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Scrap dealers face legal shake-up

The scrap metal trade faces a radical regulatory shake-up which could see merchants forced to pay a licence fee policed by local authorities.

The revelations came as Richard Ottaway (Con) MP outlined his plans for his private member’s bill (PMB) to boost the industry’s regulation and pledged to “tackle the market that is driving crime”.

The bill will be introduced to Parliament on Wednesday (20 June) and is backed by both the Government and the Labour opposition.

Ottaway told a Local Government Association conference that his bill would introduce:

  • Tougher rules for dealers who wanted licences
  • Greater powers for police and local authorities to suspend and revoke licences
  • A single national register of licensed dealers 

The bill will also force scrap metal dealers to complete more detailed records of transactions.

He said: “I hope my bill will provide the strong legislative framework so desperately needed to empower our local councils and police forces in their fight against offenders who willfully plunder this country of metal.”

“I am absolutely committed to take this important step to tackling the market that is driving this crime.” 

Cllr Mehboob Khan, chair of the LGA’s safer and stronger communities board, said: “Councils want to see an annually-renewable licence for scrap metal dealers, which could be reviewed at the instigation of the police or licensing authority and, if necessary, revoked. This would make it much less likely that stolen metal will find its ways into scrapyards.”

How current system works

Under the current system scrap merchants are regulated by the Scrap Metal Dealers Act (1964).

Merchants are required to register with the local authority, although councils have no power to vet or investigate applications or applicants.

Dealers must keep and maintain records of transactions. The penalty for failure to comply is a limited fine.

Merchants are also regulated through Environment Agency waste permits and inspections. There are currently, for certain classifications of dealer, a number of exemptions from EA regulation.

From this Autumn, following a recent change in the law, merchants will be banned from trading in cash, and penalties for breeches of the Scrap Metal Dealers Act will be unlimited.

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