FAQs

To ease the pressure on Victoria’s small and medium-sized businesses at this time, the Victorian Government has reintroduced the Commercial Tenancy Relief Scheme (the Scheme)Below are our FAQs for the Scheme, which is effective from 28 July 2021 and will run until 15 January 2022.

Please note the information on this page is not to be taken as specific legal advice. If you need assistance in resolving a dispute, please refer to our dispute applications page.

 

Commercial Tenancy Relief Scheme 2021 – FAQs

1. What is the Commercial Tenancy Relief Scheme (the Scheme)?

1. What is the Commercial Tenancy Relief Scheme (the Scheme)?

The Commercial Tenancy Relief Scheme (the Scheme) has been introduced by the Victorian Government to ease the financial hardship faced by commercial tenants as a result of the coronavirus (COVID-19) pandemic.

To be eligible, the tenant must be a small to medium enterprise with an annual aggregate turnover under $50m who has had a minimum 30 per cent reduction in turnover, and has followed the process under the Scheme for requesting rent relief from their landlord (see question 13). To access the full eligibility criteria, see question 9.

The Scheme is broadly based on the previous Commercial Tenancy Relief Scheme that was introduced in 2020, with the aim of supporting tenants and landlords to negotiate in good faith to reach an agreement on rent relief in a timely manner.

The Victorian Small Business Commission (VSBC) will provide support to tenants and landlords through a free mediation service to assist parties in reaching a fair agreement that they can both accept.

Landlords who provide rent relief to their tenants will be supported through a $120 million package announced on 5 August 2021. The package comprises a $20 million Commercial Landlord Hardship Fund and $100 million to support land tax relief of up to 25 per cent for landlords who support their tenants. Details will be provided on the Business Victoria website.

A mandatory reassessment at 31 October 2021 enables both parties to check in and assess whether circumstances have changed and rent relief needs to be adjusted.

The Scheme is effective from 28 July 2021 and will run until 15 January 2022.

Quick reference to key resources located in the following FAQs

Table 1 – Rent relief periods

Table 2 – Comparison and turnover periods

Table 3 – Reassessment periods

Table 4 – Alternative tests

Optional tenant letter template 1 – for making a single, complete rent relief request

Optional tenant letter template 2 – for making an initial rent relief request and a further letter for supplying the required evidence

Optional landlord letter template – for making a rent relief offer

2. What are the key features of the Scheme?

2. What are the key features of the Scheme?

The key features of the Scheme include the following:

  • Commercial landlords are required to give their tenant rent relief that:
    • is in proportion to their tenant’s fall in turnover because of coronavirus
    • is made up of a minimum 50 per cent rent waiver (the remainder can be made up of a rent deferral).
  • Evictions for not paying rent will be banned until 15 January 2022 where the tenant:
    • is a small to medium enterprise (SME)
    • has an annual aggregate turnover under $50m (at the group level)
    • had a minimum 30 per cent reduction in turnover because of coronavirus and
    • has followed the process under the Scheme for requesting rent relief from their landlord (see question 13).
  • There will be a freeze on rent increases until 15 January 2022.
  • Fall in turnover will be calculated by comparing pre-pandemic 2019 turnover to recent turnover in 2021. Tenants can compare their turnover from any three consecutive months between 1 April and 30 September 2021 to their turnover in the same three months in 2019.
  • Newer businesses that weren’t operating in 2019 will also be protected, with special arrangements in place to calculate their turnover impacts.
  • A mandatory reassessment point enables tenants and landlords to check in with each other during the period of rent relief and assess whether circumstances have changed and rent relief should be adjusted.
  • Tenants and landlords can access free mediation through the Victorian Small Business Commission (VSBC) to resolve disputes over rent relief and other disputes under the Scheme.
  • Tenants can apply to the VSBC for a binding order for rent relief if their landlord fails to respond or sufficiently respond to the VSBC or doesn’t engage in mediation in good faith (see question 61).

Small business tenants seeking rent relief will need to make a written request to their landlord with evidence of their eligibility, as set out in question 9.

If a tenant has already made a request and is seeking further rent relief for this extended period, then they will need to make another request to their landlord, supplying the required evidence.

Regulations have been made under the Scheme.

3. What are the transition arrangements between the previous Scheme and the current Scheme?

3. What are the transition arrangements between the previous Scheme and the current Scheme?

Many tenants and landlords will have agreements or arrangements in place that were negotiated under the previous Scheme. Tenants should continue to make genuine efforts to pay their rent as previously negotiated.

Where a compliant request for rent relief has been made under the current Scheme and where there is also an agreement already in place from the previous Scheme, the existing deferred rent repayments are frozen until 15 January 2022. At this time, the tenant must resume repaying the previously deferred rent in the same instalments and frequency as previously deferred.

4. If a tenant was eligible for the previous Scheme, are they automatically eligible for rent relief under the current Scheme?

