scrap metal dealers act

The Scrap Metal Dealers Act 2013 made three things mandatory: no cash for scrap, licensed dealers only, and proper records of every sale. It affects businesses and everyday sellers differently, so this guide is split into two parts. Over a decade on, it has made stolen metal much harder to sell on without a trace, without eliminating metal theft entirely.

Has it actually worked?

When the Act became law in October 2013, its aims were straightforward: make it harder to fence stolen metal, and keep better records of what is being scrapped and by whom. Over a decade on, there is a real track record to look at. Scrap metal theft, particularly of catalytic converters and cabling, has remained a persistent crime problem despite the Act, though licensing and the cash ban have genuinely made it much harder for stolen material to be quietly sold on. It is fair to say the Act raised the bar for legitimate traceability without eliminating the problem it was aimed at.

How the Act affects scrap car businesses

Made law in October 2013, the Scrap Metal Dealers Act 2013 means scrap metal businesses can no longer pay cash for scrap, must be licensed, and have to keep proper records for traceability. Curious why the law came in at all? See why you cannot scrap a car for cash.

Cash payments are banned. The law prohibits cash as payment for scrap metal of any kind, including scrap cars. Cheques or electronic payments have to be used instead, since both are traceable. It is still legal to pay cash for a damaged car being bought to repair and put back on the road. Where it gets genuinely grey is the line between the two: if a buyer is not actually selling on a reasonable proportion of repaired cars, and is instead using "repairable" as a loophole to keep paying cash for what are really scrap vehicles, that is exactly the pattern the law is designed to catch.

Local authority licences. A business with a fixed site, a scrap yard, needs one licence per site, even if it collects from areas covered by different councils. A mobile operator with no fixed site needs a separate licence for each area they work in, and licences must be displayed prominently on every collection vehicle and at every site. Trading without a licence can result in the police or local authority forcing a business to stop trading entirely.

Scotland has its own rules. The 2013 Act itself covers England and Wales, but Scotland is not a gap: since 1 September 2016, Scottish law has banned cash for scrap too, under the Air Weapons and Licensing (Scotland) Act 2015, which limits payment to a non-transferable cheque or a transfer into an account in the seller's name. A Scottish mobile operator collecting in England or Wales still needs a licence for each area they collect from there.

Registration with Disclosure Scotland. Despite the name, this applies UK-wide. Disclosure Scotland provides the criminal records checks used to confirm that a scrap business's directors and managers are suitable to run one.

Records must be kept for three years. Purchase records need a description of the vehicle, its weight, any distinguishing marks and its registration number, alongside the seller's identification, name, address and full payment details. Sale records need slightly less: weight, description, and the buyer's name, address and transaction details. If you sell to a licensed ATF, there is a genuine traceable record of the sale, useful if the DVLA, an insurer or the police ever have questions about a vehicle you have scrapped.

Police powers. Police and local authority officials can enter a licensed site with sufficient notice, a deliberate measure aimed at rogue traders operating outside the rules.

How the Act affects you when selling a scrap car

You will need photo ID and a recent utility bill. Whoever hands the car and its documents over needs photo ID and a utility bill less than three months old. A British driving licence or passport is the most commonly accepted ID, and the utility bill can be from any energy supplier (phone bills are not accepted). It has to be the seller's ID, not necessarily the registered keeper's, unless they are the same person.

Cash is not an option. Payment has to be by cheque or electronic transfer, which may mean a short wait for the payment to clear rather than money in hand. Worth budgeting for: some cashless payment systems charge a transaction fee, which can mean a few pounds less than the headline price. If you have the choice, a bank transfer or cheque typically avoids this entirely. What else affects what your car is worth? See scrap car prices.

It is easier to spot a reputable dealer. Licensed ATFs have to display their licence on collection vehicles and at their site, and are legally required to ask for your photo ID and utility bill. If a buyer offers you cash, or does not ask for ID, that is a clear sign to take your car elsewhere. The full list of scam warning signs goes further, and the five steps to scrapping a car shows what the compliant version of the process looks like end to end.

Common questions about the Act

England and Wales: Scrap Metal Dealers Act 2013, legislation.gov.uk. Scotland: Air Weapons and Licensing (Scotland) Act 2015, section 68, in force 1 September 2016, legislation.gov.uk. Checked 28 August 2026.