Legislation to give effect to the Coronavirus Commercial Leasing Code of Conduct developed by the National Cabinet in early April was tabled in the WA Parliament yesterday (16 April 2020). This legislation provides some much needed detail as to how the Code is to apply in Western Australia.
Most importantly the legislation clarifies who the new laws apply to. Namely, small businesses that are tenants under a small commercial lease.
A “small business” is defined as a business that is either:
- wholly owned and operated by an individual person, or by individual persons in partnership, or by a proprietary company and features all of the following:
o a relatively small share of the market in which it competes; and o is managed personally by the owner or owners or directors as the case requires; and o is not a subsidiary of, or does not form part of, a larger business or enterprise; or
- declared by the Governor to be a small business for the purposes of the Small Business Development Corporation Act 1983.
A “small commercial lease” is defined as either:
- a retail shops lease under the Commercial Tenancy (Retail Shops) Agreements Act 1985; or
- a lease where the tenant owns or operates a small business and uses the leased premises to carry on that business; or
- a lease where the tenant is an incorporated association; or
- any other lease which is prescribed in regulations.
The new laws are proposed to take effect on 30 March 2020 and to end on 29 September 2020, unless another date is determined by Government to be the relevant date. Leases for eligible tenants are taken to be modified to the extent necessary to give effect to the new laws.
We will publish a practical guide to the new laws in the near future. In the meantime, for more information on the above, please contact Anton Conti or Susan Nicholson by telephone on 9389 3999 or by email at AConti@cullenmacleod.com.au or SNicholson@cullenmacleod.com.au