4. If a tenant was eligible for the previous Scheme, are they automatically eligible for rent relief under the current Scheme?

No – a new request for rent relief must be made to the landlord and the tenant must meet the eligibility criteria under the current Scheme.

5. Are sole traders eligible to take part in the Scheme?

5. Are sole traders eligible to take part in the Scheme?

Yes. Sole traders are eligible to take part in the Scheme.

6. Does the Scheme apply to commercial licences?

6. Does the Scheme apply to commercial licences?

It is important to note that the Scheme applies to commercial licences. For example, where there is no lease but where a business has a licence to occupy offices from which it provides its services or supplies its goods. Commercial licensees and licensors have the same rights and obligations under the Scheme.

7. Does an eligible tenant need to be registered for GST?

7. Does an eligible tenant need to be registered for GST?

No. While the turnover calculations are based on GST turnover, an eligible tenant does not have to be registered for GST to be eligible, as long the tenant fulfils all eligibility criteria.

8. What is an ‘eligible lease’?

8. What is an ‘eligible lease’?

An eligible lease is a retail or non-retail commercial lease or licence that was in effect on 28 July 2021 under which the tenant (which includes licensees) is an operator of a small to medium enterprise and is eligible under the Scheme.

9. What is an eligible tenant?

9. What is an eligible tenant?

It is important that tenants read the regulations for the Scheme carefully, in particular the information about eligibility, because this FAQ only provides general information about this topic. It doesn’t refer to all circumstances of a tenant’s eligibility or ineligibility.

In most cases, an eligible tenant:

  • is an SME entity that, as at 28 July 2021, operated a business in Australia and
  • satisfies the fall in turnover test as set out at regulation 12 of the Scheme and
  • is not an ’excluded’ tenant or certain prescribed class of tenant.

An SME entity is defined in regulation 10 of the Scheme. For the purposes of the Scheme, it’s an entity with an annual turnover of less than $50m at the group level during the 2021 financial year or, if having not traded for the full duration of the 2021 financial year, its turnover for the 2022 financial year is likely to be less than $50m.

Please refer to table 2, which sets out information in relation to the turnover test, the turnover test period and comparison turnover.

An ‘excluded’ tenant includes tenants who use the premises wholly or predominantly for a farming or agricultural activity. It also includes tenants who are a listed corporation or a subsidiary of a listed corporation.

Under the Scheme, certain entities are not eligible tenants. Examples of these are a local governing body, an Australian government agency, a tenant whose financial affairs and property are under external administration (such as tenant who is subject to a trustee in bankruptcy or a liquidator) and a tenant who is affiliated with another entity where the combined turnover of the tenant and the other entity exceed $50m.

10. What is rent relief?

10. What is rent relief?

Rent relief is any form of relief provided to a tenant in relation to their obligation under a lease to pay rent. It can take the form of a rent waiver, reduction, remission or deferral.

A rent waiver is where the landlord and tenant agree that the landlord will not collect the rent or part of the rent owed for an agreed period of time. Rent that is waived does not become payable by the tenant at a later date.

A rent remission means the cancellation of a debt or charge, such as a landlord agreeing not to seek payment of rent that was owed but has not been paid (rent arrears).

A rent deferral is where the tenant and landlord agree that the tenant will pay the rent or part of the rent owed at a later date over an agreed period of time (i.e. payment is postponed).

11. For what period does rent relief apply?

11. For what period does rent relief apply?

The Scheme is in operation from 28 July 2021 to 15 January 2022.

Rent relief agreements can be made within this period and can extend beyond the period of the Scheme.

The Scheme is retrospective back to the date of its announcement of 28 July 2021. A tenant can make a request for rent relief back to that date, as long as they submit their application to their landlord and provide the necessary evidence on or before 30 September 2021. If the tenant applies after 30 September 2021, the rent relief period starts from the date they apply to their landlord.

See table 1 – rent relief periods.

12. What can a tenant do if they can’t keep paying rent because of coronavirus (COVID-19)?

12. What can a tenant do if they can’t keep paying rent because of coronavirus (COVID-19)?

If a tenant is having trouble paying rent because of coronavirus, the VSBC recommends they:

  • keep paying, as a minimum, their monthly rent reduced by the same percentage as their fall in turnover
  • speak or write to their landlord as soon as possible to communicate their situation and provide details of the reduction in their turnover
  • follow the process for tenants and landlords under the Scheme, which includes negotiating in good faith, to try to reach an agreement on rent relief.

Tenants can use the VSBC’s letter templates to guide them in requesting rent relief. These optional templates include:

  • option 1 – a letter for making a single, complete request
  • option 2 – a letter for making an initial request and a further letter for supplying the required evidence.

If anything about the Scheme is unclear to a tenant or landlord or if they have concerns, they can contact the VSBC for advice. If they can’t reach an agreement, they can apply to the VSBC for help in resolving their rent dispute through free mediation.

