Pawnbrokers and Second-hand Dealers Act 1996

The Act’s primary subjects are licensees—individuals, partnerships and corporations holding pawnbrokers’ licences, second-hand dealers’ licences or combined licences (s 9(1)). Any person or corporation carrying on the relevant business without a licence commits an offence (ss 6–7). “Carrying on business” is given an expansive presumption: selling second-hand goods on more than six days in any 12-month period presumptively constitutes a business (s 38(1)), regardless of location or whether the sales are from shops, markets, residences or vehicles.

Employees of licensees are directly affected. They must comply with record-keeping, identity-verification and suspicious-goods reporting obligations (ss 15, 16(2), 19). A licensee’s failure to ensure employee compliance can ground disciplinary action (s 34(1)(c)). Executive officers of corporate licensees are subject to fit-and-proper tests (s 8(2)), disqualification rules (s 8A(3)(c)) and personal liability for corporate offences (s 40A).

Market promoters—persons who receive fees, commission or rent from vendors at a market (defined to exclude annual events such as school fetes or prescribed activities)—must obtain identity evidence before permitting second-hand goods sales (s 15A) and keep vendor records (s 16(3)). Breach attracts a 50-penalty-unit maximum.

Claimants alleging ownership of goods in a licensee’s possession may invoke the Part 4A restoration-notice procedure. They must provide a signed statement, prior police report and supporting evidence to a police officer (s 32F(1)). If a restoration notice issues, the claimant becomes the respondent in any NCAT proceedings (s 32G(9)).

Pawnors (persons who pawn goods) obtain statutory rights: a minimum three-month redemption period (s 29(1)(a)), entitlement to a compliant pawn ticket and information statement (s 28(5A)), protection against post-redemption-period interest or increased safekeeping fees (s 32B), and a right to surplus proceeds if claimed within 12 months (s 31(1)), supported by a mandatory notice of entitlement (s 31A(1)).

Authorised officers—police officers, the Secretary, Fair Trading investigators appointed under the Fair Trading Act 1987 s 18, or persons authorised in writing by the Secretary (s 3(1))—are given entry, inspection, record-production and seizure powers (ss 17–18, 20–21). They may issue penalty notices (s 26) and, if not police, may direct production at a nominated place rather than a police station (s 17(4)).

The Secretary (Commissioner for Fair Trading or Departmental Secretary) occupies a central administrative role: granting, renewing, conditioning, suspending or revoking licences (ss 9, 11, 36), determining fit-and-proper status and ignoring certain disqualifying factors (s 8A(4)–(5)), issuing exemptions (s 4A), maintaining the register (s 13), and conducting disciplinary inquiries. The Secretary’s decisions are subject to NCAT administrative review (s 39).

The Commissioner of Police supplies criminal intelligence that can disqualify applicants or licensees (s 8A(2A)) and receives mandatory reports of records where prescribed (s 16(5A)). Criminal intelligence cannot be disclosed in reasons for refusal (s 9(5)).

Courts retain supplementary roles: automatic or discretionary licence revocation on conviction (s 33), forfeiture orders against unlicensed dealers (s 41), and mandatory directions for police seizure of stolen goods located with licensees (s 32M).

The Tribunal (NCAT) determines ownership disputes under s 32G, with power to order delivery, monetary payment or other relief, and may assess value or order compensation representing what would have been payable on redemption.

Finally, the Act affects members of the public who buy from or sell to licensees, as the regulatory framework is designed to reduce the market for stolen goods and to give transparency and redress to pawnors.

