(1) In general

Chapter 763 of title 10, United States Code, is amended by inserting after section 7544 the following:

7545. Restriction on sales and procurement of certain weapons and ammunition

(a) Prohibitions relating to certain highly dangerous military-Grade weapons and ammunition

(1) Sales in commercial marketplace

The Secretary of Defense or a private operator of a government-owned plant may not sell to any dealer, directly or through a private contractor, in the commercial marketplace—

(A)

any military-grade assault weapon; or

(B)

any covered ammunition.

(2) Procurement

The Secretary of Defense may not procure any item from a dealer or manufacturer of firearms or ammunition that sells a military-grade assault weapon or covered ammunition in the commercial marketplace.

(b) Limitations Relating to other weapons and ammunition

(1) Applicability

The provisions of this subsection shall apply to all firearms and ammunition, other than military-grade assault weapons and covered ammunition.

(2) Sales in commercial marketplace

The Secretary of Defense or a private operator of a government-owned plant may not sell any firearm or ammunition to any dealer in the commercial marketplace that fails to meet the requirements described in paragraph (4).

(3) Procurement

The Secretary of Defense may not procure any item from a dealer or private manufacturer of firearms or ammunition that sells firearms or ammunition in the commercial marketplace if the dealer or private manufacturer—

(A)

directly sells firearms or ammunition to individual purchasers in the commercial marketplace and fails to meet the requirements described in paragraph (4); or

(B)

sells any firearm or ammunition to any dealer in the commercial marketplace that fails to meets the requirements described in paragraph (4).

(4) Requirements

The requirements described in this paragraph for any dealer of firearms or ammunition are the following:

(A)

The dealer must—

(i)

with respect to a dealer of firearms, have a license under chapter 44 of title 18;

(ii)

with respect to a dealer of ammunition, have a license under subsection (d)(1); and

(iii)

comply with all requirements under Federal law for licensees under chapter 44 of title 18.

(B)

In each of the previous 3 calendar years, the Attorney General has traced not more than 24 firearms used in crimes back to the dealer with a time to crime of less than 3 years.

(C)

With respect to a dealer that sells ammunition, during any 30-day period, the dealer may not transfer to the same individual purchaser—

(i)

more than 500 rounds of covered ammunition; or

(ii)

more than 1,000 rounds of other ammunition.

(D)

The dealer must agree to a minimum code of conduct that includes the following:

(i)

A refusal to transfer a firearm or ammunition until the NICS background check system has verified that the transfer is not prohibited.

(ii)

The implementation of a security system, including adequate locks, exterior lighting, surveillance cameras, alarm systems, and other anti-theft measures and practices that the Attorney General may through regulations prescribe.

(iii)

A refusal to sell firearms in any marketplace, including online or at a gun show, unless the marketplace requires every firearm seller to complete a NICS background check on prospective firearm purchasers.

(iv)

A refusal to transfer firearms or ammunition to any person that exhibits signs of alcohol or drug intoxication or cognitive or mental instability (as those terms are defined by the Attorney General, in coordination with the Secretary of Health and Human Services).

(v)

A refusal to transfer a firearm or ammunition to any person the dealer knows or has reason to believe poses a danger to that person or others.

(vi)

With respect to firearms, the implementation and maintenance of a remotely searchable electronic record of—

(I)

the make, model, caliber or gauge, and serial number of every firearm in the inventory of the dealer; and

(II)

the performance of quarterly inventory checks.

(E)

With respect to ammunition, the dealer must implement and maintain a remotely searchable electronic record of—

(i)

importation;

(ii)

production;

(iii)

shipment;

(iv)

receipt;

(v)

sale; and

(vi)

any other disposition of ammunition at the place of business of the dealer for such period, and in such form, as the Attorney General may by regulations prescribe.

(F)

The dealer must implement a mandatory training course developed by the Attorney General, in coordination with the Secretary of Health and Human Services, where appropriate—

(i)

which, with respect to each employee of the dealer authorized to engage in the transfer of firearms or ammunition in the course of the business—

(I)

an employee as of the date of enactment of this section completes not later than 90 days after the date of enactment of this section; and

(II)

an employee hired after the date of enactment of this section complete not later than 30 days after the date on which the employee is hired; and

(ii)

that trains employees on—

(I)

how to recognize and identify—

(aa)

straw purchasers; and

(bb)

any other fraudulent activity described in chapter 44 of title 18, United States Code;

(II)

indicators that a person is attempting to purchase a firearm or ammunition illegally;

(III)

how to recognize and identify indicators that an individual intends to use a firearm for unlawful purposes;

(IV)

how to recognize and identify indicators that an individual intends to use a firearm for self-harm;

(V)

how to prevent theft or burglary of firearms and ammunition;

(VI)

how to respond in the circumstances described in subclauses (I) through (V) and the applicable reporting requirements;

(VII)

how to verify the age of a purchaser of a firearm or ammunition;

(VIII)

with respect to a dealer of ammunition, how to detect whether a single purchaser has reached the applicable ammunition purchase limit to prevent a violation of subparagraph (C); and

(IX)

other reasonable business practices that the Attorney General determines will deter firearm trafficking or deter the provision of a firearm to an individual who indicates an intent to use a firearm for unlawful purposes or for self-harm.

