited permittee orders explosive materials, the licensed
distributor must write on the front of the user-limited permit the
transaction date, his signature, and the distributor's license number
prior to returning the permit to the user-limited permittee.

(Approved by the Office of Management and Budget under control number
1140-0079)

[ATF No. 1, 68 FR 13787, Mar. 20, 2003, as amended by ATF No. 2, 68 FR
53512, Sept. 11, 2003]