It is not uncommon for a commercial
landlord to desire to have a lease fall outside the operation of the Retail Leases Act 2003 (Vic) (RLA), thereby enabling the landlord to
claim land tax and lease preparation legal costs as an outgoing from the
tenant.
What constitutes a “retail lease” (being a lease which is regulated by
the RLA) is set out in Section 4 of the RLA.
One of the exceptions to a lease being a “retail lease” is where the
tenant is a body corporate or a subsidiary of body corporate whose securities
are listed on a stock exchange located outside of Australia that is a member of
the World Federation of Exchanges (WFE)
(see Section 4 (2)(d) of the RLA).
However, much confusion has arisen in trying to determine whether the
relevant overseas stock exchange is a member of the WFE.
In an effort to reduce the confusion, the Victorian Minister for Small
Business, Innovation and Trade has made a determination dated 12 August 2016,
pursuant to the Minister’s powers under clauses 4(2)(g) and 5 of the RLA, which
has the effect of excluding the following tenants from the definition “retail premises”:
“bodies corporate or companies or corporations
whose securities are listed on a stock exchange outside Australia or the
subsidiaries (including subsidiaries as defined in Section 9 of the
Corporations Act 2001) of such bodies corporate, companies or corporations”.
It is expected that the determination will make it easier for landlords
and their advisors to determine if the RLA will apply to leases to tenants or
their subsidiaries who are corporations listed on overseas exchanges.
If you require assistance with retail leasing, please contact Andrew
Bini, Senior Commercial Lawyer, Nevett Ford Melbourne Pty Ltd.
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