New Zealand Act
It is designed to make it harder to move stolen goods through secondhand channels and easier for Police to recover property.
Plain-English explainers, not legal advice. Use the linked official source for section-level detail, and get advice for your situation.
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The Secondhand Dealers and Pawnbrokers Act 2004 sets rules for secondhand dealers, pawnbrokers, promoters, and internet auction providers in New Zealand.
Its purpose is to make it harder for criminals to dispose of stolen goods through secondhand dealers and pawnbrokers, and to make it easier for Police to recover stolen goods and solve property crimes.
Practical sense check
A secondhand dealer is a person who buys, sells, exchanges, or otherwise deals in secondhand articles or scrap metal, other than for personal use or enjoyment or as a gift, and who is not a pawnbroker or an employee of one.
A pawnbroker is a person who, in expectation of profit, gain, or reward, lends money on the security of goods while taking possession but not ownership.
The Act says some people are not engaged in business as secondhand dealers when selling secondhand articles or scrap metal. These include a registered auctioneer acting in the course of business, certain charitable or non-profit organisations, an internet auction provider, an agent of the Crown, and any other prescribed person.
The Act also says that taking trade-ins when selling new goods does not of itself indicate that a person is engaged in business as a secondhand dealer.
The Act includes a practical presumption about when a person is engaged in business as a secondhand dealer.
Unless there is evidence to the contrary, a person is presumed to be engaged in business if, on 6 or more different days within a 12-month period, they buy covered secondhand articles or scrap metal for non-personal purposes, or sell or exchange covered items acquired for non-personal purposes. The same presumption applies if they get more than $2,000 revenue within 12 months from selling those items.
Practical sense check
Every person who engages in business as a secondhand dealer must hold a licence. Every person who acts as a pawnbroker must also hold a licence. If 2 or more people operate in partnership, each partner must hold a licence.
An applicant for a licence must be either an individual or a company. The Act sets out the information that must be included in each type of application.
Key points
The Act requires licensed secondhand dealers to keep a dealers record, verify identity, store the record properly, and give Police access to the record when required under the Act.
It also prohibits licensed secondhand dealers from entering into buyback contracts. A buyback contract is a sale where the seller can repurchase the goods later at a higher price.
Covered articles must generally be kept for 10 working days and labelled. The Act also includes a modification where groups of articles are acquired as a single item.
A pawnbroker must not enter into a buyback contract while apparently acting in the business of a pawnbroker. Pawnbroking contracts may only be entered into at pawnbroking business premises identified in the licence.
The redemption price is limited to the amount advanced plus the redemption fee. A pawnbroker may charge only a redemption fee, and may advance only money on a pledge.
The redemption date must be at least 3 months after the pledge date, unless a later date is agreed. A pledge ticket must be given when the goods are handed over. Pawned goods must be retained until the redemption date and labelled.
A pledger may redeem goods on payment of the redemption price and may inspect them at a reasonable time.
Practical sense check
The Act relies heavily on records and identity verification. It defines authorised identification by reference to Schedule 2.
Schedule 2 includes current passports, current New Zealand driver licences, current overseas driver licences with a photograph, certain New Zealand Government photo ID documents, some recently expired documents, an 18+ card issued by the Hospitality Association of New Zealand, and certain school photo ID documents.
The Act also gives Police access rights in relation to employee records, dealers records, pawnbrokers records, promoters records, internet auction providers records, and goods, in the situations covered by the Act.
There is a defence to some charges involving failure to produce documents or things if the constable was not in uniform and did not produce evidence of being a constable, or if the request was unreasonable in the circumstances.
A promoter who carries on a business of letting or otherwise providing space to stallholders for a market or fair where stalls are or may be used for secondhand dealing must keep a promoters record.
That record must include the market or fair dates, location, and details for each stallholder proposing to sell secondhand articles or scrap metal.
If the stallholder does not hold a licence or certificate, the promoter must record how identity was verified. The Act allows verification by sighting authorised identification, by personal knowledge, or by another prescribed method.
The promoter must keep the information for at least 12 months from the date of the market or fair.
An internet auction provider must keep an internet auction providers record. The record must show the full name, date of birth, contact telephone number, and email address of every person offering secondhand articles or scrap metal for sale on the website, plus any other prescribed information.
Information about a particular sale or attempted sale must be kept for at least 12 months from the date bids closed.
Sense check
A person who engages in business as a secondhand dealer must hold a licence. A person who acts as a pawnbroker must also hold a licence. If 2 or more people operate in partnership, each partner must hold a licence.
Unless there is evidence to the contrary, you are presumed to be engaged in business if, on 6 or more different days within 12 months, you buy covered secondhand articles or scrap metal for non-personal purposes, or sell or exchange covered items acquired for non-personal purposes. The same presumption applies if you get more than $2,000 revenue within 12 months from selling those items.
Schedule 1 lists covered articles. Examples include bicycles, cameras, computer items, copper in any form, whiteware, jewellery, musical instruments other than pianos, portable power tools, tool sets, watches and clocks.
Yes, in some cases. The Act says certain people are not engaged in business as secondhand dealers when selling secondhand articles or scrap metal, including a registered auctioneer acting in the course of business, certain charitable or non-profit organisations, an internet auction provider, an agent of the Crown, and any other prescribed person.
Schedule 2 includes a current passport, a current New Zealand driver licence or current overseas driver licence with a photograph, certain current New Zealand Government photo ID documents, some of those documents if expired less than 2 years earlier, an 18+ card issued by the Hospitality Association of New Zealand, and certain current New Zealand secondary or composite school photo ID documents.