A six-month moratorium on evictions for certain commercial tenancies in Western Australia and a mandatory code of conduct to assist with negotiations between landlords and tenants have been passed by the WA parliament.
The new laws are designed to help relieve the financial distress of many small commercial tenants who have been hit by coronavirus restrictions.
Under the legislation, the six-month eviction moratorium is backdated until 30 March, 2020. The laws, which come into effect this week, also allow for the emergency moratorium period to be varied by regulation if required.
A number of other elements are also covered including, a freeze on rent increases; restriction on penalties for tenants who do not trade or reduce their trading hours; no interest to be charged on rent arrears; the introduction of an enhanced dispute resolution process; and a prohibition on landlords progressing proceedings that occurred after the restrictions were imposed but before these laws come into operation.
The WA Government will develop a code of conduct to provide a framework for negotiations to be carried out in good faith between landlords and tenants to agree on rent relief measures.
“It is crucial for the WA economy that small businesses are able to survive this period of restrictions and it’s hoped these measures will support efforts in preventing business failures and get people back to work when it’s over,” said WA Premier Mark McGowan.
“We urge all commercial landlords and tenants to enter into negotiations with a sense of shared destiny and to understand each other’s difficulties at this time.
“Business closures will benefit no-one, so mutually acceptable arrangements are urgently required to help save these businesses so they can bounce back quickly.”
The National Cabinet agreed to a mandatory Code of Conduct in early April, with States and Territory governments each required to develop and legislate the principles individually.
“The new laws formalise decisions made by the National Cabinet to provide some relief for businesses impacted by the COVID-19 restrictions and ensure that mutual agreements are being reached to protect the survival of the business during this challenging period,” said WA Commerce Minister John Quigley.
“Mechanisms will be put in place for commercial tenants who can’t reach an agreement with their landlord to go to the Small Business Commissioner for mediation or conciliation. Parties can also take the dispute to the State Administrative Tribunal for resolution.”
The impact the COVID-19 restrictions have had on the business with regard to revenue, expenses and profitability will be taken into consideration when determining and implementing appropriate deferrals, reductions or waivers of rent as well as sharing costs.
Image: The West Australian