13. How does a tenant request rent relief?

13. How does a tenant request rent relief?

When a tenant requests rent relief from their landlord, the request must be in writing and be accompanied by:

  • a statement from the tenant that they are an eligible tenant
  • a statement that the tenant satisfies the decline in turnover test, which includes setting out:
    • the tenant’s turnover for the turnover test period, including the turnover test period used
    • the tenant’s comparison turnover, including stating whether the relevant comparison period or a specific alternative turnover method was used (see table 2)
    • if an alternative comparison turnover method was used, how the comparison turnover was calculated
    • the tenant’s fall in turnover
    • the reduction in rent that would satisfy the minimum requirements of an offer of rent relief made by a landlord in accordance with the Scheme and
    • any other circumstances that the tenant would like the landlord to consider in making an offer of rent relief under the Scheme.
  • a statutory declaration made by the tenant or an authorised officer of the tenant stating that the tenant is an eligible tenant and that the information provided by the tenant is true to the best of the tenant’s knowledge and belief.

It is very important that the tenant provides the required statutory declaration to the landlord within 14 days of making their rent relief request. If this is not done, then the request for rent relief will lapse and the tenant will not be protected under the Scheme. A tenant is permitted to make up to 3 requests for rent relief that lapse. Following this, a tenant cannot make a further request for rent relief under the Scheme.

Tenants can use the VSBC’s letter templates to guide them in requesting rent relief. These optional templates include:

  • option 1 – a letter for making a single, complete request
  • option 2 – a letter for making an initial request and a further letter for supplying the required evidence.

14. How is ‘turnover’ defined?

14. How is ‘turnover’ defined?

Turnover is defined as the GST turnover of a small to medium enterprise and includes:

  • the proceeds of sales of goods and/or services (including any turnover from internet sales of goods or services)
  • commission income
  • repair and service income
  • rent, leasing and hiring income
  • government bounties and subsidies
  • interest, royalties and dividends
  • other operating income
  • payments such as Victorian Government COVID-19 Business Support Fund payments received by the tenant during the relevant period.

Turnover does not include GST or any financial assistance paid to the tenant by the Commonwealth in response to coronavirus.

15. How is the decline in turnover test satisfied?

15. How is the decline in turnover test satisfied?

A tenant satisfies the decline in turnover test if the turnover for the turnover test period falls short of the tenant’s comparison turnover by 30 per cent or more.

The term ’turnover test period’ has various meanings depending on the date the tenant started trading at the premises. Please refer to table 2 for more information.

The term ’comparison turnover’ is the tenant’s turnover for the relevant comparison period or, if applicable, an alternative comparison turnover period.

The ’relevant comparison period’ depends on the turnover test period that is selected to make the comparison. Please refer to table 2 for more information.

A tenant can use an alternative comparison turnover if:

  • they started their business on or after 1 April 2019. Please refer to table 2 for more information.
  • there was an acquisition or disposal of the tenant’s business on or after the start of the relevant comparison period and before the applicable turnover test period that changed the tenant’s comparison turnover
  • there was a restructure of the tenant’s business on or after the start of the relevant comparison period and before the applicable turnover test period that changed the tenant’s turnover
  • the tenant’s turnover has substantially increased by certain percentages within certain periods immediately before the applicable turnover test period
  • the tenant’s business has been affected by drought or natural disaster during the relevant comparison period and this event changed the tenant’s turnover
  • the tenant’s turnover is irregular and not cyclical
  • the tenant is a sole trader or small partnership without employees who, due to sickness, injury or leave, did not work for all or part of the relevant comparison period and the tenant’s turnover was affected as a result
  • the tenant temporarily ceased trading for a week or more during the relevant comparison period and resumed trading before 28 July 2021 due to uncontrollable and extraordinary circumstances.

A decline in turnover is calculated by comparing turnover for the comparison periods as shown in table 2.

To work out actual turnover, tenants need to use a cash or accruals basis. However, they must use the same method for both periods.

16. Are alternative tests available to determine a decline in turnover?

16. Are alternative tests available to determine a decline in turnover?

For most businesses the turnover test period is the three consecutive months between 1 April 2021 and 30 September 2021, with the comparison period being the corresponding three months between 1 April 2019 and 30 September 2019. If your business started trading after 1 April 2019, see question 15 for information about alternative comparison periods for new businesses.

If your business started before 1 April 2019 but events or circumstances outside your normal business settings mean that the normal comparison period is not appropriate for your business, you might be able to demonstrate decline in turnover by using alternative tests, similar to the tests you might have used to determine your eligibility for JobKeeper. To access the alternative tests for the Scheme, see table 4.

17. Which comparison turnover period and turnover test period applies?

17. Which comparison turnover period and turnover test period applies?

The comparison turnover period and turnover test period used by a tenant to demonstrate their eligibility for the Scheme and the request for rent relief that matches their fall in turnover depends on when the business started.

