Not a lawyer, and wasn't on the call so can't tell you the exact language that was used. That said - here's chapter/verse from the BATFE Regs (note 7.2.2):
Section 7.2 What is a “manufactur
er”?; What is “manufacturing”?
7.2.1 “Manufacturer”.
As defined by the GCA, a “manufact
urer” is any person engaged in the
business of manufacturing fir
earms or ammunition for purposes
of sale or distribution.
109
Similarly,
NFA defines the term to mean any person “who is e
ngaged in the business of
manufacturing firearms”,
that is, firearms subject to the NFA.
110
To determine who is a “manufacturer” of firearms, we must look
to see whether the person manufactures
firearms as discussed in Section 7.2.2.
7.2.2 “Manufacturing”.
“Manufacturing” is not defined by th
e law, regulations, or any formal ATF
ruling. Nevertheless, the term has
been interpreted by ATF to cover
activities other than producing a
firearm from scratch. As interpreted by ATF, the term
covers virtually any work performed on a firearm
during the process of preparing the
firearm for subsequent sale. For ex
ample, a person having a contract
with a manufacturer to apply finish
ing or other work on firearms, or fi
rearms frames or receivers, to
prepare them for subsequent sale by the manufacturer
would be a “manufacturer
” required to qualify as
such. Of course, if the person produced firearms
parts other than frames or receivers for the
manufacturer or performed work on
firearms parts not defined as “fir
earms,” the person would not be a
“manufacturer.”