I posted this on another forum to get more responses. Some of you may recognize it from there.

I just got my O7 in hand a few days ago. I had heard that there were ways around ITAR (exceptions). I looked around the web all night and cannot find anything that is going to get me off the hook for the $2250 or whatever it is. There is no way just starting off I can do this in my little shop at home. I may just drop the 07 to an 01 and be done. Now I also read if a customer orders a specific rifle in a specific configuration they do not consider it "manufacturing" instead its "gun smith work" I originally wanted to get a run of my own AR15 receivers done and run an "a la carte" "build a gun" type of shop. I was also planning to Market The AR15 in this state to hunters with varmint models in 223 and deer/bear rifles in 6.8. But the profit margin cannot work with ITAR and a small shop. Not here, not now, not happening. I am totally confused and need to do more research on what they consider "manufacturing". I will be writing letters to everyone I can about this added government intrusion and THEFT. Not that it will make a bit of difference. It sucks because I already have a lot of time and money invested in this and now it is mostly wasted. The Feds would make more money by lifting ITAR for us and collecting the FET and income tax than trying to scrape the $2250. They dont understand that business makes money for everyone not just the owners. It would cost the consumer about 45 dollars a rifle if I paid the ITAR if I stayed below the 50 rifles a year. If I produced 50 It would run the consumer even more. Making it impossible for me to be competitive in the market place. I believe we killed British for less than what they do to us right now. Pretty * discouraging. I was looking forward to growing this business but it does not look good. Now I have one more question. If I do not produce any firearms by manufacture am I still on the hook for ITAR being a 07 FFL?
If anyone has any input for a newbee I am all ears.

Rant over,

AL

Al, I feel your pain!!!!
I tried going that route with bullet/boolit manufacturing and discovered that the ITAR was not for me!! In fact, when I talked to the ATF they actually chuckled when I told them what I was planning on doing. They said the extra for the 07 was only $30.00 but the ITAR for the FEDs was really high!!! Well, needless to say I scrapped my ideas of becoming a small boolit/bullet manufacturer!!

I suppose its just another government money grab and another attack on our 2nd. It really does kill a small business  that want to grow slowly. Its a go big or go home world. BALLS OUT take a huge risk and try to make a million or pack up and go home.

AL

"The statutory authority of the President to promulgate regulations with respect to exports of defense articles and defense services is delegated to the Secretary of State by Executive Order 13637."

Was this done under OBAMA?

Google is your friend.
(and ITAR wasn't Obamas idea btw)

<-  07/C2

That is manufacturing, period.

To make it real simple for you:
If you are building/assembling/upgrading a firearm that your business owns for the purpose of reselling it, you are manufacturing.
If you are building/assembling/upgrading a firearm that someone else already owns and you only charge labor for and replacement parts, you are gunsmithing.

Obama didnt create ITAR but it changed under him correct?

I googled my eyes out reading the State dept regs. And also other peoples findings with ITAR.

Like I said I thought  there was a exception you could file with the State Dept.

My original post is not the letter I wrote to anyone so dont try to make it out like I wrote a crazy rant letter to some government official. GEEZE.

I havent written to the ATF about this as its not there area its the State Dept.

I just wrote to Susanne Collins.

AL

No, it changed under Bush, that's when the annual fee went from $500.00/year to $2,250.00 per year.


Someone else wrote a letter asking for clarification on the activities that would require an 07 to register.  He does not have a response yet.

Honestly, I don't mean this in a condescending manner but, if you can't swing the ITAR fee you should seriously re-examine your business model and plan.

You applied for and received an 07 FFL, exactly what you wanted.  For all practical purposes anyone with an 07 FFL owes ITAR, there are very few 07 FFLs who will only research.  You haven't mentioned a SOT, most 07 applicants also pay their SOT and build or acquire post-samples.  They also complain about not wanting to pay ITAR, often saying "I only bought post-samples, I didn't build any."  They owe ITAR too.

One does not beat the taxman. The taxman beats you.

I suggest that you contact the State Department and get clarification on THEIR definition of manufacturing, it differs from the ATF's definition. If you are only assembling pre manufactured parts you are not obligated to pay ITAR.  DO NOT BELIEVE ME. Write a letter and get the response in writing.