Where possible, a tenant compares their recent turnover to a comparison point before the impacts of coronavirus started in March 2020. There are different tests for businesses that started during the pandemic, depending on the date they started.

See table 2 – comparison and turnover periods.

18. What evidence is required to show a fall in turnover?

18. What evidence is required to show a fall in turnover?

A tenant needs to provide evidence of at least one of the following to their landlord to show a fall in turnover:

  • Extracts from the tenant’s accounting records or
  • The tenant’s business activity statement(s) that relate to the relevant turnover test period (providing the GI information – total sales – as highlighted in the ATO’s form) or
  • Statements issued by an authorised deposit-taking institution (e.g. a bank) that relate to the tenant’s account or
  • A statement prepared by a practising accountant

19. What turnover evidence is not appropriate for a landlord to ask a tenant in connection with an offer of rent relief?

19. What turnover evidence is not appropriate for a landlord to ask a tenant in connection with an offer of rent relief?

A landlord should not ask the tenant to provide any financial information other than one of the four forms of financial information required to be provided by the tenant under the Scheme (see question 18). For example, the landlord should not:

  • request future cash flow projections
  • request balance sheets, profit and loss or year to date financials
  • request the tenant’s bank balance
  • require the financial information to be verified, examined, assured, audited or provided by a third party such as an accountant
  • require an accountant to provide a letter of comfort or similar on the financial information
  • request financial information for periods other than the ‘relevant period’ (i.e. the period nominated by the tenant as the period for a reduction in turnover).

20. What does a landlord need to do to respond to a tenant’s compliant request for rent relief?

20. What does a landlord need to do to respond to a tenant’s compliant request for rent relief?

A landlord must offer rent relief in writing to an eligible tenant within 14 days of the tenant making a compliant written request, unless a different time frame has been agreed to by the landlord and tenant in writing.

An offer of rent relief must relate to up to 100 per cent of the rent payable under the lease during the rent relief period and must, at a minimum, match the fall in the tenant’s turnover. At least 50 per cent of the rent relief offered must be in the form of a rent waiver unless the landlord and tenant reach a different agreement in writing.

Landlords can use the VSBC’s optional letter template to guide them in making a rent relief offer.

21. Do landlords and tenants need to negotiate rent relief after the landlord makes an offer?

21. Do landlords and tenants need to negotiate rent relief after the landlord makes an offer?

Where a tenant doesn’t agree with the landlord’s offer, the landlord and tenant must continue to negotiate in good faith with the aim of reaching a fair agreement on rent relief for the rent relief period (see question 22).

22. What does negotiating ‘in good faith’ mean?

22. What does negotiating ‘in good faith’ mean?

It involves all parties communicating with each other and having discussions honestly and fairly with the genuine aim of reaching an agreement. It also involves behaving in an open and transparent manner and providing sufficient and accurate information within the context of negotiations. It is an offence under the Scheme if a landlord or tenant provides false or misleading information.

Under the Scheme, landlords and tenants are required to co-operate and act reasonably in all of their discussions and actions and to negotiate rent relief in good faith with a view to reaching an agreement. They are also required to provide relevant documentation (consistent with the regulations for the Scheme) in a timely manner.

In certain circumstances, the VSBC may make a binding order for rent relief if a landlord does not sufficiently respond to the VSBC or does not engage in mediation in good faith (see question 61).

23. Are landlords required to provide proportional rent relief to eligible tenants?

23. Are landlords required to provide proportional rent relief to eligible tenants?

Yes. A landlord’s rent relief offer must, at a minimum, be in proportion to the fall in the tenant’s turnover. For example, if the tenant’s turnover has fallen by 40 per cent (using the comparison period in question 17), the required rent relief is at least 40 per cent of the tenant’s current rent.

At least 50 per cent of the rent relief offered must be made up of a rent waiver. The remainder can be made up of a rent deferral.

24. What is the period during which a landlord must provide proportional rent relief to their tenant (i.e. rent relief that matches the tenant’s fall in turnover)?

24. What is the period during which a landlord must provide proportional rent relief to their tenant (i.e. rent relief that matches the tenant’s fall in turnover)?

The period depends on the date the tenant makes a compliant request for rent relief.

If the tenant makes the request for rent relief on or before 30 September 2021 then the landlord may be required to offer rent relief from 28 July 2021 to 15 January 2022.

If the tenant makes the request for rent relief after 30 September 2021 then the landlord may be required to offer rent relief from the date of the request to 15 January 2022.

25. Does a landlord’s rent relief offer need to directly equal the tenant’s fall in turnover?

25. Does a landlord’s rent relief offer need to directly equal the tenant’s fall in turnover?

A landlord’s offer of rent relief must, at a minimum:

  • match the fall in the tenant’s turnover during the most recent turnover test period
  • apply to the period as set out in question 17, taking into account:
    • any waiver or reduction of outgoings provided by the landlord to the tenant
    • any waiver or reduction of outgoings or other expenses for the premises provided by other parties (e.g. water company or council).

