Laws against repairable write-offs in NSW came into force on 31 January.
NSW Roads Minister David Borger said the the laws aimed to improve vehicle safety and consumer protection and reduce the risk of vehicle theft and re-birthing.
"This means that if a car is written off in NSW after 31 January, it will be classified as a statutory write-off and will be prevented from being re-registered," Borger said.
"These written-off vehicles will still be able to be sold but only for parts or scrap metal.
"Six thousand motor vehicles are stolen each year and not recovered. Many of these end up being re-birthed by criminal gangs."
Rebirthing occurs when a written-off vehicle is rebuilt using parts from a stolen car and it is then re-registered and sold.
NSW is leading the fight against organised criminals and unscrupulous repairers who use parts from stolen or wrecked cars to rebuild them and sell them to unwary consumers.
"Vehicle re-birthing is a serious road safety issue," Borger said. "Before this new law, it was estimated about 60 per cent of repairable write-offs presented for re-registration contained stolen or suspect parts and some had defective repairs."
"This meant in the event of a crash, suspect vehicles would not provide the expected level of safety and protection to occupants and increased the chance or severity of a crash."
Borger said NSW light vehicles including cars, trailers, caravans and motorcycles written-off from 31 January 2011 cannot be registered anywhere in Australia and can only be used for parts or scrap metal.
Eligibility to repair a vehicle will be considered on a case-by-case basis, where ownership has not changed. If the vehicle is in an exempt category and was assessed as not failing the vehicle damage assessment criteria, the registered operator can apply to the RTA for authorisation to repair.
In March 2009 a comprehensive vehicle history check facility was launched on the RTA website, to help people buying a second-hand vehicle to check whether a vehicle has been written-off anywhere in NSW.
In its push for the new laws, the NSW Motor Traders Association acquired a poorly repaired Toyota Corolla, which was subsequently crash-tested.
This vehicle had been used to highlight the issues of unsafe repair when written-off vehicles are sold off at auction and then put back on the road by back yard repairers and sold to unsuspecting motorists.
According to Borger, the laws are among the most important consumer protection and vehicle safety reforms made in Australia in recent years.
"These reforms tackle the risk to the community of organised vehicle theft and re-birthing, where stolen parts are used to illegally rebuild written-off vehicles," he said.
NSW MTA CEO James McCall praised the government for taking action to tackle the issue of written-off vehicles.