Scrap metal dealership licence

A person carries on a business as a Scrap Metal Dealer if they:

A person who manufactures articles is not regarded as selling scrap metal if that person sells scrap metal only as a by-product of manufacturing articles or as surplus materials not required for manufacturing them.

A person carries on business as a Motor Salvage Operator if the person carries on a business which consists:

• Of recovering salvageable parts from motor vehicles for re-use or sale and subsequently selling or otherwise disposing of the rest of the vehicle for scrap
• Of buying written-off vehicles and subsequently repairing and reselling them
• Of buying or selling motor vehicles which are to be the subject (whether immediately or on a subsequent re-sale)

What is scrap metal?

• Any old, waste or discarded metal or metallic material, and
• Any product, article or assembly which is made from or contains metal and is broken, worn out or regarded by its last holder as having reached the end of its useful life

The following are not regarded as scrap metal:

• Gold
• Silver
• Any alloy of which two per cent or more by weight is attributable to gold or silver

Are there different types of licence available?

There are two types of licence, one for a site and the other for a mobile collector (for those carrying on business otherwise than at a site).

A Site Licence permits you to buy and sell scrap metal from a fixed location within our area. Each site will have a nominated Site Manager included on the licence.

A Collector's Licence permits you to travel within our area to collect scrap metal. You may not take this metal back to a site that you run within our area in order to sell it.

You may only apply for one type of licence in each Council area, but you can apply to include multiple sites in that area on the one licence.

What do I have to submit with my application form?

We cannot issue a licence unless we are satisfied that the applicant is a suitable person to carry on the business of a scrap metal dealer.

In the case of a partnership this means assessing the suitability of each of the partners in the partnership. In the case of a company, it means assessing the suitability of any directors, company secretaries or shadow directors.

Therefore, as part of the application process you will have to provide a basic disclosure certificate.

With the application form for each of the above parties as is relevant to your circumstances (as well as supplying one for each of the proposed Site Managers). This is to enable us to determine whether or not any person(s) proposed have a relevant conviction.  Refusing to provide a basic disclosure certificate would be grounds under paragraph 4(2) of Schedule 1 of the Act for us to decline to proceed with the application.

Any certificate produced should not be more than three months old. The certificate will be returned to the applicant(s) once the application has been processed.

In assessing an applicant's suitability, we can consider any information it considers relevant.  Applicants' behaviour in the operation of their business, such as the fact they have been operating for a considerable period of time without planning permission for their site, or that they are not registered with the Information Commissioner's Office (ICO) under the Data Protection Act, could be factors that are considered.

Is there a fee?

Yes. The fee allows us to recover the costs stemming from administering and seeking compliance with the regime. Current fees:

• Scrap Metal Dealers Act 2013 - Fees Site Licence £282 
• Collector's Licence - £129
• Renewal of Site Licence - £282
• Renewal of Collector's Licence - £129
• Variation (either type of Licence) - £40.00

What happens if we tell you that we are going to refuse your licence?

We will notify you that they are proposing to refuse your application. You will be given 21 days in which to make representations against this. Should you wish to make oral representations, the Licensing Committee will convene to hear these.

Should the Committee formally refuse your Licence, you may then appeal to the Magistrates' Court within 21 days if you wish.

How long does the licence last for?

The licence lasts for 3 years and then lapses. The dealer must renew the Licence.

What happens if circumstances change once I've been granted a licence?

Under the act, you are required to notify us of any changes which would materially affect the accuracy of the information you provided when making your original application. This has to be within 28 days of the changes occurring. Therefore, if any changes occur, you should apply to vary your licence. A fee is payable for this procedure.

The options for variation are as follows:

• Change of Licence Holder's details (name or address)
• Change from a Site Licence to a Collector's Licence or vice versa
• Changes to the sites licensed (adding, removing or changing details)
• Change of Site Managers

Should you cease to carry on the business of a Scrap Metal Dealer, you must also inform us of that fact within 28 days.

Do I need to display my licence?

Yes. If you have a Site Licence you must ensure that a copy is displayed at each site identified in the licence in a prominent place in an area accessible to the public.

If you have a Collector's Licence you must ensure that a copy is displayed on any vehicle that is being used in the course of your business in a manner which enables it to be easily read by a person outside the vehicle.

Can I pay cash for scrap?

No. It is an offence under the Act to pay cash for scrap metal. You can only pay via the following methods:

• By a cheque which under section 81A of the Bills of Exchange Act 1882 is not transferable, or
• By an electronic transfer of funds (authorised by credit or debit card or otherwise)

The Secretary of State may amend these provisions to permit other methods of payment in which case these Notes of Guidance will be updated accordingly.

What records am I required to keep?

The Act states that a Scrap Metal Dealer must record the following information:

• The description of the metal, including its type (or types if mixed), form, condition, weight and any marks identifying previous owners or other distinguishing features
• The date and time of its receipt
• If the metal is delivered in or on a vehicle, the registration of the vehicle
• If the metal is received from a person, the full name and address of that person
• If the dealer pays for the metal, the full name of the person who makes the payment acting for the dealer

If the dealer receives the metal from a person, the dealer must keep a copy of any document which the dealer uses to verify the name or address of that person.

If the dealer pays for the metal by cheque, the dealer must keep a copy of the cheque.

If the dealer pays for the metal by electronic transfer:

• The dealer must keep the receipt identifying the transfer, or
• If no receipt identifying the transfer was obtained, the dealer must record particulars identifying the transfer

If a dealer disposes of scrap metal under a Site Licence they must record the following information:

• The description of the metal, including its type (or types if mixed), form and weight
• The date and time of its disposal
• If the disposal is to another person, the full name and address of that person
• If the dealer receives payment for the metal (whether by way of sale or exchange), the price or other consideration received

If a dealer disposes of scrap metal under a Collector's Licence, they must record the following information:

• The date and time of the disposal
• If the disposal is to another person, the full name and address of that person

The dealer must keep the information and other records mentioned above for a period of 3 years beginning with the day on which the metal is received or (as the case may be) disposed of.

A person guilty of an offence under this section is liable for a fine.

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