Landlords will be required to decrease commercial rents in line with the drop of revenue experienced by tenants under a new code of conduct, which will be mandatory and legislated by the states and territories.
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Prime Minister Scott Morrison said on Tuesday landlords would be required to waive or defer rents for tenants who can demonstrate financial distress due to the coronavirus.
Businesses that were eligible for the JobKeeper payment and have a turnover of $50 million or less would be considered eligible for the code of conduct.
The new mandatory code comes after a draft voluntary code of conduct negotiated between retailers and landlords was sent back to the negotiating table by the national cabinet on Friday.
It maintains the same principles laid out by Mr Morrison last week, where small and medium businesses in retail, office or industrial leases would be able to come to an agreement with their landlord, to reduce rent in line with the amount their turnover has reduced.
"The code provides a proportionate and measured burden share between the two parties while still allowing tenants and landlords to agree to tailored, bespoke and appropriate temporary arrangements that take account of their particular circumstances," Mr Morrison said in a statement.
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Small and medium businesses, as well as non-for-profits who have the Commonwealth government as their landlord will have their rent waived across Australia, a move which will cost $7.6 million over six months.
Mr Morrison called on the big banks, including international banks, to come to the table and assist landlords and tenants.
Businesses who get rent relief will be obliged to keep their employees paid through the JobKeeper program on the books.
Residential tenancies haven't been included in the code of conduct, with the states and territories left to make their own decisions on eviction moratoriums and measures to support landlords.
In the ACT, residential landlords who cut rents by at least 25 per cent for those in need are eligible for rebates on their rates.
Finance Minister Mathias Cormann said the code of conduct would include scope for landlords who "do the right thing" during the COVID-19 crisis to receive land tax relief or deferral.
"We are trying to do our bit, providing the right incentives along the way," the minister said on Sky News.
"But we do also expect that landlords will do the right thing in relation to those tenants who are in financial distress."
ACT Chief Minister Andrew Barr said the national cabinet's agreed code of conduct would complement the already announced territory scheme.
"They very happily co-exist and the principles on which we have designed our initiatives are entirely consistent with the national scheme," he said.
"The way we would enact it in our legislation, in our approach gives us regulation making powers that will see that the national scheme be able to be applied quite easily in the ACT."
Mr Barr said on Tuesday the ACT would introduce a mediation process for agreements between a landlord and tenant could not be reached.
"We will have a mediation process in place in the ACT that would allow those, for what we hope, would be a small number of cases where landlords and tenants cannot resolve the matter to go through a binding mediation process," he said.
"We will have that infrastructure in place in the coming weeks. In the meantime we would ask commercial landlords and tenants to begin their conversations around a proportionate response to this situation."
- With AAP
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