Who needs to be licensed?

Whether you will need to be licensed under the new Act will depend on the types of activity you or your company are engaged in.

Secondhand Dealers

The Secondhand Dealers and Pawnbrokers Act 2004 states that "every person who engages in business as a secondhand dealer must hold a licence".

Am I a "secondhand dealer"?

A secondhand dealer is defined as:

a person who buys (for the purpose of trade), sells, exchanges, or otherwise deals in
secondhand articles or scrap metal
(but who is not a pawnbroker or an employee of a secondhand dealer and pawnbroker).

This definition includes individuals, partnerships, and companies.

You will only be a "secondhand dealer" if the goods you buy, sell, exchange, or otherwise deal in are listed as "articles".

If you trade in any of those items you will be dealing in secondhand articles. You are also covered by the definition of "secondhand dealer" if you deal with scrap metal.

Am I "in business"?

You will be presumed to be in business as a secondhand dealer if you or your company, in any 12-month period:

buys secondhand articles or scrap metal
for the purpose of trade
on six or more different days.

You will also be presumed to be in business as a secondhand dealer if, in any 12-month period, you or your company:

sell, exchange, or otherwise deal in
secondhand articles or scrap metal (being secondhand articles or scrap metal acquired for the purpose of trade)
on six or more different days or
so as to receive revenue of $2,000 or more.

If you fall within the definitions of both "secondhand dealer" and "in business" you will need to be licensed under the Secondhand Dealers and Pawnbrokers Act 2004. There are a number of exceptions.

Pawnbrokers

The Act also requires that "every person who acts as a pawnbroker must hold a licence."

Am I a "pawnbroker"?

A pawnbroker is, broadly, a person (including a company or partnership) who:

in expectation of profit, gain, or reward;
lends money;
on the security of goods;
by taking those goods into their (the pawnbroker’s) possession but without taking ownership of the goods.

(A person is not a pawnbroker if they are a secondhand dealer or employee of a secondhand dealer and pawnbroker.)

If you fit this definition, you are a pawnbroker and are required to be licensed under the Act.

Requirement to be licensed

If you fall within the definition of "pawnbroker" or are "engaged in business as a secondhand dealer", you will need to become a licence holder.

If you carry on business as a secondhand dealer or act as a pawnbroker without a licence you could be prosecuted and have a fine of up to $20,000 imposed on you by a Court.