(G)

Not later than 30 days after the date on which the Bureau of Alcohol, Tobacco, Firearms and Explosives releases to the dealer results of any compliance inspection conducted by the Bureau, the dealer must report the results of the inspection to any manufacturer or wholesaler dealer from which the dealer obtains firearms or ammunition.

(H)

The dealer does not maintain financial ties valued at more than $1,000,000 annually with an entity that—

(i)

during the 5-year period preceding the date of a sale or procurement described in paragraph (2) or (3), separated from the dealer through a spin-off transaction; and

(ii)

does not comply with the requirements of this paragraph.

(5) Inspection results

With respect to an inspection of a dealer described in paragraph (4)(G), not later than 30 days after the date of the inspection, the Director of the Bureau of Alcohol, Tobacco, Firearms and Explosives shall send to the Department of Defense a copy of the report.

(6) Regulations

The Attorney General may promulgate necessary regulations to implement the requirements of this subsection.

(7) Interdepartment coordination

The Attorney General, in coordination with the Secretary of Defense, shall monitor compliance with paragraph (4) by dealers.

(8) Penalty

A dealer that violates paragraph (4) may not participate in a sale or purchase described in paragraph (2) or (3).

(9) Data sharing

Notwithstanding any other law, the Attorney General may share crime gun trace data with the Department of Defense as necessary to carry out this section.

(c) Reporting requirements

(1) Government-owned plant report

Not less frequently than annually, each government-owned plant that produces any ammunition or firearms that are commercially sold shall submit to Congress a report that includes, for the year covered by the report—

(A)

the number of customers of the plant for ammunition or firearms in the commercial marketplace, disaggregated by the State in which the customer is located;

(B)

the revenue of the plant from sales of ammunition or firearms in the commercial marketplace;

(C)

the amount of ammunition or firearms sold by the plant in the commercial marketplace;

(D)

an operational plan for avoiding any diversion of firearms or ammunition into the illegal market or to customers not authorized for purchase under this section; and

(E)

steps taken to implement the plan described in subparagraph (D).

(2) Department of Defense report

Not less frequently than annually, the Secretary of Defense shall submit to Congress a report containing the following:

(A)

A list of manufacturers and dealers from which the Secretary procures firearms that also sell firearms in the commercial market.

(B)

A list of the types of firearms those dealers sell in the commercial market.

(C)

The amount of money the Secretary pays to those dealers for firearms each year.

(d) Licenses for dealing ammunition

(1) In general

The Attorney General shall make licenses available to dealers of ammunition, who may apply for such licenses for the purpose of subsection (b)(4)(A)(ii) to be eligible to make the sales or purchases described in paragraph (2) or (3) of subsection (b).

(2) Requirements

In making licenses available in accordance with paragraph (1), the Attorney General shall apply in a substantially similar manner the requirements under chapter 44 of title 18 for licenses of dealers of firearms to dealers of ammunition.

(3) NICS system

(A) In general

Not later than 180 days after the date of enactment of the Stop Militarizing Our Streets Act of 2026, the Attorney General shall authorize a dealer of ammunition licensed in accordance with paragraph (1) to access and use the NICS background check system in accordance with laws applicable to the use of the NICS background check system.

(B) Authorization

A dealer of ammunition authorized under subparagraph (A) may use the NICS background check system for the purpose of subsection (b)(4)(D) to be eligible to make the sales or purchases described in paragraph (2) or (3) of subsection (b).

(C) Ammunition background checks

A dealer of ammunition licensed in accordance with paragraph (1) may perform a NICS background check on an individual purchasing ammunition from the dealer.

(e) Regulations

The Attorney General shall promulgate a rule with requirements for dealers to comply with the recordkeeping requirement described in subsection (b)(4)(E).

(f) Definitions

In this section:

(1) Ammunition; firearm; manufacturer

The terms ammunition, firearm, and manufacturer have the meaning given those terms in section 921(a) of title 18.

(2) Covered ammunition

The term covered ammunition—

(A)

means ammunition that is larger than .22 caliber; and

(B)

includes .223 Remington ammunition and 7.62 North Atlantic Treaty Organization ammunition.

