Coronavirus Alert: Update on commercial leases

It is titled the COVID-19 Emergency Response Bill 2020 (Bill). It is expected that the Bill will receive assent shortly and commence operation.

The Bill allows for new regulations to be made which will apply to leases governed by the Retail Shop Leases Act 1994 and any other leases that are designated. A similar but separate power is created by the Bill for residential tenancies.

The Bill gives power to relevant Ministers to make regulations in response to the COVID-19 pandemic relating to:

• prohibiting repossession of premises, or the termination of leases by landlords;
• regulating or preventing the exercise or enforcement of other rights of a landlord under a lease or any other agreement relating to leased premises;
• exempting specified tenants or leases from obligations imposed under an Act;
• requiring parties to a lease to have regard to a prescribed standard or code; and
• providing for a dispute resolution process.

Any regulation made under the Bill will not have effect prior to the commencement date (not yet known) and will expire on 31 December 2020.

In addition, the Bill creates a temporary Small Business Commissioner role which will be responsible for dispute resolution.

Learn more: National Cabinet’s ‘Mandatory Code of Conduct for SME Commercial Leases’

Relevant articles

• Checklist for landlords impacted by COVID-19 rent relief packages
• Mandatory code for commercial tenancies