Yes I have picked up loot in Xalas. Why would this be a problem? I hunt there regularly and have never had a problem with their boxes or other misc. drops.

Rys

If you're lugging around the equipment they carry (I think this gives you some "social outrage warning" messaging, or maybe that's in the appraisal?), it makes people mad at you. I don't know if it has to be visibly worn/held, or if it counts even if its inside your backpack.

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Uzmam! The Chairman will NOT be pleased to know you're trying to build outside of approved zones. I'd hate for you to be charged the taxes needed to have this place re-zoned. Head for the manor if you're feeling creative.