Art galleries, dealers and auction houses have been urged to sign up to code of conduct aimed at ending dodgy sale practices within the multi-million dollar indigenous art sector.

The voluntary code follows a 2007 Senate inquiry that found many indigenous artists were working in squalor for minimal pay, drugs and second-hand cars.

The inquiry also found that the industry had been swamped with fakes and poor-quality work because of a lack of regulation and sweatshop-like practices.

Federal Arts Minister Peter Garrett says many of those problems are ongoing.

So this is a great opportunity for the indigenous arts community to make a stand against unprofessional dealings,” he said in a statement on Thursday.

The government has provided $600,000 to implement the code which will be administered by public company – Indigenous Art Code Limited.