Evidence Session (Sections 3072-3099)|
23 MARCH 2006
3072. CHAIRMAN: Good morning Mr Clarkson.
3073. MR CLARKSON: Good morning. It
is time to round up the usual suspects! May I say today that the
appearances are as on your sheet. There is another usual suspect
who is making a cameo performance from retirement, Mr Michael
Pritchard who will be instructing me here today. What we lay before
you today is registration of second hand dealers. The act seeks
to regulate the second hand trade and reduce the levels of acquisitive
crime such as burglary by making it part of a scheme to dispose
of stolen goods and turn them into cash. Dealers in second hand
goods will be required to register with councils, keep records
of their transactions and that will provide the metropolitan police
and local authority trading standards officers with comprehensive
intelligence which will allow stolen property to be traced through
the supply chain.
3074. I can give comfort to the Committee that
this is not radical, it is not new. Parliament has passed similar
legislation on a number of occasions before. I hope that you have
had this document through the system, it is an important document
and is really seminal to a number of the points that we are going
to lay before you. It is perhaps helpful for me to tell you the
genesis of it, if you go right to the end you will see something
called The Kent County Council Act 2001 in appendix three in the
back. I am not going to take you through the Kent County Council
Act which is very similar in many respects to what they are laying
before you in the Bill but what is important is on page 14 of
that appendix, section 20, under the heading reports, "Not
more than 3 years after the appointed day the councils shall submit
to the Secretary of State a report on the working provisions of
the Act; and the Secretary of State shall lay any such report
before Parliament." That is what this document is, a product
of the examination of the Kent Act they were required three years
afterwards to submit this report. It is quite a useful document
as an aid to a number of matters because you see a number of the
3075. If you go to page 15 of it, the main
document, you can see that what we lay before you is not original.
I cannot say the form of the legislation is the same but there
has been a number of Acts, the South Yorkshire Act, Merseyside,
Manchester, Humberside, Lancashire, Hereford, Worcester, North
Yorkshire, Newcastle, Nottingham and Kent. I am going to take
some time with the executive summary and that is the nub of my
opening. Can you go to page one of it. If the Committee will forgive
me I am going to read it out. It is a useful exposition. "The
basic premise of the market reduction approach is that by disrupting
the market for stolen goods, the motivation to steal can be reduced
and hence levels of acquisitive crime will fall. Kent Police have
been applying this approach since 1994, but in 1999 decided, in
collaboration with Kent and Medway Councils, that legislation
was needed to help control the market for stolen goods. The report
highlights how the implementation of this legislation in Kent
has contributed to overall falls in acquisitive crime in the county
and asserts that national legislation would, if enacted, have
benefits. Kent Police and Trading Standards requested local legislation
to manage the open market place (second hand shops, car boot sales
etc.) which was enacted in 2001. The Kent Acts are just one tactic
amongst many to control the disposal of stolen goods. They have,
however, given Kent Police a range of inspection and enforcement
powers necessary to manage the open market place. The legislation
requires dealers to register with the Councils and to keep records
of specified transactions. The Kent Acts also contain provisions
to regulate occasional sales such as markets, boot fairs, trade
fairs, and one-day sales." Passing the Bill before you does
not dissent to that. "Briefly, the main provisions are as
follows: They apply to persons dealing in second hand goods in
the course of a business. Both the dealer, and any business premises
situated in Kent must be registered. A single registration covers
both Councils." Medway also are involved as you will appreciate.
"With some exceptions, registered dealers have to keep specified
records relating to the items they acquire and sell. Dealers are
required to display a copy of their registration certificate when
trading from any premises in Kent, including a vehicle or stall.
The main enforcement benefit provided by this part of the legislation
is that it gives both the Police and authorised officers from
the Council the power to enter registered premises and to inspect
and take copies of records."
3076. I am not going to read out in relation
to occasional sales because that is not a provision that is proffered
in this Bill. The added value of the legislation, "Without
legislation, it is difficult to make a scheme such as this work.
A voluntary scheme previously tried in Medway was met with only
limited success. Voluntary schemes have no legislative teeth and
will not control those determined to avoid the voluntary requirements.
These are likely to be the very people that police and other enforcement
agencies most need to control. Of particular importance is the
fact that no other legislation gives any of the powers that these
Acts provide. The Kent Acts require an infrastructure and commitment
within both the local Police and Trading Standards department
that supports and resources a market reduction approach. Without
this infrastructure, the Kent Acts would not function efficiently.
The Kent Police and Trading Standards have fully utilised the
local legislation. The success of the Market Reduction Approach
has been measured by both partner agencies. The outcomes are outlined
in this report. Overall, this report asserts that the Kent and
Medway Acts have been instrumental in supporting the management
of both overt (such as second hand shops and antique dealers)
and covert (criminal handlers) markets that can be used for the
resale of stolen goods. This, in turn, has contributed to a 6.9%
reduction in burglaries and an 18.9% reduction in vehicle crime
in Kent since the Acts came into force. No other police force
within Kent's family of most similar forces have experienced these
levels of crime reduction. Consultation across a wide selection
of the public, has shown that the Kent Acts are generally supported.
