Councils in New South Wales have been accused of stifling legislation allowing for the decriminalisation of the sex industry.

A group has been formed to fight for the rights of sex workers in the community and began its campaign with a protest last night outside a meeting of the North Sydney Council.

The Sex Workers Rights Action Coalition says North Sydney is among a number of councils making life difficult for those in the industry.

The group's spokeswoman Joanne says the council has made it so difficult for new brothels and home businesses to get development approval that a de facto prohibition is effectively in place.

"Local councillors have taken a vigilante, anti-sex approach," she said.

"Brothels and private workers are being subject to closer scrutiny than any other business in the community."

But North Sydney Mayor Genia McCaffrey says she is only concerned with stamping out illegal brothels and preventing the creation of red light districts.

"Every application is treated on its merits," she said.

"I don't think it's any more difficult for a brothel to get an approval if it's in an area where brothels are allowed in the controls.

"If the council was intent on closing down brothels in North Sydney, certainly our track record is the exact opposite."

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