After the Federal Government announcedthata moratorium on evictions and acommercialcode ofconductwould be put in place to help those suffering financial hardship due tocoronavirus (COVID-19), eachStateGovernmentwas left todeterminethespecificdetails as part of theirlegislation.
This can be confusing to understand, so we have pulled togethersome informationto help commercial landlords and tenants understand how these changes may impact them.
Temporary legislation
Recently,theCommercial Tenancies (COVID-19 Response) Act 2020hascome into play, however thecodeofconductthat is referred to in the Actis yet to be finalised and will be done so in the coming weeks.
The Act will be backdatedto 30 March2020until the 30 September 2020 note this date can be shortened or extended where necessary and will be repealed 12 months after the emergency period has finished.
Why is it being updated?
The temporary legislation aims to help small commercial tenants that are now in financial distress to survive the current economic conditions due to the unforeseeneconomicimpacts of COVID-19.
The idea behind this is to ensure that those who are struggling now can reopen their doorsto tradeonce the restrictions are lifted and continue business as they would have prior to the outbreak occurring.
If atenantis evicted due to not being able to pay rent, theownercouldspend more time trying to find a new tenantand losing more rent coming in, than they would in assisting the current tenant who is struggling.
What is included in the Act?
Apart from the eviction moratorium,the legislationalsoincludes:
Rents cannot be increased duringtheemergency period.
For those that are unable to pay their rentdue to a loss of include from COVID-19, no interest will be charged on rent arrears.
An enhanced dispute resolution process with the Small Business Commissioner will be introduced for those who can not reach an agreement.
Restriction on penalties for tenants who do not trade or reduce their trading hours.
Property ownersareprohibitedon progressing proceedings that occurred after the restrictions were imposed but before these laws come into operation.
Commercial code of conduct
In addition, a mandatory code of conduct will be established which will aim toassistwith negotiations between landlords and tenants, to agree on rent relief measure.
At this stage,this is still beingdrawn up bythe Department of Mines, Industry Regulation and Safety(DMIRS)and REIWA has sent a submissiontoDMIRSoutlining what we as an industry body believe will help bothproperty ownersandtenantsduring this process.
