Security Industry Act 1997

The Act primarily affects three broad groups: individual security operatives, master licensees (businesses), and ancillary service providers.

Individual operatives include armed and unarmed security guards, crowd controllers at licensed premises, public events, hospitals, retail outlets or public places (s 4(2) definition of "crowd controller" and "relevant place"), bodyguards, cash-in-transit officers, dog handlers, monitoring centre operators, private investigators (defined in s 4(2) as those investigating or surveilling third parties on behalf of a client), locksmiths, installers and maintainers of security equipment, sellers of security equipment or methods (excluding basic household items at approved retail outlets), trainers, assessors, risk consultants and brokers. These persons require a class 1 or class 2 licence (s 7(2)) and, when carrying firearms, must comply with the Firearms Act 1996 (s 23AA). New class 1 entrants who have not held a licence in the previous three years face mandatory additional training (s 23E). Self-employed individuals must also hold a class MA master licence (s 10(1)(a)).

Master licensees (classes MA–ME) are businesses or self-employed persons who provide security personnel to others (s 4 definition of "provide persons"). They are strictly limited by the number of persons they may supply daily and must ensure every supplied person holds an appropriate class 1 or 2 licence (s 7(1), s 39). Master licensees face additional Tier 3 conditions: they cannot supply ineligible persons for prescribed work (s 22A), must maintain a fitness-for-work policy covering alcohol and drugs (s 39B), submit firearms for ballistics testing on request (s 39A), and comply with uniform, storage and subcontracting rules (ss 23, 23A–23B, 38A). Corporations and their close associates (defined in s 5 by reference to financial interests, relevant powers and executive positions) are assessed for suitability.

Ancillary providers include organisations approved to deliver training, assessment and instruction (s 27A), persons selling or advising on security equipment at retail outlets (exempt only if limited to basic household or automotive items), and interstate operators seeking visitor permits for special events (Part 3A). Employers of security staff, clients who contract for security services, and subcontractors are indirectly affected through the chain-of-responsibility rules in s 38A, which require written consent and disclosure of subcontracting particulars before payment can be demanded.

The Act also affects the Commissioner of Police, enforcement officers (police or authorised NSW Police Force members under s 3), Service NSW (for photographs), and the Civil and Administrative Tribunal (administrative review under s 29). Exempt persons include police, Australian Crime Commission, ICAC, correctional officers and certain law enforcement personnel when performing official duties (s 6(2)–(2A)). The Crown is bound (s 6(1)), but regulations may create further exemptions (s 6(3)–(4)).

Finally, the public is an intended beneficiary: the regime seeks to reduce risk from untrained or unsuitable persons carrying firearms, guarding critical infrastructure, investigating private affairs or controlling crowds at events.

Licensees' duties are both positive and negative. Positive duties include completing approved training and maintaining continuing competency (ss 15(1)(f)(iii), 17(7), 21A, 23E), wearing the physical licence visibly while on duty (s 36, with detailed placement rules in s 36(1A)), producing the licence on demand (s 35), complying with all conditions (s 30), maintaining fitness-for-work policies (master licensees only, s 39B), submitting firearms for ballistics testing (s 39A), and ensuring supplied personnel are licensed (s 39). Master licensees must not provide more persons per day than their licence authorises (s 7(1)(b)) and must observe strict subcontracting transparency rules (s 38A).

Negative duties prohibit carrying on unauthorised activities (s 7), contravening conditions (s 30), advertising without a master licence or omitting the licence number (s 32), making false or misleading statements to induce contracts (s 33(1)), abusing the licence to suggest extra powers (s 34), selling or lending the licence (s 37), delegating to unlicensed persons (s 38), storing firearms at prohibited residential premises (s 23B), carrying firearms without a uniform (s 23A), and supplying ineligible persons (s 22A). Obstruction, false information, record tampering, conspiracy and inducement offences apply to all persons (ss 39S–39X).

Rights include the ability to apply for a licence or renewal (ss 14, 17), seek variation of a class 1 or 2 licence (s 27), apply for visitor permits or temporary excess services permits (ss 39D, 40A), and seek administrative review by NCAT of refusal, conditions, suspension or revocation (s 29). Licensees may request destruction of fingerprints and photographs after ceasing to hold a licence (s 18(5)–(6)). Applicants and licensees can provide further information to rebut concerns (s 20) and are protected from liability for complying with notices (s 20(3)). The Commissioner may grant exemptions from wearing uniforms or licences in special circumstances (ss 23A(6), 36(2)) and urgent exemptions from licensing (s 6AA). Holders of renewed licences pending physical issue may rely on the prior physical licence (ss 35(3), 36(4)).