26. What supports are available to a landlord who provides rent relief to their tenant?

26. What supports are available to a landlord who provides rent relief to their tenant?

The Victorian Government will provide land tax relief of up to 25 per cent to landlords waiving rent for their tenants, in addition to any previous 2021 land tax relief, at an estimated cost of $100 million. Businesses that own their premises may also be eligible. Eligible landlords will also be able to defer any remaining 2020 and 2021 land tax until 31 May 2022. More information will be made available on the State Revenue Office website.

Small landlords who experience hardship as a result of waiving rent between 28 July 2021 and 15 January 2022 under the Scheme will be eligible to apply for a grant of up to $6,000 per eligible tenancy as part of the Commercial Landlord Hardship Fund 3. In cases where landlords are experiencing acute hardship because of an agreed rent waiver, the grant may be increased to a maximum of $10,000 per eligible tenancy. When applying, landlords must provide information about the agreed rent waiver using Business Victoria’s  acceptance template letter or similar. FAQs, the template letter and information on how to apply are available on the Business Victoria website.

27. Can a tenant be deemed to have accepted a landlord’s offer of rent relief?

27. Can a tenant be deemed to have accepted a landlord’s offer of rent relief?

Yes. A tenant will be deemed to have accepted the landlord’s offer of rent relief if after 15 days of receiving the landlord’s offer:

  • the landlord and tenant haven’t reached agreement in relation to rent relief and
  • the tenant hasn’t applied to the VSBC for free mediation and
  • the landlord’s offer of rent relief complies with the minimum requirements of the Scheme.

28. What if rent relief that had previously been negotiated doesn’t match the tenant’s fall in turnover?

28. What if rent relief that had previously been negotiated doesn’t match the tenant’s fall in turnover?

Rent relief agreements already in place will continue as agreed. A tenant can request further rent relief that matches their fall in turnover from 28 July 2021.

29. Can a tenant ask for more rent relief after an agreement has been made?

29. Can a tenant ask for more rent relief after an agreement has been made?

A tenant can ask for more rent relief if they have reached an agreement for rent relief and their financial circumstances have materially changed.

The landlord and tenant must follow the same processes set out in the Scheme for requesting and offering rent relief.

30. Can a tenant apply for rent relief on rent that is due before 28 July 2021?

30. Can a tenant apply for rent relief on rent that is due before 28 July 2021?

A tenant can only apply for rent relief for the period 28 July 2021 to 15 January 2022, as set out in question 11. Agreements made before 28 July 2021 still apply, though tenants can seek further rent relief for the period 28 July 2021 to 15 January 2022.

31. How does the mandatory check in point to reassess rent relief work?

31. How does the mandatory check in point to reassess rent relief work?

The mandatory reassessment point enables tenants and landlords to check in with each other during the period of rent relief and assess whether circumstances have changed and rent relief should be adjusted.

The mandatory reassessment only applies for rent relief requests made on or before 30 September 2021 and for tenants that began trading before 1 April 2021.

Tenants completing a mandatory reassessment need to provide their evidence to their landlord by 31 October 2021.

See table 3 – reassessment periods.

32. How is rent relief reassessed at the mandatory check in point?

32. How is rent relief reassessed at the mandatory check in point?

The fall in turnover for the reassessment period is calculated by comparing the turnover in the two periods in this table, depending on when the business started. Rent relief might either increase or decrease as a result of the reassessment.

The minimum reduction in rent must be the same as the fall in turnover, with at least half waived and the remainder deferred.

The tenant must provide the landlord in writing:

  • the test turnover
  • the comparison turnover
  • the change in turnover
  • a statutory declaration made by the tenant or an authorised officer of the tenant stating that the tenant is an eligible tenant and that the information provided by the tenant is true to the best of the tenant’s knowledge and belief.

33. Can rent be increased during the protection period (including after an agreement has been reached) if the tenant’s situation improves?

33. Can rent be increased during the protection period (including after an agreement has been reached) if the tenant’s situation improves?

A landlord must not increase the rent payable at any time from 28 July 2021 to 15 January 2022 (the protection period), unless the landlord and tenant agree in writing that the regulation preventing a rent increase does not apply to their lease. This restriction does not apply to a retail lease where the lease allows rent to be determined by the tenant’s volume of trade.

Any provision in the eligible lease that does increase or may have the effect of increasing the rent during the protection period is void and can never be claimed by the landlord.

34. What if a tenant refuses to negotiate or keep paying rent?

34. What if a tenant refuses to negotiate or keep paying rent?

The landlord can apply to the VSBC for help, which includes preliminary assistance provided by VSBC staff. Where disputes can’t be resolved this way, the matter can be progressed to free and impartial mediation.

