by Ursula Kampmann
July 17, 2014 – The US state of Minnesota has introduced new regulations regarding the bullion trading on July 1, 2014. Unfortunately in Minnesota they define ‘bullion’ in a way that every, really every single coin dealer will be affected by that new law. Bullion shall be, according to that law, everything that contains more than one percent of its weight in gold, silver, platinum or any other precious metal. And most coins do that. Additionally there is no time limit which means, in consequence, that not only modern issues but even historical and ancient coins are concerned.
Every dealer comprising all foreign dealers – as the Minnesota Department of Commerce confirmed upon CoinsWeekly’s request on July 9, 2014 – is required to register with the Minnesota Department of Commerce if they sell coins to Minnesota worth $5,000 or more. It does not matter if sell the coins via post, in an auction or personally at a coin show – whether abroad or in another US state.
The registration is by no means simply a matter of form but full of requirements and rules. Some rules are quite extraordinary like the request that the owner of the company and every employee who might sell a coin to someone from Minnesota must provide all criminal convictions by any court within the last ten years and a document setting out their qualifications; both documents must be provided to the customers. All consumers must be informed about the date the coin will be delivered or will be paid for (in case that a coin is purchased). In addition some of the many details dealers must provide for every single coin offered for sale (and imagine doing that for a complete auction catalogue!) are the coin’s performance, efficacy, nature, investment value, central characteristics, liquidity, earnings potential, or profitability. To inform the consumers about how you will store a coin received from a consumer seems quite a child’s play at that point. You may imagine that the invoice must also comply with that regulation including a description of the object, the price and its metal content. If the metal content is not known the invoice must mention that the price is not based on the coin’s precious metal content. At least most dealers won’t have difficulties in keeping a copy of the invoice.
The Department’s website gives no hint at the penalty for those who sell coins to customers from Minnesota without being officially registered. But, as we have learnt from American court decisions in other cases of dissatisfied customers, punishment may easily add up to some thousands or tens of thousands of dollars.
Actually this new law has created a kind of extralegal space since virtually no one will be able to comply with it according to the letter of the law. And at this point the old rule is effective: ‘Ubi non unde petitur, ibi non iudex’ (no plaintiff, no judge). And you better not refuse to give a regular customer from Minnesota the discount they may claim one day …
You can find the guidance of the Government of Minnesota here.
Here you can read all the requirements in detail you must comply with and everything else you have to keep in mind when dealing with coins.
Pat Heller wrote indignant an article in the online edition of Numismatic News.