Enforcement officers have rights to enter premises without warrant (s 39I), apply for search warrants (s 39J), seize evidence (s 39K(1)(h)), require answers and records (ss 39O, 39Q), and issue penalty notices (s 45A). The Commissioner may use criminal intelligence without disclosure (ss 15(7), 26(6), 29(3)–(5)) and publish offence and revocation information (s 39Y).

Penalties are calibrated by offence severity and licence tier. Carrying on unauthorised security activities attracts 1,000 penalty units for corporations or 500 penalty units/imprisonment for 2 years for individuals under s 7(1); the individual offence under s 7(2) is 500 penalty units or 2 years imprisonment. Advertising offences carry 500/250 penalty units or 6 months (s 32(1)), while licence condition breaches are tiered under s 30: Tier 1 (100/50 penalty units), Tier 2 (200/100 penalty units or 6 months), Tier 3 (500/250 penalty units or 12 months). Specific master licence breaches (ss 22A, 23, 39, 39A, 39B) carry up to 1,000/500 penalty units or 2 years. New Part 3C offences (obstruction, non-compliance, record tampering, false information, conspiracy, inducement) each attract 500 penalty units or 2 years imprisonment (ss 39S–39X).

Enforcement is multi-layered. The Commissioner may suspend (s 25, up to 60 days, extendable) or revoke licences (s 26, mandatory where a new application would be refused under s 26(1A)), impose prohibitions on future applications for 2 years (s 16B), and require surrender of suspended or revoked licences (s 31, 200/100 penalty units or 6 months). Court-ordered suspension up to 28 days is available (s 40). Penalty notices provide an administrative alternative (s 45A), with amounts prescribed by regulation. Publication of offences (where penalty notice > $5,000 or proceedings finalised) and revocations is permitted (ss 39Y–39ZA), serving both specific and general deterrence.

Investigation powers are extensive. Enforcement officers may enter business premises without warrant at reasonable times (s 39I), or with warrant (s 39J), examine, copy, seize records, take photographs and require answers (s 39K). Notices to produce information or records may issue (s 39O), with answers compellable notwithstanding self-incrimination (s 39R), though use immunity applies in most criminal proceedings. Obstruction or non-compliance is itself an offence (ss 39S, 39T). Ballistics testing and fitness-for-work policies are independently enforceable (ss 39A–39B).

Proceedings must commence within 3 years (s 45(2)) and are heard summarily in the Local Court (s 45(1)). Directors and managers are liable as accessories where a corporation commits an offence (s 44). For class MA/MB master licences, monetary penalties are reduced by 75% (s 44A), except for excess staffing breaches.

The Act is designed to operate alongside, and in some cases displace, other regulatory schemes. It expressly cross-references the Firearms Act 1996: class 1F licences are only available to persons holding firearms authority (s 11(1)(f), s 23AA), uniform and storage conditions apply when firearms are carried or kept (ss 23A–23B), and ballistics testing is mandated (s 39A). A conviction for unauthorised firearm possession under the Firearms Act does not duplicate liability under s 30 for the same conduct (s 23AA(2)).

Interaction with vocational training law is managed by s 6A, which declares the Act's training approval and enforcement provisions to be excluded matters under s 10 of the National Vocational Education and Training Regulator Act 2011 (Cth) and VET legislation displacement provisions under s 11. This preserves the Commissioner's monopoly over approval of security training providers (s 27A) notwithstanding ASQA registration.

Criminal records legislation is modified: s 12 of the Criminal Records Act 1991 does not apply to licence or renewal applications (ss 14(6), 17(10)), and certain convictions remain permanently disqualifying (s 16(2) note). Child protection registration automatically bars licensing (s 15(1)(b)).

Law enforcement and correctional legislation supplies exemptions (s 6(2)–(2A)) for NSW Police Force, Commonwealth and interstate police, armed forces, NSW Crime Commission, Australian Crime Commission, Law Enforcement Conduct Commission, ICAC, correctional and juvenile justice officers, and other criminal law enforcement agencies. The Police Act 1990 is engaged for referrals of serving or former officers (s 19) and for dismissal-based disqualification (s 16(1)(d), (4A)).

Planning, liquor and public health laws intersect via the definition of "relevant place" for crowd controllers (s 4(2)), which includes licensed premises under the Liquor Act 2007, public entertainment venues, hospitals, quarantine facilities, retail premises and public places. The Act does not confer extra powers (s 8), so security personnel must rely on occupier's rights, common law or specific statutory powers when removing persons.

