Good title - “power” not “authority”. ATF has no authority to interpret their regulations this way, it’s a power grab and has nothing to do with legitimate government authority.
You are correct. They are illegally “making law.”
Government Bureaus, Agencies, Commissions, and other administrative bodies create their own rules and regulations and have always interpreted them at their whim.
Another example is the Federal Communications Commission at the ready to “hold” that the internet is a utility, and regulate it as such. Stand by for all kinds of rules, not to mention the accompanying new taxes and fees from local, state, and the Federal Government to come into being on monthly bills from providers. Its a control and tax bonanza flow of new cash from unwilling payers and reluctant internet provider tax collectors. Its a government dream scheme.
The only way that out of control agencies to be stopped ia through Court or Legislative action. Don’t hold your breath waiting for that.