It's a long story. All of my units are fully legal for the manner in which I am now using them.
The government basically doesn't like it when noobs don't know what they are doing and transmit on frequencies that are reserved for police/air traffic/military/etc. There are the FRS and GRMS radio frequencies that are free for everyone to use under certain power conditions, then there's every other frequency which you need the correct license to transmit on, or perhaps is reserved for nobody except police etc to transmit on. The baofengs can be used to transmit on any frequency within their range, have detachable antennas, and user adjustable power settings. Additionally, they ship with random fucking frequencies programmed in out of the box, so it takes some effort to program in the legal frequencies. So it's basically up to the user to be a smart guy and program every frequency in correctly if you want to be legal. Apparently enough people were getting this wrong and just punching in random frequencies at max power, so the gov introduced new legislation.
They now have established two different tracks:
1. Pleb-only radios that are low-power only and have the legal channels programmed in already with no custom channel programming and have fixed antennas (no detachable antennas allowed). This means the radio is guaranteed to be legal no matter what knobs and settings and shit the pleb punches in. An example of these would be the Motorola Talkabout series.
2. Advanced radios that can do whatever but I think are not allowed to talk on the pleb (FRS/GMRS) bands.
So the baofengs that I have are not technically legal to buy now under the rules, since they fit into both categories. However there was a 'grandfather' clause in the rules that says any radios purchased before the ban are still allowed to use, and to give away for free, you just aren't supposed to sell or buy them from now on. That said, I notice you can still buy them off amazon no problem so it's not really tightly enforced, but it is technically illegal.
So compliance is up to me. If I transmit within the legal power limit on a license-free band, I'm in the clear. If I just punch in some random frequency, dial up the power, or whatever it would be be illegal to do that and I could possibly expect to be triangulated and heavily fined, depending on the particulars of the situation. I personally think the regulations are bullshit and we should have complete RF anarchy but currently it's not worth getting triangulated and ham jannie'd with up to a 500,000+ fine for willful noncompliance so I follow the rules. However I find it very useful to have a bunch of cheap radios where I can decide to NOT comply one day if the lads start boogie'ing on down some day.