(3) Dealer

The term dealer—

(A)

has the meaning given the term in section 921 of title 18; and

(B)

includes any person engaged in the business of selling ammunition at wholesale or retail, including an unlicensed private vendor of ammunition.

(4) Financial ties

The term financial ties—

(A)

has the meaning given the term by the Secretary of Defense in a regulation; and

(B)

includes a revenue sharing agreement or a transfer of assets through a purchase or sale transaction.

(5) Gas-operated

The term gas-operated, with respect to a firearm, means that the firearm harnesses or traps a portion of the high-pressure gas from a fired cartridge to cycle the action using—

(A)

a long stroke piston, in which gas is vented from the barrel to a piston that is mechanically fixed to the bolt group and moves to cycle the action;

(B)

a short stroke piston, in which gas is vented from the barrel to a piston that moves separately from the bolt group so that the energy is imparted through a gas piston to cycle the action;

(C)

a system that traps and vents gas from the barrel or the chamber to directly strike or impinge the bolt, bolt carrier, or slide assembly to unlock and cycle the action;

(D)

a hybrid system that combines elements of a system described in subparagraph (C) with a system described in subparagraph (A) or (B) to capture gas vented from the barrel to cycle the action; or

(E)

a blowback-operated system that directly uses the expanding gases of the ignited propellant powder acting on the cartridge case to drive the breechblock or breech bolt rearward.

(6) Government-owned plant

The term government-owned plant means a facility owned by the Federal Government that produces firearms or ammunition.

(7) Gun show

The term gun show means a gun show or an event described in section 478.100(b) of title 27, Code of Federal Regulations, or any successor regulation.

(8) Large-capacity ammunition feeding device

The term large-capacity ammunition feeding device—

(A)

means a magazine, belt, drum, feed strip, or similar device, including any such device joined or coupled with another in any manner, that has an overall capacity of, or that can be readily restored, changed, or converted to accept, more than 10 rounds of ammunition; and

(B)

does not include an attached tubular device designed to accept, and capable of operating only with, .22 caliber rimfire ammunition.

(9) Military-grade assault weapon

The term military-grade assault weapon means a firearm that—

(A)

is semi-automatic;

(B)

is—

(i)

gas-operated or has been modified to operate as a gas-operated firearm;

(ii)

recoil-operated or has been modified to operate as a recoil-operated firearm, except for recoil-operated handguns; or

(iii)

designed and functions, or can be readily modified, to materially increase the rate of fire of the firearm; and

(C)

has—

(i)

a fixed ammunition feeding device with the capacity to accept more than 10 rounds of ammunition; or

(ii)

the capacity to accept a large-capacity ammunition feeding device.

(10) NICS background check

The term NICS background check means a background check through the national instant criminal background check system established under section 103 of the Brady Handgun Violence Prevention Act (34 U.S.C. 40901).

(11) Recoil-operated

The term recoil-operated with respect to a firearm, means that the firearm uses the recoil force to unlock the breech bolt and complete the cycle of extracting, ejecting, and reloading.

(12) Semi-automatic

The term semi-automatic, with respect to a firearm, means any repeating firearm, other than a machine gun, that—

(A)

uses a portion of the energy of a firing cartridge or shell to extract the fired cartridge case or fired shell casing and chamber the next round; and

(B)

requires a separate pull, release, push, or other method of initiation of the trigger to fire each cartridge or shell.

(13) Spin-off transaction

The term spin-off transaction means a transaction that separates a division or line of business from a parent company of an entity.

(14) Straw purchase

The term straw purchase—

(A)

with respect to a firearm, means a purchase described in section 932(b) of title 18; and

(B)

with respect to ammunition, means a purchase described in 932(b) of title 18, except that, for the purpose of this subparagraph, any reference in that section to firearm shall be deemed to be a reference to ammunition.

(15) Time to crime

The term time to crime means the period of time between the retail sale of a firearm and the recovery of the firearm by a law enforcement agency as a result of the use or suspected use of the firearm in a crime.

(2) Clerical amendment

The table of sections at the beginning of such chapter is amended by inserting after the item relating to section 7544 the following new item:

(1) Cooperative activities with non-Army entities

Section 7544(c) of title 10, United States Code, is amended by adding at the end the following new paragraph:

(5)

The non-Army entity abides by the commercial sale restrictions set forth in section 7545 of this title.

(2) Policy

Section 7552 of such title is amended, in the matter preceding paragraph (1), by striking It and inserting Subject to the restrictions set forth under section 7545 of this title, it.

(3) Armament Retooling and Manufacturing Support Initiative

Section 7553(b) of such title is amended, in the matter preceding paragraph (1), by striking The and inserting Subject to the restrictions set forth under section 7545 of this title, the.