The National Cabinet has agreed to a set of principles for governing commercial tenancies for those businesses that have been put under strain due to the Covid-19 pandemic.
With good faith leasing and proportionality at its core, the code involves several relief measures including rent waivers and deferrals for those businesses earning $50 million or less that have experienced at least a 30 per cent drop in turnover.
The National Retail Association (NRA), the Australian Retailers Association (ARA), the Pharmacy Guild of Australia (PGA) and the Shopping Centre Council of Australia (SCCA) are yet to see the finalised code, but welcome its announcement today.
The parties submitted a draft code to the National Cabinet on 5 April.
Given retail leasing is regulated in each jurisdiction, a key purpose of a code was to ensure a nationally consistent approach, and efficient and timely application given the rapid commercial impacts arising from the virus.
"The model announced by the Prime Minister today is sensible and proportionate. It will ensure - to the greatest degree possible - that businesses who suffer a major downturn have the best chance of surviving," says NRA CEO Dominique Lamb.
"And that is good for both tenants and landlords. Just as we want to see businesses survive to keep employing their staff, property owners will also want to see the retail sector survive."
ARA CEO Russel Zimmerman says the Prime Minister and National Cabinet can be assured his association and retail industry colleagues will work to ensure the code is progressed and applied in good faith.
"The most important issue is that the industry is talking, and landlords and tenants are working together to ensure business continuity."
Pharmacy Guild of Australia national president George Tambassis says the code will provide clarity for commercial tenants, including community pharmacies that need to negotiate arrangements with landlords during the Covid-19 downturn.
"Fundamentally, as the Prime Minister said, it is about sitting down and working out an agreed course so that we can all get through this together, and with normal business and employment able to resume," says Tambassis.
"A lot of the principles under the Code the SCCA has already agreed to, including publicly and independently committing to not terminating leases for the non-payment of rent a few weeks ago," adds Shopping Centre Council CEO Angus Nardi.
The SCCA's focus is on small, medium and family-owned businesses.
"Every day, our members are having hundreds of conversations with their retailers. Like many other industries, centre owners are receiving high volumes of requests for assistance. These are being worked through as quickly as possible," says Nardi.
"We welcome the approach to proportionality, which we understand provides a set of guiding principles and examples, which will ultimately be negotiated on a case-by-case basis."
All groups look forward to working with States and Territories on regulation, particularly to ensure a uniform approach.
"All of our groups engaged on retail lease legislation across the country, and we look forward to the next stage of work. We call on States and Territories to work together to ensure a uniform approach and efficient application," adds Lamb of the NRA.
"We look forward to working with the NRA, Pharmacy Guild and SCCA as are all working towards the same goal to emerge from the other side of this unprecedented experience with our retail partners especially our SMEs in the best possible position to succeed," notes Zimmerman of the ARA."
Today's announcement coincided with the release of a survey from the Australian Bureau of Statistics (ABS), which found more than a third of businesses have renegotiated their lease and rental arrangements and a quarter have deferred loan repayments.
Updated at 4:43pm AEST on 7 April 2020.