It would be remiss to discuss the history of the Adult Retail Industry, without first discussing the history of censorship in Australia, as one has greatly affected the other. 

During most of the 20th century, Australia was one of the strictest censors in the western world. Most imported publications were closely inspected before being released, and Australia would frequently ban what was considered suitable reading in England, Europe and America. 

The standard British test for obscenity as the tendency "to deprave and corrupt" had been established in 1868 by the aptly named Lord Cockburn. In 1875, Victorian magistrates were entitled to issue search warrants for police to seize obscene publications. In addition, they could order the destruction of such material.

Books were also frequently censored. While mostly imported, the responsible control body was the Customs Department. Its officers would seize books that they found objectionable and the importer would be charged before a jury that ruled on the publication's confiscation due to indecency. 

After federation, this practice was institutionalized in the Federal Customs Act of 1901. Three pieces of legislation were used by Customs to help decide what might be deemed offensive, indecent, scandalous, disgusting or immoral, and thus ban such publications coming into Australia: 

1. Section 52(c) of the Customs Act 1901 (blasphemous, indecent or obscene works or articles);

2. Item 14A of the Second Schedule of Customs (Prohibited Imports) Regulations introduced in 1938 (literature unduly emphasising matters of sex or crime, or calculated to encourage depravity);

3. Item 14 of the Second Schedule of Customs (Prohibited Imports) Regulations introduced in 1921 (seditious publications).

A change in the Customs Department's censorship policy occurred with the beginning of the economic crisis in 1929. In a climate of increased uncertainty and fear of depression, there was a need to protect the values and the lifestyle of Australian society from everything that might challenge or question them. 

As early as in 1933 the Department had established the Book Censorship Advisory Council, a board that was created to give expert advice to the Minister, if he sought it, and in 1937 it was finally replaced by the Literature Censorship Board.

In 1957 the then Minister for Customs, Senator Denham Hently, ordered that in the future, all books under consideration of a ban must be submitted to the Censorship Board. In 1960 an Appeal Board was established. Furthermore, the Censorship Board was ordered to regularly review the list of banned books, that consequently led to the release of 178 publications on that list.

Much needed change came in 1969 with the appointment of Don Chipp as the Customs Minister in the newly elected Fraser Liberal government. Chipp believed that federal censorship had gone too far. In 1970 he oversaw the introduction of the 'R' (restricted) certificate for films, which allowed previously banned films to be re-rated and shown to adults. In 1971 he also began the process of abolishing the censorship of printed material, unbanning many novels, as well as allowing the sale of Playboy magazine.

In calling censorship 'evil' and stating that "...[it] is to be condemned", he called for a reduction in government action and called upon the people to take censorship in their own hands: 

"People should censor more and more. The individual, the bookseller, should have a responsibility, the television station, the radio station, the parent, the individual; Governments should censor less and less, move more and more out of the field and leave it to individual choice. I would have thought that is liberalism.^"  (Don Chipp)

Chipp was convinced that one man/woman, respectively one minister, could not decide what his/her fellow citizens should be allowed to read. This new way of thinking reflected in a sense the beginning transition in Australian politics away from the conservative 'White-Australia-policy' towards a concept of a multicultural and more liberal society.

However the dramatic changes to Australia’s censorship laws weren’t all of Chipp’s making. Rather, the Australian publishing industry became fed up with the country’s draconian laws, spectacularly protesting the ban on Philip Roth’s sexually explicit 1969 novel, Portnoy’s Complaint – a protest that couldn’t be ignored by Chipp. The novel was the last work of fiction taken to court in Australia.

After Labor won power in 1972, the new Prime Minister Gough Whitlam began dismantling the censorship regime completely, dwindling the list down to almost zero and removing Customs’ control over what Australians could choose to read. 

"...adults [should] be entitled to read, hear or view what they wish in private and public and (...) persons (and those in their care) [should] not [be] exposed to unsolicited material offensive to them." (Gough Whitlam)