Licensee duties are extensive. They must nominate business and storage premises (ss 12, 12A), keep all pawned goods at approved premises until redemption, purchase, consignment for auction or authorised removal (s 12B(2)), and ensure second-hand goods are retained unaltered for 14 days (s 21(1)). Records must capture every acquisition, disposal, redemption and employee (s 16(1)–(2)). Before accepting goods, licensees must obtain prescribed identity evidence and must not accept goods if they have reasonable grounds to believe the supplier is not the owner or authorised agent (s 15(2)). Suspicious goods trigger an immediate reporting duty (s 19). Pawnbrokers must create a signed, complete record at the time of pawning (s 28(1)–(3)), issue a compliant pawn ticket (s 28(5)–(5A)), refrain from varying pawn agreements except under s 29A or regulations (s 29B), sell unredeemed high-value goods so as to obtain the best price (s 30(1)), and account for surplus proceeds (s 31). Signage displaying interest rates and fees is mandatory (s 32C). Licensees must comply with licence conditions (s 11) and report their own or employees’ dishonesty convictions within 28 days (s 33A).

Rights of pawnors include the statutory redemption period (s 29), protection against post-redemption interest or increased fees (s 32B), the right to a clear explanation of fees via the pawn ticket (s 28(5A)), and entitlement to surplus proceeds (s 31). Buy-back contracts are deemed pledges (s 5), attracting the Act’s protections. Pawnors may extend the redemption period by compliant agreement (s 29A) and may redeem even after expiry but before sale (s 29(2)).

Claimants have a statutory pathway to recover goods via restoration notice without immediate court action (s 32F). If the licensee applies to NCAT, the claimant is a party and may obtain delivery or value (s 32G). The Act expressly preserves common-law rights and prevents licensees from contracting out of liability for loss or damage on more favourable terms than the common law (s 44B).

Market promoters’ duties mirror licensees’ identity and record obligations (ss 15A, 16(3)).

The Secretary’s rights include imposing conditions at any time (s 11(1A)), revoking or suspending for disqualification or other grounds (s 36), and exempting persons while publishing the exemption (s 4A(3)). The Secretary may ignore certain disqualifying factors on prescribed grounds (s 8A(4)–(5)).

Authorised officers enjoy entry, inspection, record-production and goods-inspection powers, including opening locked containers (s 20(2A)) and requiring production at police stations or nominated places (s 17).

Rights are balanced by obligations: claimants must not make false allegations (s 32K), and all persons must not obstruct authorised officers (s 25) or supply false information (s 24).

Most offences carry a maximum of 50 penalty units. Carrying on business without a licence (ss 6–7) is 100 penalty units. Failure to display licence details (s 14), notify changed premises (ss 12(2), 12A(2)), or comply with record, identity or reporting duties (ss 15(4), 16, 19, 28(7), 29(6), 30(1), 31(2), 32, 32A–32D) each attract 50 penalty units. Obstruction (s 25), false information (s 24) and failure to comply with restoration notices or retention obligations (ss 32F(4), 32H) are likewise 50 penalty units. Lesser penalties apply to signage breaches (ss 32L, 14) and surrender of revoked licences (s 37—10 penalty units).

Enforcement is multi-layered. Penalty notices under the Fines Act 1996 provide an infringement-notice route (s 26). A demerit-points scheme aggregates convictions or paid penalties; 12 or more points in three years can trigger show-cause action (s 27(3)). The Secretary may serve show-cause notices on 11 enumerated grounds, including dishonesty convictions, false application statements, breach of conditions, probable dealing in stolen goods, demerit points, or becoming a disqualified person (s 34(1)). After inquiry, the Secretary may revoke, suspend, impose conditions, or refuse future grants (s 36). Criminal-organisation association mandates revocation (s 36(1A)). Former licensees remain amenable to sanction for conduct during licensure (s 36A).

Courts may revoke licences on conviction for dishonesty or Act offences (s 33(2)), order forfeiture of goods or payment of proceeds derived from unlicensed activity (s 41), and direct police seizure of stolen goods (s 32M). Corporate offences attribute liability to knowing executive officers (s 40A). Proceedings are summary before the Local Court and must commence within 12 months (s 40).

Administrative review by NCAT is available for refusal, revocation, suspension or conditioning of licences (s 39), but criminal-intelligence material cannot be disclosed to the applicant (s 39(1B)). NCAT also determines ownership disputes under s 32G with flexible remedial powers.