At mediation, an experienced and independent mediator will assist both parties to have good faith negotiations with the aim of reaching a fair agreement.

For information on whether a tenant is in breach of their lease for not paying rent, see question 43. For information on whether a tenant can be evicted for not paying rent, see question 53.

35. How can a landlord and tenant resolve a dispute?

35. How can a landlord and tenant resolve a dispute?

If a landlord and tenant need help to resolve a dispute over rent relief, they can apply to the VSBC for help.

Help can be sought early on, often just over the phone, and where disputes can’t be resolved this way, there is additional help available through access to free mediation. At mediation, an experienced and independent mediator will guide both parties in good faith negotiations with the aim of reaching an agreement that both parties can accept.

36. Can a tenant who is not under an eligible lease apply to the VSBC for help?

36. Can a tenant who is not under an eligible lease apply to the VSBC for help?

Yes. The VSBC offers a dispute resolution process, which includes free mediation to help small business tenants and landlords to resolve rent relief disputes at no cost. Where a tenant isn’t under an eligible lease, the landlord and tenant can use the Scheme to guide their negotiations although the rent relief requirements cannot be mandated. It’s important for parties to negotiate in ‘good faith’ (see question 22).

37. Is the Victorian Small Business Commission currently providing mediation services?

37. Is the Victorian Small Business Commission currently providing mediation services?

Yes, mediation services are being conducted via videoconferencing and teleconferencing at no cost to commercial tenants and landlords. Either party can apply for mediation via the VSBC’s applications web page.

38. How much will mediation cost for businesses that are already in financial distress?

38. How much will mediation cost for businesses that are already in financial distress?

There is no cost to small business tenants or their landlords for mediation to help resolve a dispute over rent relief. Either party can apply for mediation via the VSBC’s applications web page.

39. When applying for mediation, what are the meanings of the terms ‘applicant’ and ‘respondent’?

39. When applying for mediation, what are the meanings of the terms ‘applicant’ and ‘respondent’?

The ‘applicant’ is the person, business or company applying for mediation. The ‘respondent’ is the person, business or company receiving the application for mediation (i.e. the person, business or company that the applicant is in a dispute with).

40. If a small business tenant or landlord has already submitted an application to the VSBC for help to resolve a dispute over rent relief and is wanting to request further rent relief, do they need to apply to the VSBC twice?

40. If a small business tenant or landlord has already submitted an application to the VSBC for help to resolve a dispute over rent relief and is wanting to request further rent relief, do they need to apply to the VSBC twice?

If the initial dispute hasn’t yet been resolved, the tenant or landlord should contact the VSBC dispute resolution officer who has been helping to resolve the dispute to find out what further information they might need to provide.

41. Is the information provided by a landlord or tenant during the dispute resolution process protected by confidentiality?

41. Is the information provided by a landlord or tenant during the dispute resolution process protected by confidentiality?

Yes. A landlord or tenant must not divulge any personal, commercial, business or financial information obtained in the course of any dealings between them in connection with the Scheme, except where specifically permitted.

42. Is mediation binding?

42. Is mediation binding?

Mediation doesn’t involve making orders or handing down a decision for or against a party. Whether an agreement is reached is up to the parties. If a landlord and tenant reach agreement at mediation, they can sign binding Terms of Settlement. If a party to an agreement doesn’t meet their obligations, the other party may be able to take action at the Victorian Civil and Administrative Tribunal (VCAT) to enforce the agreement. For example, if a tenant breaks an agreement to pay agreed rent relief, they may be at risk of being evicted.

43. Is a tenant in breach of their lease if they don’t pay rent during the relevant period?

43. Is a tenant in breach of their lease if they don’t pay rent during the relevant period?

A tenant is not in breach of the lease if they don’t pay the required rent during the relevant period providing:

  • the process for requesting rent relief has been followed (see question 13) or
  • during the protected period the tenant pays the amount of rent in line with any variation to the lease or any other agreement that provides rent relief either directly or indirectly (e.g. where the landlord has agreed to provide a service or carry out work for the tenant).

44. Under what circumstances can a landlord evict a tenant under the Scheme?

44. Under what circumstances can a landlord evict a tenant under the Scheme?

A landlord cannot evict a tenant who is eligible under the Scheme if the tenant can’t pay rent because of a fall in turnover due to coronavirus, provided:

  • the lease was in effect on or before 28 July 2021 and
  • the tenant has made a written request for rent relief from their landlord in line with the regulations for the Scheme.

A landlord also cannot evict a tenant under an eligible lease where the tenant is unable to trade as a result of:

  • sickness or injury affecting the tenant, its officers or employees
  • natural disaster affecting the tenant.

The ban on eviction does not cover circumstances that fall outside the Scheme. For example, evictions relating to:

  • damage to the property
  • unpaid rent before 28 July 2021
  • situations where a tenant doesn’t pay rent that they had agreed to pay under a rent relief agreement.

