§ 54-70. Incidental purchase of metals and gems.

(a)

The provisions of this article shall not apply to any precious metal or gem dealer for whom the purchase of secondhand precious metals and gems is merely incidental to the primary business of sale of newly manufactured merchandise. The purchase shall be deemed incidental and the dealer shall be exempt if he derives 90 percent or more of his gross income from the sale of newly manufactured merchandise and has previously filed a statement to this effect with the director of finance. Such statements shall be filed quarterly on or before March 31, June 30, September 30 and December 31 of each year.

(b)

All dealers who certify to the director of finance, pursuant to this section or any prior ordinance, that 90 percent of their gross income is derived from the sale of newly manufactured items, shall keep complete and accurate records, according to generally accepted accounting practices, pertaining to their business. These records shall indicate and differentiate between all purchases and sales of newly manufactured merchandise and purchases and sales of secondhand merchandise. All records required to be kept by this section shall be open for inspection and audit during normal business hours by the director of finance or his duly authorized agent or law enforcement officials. All records required to be kept by this section shall be for official use only and shall be preserved by the dealer for a period of one year from the date such record was made.

(c)

Any gold or silver dealer who has certified to the director of finance that 90 percent of his gross income is derived from the sale of newly manufactured merchandise and thereafter either fails to maintain records as required by subsection (b) of this section, or whose records reflect income from the sale of newly manufactured merchandise which is less than 90 percent of the dealer's total gross income, shall immediately be required to obtain a license as set out in this article and shall be subject to the regulations set out in this article.

(d)

Any precious metal or gem dealer opening a new business or establishing a new location for an existing business shall become eligible to be exempted from the provisions of this article three months after such business has been in operation, providing that records, as required by subsection (b) of this section, have been kept during that period and are available for inspection and a statement of exemption has been filed with the director of finance.

(Code of Gen. Ords. 1967, § 27.46; Ord. No. 53641, 2-5-82)