The Act is expressly subordinate to other licensing regimes. Section 4(1) provides that it does not affect activities conducted under a licence, permit or authority under another Act (examples: Property and Stock Agents Act 2002, Firearms Act 1996, Motor Dealers and Repairers Act 2013). A person need not obtain a licence under this Act for activity already authorised by another statute.

It interacts heavily with fair-trading legislation. Authorised officers include investigators appointed under Fair Trading Act 1987 s 18 (s 3(1)). The Secretary is the Commissioner for Fair Trading or Departmental Secretary (s 3(1)). Disciplinary grounds include contraventions of any Act administered by the Minister (s 34(1)(c)). Licensing procedures apply the Licensing and Registration (Uniform Procedures) Act 2002 (Part 2) with modifications (s 9). Administrative review lies under the Administrative Decisions Review Act 1997 (s 39).

Criminal law intersections are pronounced. Disqualification for recent dishonesty convictions (s 8A(2)(a), (3)(a)) references Crimes Act 1900 offences. Conviction for receiving under Crimes Act 1900 ss 188–189A automatically revokes a licence (s 33(1)). Criminal intelligence within the meaning of the Crimes (Criminal Organisations Control) Act 2012 can disqualify applicants or licensees on association grounds (ss 8(1)(d), 8A(2A)), with non-disclosure protections (s 9(5)). The Fines Act 1996 governs penalty notices and demerit points enforcement (ss 26–27). Part 17 of the Law Enforcement (Powers and Responsibilities) Act 2002 applies to goods seized under court direction (s 32M(3)).

Consumer-protection overlays appear in the prohibition on contracting out (s 44A) and the preservation of common-law liability for loss or damage (s 44B). The Corporations Act 2001 (Cth) supplies the definition of “executive officer” (s 3(1)) and meanings of “administrator” and “controller” (s 8A(6)). Insolvency events trigger disqualification (s 8A(2)–(3)).

The Charitable Fundraising Act 1991 exempts authorised fundraising from the Act (s 4(2)(a)). Market promoters’ obligations sit alongside any local-government or event-specific rules. Electronic service and record provisions (ss 16(7), 28(5C), 29A(8), 42A) align with broader government digital-transformation policy.

Finally, the Act preserves other civil and criminal remedies. Section 32I limits Local Court jurisdiction in certain detention-of-goods actions while preserving superior-court powers. Section 32M supplements, but does not replace, Criminal Procedure Act 1986 s 43 restoration orders.

The Act has been amended more than a dozen times since 1996, with the most significant overhaul occurring via the Pawnbrokers and Second-hand Dealers Amendment Act 2002 (No 104). That Act inserted s 3A (extended pawnbroker definition emphasising substance over form), repealed the former s 22 complaint procedure, inserted the entire Part 4A dispute-resolution regime (ss 32E–32M), added detailed pawn-ticket and fees-disclosure requirements (s 28(5A)–(5B)), introduced redemption-extension rules (ss 29A–29C), reformed sale-of-unredeemed-goods obligations (ss 30–30A, 31–31A), inserted the demerit-points scheme (s 27), expanded disqualification grounds (s 8A), and added anti-avoidance (ss 44A–44B) and corporate-liability (s 40A) provisions. These changes responded to concerns that the original Act provided insufficient consumer protection for pawnors and inefficient mechanisms for true owners to recover stolen goods.

Subsequent amendments have layered regulatory tightening. The Criminal Organisations Legislation Amendment Act 2009 (No 23) inserted organised-crime association disqualifications (ss 8(1)(d), 8A(2A)) and corresponding non-disclosure rules for criminal intelligence (ss 9(5), 39(1B)), reflecting a policy to prevent outlaw-motorcycle-gang infiltration of the cash-based second-hand trade. The Fair Trading Legislation Amendment (Reform) Act 2018 (No 65) substituted new licence-duration and restoration rules (ss 10, 10A), updated show-cause and disciplinary provisions, and aligned terminology with the Civil and Administrative Tribunal Act 2013.