The ban on eviction does not cover tenants who are not eligible under this Scheme.

45. What will happen to tenants that have already received an eviction notice?

45. What will happen to tenants that have already received an eviction notice?

These tenants should contact the VSBC in relation to their individual situation.

If a tenant has been issued a Notice to Vacate or eviction notice and they want to remain at the premises, they should immediately contact their landlord to see if they can come to an agreement to avoid being evicted. If they are unable to reach a resolution, they should apply to the VSBC for free and impartial mediation. At mediation, parties will be supported in negotiating leasing arrangements.

The VSBC can be contacted on 13 8722 or by submitting an application form online.

46. If an agreement is reached to defer rent, when is that rent payable?

46. If an agreement is reached to defer rent, when is that rent payable?

A landlord and tenant must vary the lease or agree that the tenant will pay the deferred rent over the remaining term of the lease or 24 months, whichever is greater. The remaining term includes any negotiated extension to the lease.

If any rent is deferred by variation to the lease or agreement between the landlord and tenant, the landlord must not request payment of the deferred rent until 15 January 2022.

47. If rent is deferred, is the lease extended?

47. If rent is deferred, is the lease extended?

Yes. If payment of any rent is deferred by a rent relief agreement, the landlord must offer the tenant an extension to their lease equal to the length of time for which rent is deferred. This extension must be on the same terms and conditions that applied under the lease before 28 July 2021, unless the landlord and tenant reach a different agreement in writing.

48. Can a small business tenant end their lease early?

48. Can a small business tenant end their lease early?

A lease is a legally binding agreement. By signing it, the landlord and tenant have agreed that the tenant will lease the retail or commercial premises for the period of time specified in the lease.

Usually, a lease can’t be broken early by the landlord or tenant, unless the lease allows for this or if both parties agree to this happening.

Some tenants who are experiencing a downturn in trade might want to end their lease early. The VSBC encourages tenants in this situation to communicate with their landlord as early as possible to discuss their position and alternative options, such as rent relief. Learn more about ending a lease early.

49. Can a tenant reduce opening hours or close their business even though they could keep trading in another way e.g. takeaway or click and collect? What can the landlord do if this happens?

49. Can a tenant reduce opening hours or close their business even though they could keep trading in another way e.g. takeaway or click and collect? What can the landlord do if this happens?

Yes, a tenant can do this. An eligible tenant is not in breach of their lease if they reduce opening hours or if they close their business and stop carrying out business at the premises during the protection period.

If this occurs, a landlord must not:

  • evict or try to evict the tenant.
  • re-enter or try to re-enter the premises
  • have recourse or try to have recourse to any security relating to the non-payment of rent under the lease.

If a tenant meets all other eligibility criteria they do not need to demonstrate a decline in turnover for this protection.

50. What are outgoings?

50. What are outgoings?

Outgoings are costs relating to the premises that a tenant may need to pay (e.g. water rates or council rates).

It’s the landlord’s responsibility to provide the tenant with various documents outlining outgoings (estimates and actual) and who is responsible for paying these costs at various points over the term of the lease.

51. Is a landlord required to reduce or refund outgoings?

51. Is a landlord required to reduce or refund outgoings?

If a third party (e.g. a water company or council) reduces any outgoings charged, the landlord is required to pass on this reduction to the tenant (i.e. the tenant pays their share of the reduced outgoings). If the tenant has already paid the landlord their share of the original outgoings, the landlord must reimburse the excess amount as soon as possible.

52. Is a landlord required to waive recovery of outgoings?

52. Is a landlord required to waive recovery of outgoings?

A landlord must consider waiving recovery of any outgoings or other expenses payable by the tenant under the lease for any part of the protection period that the tenant is unable to operate their business at the premises.

53. Can a tenant be evicted for not paying rent or outgoings during the protection period?

53. Can a tenant be evicted for not paying rent or outgoings during the protection period?

If a tenant has followed the process for requesting rent relief (see question 13) and is paying the amount of rent and outgoings agreed to with the landlord, the landlord must not:

  • evict or attempt to evict a tenant
  • re-enter or otherwise recover the premises or attempt to do so.

If the landlord breaches either of the above requirements, they can be fined $3,634.80.

54. Can a landlord stop providing services at the premises?

54. Can a landlord stop providing services at the premises?

If a tenant is unable to operate their business at the premises for any length of time during the protection period, the landlord can stop providing, or reduce the provision of, any service at the premises, provided this is reasonable in the circumstances or is in response to any reasonable request of the tenant.

55. Can a landlord hold the security deposit (bond) until deferred rent has been paid?

55. Can a landlord hold the security deposit (bond) until deferred rent has been paid?

Depending on the terms of the lease or other agreement reached between the landlord and tenant, a landlord might be able to hold the security deposit until after the tenant has finished paying the deferred rent.