Administrative review under the Administrative Decisions Review Act 1997 is available via NCAT (s 29), but criminal intelligence is protected from disclosure (s 29(3)–(5)). The Interpretation Act 1987 supplies default rules (note to s 3).

Finally, the Fines Act 1996 governs penalty notices (s 45A), and the Crimes (Sentencing Procedure) Act 1999 and Crimes (Administration of Sentences) Act 1999 are relevant to imprisonment terms and correctional officer exemptions.

The most significant recent amendments are contained in the Security Industry Amendment Act 2022 (assented 28 November 2022, various commencement dates). Schedule 1 expanded the definition of "security activity" to include explicit risk identification, analysis and management strategies (new s 4(1)(h1)), broadened "provide persons" to cover indirect arrangements such as franchises (s 4), introduced a new prohibition on making licence applications for 2 years where an earlier application was refused on fit-and-proper or public interest grounds (new s 16B), and strengthened master licence conditions (new s 22A barring supply of ineligible persons for prescribed work, updated s 23 on subcontracting). Tiered conditions and penalties were rationalised (new s 30), with Tier 3 attracting the highest sanctions. New Part 3C created aggravated offences of obstruction, non-compliance, record tampering, false information, conspiracy and inducement, each carrying up to 500 penalty units or 2 years imprisonment. Part 3D authorised publication of offence and revocation information, subject to finalisation safeguards (ss 39Y–39ZA). These changes responded to reviews identifying vulnerabilities in supply chains, infiltration by unsuitable persons, and the need for greater transparency and deterrence following high-profile incidents involving unlicensed or corrupt operators.

The Security Industry Amendment Act 2017 inserted s 27A (approval regime for training providers), made continuing training a Tier 2 condition (s 21A), expanded NCAT review rights, and refined enforcement officer powers. It also repealed spent provisions and aligned terminology with the Civil and Administrative Tribunal Act 2013.

Earlier 2012 amendments (Security Industry Amendment Act 2012) replaced the provisional licensing system with mandatory training conditions (s 23E), introduced the subclass system for master licences based on daily worker numbers (s 10), added detailed subcontracting transparency rules (s 38A), and created comprehensive entry, search and information-gathering powers (new Part 3B). These responded to regulatory reviews that found gaps in oversight of large providers, inadequate vetting of trainers, and insufficient investigative tools.

The cumulative effect has been to shift the Act from a relatively static licensing statute to a dynamic, risk-based regulatory framework capable of rapid response to emerging threats such as organised crime infiltration, inadequate training standards and supply-chain opacity.

Although the Act contains express non-disclosure protections for criminal intelligence (ss 15(7), 26(6), 29(3)–(5)), these have been tested in NCAT and the Supreme Court. In several unreported NCAT decisions, applicants have argued that the Commissioner's reliance on undisclosed material breaches procedural fairness. The Tribunal has consistently applied the statutory closed-hearing regime, receiving evidence in the absence of the applicant and confirming that the Act displaces common-law fairness requirements to the extent necessary to protect intelligence sources. No successful constitutional challenge on Chapter III grounds has succeeded; the provisions have been upheld as valid exercises of State legislative power.

Controversy has surrounded the breadth of the "fit and proper person" test and the Commissioner's use of spent or non-conviction findings. In one NCAT matter involving a former police officer, the Tribunal accepted that integrity-based dismissal under s 181D of the Police Act 1990 could found refusal even where no criminal charge resulted. Challenges to the 10-year conviction look-back period (s 16(1)(a)) have failed, with the Tribunal emphasising the protective purpose of the regime.

The armed guarding uniform and storage conditions (ss 23A–23B) have generated enforcement disputes. Police seizures of firearms from non-uniformed guards have been upheld, and automatic suspension of class 1F licences has been confirmed as mandatory. One controversy involved the definition of "prohibited premises" (s 23B(5)), with licensees arguing that temporary cohabitation with a disqualified person should not trigger the storage ban; the Commissioner has maintained a strict interpretation.

Subcontracting transparency (s 38A) has been criticised by industry associations as burdensome for legitimate franchise models, yet the 2022 amendments reinforced rather than relaxed the written-consent and particulars requirements. Private investigators (class 2E) have contested the breadth of the surveillance definition (s 4(2)), particularly whether open-source online monitoring constitutes "surveillance of a third person"; the current text appears to capture it when done on behalf of a client who is not the employer.

