CODE OF PRACTICE FOR DEALING IN
SECONDHAND AUTO PARTS

Sub-program A: Reducing the Cost of Theft

Approach A1: Improving the Standard of Vehicle and Component Identification.

 

Background

As written-off vehicle registers restrict the trade in whole vehicle rebirthing the illicit parts market is likely to become even more attractive to criminals. Already, more than one in twenty recycling businesses encounter suspects parts, vehicles or sellers every week and the NMVTRC estimates that more than 12,000 vehicles are stolen each year for dismantling and on-sale.

Minimising the likelihood of stolen parts being unwittingly traded by legitimate recyclers is central to combating this illicit trade.

Over time, some states and territories have responded to the problem by subjecting recyclers to the record keeping requirements of motor car trader or secondhand dealer legislation. Some commentators have suggested that there is a need for nationally consistent laws in these areas but there is also concern about the lack of rigour with which existing laws are enforced.

The NMVTRC does not consider a nationally consistent regulatory regime to be achievable in the medium term. A voluntary code of practice however may deliver accredited recyclers with tangible benefits for participating in the short term and provide a basis for any longer term regulatory solution.

Work program

Study of the Stolen Parts Trade - 2001

In 2001, the NMVTRC commissioned the Australian Institute of Criminology to undertake a study of the stolen parts trade in Australia . The study observed that the business practices of various stakeholders, including parts recyclers, were facilitating the illicit trade in stolen parts. The study was unable however to fully quantify the economic dimensions of the problem.

 

Code of Practice: Feasibility Study – 2002

AD Edwards Consulting Pty Ltd (ADEC) was contracted by the NMVTRC to report on the feasibility of achieving the desired theft reduction outcomes via an industry-based voluntary code of practice for parts recyclers. ADEC found that by tying a proportion of the market for used parts to an accreditation requirement, significant economic benefits could be generated for participating businesses, the entry of stolen parts into legitimate industry would be restricted and “backyarders” could be marginalised.

Click here for a copy of Feasibility Study.

 

 National Workshop – 2002

Responses to the Feasibility Study confirmed a strong level of support for the proposed code. Key issues raised by stakeholders included the desirability that a COP be compatible with potential future regulatory backing and the need to minimise the burden of compliance on small businesses.

A national workshop of key stakeholders, facilitated by the NMVTRC, resolved to develop an “exposure” draft of the code for further consultation and reached agreement on a set of key principles to guide the its development.

Click here for the Workshop Communiqué.

 

 Development of a Draft Code of Practice - 2003

The development of the draft code was undertaken by ADEC and was supported by extensive national consultation including direct discussions with more than 200 parts recycler businesses and correspondence with more than 1,900 recyclers and other stakeholders. Consultation also included the input of a NMVTRC convened expert reference group comprising representatives of the Auto Parts Recyclers Association of Australia, motor trades associations, an independent recycler, and representatives of police services, offices of fair-trading, insurance companies and transport agencies.

A consultation package addressing the most commonly asked questions and issues related to the code and the proposed accreditation agreement have been circulated to recyclers and other stakeholders for comment. In addition, the NMVTRC has addressed a number of information forums, organised by the industry, to explain the code.

Click here for the Accreditation Agreement or the Frequently Asked Questions from the consultation package.

Or click here for the report titled Code of Practice for Dealing in Second-hand Auto Parts—Phase 2 Report.

 

Establishing a national Code of Practice

National Parts Code, an independent not-for-profit incorporated association to administer the Code, was established in December 2004.  Year one establishment costs are being underwritten by the NMVTRC to eliminate the need for member subscriptions from participating businesses for the first 12 months.

Click here for more details about National Parts Code.

Next Steps

Continuation of the National Parts Code is contingent on the number of participating businesses. An assessment of the Code's future will be made by mid 2006.