Some of you will remember that last year APHIS (USDA) proposed modifying its rules governing who must be licensed under the Animal Welfare Act as a "Dealer," and thereby become subject to federal licensing and regulation requirements. The proposal was discussed in several threads at the time, including this one, and several Boards members submitted comments, as did the ABCA.
Today APHIS issued the final regulations. They are substantially unchanged from what was originally proposed. I've read the 91 pages of APHIS comments that accompanied them, and was on the line for a conference call (thanks for the heads-up, Deb Meier) earlier today at which APHIS announced the new regs, and took some questions (call lasted less than 45 minutes, they didn't get to me).
Based on all that, this is what I take away (simplifying a little, but not where it matters):
You are exempt from licensing and regulation if you don't sell any dogs to be used as pets, ever. Questions were raised as to how APHIS would interpret that -- suppose you breed for work, but occasionally you sell a dog that ends up being used as a pet, or unbeknownst to you is used as a pet, etc.? They said several times that with regard to enforcement "it comes down to your business model." If you're marketing them as working dogs and all your breeding and advertising is consistent with that, and the vast majority of your sales are consistent with that, then you're unlikely to be targeted. (So don't add on your website "And they make great pets, too!") They said that dogs sold for dual purposes (pet and X) will be considered pets. Dogs bred and sold for agility are considered pets. With regard to the meaning of "sell," they said that rescues that collect adoption fees are considered to be selling dogs within the meaning of the regs.
Even if you sell dogs to be used as pets, you still are not subject to regulation if you fall within the definition of a "retail pet store." To meet that definition under the proposed regs, everyone who bought a dog from you had to come to your place of business or residence and see the dog in connection with the purchase; if you ever sell a dog to anyone who doesn't come to your premises, you could not qualify. The final regs say pretty much the same thing, but APHIS is interpreting them to give more latitude than that. (Writing regs that say one thing and then saying you're going to interpret them to say something different is one reason people hate lawyers, IMO, and why even lawyers hate administrative law.) As long as the buyer, seller and dog are together in one place "face to face" at the time of the purchase and/or the time the buyer takes custody of the dog, that is sufficient for the seller to meet the definition of a retail pet store, and be exempt. So the way they are interpreting it, you can deliver the dog to the buyer (and maybe even to an agent of the buyer, who they will consider to be the buyer) at a trial or clinic, or (to take a darker example) in a Walmart parking lot, and still be a retail pet store and therefore not subject to licensure/regulation. They say that this will exempt most rescues, whose "business model," they say, is to have a representative of the rescue deliver the dog to the new owner at an adoption fair or the like. But if you (breeder or rescue) ever ship even one dog, or sell it when you, the "buyer" and the dog are not all in the same place at the same time, you cannot take advantage of this "retail pet store" exemption.
The only other way to avoid the regulation/licensure requirements if you ever sell a dog is if you have no more than four "breeding females" on your premises AND you never sell a dog that you did not breed and raise on your premises. Dogs, cats and small exotic or wild mammals all count toward the total, and it doesn't matter if you own some and another family member owns the others; they will all be aggregated. "Breeding females" is not defined in the regs, but they say they interpret it to mean "capable of being bred," whether or not the dogs are or have been bred. They say it will be up to their inspectors to decide if an animal is a breeding female, and the inspectors will make this decision based on considerations like age and health, but with no specific or additional guidelines. This would be fun to challenge, from a lawyer's point of view, but leaves the breeder with no certainty in advance as to whether s/he qualifies for this exemption or not, when the whole point of regs is to provide certainty about what the law requires. Most working breeders probably could not meet this exemption in any case, however, because it would be rare for one to never sell a single dog that was not born and raised on their premises.
Regarding enforcement, APHIS said that they will monitor ads and internet sites, and perhaps even contact them asking things like "Do you ship?" They will look first to those facilities selling the most dogs, and those against whom credible complaints have been made. All inspections will be by USDA inspectors.
That's about the size of it. If APHIS is spread as thin, enforcement-wise, as I'm guessing they are, this might not end up being such a bad thing -- they'll prioritize the big bad breeders and not even notice our good, much more small-scale, breeders. But even if that's how it turns out, it's a crummy rule change-- badly drafted, not well-fitted to what it's supposedly trying to achieve, and intellectually dishonest.