THE cost of running a sex shop in York is in line for a major shake-up - after one trader got hot under the collar and complained the system was illegal.

Lawyers representing the Adult Shop, Gillygate, sent a hard-hitting letter to the council and threatened court action over its "irrational and unfair" licensing system.

Under the current set up, the council charges the city-licensed sex shops using a two-tier system.

The fee for a "category two" shop selling only explicit R18-rated books, videos and DVDs is £2,197.

However, if a sex shop wants no restrictions on what it sells - and wants to pack its shelves with sex toys - then it has to fork out £9,330 a year to City of York Council for a "category one" permit.

But that system looks set to be overhauled and a single-tier price structure introduced after the solicitor's letter landed at the Guildhall.

Wilson Barca, of Wilson Barca Solicitors, London, said there was "no logical justification" for the difference between the two licences.

"The sales of sex toys and lingerie by our client do not amount to more than ten per cent of their total sales," his letter stated.

"Whilst they want to be able to offer their clients a full range of product, the fee levied for this additional product line is disproportionate.

"Their competitors are thereby given an unfair competitive advantage for no benefit to the public or the city of York."

Raising the prospect of a possible judicial review into pricing, he continued: "The two-tier licence system is unlawful, irrational and unfair." He said to ensure a level playing field either their competitors' fee should be increased or the Adult Shop fee lowered.

Shop boss Tony Bartlett-Moore told the Evening Press: "It's an unfair system."

However, a report to the council's environment advisory panel has recommended that it should scrap the two-tier system and set a new fee.

Richard Haswell, head of licensing at the council, said the two-tier system was set up because shops selling books and videos had a lower profile and attracted fewer customers. After legal advice, officers were told different fees should only be considered if there was a disparity between work involved in issuing and maintaining the two categories.

"In respect of the three licences issued, York there is no significant difference in this regard," the report said.

Fees in other parts of country range from £1,500 in Peterborough to £14,000 in Bristol. No other authority has a two-tier scheme.

There are three licensed sex shops in York.

The Private Shop, Bootham, and the Adult Shop are "category 1" shops, while Blue Star Publications, Victoria Street, pays the lower fee.

Updated: 09:26 Wednesday, July 13, 2005