PM spoke about the Covid-19 package for landlords and tenants

April 3, 2020


After meeting with the National Cabinet this morning, this afternoon the Prime Minister announced as follows in relation to a proposed Industry Code for commercial and retail leases.  The Prime Minister said (in summary):

  • They have been working on this issue for some time and are close to resolving issues regarding commercial leases.
  • An industry code has been worked on by various stakeholder groups represented by landlords and tenants.  That industry code has not got to the point that they believe it needs to get to in order to ensure sufficient security to protect landlords and tenants.
  • That code will be made a mandatory code incorporated into State and Territory legislation, where it will be mandatory for tenancies where they have a turnover of less than $50M and are participant in the JobKeeper program (i.e 30% loss of revenue) and you’re a tenant.   They’ll be looking to implement a mandatory code of practice to guide negotiations between landlord and tenant to guide businesses through this time.
  • As part of this code, both parties will need to negotiate in good faith and there will be a proportionality principle – e.g. that the turnover reduction of tenant needs to be reflected in the rental waiver of the landlord.  However how this is done will be up to the landlord and the tenant and inside the terms of the lease.  E.g. if there is a 3 or 6 month rental waiver, because they’ve had to close their doors, one way to do that is to extend the lease or to agree to a different level of rent over the entire period.  We do not wish to be prescriptive about these things.
  • The banks will need to come to the party as well.  Because they are not a party to these arrangement, this makes it legally difficult.
  • As a National Cabinet, they want this to be done by industry and they want to finalise it as a code, as soon as possible, so they can adopt it into State & Territory legislation.
  • If you are in that arrangement, then you will have that protection of issues around evictions and claims/penalties or acting on guarantees or interest protection on rent – you would be protected.  Also landlords would be protected in that the lease would not be able to be terminated on those grounds.

We will try to post a link to the video and any press release shortly.

Sam Hopper and Abilene Singh

Thanks also to Callum Dawlings

About Sam Hopper

Sam is a property and insolvency barrister.

View all posts by Sam Hopper


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2 Comments on “PM spoke about the Covid-19 package for landlords and tenants”

  1. Kathy Tsiaplis Says:

    Sam thanks for these updates, they are so helpful.

    Interestingly, a number of national tenants will most likely fall outside this Code given the $50M threshold.

    What is also interesting is that a mediation service will be implemented to help landlords and tenants who can’t come to commercial agreement! I wonder whether the VSBC will be responsible for this? I guess we will all be watching this space!

    Interesting times! Stay well.

    Kind regards

    Kathy Tsiaplis Principal

    KTSI Legal Tel: 0414 645 216 E:



  2. Anonymous Says:

    Thanks Kathy. The PM suggested during questions that the big landlords and the big tenants would need to work it out themselves.


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