COVID-19: Extension of Commercial Tenancies by States and Territories - 23 October 2020
Further to our article published on 28 May 2020 (click here to read the article), and given the ongoing impacts of COVID-19, the relevant commercial tenancies state and territory based legislation implemented as a result of the National Code has in most cases been (or is anticipated to be) extended. We have summarised in this article the updated status of the relevant legislation in each state and territory as of 23 October 2020. Please note we have used defined terms set out in our article of 28 May 2020 throughout this article.
NSW - NEW REGULATION RELEASED
On 23 September 2020, the NSW Government announced the NSW COVID Regulation is to be extended until 31 December 2020 for any tenants and landlords experiencing financial hardship.
Click here to read the NSW Government media release.
On 23 October 2020, the NSW Government released the Retail and Other Commercial Leases (COVID-19) Regulation (No 2) 2020 which commences on 24 October 2020. This Regulation extends the prescribed period so that it now ends 31 December 2020.
Tenants that have already been receiving rent relief under the NSW COVID Regulation may seek further rent relief from 25 October 2020 to 31 December 2020. The extension of the prescribed period will not result in current rent relief arrangements between landlords and tenants being automatically extended. In addition, a tenant may make a second or subsequent request to renegotiate rent but it may not relate to rent for a period for which rent has already been reduced, waived or deferred following a renegotiation.
Eligible landlords that reduce the rent of eligible tenants between October and December 2020 can apply for a land tax concession on relevant properties. The concession will be applied to any unpaid 2020 land tax liability, and refunds will be issued for payments already made in 2020.
The QLD Government announced on 16 September 2020 that a three-month extension, effective to 31 December 2020 was to be granted to provide continuing relief to commercial leaseholders in need.
Click here to read the QLD Government media release.
The moratorium on evictions for commercial leaseholders has been formally extended to 31 December 2020 by the Retail Shop Leases and Other Commercial Leases (COVID-19 Emergency Response) Amendment Regulation 2020 (“QLD COVID Amendment Regulation”).
The QLD COVID Amendment Regulation defines the extension period as the period commencing on 1 October 2020 and ending on 31 December 2020 (“Extension Period”). During the Extension Period, the “affected lease” test is increased as it is necessary for the tenant to be eligible for the updated JobKeeper Payment Scheme for the period starting on 28 September 2020 and ending on 4 January 2021. We note it is a requirement of the updated JobKeeper Payment Scheme for tenants to evidence an actual reduction in turnover, which was previously not necessary.
On 10 September 2020 the ACT Government extended the rent relief scheme offered to commercial tenants through the Leases (Commercial and Retail) COVID-19 Declaration 2020 (No. 2) (“ACT COVID Amendment Declaration”).
The ACT COVID Amendment Declaration came into effect on 28 September 2020 and will expire on 31 January 2021 (unless extended further).
As with the ACT COVID Declaration, the ACT COVID Amendment Declaration also places an obligation on landlords to negotiate in good faith with an impacted tenant that has committed a prescribed breach under a prescribed lease and tenants are similarly required to negotiate in good faith. The definition of an impacted tenant in the ACT COVID Amendment Declaration reflects changes to the JobKeeper scheme that came into effect on 28 September 2020.
The ACT COVID Amendment Declaration revokes the ACT COVID Declaration however impacted tenants under the ACT COVID Declaration continue to be protected for prescribed breaches that occurred between 1 April 2020 and 27 September 2020.
On 20 August 2020 the VIC Government announced that it would extend the ban on evictions and rental increases until 31 December 2020.
The COVID-19 Commercial and Residential Tenancies Legislation Amendment (Extension) Act 2020 (“VIC COVID Amendment Act”) came into effect on 22 September 2020 and amends and extends the Commercial Tenancy Relief Scheme (“The Scheme”). Additional measures have been introduced, with commercial landlords required to provide rent relief in proportion with the reduction in turnover being experienced by eligible tenants going forward and eligible tenants seeking relief being required to apply to their landlord in writing with evidence that they are eligible for The Scheme.
Click here to read about the steps set out for landlords and tenants negotiating under The Scheme.
Pursuant to NT Government Gazette No. S48 dated 23 September 2020, the operation of the declaration of the public health emergency was extended to 23 December 2020. As a result of this extension, the relevant period has been extended meaning that until 23 December 2020 a landlord must not give a tenant a notice to terminate / quit unless the landlord has, for a period of at least 30 business days, made good faith efforts to negotiate with the tenant to allow the tenant to remain in the premises.
On 25 September 2020 the SA Government amended the SA COVID Regulation through introduction of the COVID-19 Emergency Response (Commercial Leases No 2) (Prescribed Period) Variation Regulations 2020 (“SA COVID Variation Regulation”) to extend the application of the Regulations to 3 January 2021.
The SA COVID Variation Regulation came into operation on 1 October 2020 and does not apply to leases entered into after 30 March 2020.
On 10 September 2020, the WA Government announced that the emergency period under the WA COVID Act will be extended until 28 March 2021.
Click here to read the WA Government media release.
The Commercial Tenancies (COVID-19 Response) Regulations 2020 (“WA COVID Regulation”) came into effect on 26 September 2020. An eligible tenant can either request that existing rent relief arrangements continue for the period from 29 September 2020 to 28 March 2021 (“Extended Period”) or alternatively may renegotiate rent relief for the Extended Period. Eligible tenants are required to provide evidence to landlords showing details of loss of turnover on an ongoing basis (i.e. monthly). Rent relief is to be proportionate to the actual reduction in turnover and should be adjusted accordingly as turnover changes.
On 4 September 2020 the TAS Government announced that support for tenants and landlords impacted by COVID-19 would be extended to 1 December 2020.
Click here to read the TAS Government media release.
The extension to 1 December 2020 will apply to the financial hardship period for commercial tenancies and to the Rent Relief Fund. The TAS Government also announced introduction of a COVID-19 Landlord Support Fund.
The TAS Leasing COVID Act has yet to be amended to reflect the above extension.