Research into costs to the retailers and persons subject of the
legislation has shown these costs to be minimal." I should
add there that the cost of registration in the Kent Act was zero,
there was no payment required. There is a proposal for a fee under
research has also been carried
out into other similar local legislation that has been enacted
throughout the country. The majority are using the legislation
actively. In addition, a further eleven areas in the country have
expressed interest in obtaining similar legislation. This gives
strong support for consideration of national legislation. Disparate
local acts could be replaced by a single act, thereby providing
standard recording, registration and inspection requirements throughout
the country. It would also encourage effective interagency liaison
as has occurred in Kent."
3078. "Kent and Medway Trading Standards,
together with Kent Police, wish to continue in their use of the
local Acts. National legislation, if supported by the commensurate
resources as outlined, would benefit all of the country, as the
Kent Acts have benefited our county and communities." That
last sentiment is endorsed by the Promoters here. I cannot tell
you that there is national legislation coming forward. May I take
you to the scheme of the Bill, and it is page 63, clause 87. I
am not going to take it in too much detail.
3079. Interpretation 88, " 'dealer in
second hand goods' means a person who carries on a trade or business,
the whole or part of which consists of transactions in second
" Under 89(1) they shall be registered,
"A person shall not in a borough carry on a trade or business
the whole or part of which consists of transactions in second
hand goods when he is not registered by the council under this
section or exempted from registration by section 92
he is not so exempted, he shall not carry on such a business in
premises in a borough which is occupied by him when the premises
are not so registered. On application for registration under this
section shall register the applicant and, if the applicant specifies
premises, those premises and issue to the applicant a certificate
of registration on which there shall appear a registration number."
Then there are a number of items that have to be set out in writing.
89(5)is important, "Registration under this section shall
remain in force for three years from the date of registration."
89 (6) "A council may charge a reasonable fee for a registration
under this section, calculated by reference to the cost of dealing
with applications for such registration." The reason for
that fee is that it is universal now but if there is any form
of licensing or registration, a fee is charged to cover overheads.
3080. CHAIRMAN: Mr Clarkson, I am sorry
to interrupt you but I believe you said in relation to the Kent
Acts that there is no fee?
3081. MR CLARKSON: No, there is no fee.
3082. CHAIRMAN: Will there be evidence
coming forward to us as to why in this case it is felt that a
fee is necessary or have you just given us that evidence?
3083. MR CLARKSON: I have given you
some of it but I am going to call two witnesses.
3084. CHAIRMAN: Thank you.
3085. LORD FAULKNER OF WORCESTER: Will
you also tell us the range of fees that are charged?
3086. MR CLARKSON: Yes. I think the
figure is of the order of £33 which works out at £11
a year. Then, the information to be kept, which is really plagiarised
from the Kent Act, section six, that is, and I am going to summarise
it, details under one in respect of every transaction under which
he acquires an interest in second hand articles, he must keep
a record of the date of the transaction, a description sufficient
where reasonably possible to identify the articles quantity, the
name and address of the person from the article is required and
if the person is registered under this act as it would be, the
registration number, et cetera.
3087. Then, I am going to go to two, that subsection
one shall not apply in respect of any transaction in respect of
which a person acquires an interest in or takes charge of any
second hand article which will in his reasonable opinion at the
time of transaction be disposed by him for no value or at a price
less than the relevant amount. If you go forward you will see
what the relevant amount is in clause 4 but before I get there
subsection two above, "shall not apply in relation to any
electrically or battery powered goods or to any medium on or by
which sound images or other data are or maybe stored or recorded."
The relevant amount for acquisition is £10 in the case of
vehicle parts, jewellery, watches, photographic equipment, sports
equipment, equestrian equipment, boating equipment, musical instruments,
tools, bicycles, firearms and gardening equipment. It is £50
in respect of all other articles in which the subsection applies.
95 is the end of the process, there has to be a record kept of
the selling. The relevant amount for selling is something over
six items at £100 pounds for the materials set out there
in 6(a) and £500 in the case of all other articles.
3088. Seven which is of interest, I suspect,
to those sitting alongside me. In the case of transactions under
which a dealer of second hand goods acquires an interest in, or
takes charge of, or sells articles at an auction, the entry of
the name and address of the auctioneer in the record referred
to in subsection one shall suffice for the purposes of subsection
one (c) one or as the case may be, subsection 5(a) shall apply.
An addition apart which is on page 15 of the clauses apart, "Subsection
(1) and (5) above shall apply to transactions which take place
outside the borough only if - (a) the person acquiring an interest
in, taking charge of or selling the articles in question occupies
premises registered under subsection (5) above; or (b) the usual
place of residence of the person acquiring an interest in, taking
charge of or selling the articles in question is within the borough
(except if that person carries on his business as a dealer in
second hand goods primarily in premises occupied by him and situated
outside the borough)".
