Law to protect commercial tenancies

LEGISLATION PROTECTING commercial tenants from hardship during Covid-19 is being considered by the Legislative Council. Minister for Building and Construction Elise Archer said the bill gives effect to the code of conduct for commercial tenancies agreed upon by National Cabinet last month. ‘The purpose of the Code is to govern the conduct of commercial tenants and landlords, and provide additional protections and rent reductions for tenants experiencing financial hardship,’ she said. Measures include:
• protection of commercial leases for eligible tenants (a tenant who is eligible for the JobKeeper program and has a turnover of less than $50 million per annum)
• a freeze on rent increases (a lessor must not, unless agreed by the lessee, increase rent for a protected lease during the financial hardship period)
• rent reductions (the lessor must provide the lessee of a protected lease a reduction in rent in line with the provisions provided in the Code)
• the establishment of mediation services and a Code Administration Committee to support the Code. The financial hardship period is from 1 April 2020 until the cessation day which is 12 months after commencement of the Act, or sooner, if determined by the Treasurer that the Code no longer needs to be in effect. Ms Archer applauded tenants and landlords who have already negotiated changes, including rent reductions and deferrals.