Retail Leases Bill 2022 (No 30)

Thursday 17 November 2022, Second reading speech

[11.34 a.m.]

Ms ARMITAGE (Launceston) - Mr President, I thank the Leader for the briefings on this bill and I also appreciated the briefings from the Law Society with their many concerns. I support the replacement of the Fair Trading (Code of Practice for Retail Tenancies) Regulations 1998 as Tasmania is the only state that has not had a review of this type of legislation since 1998.

The bill overhauls the regulations of the leasing of certain retail premises in Tasmania by ensuring that the interests of landlords and tenants of retail premises are equally protected from unfair terms and conditions of leases, or from unconscionable conduct by parties during the negotiations, or during operation of a lease.

Updating the requirements regarding the exchange of key information between landlords and prospective tenants about lease terms and arrangements; outlining specific provisions relating to when rent is payable; the basis or formula used to calculate the rent and the timing and basis for rent reviews; enabling parties to a lease to agree to renewal arrangements within the lease and specify that the landlord must give notice of between four to six months prior to expiry of their intentions regarding their renewal, or otherwise, of the lease; stipulating certain arrangements regarding outgoings and security of bonds; and if during negotiations, the landlord's cost or charges are not disclosed or made known how they may be estimated, the tenant would not be required to pay for them.

We are told to ensure that prospective tenants are informed of what the tenant is liable to contribute under the lease, providing the Director of Consumer Affairs and Fair Trading with specific powers and functions to ensure the legislation operates effectively, and setting out a mediation dispute resolution process after direct negotiation between parties fail.

We are told that this new Retail Leases Bill 2022 will provide certainty and fairness to all parties in retail leasing arrangements, but I acknowledge the concerns raised by the Law Society, and as the member for Murchison said, it was 31.

Ms Forrest - There were 31 inserted downstairs.

Ms ARMITAGE - Some 31 amendments that they proposed.

Ms Rattray - In 14 areas.

Ms ARMITAGE - In 14 areas, and I believe that they could be condensed. I acknowledge concerns raised by the Law Society where they considered there are some good things in the bill, but also inconsistencies and problems.

I also acknowledge the advice in the briefings that these concerns and proposed amendments will be taken into account over the next 12 months, and that it is important to initially pass the bill.

I am concerned when you have a group such as the Law Society with so many concerns, as it is considered they are legal experts, and I am sure they deal with these issues quite often. As we know, the people who benefit most with problems are the lawyers when it comes to these matters. They also believe the Property Council raised a number of concerns.

Consistency is also important in the type of businesses considered, as retailers with a prescriptive list of activities and shops to which they apply, and I also understand that there will be some changes to some that will be considered retail that currently are not.

Another area, Leader, if I could have some clarity, regarding the leases, owing to possible unintended consequences of the two‑tier system of retail leases over the next five years, because my understanding is that the average term of a lease in Tasmania is 15 years. Under the bill, existing retail leases are to transition within five years, unless it is a new lease, or it is renewed. There are premises that will now be considered for retail lease that were not previously.

It is confusing whether there will be some inconsistencies on a commercial level and whether there will be some unintended consequences.

While I support the bill, it is important to get the bill right as it must be clear, well understood, commercially viable, practicable and workable. I look forward to some of the comments I am sure will come up during the next section of the bill when we get into Committee.