3089. At nine, they have to keep records for
two years, ten, they have to produce records if asked for them.
There are a number of offences set out on summary conviction that
I do not propose to take the Committee through unless you would
like me to in any detail. 92 is important because it says what
it does not apply to and I can fast read that for you with headline
points, charity, scrap metal dealer because there are covered,
waste paper, cardboard, textiles, plastics in bulk or second hand
clothes. Hire purchase agreements because they are covered elsewhere,
pawn broker, (f) "a person engaged in a business of which
the primary purpose is the supply of new unused goods and to which
the supply of second hand or used goods is merely incidental."
Second hand books, dealer in animals in respect of his business,
that is an interesting concept, a second hand animal, a difficult
one. A person who is by resolution the council excluded from the
operation of this part of the Act.
3090. LORD FAULKNER OF WORCESTER: What
does that mean?
3091. MR CLARKSON: They can exclude
it, they can say specific dealers of specific goods need not register.
Then, there are provisions 93 with the addition apart which I
am not going to burden you with at 16 that set out the process
pending registration. A renewal of legislation exercised at 94
so the registration continues until it has got a new certificate.
95 is important because this is the bite, so to speak, as far
as the police and the trading standards officers are concerned.
Subject to subsection two below, "an authorised officer,
on production, if required, of his credentials, or a constable,
may at all reasonable hours exercise the following powers - (a)
he may, for the purpose of ascertaining whether any offence under
this Part of this Act has been committed, inspect any goods and
records and enter any premises; (b) if he has reasonable cause
to suspect that an offence under this Part of this Act has been
committed, he may, for the purpose of ascertaining whether it
has been committed, require any person carrying on a trade or
business or employed in connection with a trade or business to
produce any records relating to the trade or business and may
take copies of, or any entry in, any such record; (c) if he has
reasonable cause to believe that an offence under this Part of
this Act has been committed, he may seize and detain any goods
for the purpose of ascertaining whether the offence has been committed;
(d) he may seize and detain any goods or records which he has
reason to believe may be required as evidence in proceedings for
an offence under this Part of this Act; (e) he may, for the purposes
of exercising his powers under this subsection to seize goods,
but only if and to the extent that it is reasonably necessary
in order to secure that the provisions of this Part of this Act
are duly observed, require any person having authority to do so
to break open any container and, if that person does not comply
with the requirement, he may do so himself." He "
may not enter a dwelling in the exercise of his powers under this
section without the consent of the occupier unless he has obtained
a warrant under subsection (4) below. (3) An authorised officer
or constable seizing any goods or documents in the exercise of
his powers under this section shall inform the person from whom
they are seized."
3092. Then, at four, there is the mechanism
for a warrant which is a justice of the peace mechanism.
3093. At five, anybody who does enter has to
leave the premises in good order is the short summary.
3094. At six, "If any person who is not
a duly authorised officer of the council or a constable purports
to act as such under this section he shall be guilty of an offence
an liable on summary conviction to a fine not exceeding level
3095. I should have perhaps told you on the
way through, an authorised officer is in clause 2 of the Bill,
in relation to the borough council, means any employee of the
council, any other person by whom in pursuance of arrangements
made with the council any function under this act formally is
charged or any employee of any person. It was authorised in writing
by the council to act in relation to the relevant provision of
this act. By another name that is an authorised trading standards
3096. Seven, "Nothing in this section
shall be taken - (a) to compel the production by any person of
items subject to legal privilege, excluded material or special
procedure material; or (b) to authorise the taking of any such
items or material in the possession of that person."
3097. Those are defined at eight under the
Police of Criminal Evidence Act, the subtleties of that, I will
not trouble the Committee with. There is a procedure for the serving
of notices under 96. At 97, "Where the council pass any resolution
under this Part of this Act (other than a resolution bringing
into effect section 89 ... they shall, no later than 28 days before
the resolution comes into effect, either - (a) serve on every
person registered under the said section 89 and affected by the
resolution; or (b) cause to be published in a local newspaper
circulating in the borough, notice of the passing of any such
3098. The last point I should make dealing
with the Bill this is a clause that is adoptive. That is to say,
the individual councils pick it up as and when they consider it
appropriate and you will hear evidence as to what the council's
views are from Mr Wallace who is a group manager at the Trading
Standards of the London Borough of Enfield, after which you will
hear from acting Superintendent Murphy of the Kent Police who
has got clear experience of the Kent Act. He gave evidence to
Parliament on it and promoted it and is now a senior police officer
who has the responsibility for it in Kent so, you have got both
sides of it. Also, through the witnesses, you will hear from the
Metropolitan Police, there is a letter from the Metropolitan Police
explaining they are in support of it, they see it as a valuable
addition for police officers in the detection of acquisitive crime.
That is all I say in opening unless there is anything I can help
you with. I call Mr Wallace to give evidence.
3099. CHAIRMAN: Yes, that is fine. Thank
MR CHARLES WALLACE, Sworn
Examined by, MR CLARKSON