Same shop, different rules: Why harmonisation of Australia’s retail tenancy laws has been a long time coming

Australia’s retail leasing laws are in the spotlight again.

If you are in the industry, you will be aware that if you own a retail business in Western Australia and another in Victoria, you will be signing up to two very different sets of legal rules. Australia contains eight different legal regimes that govern retail leasing and the rules depend entirely on which State or Territory the business is in.

The current status?

On 31 August 2026, the Australian Government released its consultation paper on harmonisation of retail tenancies and related commercial leasing.  The consultation paper forms part of the National Competition Policy reform agenda announced in the Federal Budget 2026–27.

The Federal Government is finally asking whether it is time to bring the retail leasing laws into line.  The paper proposes 2 alternative models to the current rules:

• a single national law; or
• a model law supported by a national minimum baseline.

Why bother?

Australia’s retail tenancy legislation has developed State and Territory by State and Territory, over the past four decades.  Each State and Territory enacted its own regime, driven primarily by a need to protect small business owners from the unequal bargaining power of large landlords and shopping centre owners.

Four decades later, the result is a patchwork of different rules that often defies any real logic.  Even the most basic questions asking, ‘is this a retail lease?’ or ‘is this a retail tenant?’ generates strikingly different answers depending on the State.

In Western Australia, for example, the Commercial Tenancy (Retail Shops) Agreements Act 1985 (WA) excludes ASX-listed companies and any subsidiaries, so a large unlisted company (such as Australia Post or Aldi) can, in theory, be protected, while a small subsidiary of a listed group would not.

Cross over into New South Wales and there is no listed company carve-out at all, meaning a listed supermarket giant can be treated as a protected retail tenant in a smaller store.

Victoria, meanwhile, has seen its definition stretched to catch a cold storage facility¹ and even a sand quarry². This stretch of the Victorian definition of ‘is this a retail lease’ has reached outcomes that most in the industry would not have anticipated.

What do the people doing the deals want?

Many legal practitioners are not asking for a rigid national law with no room for any interstate nuance.  That just isn’t realistic.  A model law with a national minimum baseline approach (Option B in the consultation paper) is the preferable option.

A model law would offer greater consistency with scope for jurisdictional flexibility, supported by prescribed forms, a common dictionary of core terms and uniform timing rules.

There seems to be broad agreement over the set of principles that needs to be considered within any harmonisation, such as:

• Retail tenant
  A nationally consistent definition of ‘retail tenant’ that includes specific parameters around the type of tenant that needs legislative protection.
• Retail shopping centre
  A clear definition of ‘retail shopping centre’ and the circumstances in which the centre will fall under the rules.
• Types of premises
  Whether the premises in question is used for mixed or ancillary and whether those premises should fall under the remit of the rules. 
• Exclusions
  Appropriate and consistent exclusions for listed entities, government tenants and multinational and large corporate retail chains.
• Disclosure forms
  The same disclosure statement, timing and consequences across each State and Territory, with remedies that fit the seriousness of the mistake/breach, rather than a potential lease-ending penalty for minor breaches.
• Demolition and redevelopment
  There may be a legitimate landlord need for flexibility to undertake development, and the process could be streamlined for all parties if there were consistent notice periods, alternative premises arrangements, categories of compensable costs and clear standards for defining what is and isn’t covered.
• Rent reviews and outgoings
  Common definitions of market rent and turnover rent, a single position on ratchet clauses and a shared list of costs landlords cannot pass onto tenants. This together with nationally consistent valuation principles and valuer appointment processes.
• Assignments
  A standard application form, consistent core grounds for landlord’s refusal to consent and a fixed consent period for applications which would make selling a business clearer and easier.
• Dispute resolution
  A consistent mandatory mediation gateway in every jurisdiction before the matter is referred to tribunal or court.

The challenges ahead

Harmonisation of retail tenancy laws will inevitably mean trade-offs on either side.  Landlords and tenants will no doubt each fight to keep the protections they currently enjoy, and someone’s favourite rule may come on the chopping block.

How existing leases are treated will also matter a great deal.  Whether the legislation retrospectively affects existing leases presents a real risk for both landlords and tenants.  Changes should only prospectively affect lease arrangements and should not change the status of an existing lease.

But really, if the Government is serious about harmonising retail tenancy law, the reform agenda cannot stop at the substantive lease terms.  It must also encompass the execution, registration and identity verification, as these elements underpin every retail lease transaction.

Electronic registration is now standard in WA, yet many clients (mainly tenants of small businesses, which ironically the legislation is aimed at trying to protect) may be surprised to learn that they cannot simply sign a lease electronically (although steps are under way to remedy this position) and, as a result, register their lease electronically, in the same way as in Queensland and New South Wales.  More strikingly and conversely to WA and many other States, Victoria doesn’t have a registration system at all.

In WA under the Corporations Act 2001 (Cth) individual parties, unlike corporate entities, are unable to sign deeds electronically.   This makes electronic lodgement unfeasible as an individual will need to sign in wet-ink and Landgate (the registration agency for WA) requires the original wet-ink documents to be lodged for registration.

Even where documents can be lodged electronically (i.e. where the landlord and tenant are corporate entities), documents lodged electronically must be digitally authorised by a lawyer or a conveyancer with client authorisation.  Before that can happen, the lawyer must complete verification of identity for every party to the document up to the standard that Landgate requires.  This process can be slow and arduous, especially where clients are unrepresented, interstate or overseas.

Each State’s land registration system (or lack thereof) applies its own version of the registration rules, so a national deal can mean jumping through the same hoops several times over.

Unifying retail tenancy legislation but leaving out signing, verification of identity and registration out of the scope means that the industry will still have a number of difficulties.  Real reform needs to look at all of it holistically.

This would require coordination not only between the State and Territory governments, but also with the Australian Registrars’ National Electronic Conveyancing Council (ARNECC) and the State and Territory Registrars of Titles.  It is a complex, multi-layered challenge, but it is one that must be addressed if harmonisation is to deliver meaningful change.

What now?

The release of the consultation paper represents the most significant opportunity for reform of Australia’s retail tenancy framework in nearly two decades.

The case for harmonisation is strong, but the economic basis is even stronger.  The Government estimates that the National Competition Policy reforms could increase GDP by around $13 billion per year once implemented.

If you lease, own or manage retail premises, particularly across different States, now is the time to think about where the current rules cost you time and money, and which protections you would fight to keep.

If you would like to discuss your retail tenancy or any of this information in article, please contact Peter Beekink or Lauren Probert.

Disclaimer

The information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.

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