Publication powers under new ss 39Y–39ZA have raised concerns about reputational damage prior to final appellate determination. The 28-day appeal window and mandatory removal of information if an appeal is lodged provide some safeguard, but the potential for "trial by media" remains a live industry complaint.

Overall, judicial and tribunal decisions have upheld the Act's protective purpose, interpreting discretionary powers broadly while respecting the statutory limits on disclosure of intelligence.

Most practitioners miss that a master licensee can be personally liable for a Tier 3 offence even when the day-to-day breach is committed by an employee (s 30 read with s 44 accessory liability). The 75% penalty reduction for class MA/MB holders (s 44A) does not apply to excess staffing breaches under s 7(1)(b), creating a trap for small operators who inadvertently roster one extra guard.

The "close associate" definition (s 5) captures not only directors but anyone able to exercise significant influence through financial interests or voting power; a silent investor or franchisor can trigger mandatory refusal of the entire master licence application if they fail the fit-and-proper test. Criminal intelligence provisions allow refusal without reasons (s 15(7)), and NCAT cannot disclose the existence of such material, leaving applicants unable to meet the case against them.

Section 22A's ineligible-person prohibition operates retrospectively for the previous 5 years; a person whose licence was revoked on public-interest grounds in 2020 remains unemployable in cash-in-transit or rostering roles until 2025, even if they successfully appeal years later. The defence of "thorough inquiries" is narrow and requires documentary evidence of positive checks.

Visitor permits (Part 3A) are event-specific and cannot be used for ordinary commercial work; interstate operators who accept a one-off hospital security job outside a declared special event commit a s 7 offence. The Commissioner's power to declare "special events" by website notice (s 39C) has been used creatively to cover recurring festivals, but the notice must be current.

Fingerprint and photograph data can be used "for any purpose as the Commissioner sees fit" (s 18(4)), including unrelated law enforcement matches. Once taken, destruction is discretionary (s 18(6)), and former applicants have no automatic right to erasure.

The continuing training condition (s 21A) applies retrospectively to all existing class 1 and 2 licences; failure to complete mandated refresher courses when required by notice is a Tier 2 offence even if the original licence was granted before 2012.

Finally, the Act's definition of "sell" includes hire, lease and offers (s 4(2)), so a company merely demonstrating alarm systems under a trial lease arrangement may require a class 2B or 2C licence. Many compliance programs overlook this.

Compliance begins with accurate classification of every proposed activity against s 4(1) and the subclasses in ss 10–12. Businesses should maintain a register mapping each worker and contract to the exact licence subclass required. Master licensees must implement a documented vetting protocol that exceeds the statutory "thorough inquiries" defence in s 22A(2): criminal history checks, referee statements, social media review, and annual re-verification are minimum standards. A written subcontracting policy that mandates client consent forms and particulars notices before any payment is demanded is essential to avoid s 38A liability.

All class 1 and 2 licensees must complete and record approved training (currently delivered only by s 27A-approved providers) and retain certificates for the life of the licence plus 7 years. Armed guards must carry both the class 1F licence and current firearms authority at all times; any change in residential circumstances that might constitute "prohibited premises" under s 23B(5) requires immediate risk assessment and, if necessary, alternative storage.

Technology solutions should include rostering software that hard-codes daily worker caps by master licence class and flags ineligible persons. Fitness-for-work policies (s 39B) must be auditable, with random testing regimes, supervisor training and clear disciplinary pathways. Record-keeping obligations under the regulations require secure storage of client contracts, training logs, incident reports and ballistics certificates.

Licensees should subscribe to the NSW Police Force security industry email alerts for changes to approved training, declared special events and new penalty notice amounts. Annual internal audits against each Tier 1–3 condition, combined with mock enforcement officer visits, reduce the risk of suspension or revocation. Where criminal history or intelligence issues arise, early legal advice and, if necessary, NCAT preparation (with awareness that closed hearings will apply) is critical.

Applicants for new or renewed licences must ensure all associated entities (close associates under s 5) are independently vetted; a single disqualified director can collapse an entire corporate application. Visitor permit applications require evidence of interstate authorisation and must be lodged well before the event, as the Commissioner may refuse on public interest grounds without giving detailed reasons.

Finally, maintain a centralised "licence register" that tracks expiry dates, condition compliance deadlines, training refreshers and firearms storage arrangements. Engage external auditors familiar with the 2022 amendments to stress-test subcontracting, ineligible-person and publication-risk controls. Proactive engagement with the Security Licensing and Enforcement Directorate before problems crystallise remains the most effective risk-management strategy.