More recent tweaks address operational efficiency and pandemic-era flexibility. The Better Regulation and Customer Service Legislation Amendment (Bushfire Relief) Act 2020 (No 3) and Better Regulation Legislation Amendment Act 2020 (No 25) inserted s 4A, empowering the Secretary to grant written exemptions (published online) and to waive, reduce, postpone or refund fees on grounds of financial hardship or special circumstances. The 2020 amendments also clarified that existing exemptions under the 2015 Regulation continued temporarily. Amendments in 2022 (No 59) updated the Secretary’s title and demerit-points references. The Pawnbrokers and Second-hand Dealers Amendment (Fees and Charges) Act 2024 and statute-law revision statutes (2024 No 25, 2024 No 53) refined the definition of “fees and charges” (s 30A), updated electronic-signature and record provisions (ss 28, 29A), and modernised service-of-documents rules (new s 42A permitting email and other electronic methods).

These changes collectively respond to three policy drivers: (1) consumer protection—ensuring pawnors understand their rights and can recover surplus proceeds; (2) law enforcement—disrupting stolen-goods channels and excluding criminal elements; and (3) regulatory modernisation—electronic records, flexible exemptions, and alignment with NCAT and digital-service standards.

Because the Act directs most disputes to NCAT or administrative review, reported superior-court litigation is limited. The statute itself, however, contains provisions that have generated controversy and are clearly drafted in contemplation of legal challenge.

The non-disclosure of criminal intelligence (ss 9(5), 39(1B)) has been a flashpoint. An applicant refused a licence on s 8A(2A) grounds (association with a declared organisation) cannot be given reasons that would disclose that intelligence. NCAT and any Appeal Panel must hear argument in closed session without the applicant or representative present unless the Commissioner of Police approves otherwise. This procedural fairness limitation mirrors schemes upheld in other jurisdictions but remains controversial for licensees who lose their livelihood without knowing the full case against them. The Act grounds this limitation expressly in the Crimes (Criminal Organisations Control) Act 2012, signalling legislative acceptance of the tension between procedural fairness and organised-crime suppression.

The disqualification regime (s 8A) has produced litigation concerning the Secretary’s discretion to “ignore” a dishonesty conviction on grounds of triviality, time elapsed, offender’s age, subsequent good behaviour or other prescribed matters (s 8A(4)). Applicants have argued that the Secretary’s refusal to ignore a conviction is unreasonable or fails to give adequate weight to rehabilitation evidence. Because such decisions are administratively reviewed under s 39, the controversy surfaces in NCAT rather than courts, but the statutory grounds in s 8A(4) set the parameters of that review.

Part 4A restoration-notice procedure has been criticised for reversing the ordinary onus. A licensee served with a notice must either surrender the goods or commence NCAT proceedings within 28 days, even though the claimant’s evidence is only required to “appear to the officer to contain evidence or statements acceptable” (s 32F(1)(d)). Licensees argue this exposes them to loss if the claimant’s title is later disproved, yet the Act limits their remedy to an NCAT compensation order (s 32G(7)–(8)). The Tribunal’s power to order the licensee to pay the pawnor an amount representing what would have been payable on redemption (s 32G(8)) has been controversial in cases where the goods have deteriorated or the licensee has already incurred storage costs not recoverable under the pawn agreement.

The automatic revocation on conviction for receiving (s 33(1)) has been challenged on the basis that the court’s discretion to allow the licence to remain in force is insufficiently guided. Courts have occasionally exercised the discretion where the offence was peripheral to the licensed business, but the statutory language gives no criteria, creating uncertainty.

Section 32M’s mandatory direction to police to seize goods found stolen in criminal proceedings has raised questions about interaction with Law Enforcement (Powers and Responsibilities) Act 2002 Part 17 and with third-party interests. The provision is expressed to be “in addition to any other power” and does not require the court to hear from the licensee before making the direction.

