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NSW is to be the first state to introduce covert search warrants.
They will be issued through the Supreme Court and limited to investigations of suspected serious offences punishable by at least seven years jail.
These offences include the manufacture of drugs, computer crimes, the sale of firearms, homicide and kidnapping.
Premier Nathan Rees said the warrants would be borrowing from commonwealth anti-terrorism legislation.
"If you are a serious criminal in NSW you should not sleep easy,'' Mr Rees said.
"These laws will enable our police force to inspect your home without you knowing."
The new powers will allow for the owners of the covertly searched property to be kept in the dark for up to six months.