Watch dealing in Ohio: the precious metals licence, records, and tax

Ohio regulates watch buying twice over, and which set of rules you are in turns on what the watch is made of. A gold watch puts you under a state licence. A steel watch, on the face of the statute, does not — though it still brings duties of its own. The line between the two runs through the word "jewels", and that statute does not say whether it reaches a watch movement.

Two regimes, divided by material

Chapter 4728, Precious Metals Dealers. A "precious metals dealer" is anyone in the business of purchasing "articles made of or containing gold, silver, platinum, or other precious metals or jewels of any description" who, in any manner — any form of advertisement or solicitation included — holds themselves out to the public as willing to buy them (ORC 4728.01(A)). Watches are not named, but a gold, platinum or silver watch is plainly "made of or containing" precious metal. A "we buy gold watches" line on your website is the kind of holding out the definition describes.

ORC 4737.01 to 4737.03, secondhand articles. These sections put duties on anyone buying secondhand articles of any kind, with no licence attached. And ORC 4737.011 removes from them "the business of purchasing articles that are made of or contain gold, silver, platinum, or other precious metals or jewels."

So the regimes are drawn to be exclusive. A precious-metal watch is a Chapter 4728 item; a plain steel watch is a 4737 item.

The open question: movement jewels

Both provisions use the same words — Chapter 4728 reaches articles containing "jewels of any description", and 4737.011 carves out articles that "contain ... jewels". A mechanical movement contains synthetic jewel bearings.

An ordinary reading suggests "jewels" means gemstones, sitting beside gold and platinum. But the drafting is broad, and nothing in either chapter says whether a steel mechanical watch is a precious-metals-dealer article. It matters a great deal: the answer decides whether a dealer buying steel sports watches from the public needs a state licence and its daily police report, or only a record book. It is the first question on the attorney list above.

The Precious Metals Dealer licence

No one may act as a precious metals dealer without a licence from the Division of Financial Institutions in the Department of Commerce (ORC 4728.02(A)). Applications, renewals and amendments go through NMLS, the Nationwide Multistate Licensing System, which the Division lists as supporting the Ohio Precious Metals Dealer Act.

To qualify you need experience in the capacity involved and a net worth of at least $10,000 that you can maintain through the licence period — or, in place of net worth, a surety bond of not less than $10,000 (ORC 4728.03(B)).

On fees, the statute fixes two figures and leaves the rest to the Superintendent:

• a nonrefundable initial investigation fee of $200;
• a licence fee and renewal fee set by the Superintendent, which may not exceed $300 (ORC 4728.03(C));
• for an applicant whose investigation runs out of state, expenses assessed at a total of no more than $1,000 (ORC 4728.03).

The fee the Superintendent has actually set, and any background-check fee, are not confirmed here — the NMLS checklist that would state them could not be loaded. Check NMLS before you budget.

A licence expires on the last day of June after it is issued, unless the Superintendent sets a different annual date. It covers one office, must be posted there, is not transferable or assignable, and does not let you trade under another name or at another location. Moving needs advance written notice, and a move into a different municipality or county means a new licence fee (ORC 4728.04(A); OAC 1301:8-6-02).

Who you buy from can take a purchase outside the chapter

ORC 4728.11 lists exemptions. Three matter for watches:

• (A) Trade and collector purchases. A purchase is exempt where both buyer and seller deal in such articles, or hold themselves out — by occupation, or by avocation as collectors, speculators, or investors — as having knowledge or skill peculiar to them. Buying from another dealer is outside the chapter, and so, potentially, is buying from an informed collector. How far a private seller must go to "hold out" is not settled by the text.
• (E) Retail jewellers with incidental buying. A jewellery retailer with an Ohio vendor's licence and a fixed retail location, whose purchases from the public are incidental to its retail trade under a percentage test in the statute, is exempt — but still keeps a record of its purchases (ORC 4728.12).
• (G) Estate purchases supervised by a probate court.

Whatever exemption you rely on, ORC 4728.13(C) is blunt: "the burden of proving an exemption from a requirement of this chapter falls on the person claiming the benefit of the exemption." Keep the evidence with the purchase record.

Records, the daily report, and the hold

The record. At the time of each purchase, in books and forms the Superintendent approves, a licensee records a full description of the article, including identifying letters or marks; the seller's name, age, residence, driver's licence number or other identification, and a short physical description; and — the line that maps onto a watch's brand — "the name of the maker" (ORC 4728.06). Forms are consecutively numbered and multi-part, with one part detachable as the seller's statement; an electronic system acceptable to the Superintendent is allowed (OAC 1301:8-6-03(A)). Records stay at the licensed location in numerical order, open to the Superintendent and local police, and are kept at least two years after the final entry on any purchase (OAC 1301:8-6-03(B)).