Finally, the broad power to declare a person probably “receiving or dealing in stolen goods” on the basis of circumstantial evidence (s 34(1)(f) and example in s 34(3)) has been controversial. The Secretary may rely on the discovery of stolen goods in custody or on statistically unusual purchase volumes. Licensees argue this reverses the presumption of innocence for disciplinary purposes. The Act responds by requiring the Secretary to be “satisfied on the balance of probabilities” after inquiry and by giving the licensee a right to make submissions (s 35) before any sanction under s 36.

No provision of the Act has been held constitutionally invalid, but the criminal-intelligence non-disclosure rules and the Part 4A onus reversal continue to attract academic and industry criticism for their impact on procedural fairness and commercial certainty.

Most practitioners assume that a clean criminal record and corporate compliance automatically satisfy the “fit and proper person” test. Section 8(1)(b) and (2)(a)–(b) require the Secretary to be satisfied that the applicant and every partner or director is fit and proper; past minor regulatory breaches, even if not disqualifying under s 8A, can tip the balance. The Secretary’s discretion is broad and reviewable only on administrative-review grounds.

Another trap is the interaction between s 12B and the 14-day retention period in s 21. Pawned goods must remain at “approved premises” at all times until redemption or authorised removal. A licensee who moves stock to un-nominated premises for even one day, even while the 14-day hold period runs, commits an offence (maximum 50 penalty units) unless the defence in s 12B(6) (premises ceased to be approved within the past three days or goods in transit) applies. Many operators assume internal stock transfers are invisible to regulators; electronic record requirements and authorised-officer cross-matching powers (s 17(1)(b)–(c)) make them visible.

The “surplus proceeds” calculation in s 3(1) is frequently misapplied. Only disclosed fees that do not exceed the disclosed amounts or calculation method may be deducted. A pawnbroker who includes an undisclosed “admin fee” or repair charge without receipting it in accordance with s 30A(2) cannot deduct that amount, exposing the entire surplus to a s 31 claim. The 21-day notice obligation in s 31A is strict; the only exceptions are a written request from the pawnor or a surplus below the prescribed amount (currently $50). Failure to send the notice is a 50-penalty-unit offence even if the pawnor never claims the money.

Part 4A restoration notices create a compressed 28-day decision deadline. Many licensees assume they can simply wait for the claimant to sue in court. The Act removes that luxury: non-compliance with a restoration notice is itself an offence (s 32F(4)), and the notice remains operative until the Tribunal or a court determines title or the notice is withdrawn under the regulations. The “other proceedings pending” exception in s 32F(5) only defers the obligation; if those proceedings discontinue, the 28-day clock restarts.

Section 32(3) is a hidden title trap. A pawnbroker who buys his or her own pawned goods obtains no valid title against the true owner. The offence is committed by both the pawnbroker and the purchaser; the statutory invalidity of title survives even if the purchaser is innocent.

The demerit-points scheme (s 27) operates on a rolling three-year period. A licensee who pays several penalty notices for minor record-keeping breaches may suddenly cross the 12-point threshold years later, triggering mandatory show-cause action. Points are allocated on the date the offence was allegedly committed, not the date of conviction or payment, so historical conduct can produce unexpected revocation risk.

Finally, the exemption power in s 4A, while useful, is not a blanket waiver. An exemption must be in writing, takes effect only on the day the notice is given or later, may be conditional, and must be published. Verbal assurances from departmental officers do not bind the Secretary. A business operating under an expired or un-published exemption remains unlicensed and exposed to the s 6 or s 7 offence.

Compliance begins with the licence application. Applicants must address every element of ss 8 and 8A: age, fitness and propriety (including criminal history, bankruptcy, corporate collapses), absence of declared-organisation association, and non-disqualification. Supporting material should affirmatively demonstrate rehabilitation where any negative factor exists, because the Secretary may ignore convictions or insolvency events only on the grounds listed in s 8A(4)–(5). Corporate applicants must ensure every director meets the same standard.

