Why is the Number of Legal Brothels Decreasing?

Victoria currently has a licensing/legalisation system of sex work laws. These laws require brothel owners to be licensed and to abide by many legal restrictions.

How many licensed brothels in your council area?


The number of licensed brothels is on the decline.

Source: RED Magazine

Notes on Data

  1. The RED Magazine is published by RhED, a community health program in Melbourne.
  2. This graph excludes the estimated 500 illegal brothels in Victoria.

There are many possible reasons for this decline; one factor being the increase in the number of unlicensed (illegal) brothels.

Unlicensed (illegal) brothels usually present as massage parlours (massage shops). Although licensed (legal) brothels are on the decline, anecdotal evidence suggests that unlicensed (illegal) brothels are on the increase, with some reports suggesting there are at least 500 unlicensed (illegal) brothels in the state.

Licensed (legal) brothels face a range of sex industry specific regulations, including:

  • restrictions imposed by councils on where they can operate, specifically  restrictions on operating near schools or places of worship
  • high licensing fees
  • fees imposed on all brothel managers
  • restrictions on the number of rooms available for sexual services
  • restrictions on the number of brothels a person can own
  • ban on the service of alcohol
  • ban on children under 18 entering (exceptions apply to infants under 18 months)
  • inspections by WorkSafe checking for the provision of condoms and the installation of panic buttons
  • requirement to pay sex workers a minimum ‘cut’ of the earnings per booking
  • owners must not have disqualifying criminal convictions
  • an owner cannot be an insolvent under administration
  • requirement to provide condoms and lubricant to their sex workers and to ensure they are used during bookings

Because unlicensed (illegal) brothels operate as massage parlours and are legally classified as operating within the massage industry rather than the sex industry, they are not required to comply with any of the above regulations. This gives them a significant economic advantage over their licensed (legal) counterparts.

Section 1 of the Sex Work Act 1994 (Vic) expresses the purpose of the Act,

‘The main purpose of this Act is to seek to control sex work in Victoria…………’

Paradoxically, the current licensing system of sex work legislation creates incentives for the would-be brothel owner to avoid complying with sex work licensing laws. Instead of establishing legal brothels, owners set up massage shops which provide sexual services without a brothel license.  

Last Updated: 5 August 2019

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