The term "Gun Show Loophole" came about as a result of the passage of the Firearm Owners Protection Act of 19861 and the Brady Handgun Violence Prevention Act of 1993. These laws effectively created a dual standard for gun sales based on the federal license status of the seller. The Brady Act mandated that licensed gun dealers must conduct criminal background checks on potential buyers regardless of whether the sale takes place at the dealer's store or at a gun show, whereas the Firearm Owners Protection Act expressly exempted "persons making occasional sales or selling all or part of a personal collection" from the need to obtain a federal license to sell firearms. Thus, a private individual who is not considered to be "engaged in the business" of buying and selling guns, or who sells occasionally, is not required, or even allowed, to conduct a background check on a prospective buyer. The reason for the exception to the background check requirement for private sellers was to allow for the unregulated sale or transfer of guns between friends and relatives or the "occasional" sale of guns by individuals from their personal collection.
A View through the Gun Show Loophole,
Rich. J.L. & Pub. Int.
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