The daily report. Every business day, a licensee makes available to the local police chief, on police forms, a description of every article received the business day before, with its receipt number (ORC 4728.07). The statute names no electronic system; your local police department may prescribe one.

The hold. Two clocks run from the time of purchase. Under the rules, an item stays at the licensed location for 72 hours (OAC 1301:8-6-03(C)); under the statute, it stays in Ohio for 5 days (ORC 4728.09(A)). If police give written notice that they believe an article is stolen, it must be kept until 30 days after the day you were first required to report it (ORC 4728.09(B)).

The notice on the wall. A licensee posts this notice: "The licensee at this establishment has no right to retain property stolen from the true owner and the owner may recover any such property or its value from the licensee in an action at law." Business hours go on the main door, and changes to them are notified to the Division (OAC 1301:8-6-04, 1301:8-6-05).

Prohibited sellers. No purchases from minors, from intoxicated persons, or from anyone known to be a thief or a receiver of stolen property (ORC 4728.08).

Shows, fairs and hotel events

Buying away from your licensed office needs a temporary exhibition permit, valid for no more than seven days for any one auction, convention, exhibition, fair or show (ORC 4728.04(C)). The holder must notify the Superintendent, or the head of the local police department where the event is held, at least two weeks before it opens (ORC 4728.04(C)(4)). The Department of Commerce reminded dealers in March 2026 that this applies to anywhere other than the primary brick-and-mortar location, naming festivals and hotel events.

Steel watches: the secondhand-article duties

For secondhand articles outside Chapter 4728, ORC 4737.01 requires a separate record book or electronic file, written in English at the time of purchase, with a description of the article, the seller's name, description and residence, and the day and time of the purchase — plus a copy of the seller's photo ID. Entries are numbered consecutively from one, and the book is kept at least one year, open to any law-enforcement officer.

ORC 4737.03 adds that you may not buy from a minor or an apprentice, "or from any person between the hours of nine p.m. and seven a.m." — which rules out the late-evening house call.

There is no holding period in the current wording of 4737.01. ORC 4737.02 still refers to a peddler who "need not retain such articles for thirty days", but the retention it presupposes no longer appears in 4737.01. Treat it as a leftover cross-reference unless advised otherwise.

Sales and use tax

You need a vendor's licence before making taxable sales. The fee for a new application rose from $25 to $50 on April 9, 2025. A regular vendor's licence is issued by the County Auditor, and each fixed location needs its own — selling online from within Ohio counts. Shows and flea markets need a transient vendor's licence, also $50. An out-of-state seller's licence has no fee.

The state rate is 5.75%. Counties and regional transit authorities may add up to 3% in increments of 0.05%, and the combined rate cannot exceed 8.75%. Rates change quarterly, so check the Department of Taxation's current county table.

For remote sellers, economic nexus arrives when your sales to Ohio customers are over $100,000, or you make 200 or more separate sales to Ohio customers, in the current or previous year. Marketplace facilitators meeting the same test, counting the sales they facilitate, collect the tax. And if you sell only through a marketplace like eBay that collects and pays the tax for you, you do not need the licence.

The vendor's licence also does double duty: it is one of the conditions of the retail-jeweller exemption from Chapter 4728.

Business registration

The Secretary of State's filing fees are set in statute (ORC 111.16): $99 to file articles of organization for an LLC or register a foreign LLC, and $39 for a trade name or fictitious name registration.

Watch-specific points

• The maker's name goes in the book. ORC 4728.06 requires it in terms; for a watch, that is the brand. The same section asks for any "identifying letters or marks" on the article; on a watch, the case serial and reference numbers are the obvious candidates.
• Describe condition honestly. Ohio's Deceptive Trade Practices Act lists as deceptive representing goods as original or new when they are "deteriorated, altered, reconditioned, reclaimed, used, or secondhand" (ORC 4165.02(A)(8)). A watch carrying service parts or an aftermarket dial, sold without saying so, is the obvious risk.
• The collector exemption fits the watch trade. Much buying in this market is from informed collectors, and 4728.11(A) is written for that kind of seller — but the burden of proving it sits with you.

City rules

ORC 715.61 lets any municipal corporation regulate and license secondhand dealers and charge the licence fees it thinks proper. The two cities covered here use that power differently: Columbus regulates without licensing, and Cleveland licenses.