Quoted: BW contractors are now issued Colt M4A1s. The Bushmaster was the fast answer to arming the guys for the early contract days with the CPA. They were issued Bushmaster semi-autos with ARMS SIR rails and forward grips. These weapons are however, still in use by the non State Dept contract teams that are in country. Now the weapons are provided by State Dept. and come with Knight's rail kits and ACOGs. Also there are M240s and para M249s.
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The above paragraph references only Blackwater's WPPS contract where they (BW) are provided US Government owned weapons as "GFE" (government furnish equipment). Most security contracts in Iraq require the vendor (the business with the contract) to provide their own equipment for their employees (falsely called "independent contractors" so that the vendor can try to avoid liability, which will be decided in the BW Fallujah Four wrongful death suit).
Other contracts also have vendors using GFE weapons, like the security contractors on the Captured Enemy Ammunition Program contract, etc.
On contracts where the USG furnishes no weapons, US vendors use either semi-automatic ARs or locally acquired weapons or a mix of both.
As you are probably aware, since 1986's Volkmer-McClure "Firearms Owners Protection Act" (Hughes Amendment) no individual (which includes corporations except for certain categories of SOT - 'class III' dealers and manufacturers) can purchase
(ETA: "and transfer them onto the National Firearms Registry as per the National Firearms Act of 1934") fully-automatic weapons manufactured after Mqy 1989 and transferred onto the National Firearms Registry prior to October 1986. And an SOT must be in the business of selling firearms, not merely possessing them.
So, Blackwater Security is bound by the same rules you or I are. Its a legal 'person'. To own Title II (or "class III") fully automatic weapons, they must follow the rules (state and Federal).
TA: At the current cost of a pre-86 transferable M16 - around $13K - buying enough to outfit a PSD team would make your bids so high you'd never win a contract! Not to mention that buying them up would drive the price through the roof.To export any firearms (except under the personal exemption), they
(PMCs - edited to claify) must follow the Arms Export Controls Act and comply with the State Department's Office of Defense Trade Controls' regulations, the law of the country they are going to, and international agreements.
It is possible to go through Bushmaster's international representative and purchase what you want abroad, but then you have to comply with all laws in the country you are going to receive them in, as well as international agreements.
In the early days in Iraq, security contractor employees (so-called "ICs") were either provided USG weapons (GFE) or carried over what were allegedly their own personal weapons on mil-air flights using the personal exemption in the AECA. ODTC also granted a bunch of export licenses on some pretty loose deals where US law (NFA, GCA, FOPA) were pretty much ignored - that resulted in weapons in Iraq that could not be brought back into the US.
DOS tighten up in 2004/5. The transfer of sovereignty to the new Iraqi government pretty much finished the 'wild and woolly' days. PMCs have to follow the rules now.
This is the basis for HR 5005 - the so-called "Blackwater Bill".
Of course, all of the above is negated by a single internet commando rumor.