Unlicensed dealers in used PCs could face huge fines under proposed changes to the Secondhand Dealers Act.
Current law, dating back to 1963, carries a $200 penalty for trading in secondhand goods without a licence but that could increase to $20,000 following a Ministry of Justice review.
Proposed amendments would also require secondhand computer dealers to retain the goods for 14 days before selling them on.
The executive officer of the New Zealand Licensed Traders Association, Rex Henry, says the computer industry is largely unaware of the licensing requirement.
"The industry needs to wake up to the effects of police initiatives to enforce the act and new legislation which will come into effect next year.
"Last May the NZLTA organised a meeting with Ministry of Justice and used-computer dealers. Only one of the group had a licence and no one bothered to reply or attend the conference."
Henry says secondhand dealers are licensed to ensure they are of good character, to help the police establish where secondhand goods are traded, and to regulate the movement of articles which may be stolen.
The licensing fee is a one-off $150 but that could change to become periodic.
Computerworld spoke to four businesses that were not licensed or aware of the legal requirement to be licensed.
Two described themselves as service companies which also buy and sell used servers and PCs. They did not regard themselves as secondhand dealers, because they buy from and sell to business organisations.
However, Henry says anyone in the business of buying and selling computers is covered under the act.
Daniel King of Auckland-based PC Used says he will get a licence if the penalty increases but he sees no benefit in doing so.
"All I can see is that the police can come over and search my premises anytime," says King, who believes he makes a reasonable effort to ensure goods aren't stolen.
He is also vexed by the proposed requirement to hold stock for two weeks, saying he doesn't have room and prices could drop in that time. King says he is likely to make submissions when the amendments go a select committee hearing later this year.