woman paying at retail counter

Future of NSW rent relief measures 

The temporary COVID-19 protections for certain NSW commercial and retail lessees provided by the Retail and Other Commercial Leases (COVID-19) Regulation 2022 (Regulation) were set to expire on 13 March 2022 (after earlier extensions).

The rental relief principles under the Regulation haveprovided protections to lessees impacted by COVID-19, namely by obliging the parties to impacted leases to renegotiate in good faith the terms of their impacted lease, to suspend rent increases and to prevent lessors from taking certain actions against impacted lessees unless mediation has failed to resolve the dispute and there has been renegotiation (if requested by the lessee). 

Continuation of certain measures

A further amendment set to come into effect on 14 March 2022 (Retail and Other Commercial Leases (COVID-19) Amendment Regulation 2022) extends some of the protections for certain impacted lessees until 30 June 2022. Namely, the provisions requiring compulsory mediation will remain in place in respect of impacted lessees with business turnover of less than $5million for 2020/21 financial year. 

In addition to the previous criteria, a lessee will be considered an ‘’impacted lessee’’ if they qualify for the 2022 Small Business Support Program. 

What measures will end?

The previous suspension of rent increases under impacted leases will still cease on 13 March 2022

A lessor of an impacted lease will also no longer be obliged to renegotiate rent payable before taking action for non-payment of rent or outgoings or failure to operate from the premises for specified hours, where that breach occurs after 13 March 2022. Similarly, a tribunal or court determining whether to make orders in respect of recovery of possession of premises, termination of lease or enforcement of other lessor rights (under an impacted lease) will not be required to consider the leasing principles set out in the National Code of Conduct where the breach takes place after 13 March 2022.

What should you do?

Having regard to the cessation of some of the previous relief measures, parties to impacted leases (particularly lessees) should ensure any agreements on rent renegotiations (including any rent freezes or reductions moving forward) are firmed up and reduced to writing before 13 March 2022.

Osborn Law is continuing to monitor the implementation of the Regulation and will keep you up to date on any changes. In the meantime, if you require any assistance regarding your specific agreement with your landlord or tenant in accordance with the Regulation please contact our Property and Commercial team on (02) 4927 2900.