Once licensed, map every premises—business, storage, and any temporary location—against the nomination obligations in ss 12 and 12A. Any change must be notified in writing within 14 days; failure is an offence. For pawnbrokers, adopt a system that guarantees all pawned goods remain at approved premises until one of the four statutory exits in s 12B(2) occurs. Maintain a current list of approved premises and update the Secretary immediately upon any change.

Implement written procedures for identity verification that meet the exact documentary and additional-evidence requirements prescribed by regulation (s 15(1A)–(1B)). Record the evidence contemporaneously. Before accepting any item, conduct a title check sufficient to negate reasonable grounds for believing the supplier is not the owner (s 15(2)). For market promoters, the same identity standard applies; a second-hand-dealer licence displayed by the vendor satisfies the obligation (s 15A(3)).

Record-keeping must satisfy s 16 in full: prescribed particulars for every transaction, employee details, market-vendor logs, retention for three years, and, where required, electronic transmission to Police. Records must be in English, readily producible, and capable of cross-matching goods to entries (s 17(1)(b)–(c)). Electronic systems should be validated against any regulatory specifications made under s 16(7) or s 28(5C).

For pawnbroking, use only Secretary-approved pawn-ticket forms that contain the rights notice, itemised fees statement (including calculation method for unknown amounts), and sale-method disclosure (s 28(5A)). The ticket must not contain any exclusion or misrepresentation of rights (s 28(5B)). Interest-rate signage must be displayed prominently (s 32C). No pawn agreement may be varied except by compliant extending agreement under s 29A or as permitted by regulation (s 29B). Interest must be calculable monthly even if the redemption period exceeds one month (s 32A). After the redemption period, neither interest nor higher safekeeping fees may be charged (s 32B).

Adopt a sales protocol for unredeemed goods that demonstrably seeks the best price reasonably obtainable (s 30(1)). Keep evidence of that process; the onus of proving compliance lies on the pawnbroker in any proceedings (s 30(4)). Calculate surplus proceeds strictly in accordance with the statutory formula and the disclosed-fees limitation (s 3(1), s 30A). Send the s 31A notice within 21 days unless an exception applies, and retain proof of dispatch.

Institute a suspicious-goods protocol: any employee who suspects theft or who sees an obliterated unique identifier must report immediately to an authorised officer (s 19). Maintain an internal log of such reports.

For ownership disputes, train staff to recognise a restoration notice and to treat the 28-day deadline as absolute. The business should have a standing instruction to refer every notice to senior management or external counsel on the day of service so that either goods are delivered or NCAT proceedings are commenced within time. Goods subject to a notice must not be altered, sold, redeemed or removed except with claimant consent or in accordance with the regulations (s 32H).

Maintain a compliance calendar that tracks: licence renewal (nominating 1-, 3- or 5-year term under s 10), three-year record retention, 14-day hold periods, 21-day surplus-proceeds notices, 28-day restoration-notice deadlines, and 28-day conviction-reporting obligations (s 33A). Implement a demerit-points register so that any conviction or paid penalty is logged against the three-year rolling window.

Appoint a compliance officer responsible for premises notifications, record audits, and liaison with authorised officers. Conduct regular internal audits that replicate an authorised-officer inspection under s 17: can every record be located, do goods match records, are all pawned items at approved premises?

If an exemption under s 4A is relied upon, keep the written notice on file, ensure all conditions are observed, and monitor the expiry date. An exemption does not survive a change in circumstances that would render the original grant inappropriate.

Finally, maintain a register of all conditions imposed on the licence (whether on grant, renewal or later under s 11(1A)) and diarise any reporting or corrective-action obligations. Because the Secretary may vary or revoke conditions at any time by order served on the licensee (s 11(1B)), treat every incoming notice as requiring immediate attention and possible legal advice.

Documented, auditable systems that address each of the above obligations, combined with a culture that treats the 14-day hold, identity verification and suspicious-goods reporting as non-negotiable, represent the minimum practical compliance standard that will withstand authorised-officer scrutiny and disciplinary inquiry.