Do skip hire companies require a license under the new Scrap Metal Dealers Act 2013? According to guidelines for Local Authorities published by the Local Government Association, it appears in most instances the answer is “No”.
In 2011, the Home Office estimated that metal theft in the UK costs the economy between £250m (Deloitte, 2011) and £750m per year (the Association of Chief Police Officers, 2010). This led to legislative reforms introduced in December 2012 that prohibited cash payments for scrap metal, amended police powers of entry into unregistered scrap metal sites, and increased the financial penalties for offences in the Scrap Metal Dealers Act 1964.
Now, the latest reform – the Scrap Metal Dealers Act 2013 –creates a new licensing framework for scrap dealers and also clarifies their reporting and disclosure obligations. In particular, it obliges anyone falling within the definition of a scrap dealer (which covers both site based dealers and mobile collectors) to have a license from their local authority for the area(s) they wish to work in. Scrap dealers must also submit a Disclosure and Barring Service documentation (formally a Criminal Records Bureau check) and keep detailed written records of all of their dealings in metal. Operating without a license after 1 December 2013 is a criminal offence with maximum fine of £5,000.
Over and above the cost of complying with these new licensing requirements, particularly for scrap collectors covering multiple local authorities, the Act represents a considerable administrative burden for councils, the police and operators alike, and it will be interesting to see how each party copes.
Happily though, for the majority of skip hire companies, it looks to be just that – interesting rather than impacting – according to guidance for local authorities published by the Local Government Association entitled LGA Guide to the Scrap Metal Dealers Act 2013: Applications.
The guidance among other things specifically considers whether the definition of ‘scrap metal dealer’ includes firms that hire out skips. It concludes that “where the sale of scrap metal is incidental to the main type of work or business undertaken then no licence will be required”. In other words, if the purchase and /or sale of scrap metal is not a key part of a skip company’s business, the LGA advises that a local authority should not require them to be licensed under the Act.
So, it seems that unless you spend a significant amount of your time as a skip company paying to collect waste rather than charging to collect it – you should be fine.
NOTE: Further guidance can be found at Licensing Resource. Licensing Resource is a free resource website primarily aimed at UK Local Authority officers. Licensing Resource is an open resource and none of the content is restricted.