56. Can a landlord require the tenant to pay interest or other fees or charges in relation to paying deferred rent?

56. Can a landlord require the tenant to pay interest or other fees or charges in relation to paying deferred rent?

A landlord must not require a tenant to pay interest or any other fee or charge in relation to any payment of rent deferred by a rent relief agreement.

57. What can be done if an agreement reached at mediation breaks down?

57. What can be done if an agreement reached at mediation breaks down?

The Terms of Settlement agreement (signed at the end of mediation) is a binding document and can be enforced by judicial or tribunal proceedings, if necessary (e.g. by applying to VCAT).

58. If mediation fails, what can a landlord or tenant do next?

58. If mediation fails, what can a landlord or tenant do next?

If mediation fails to resolve a dispute over rent relief, the VSBC can issue a certificate stating that mediation has failed. The landlord or tenant may then be able to file an application with VCAT to ask for a rent relief order.

59. If a dispute can’t be resolved at mediation, can it be determined by VCAT or a court?

59. If a dispute can’t be resolved at mediation, can it be determined by VCAT or a court?

Where possible, the landlord and tenant should try to resolve their dispute and avoid a legal proceeding. However, if a dispute about a lease can’t be resolved at mediation, a landlord or tenant can apply to VCAT or a court to make a decision. A lease dispute (other than an application for an order in the nature of an injunction) can only be the subject of a proceeding in VCAT or a court if the VSBC has certified in writing that mediation failed or is unlikely to resolve the dispute.

60. What if a landlord refuses to negotiate?

60. What if a landlord refuses to negotiate?

Under the Scheme, commercial tenants and landlords can access free mediation through the VSBC to help resolve a dispute over rent relief.

The VSBC can make a binding order for rent relief if the landlord does not respond or sufficiently respond to a dispute notice from the VSBC or does not mediate in good faith, where the VSBC is satisfied the decision to do so is fair and reasonable in all circumstances.

The VSBC can also issue a certificate that enables the dispute to proceed to VCAT. VCAT is then able to make a determination on the rent relief dispute.

61. What is a binding order and when can it be made?

61. What is a binding order and when can it be made?

A binding order is an order that the VSBC can make under the Scheme in certain circumstances that sets the amount of rent relief a landlord must give the tenant.

The VSBC must make a binding order for rent relief where:

  • the VSBC has issued a certificate stating mediation has failed or is unlikely to resolve the dispute and the landlord has failed to respond or sufficiently respond to a dispute notice or the landlord has not engaged in mediation in good faith and
  • the dispute relates to a tenant’s written rent relief request that complies with the Scheme’s requirements
  • the tenant under an eligible lease has applied to the VSBC for a binding order and
  • the landlord or tenant has not started action at VCAT or a court in relation to the dispute and
  • the VSBC is satisfied that it is fair and reasonable to do so in all the circumstances.

A binding order may require the landlord to:

  • waive part, or all, of the rent for the rent relief period and/or
  • defer payment of part of the rent for the rent relief period.

The order might also direct the method of payment of any deferred rent.

A tenant can apply for a binding order using the VSBC’s request form.

62. How can tenants and landlords access the VSBC’s FAQs on rent relief from before 28 July 2021 in response to coronavirus?

62. How can tenants and landlords access the VSBC’s FAQs on rent relief from before 28 July 2021 in response to coronavirus?

The VSBC’s FAQs on rent relief from before 28 July 2021 in response to coronavirus can be accessed here.

Small business supports in response to coronavirus FAQs

1. What grants and other supports are available to small business owners who continue to be impacted by the pandemic?

1. What grants and other supports are available to small business owners who continue to be impacted by the pandemic?

On 6 August 2021, the Victorian Government announced a $400 million package jointly funded by the Commonwealth and Victorian Governments that will provide automatic payments to almost 100,000 eligible businesses, including sole traders. The package includes COVID-19 Disaster Payments, Business Costs Assistance Program Round Three grants, Licensed Hospitality Venue Fund payments, an extension of the Alpine Business Support Program and an increase to the Small Business COVID Hardship Fund grants.

Additional joint packages of support announced on 12 August19 August, 22 August and 4 September 2021 will provide further supports to small and medium-sized Victorian businesses most impacted by the current public health lockdown.

The Victorian Government is also providing more support for live performance events that have been cancelled due to the recent restrictions. The Live Performance Support Program Round Two will be available to both presenters and suppliers and will assist a wider range of affected businesses and workers than the first round.

The Australian Banking Association (ABA) announced continued support for small business customers significantly impacted by current lockdowns or recovering from recent lockdowns, including bank repayment deferrals for up to 3 months with loan terms extended accordingly. Learn more by visiting the ABA website.

For more information on small business supports, visit the Business Victoria website.

2. What mental health supports can small business owners access at this time?

2. What mental health supports can small business owners access at this time?

The Victorian Small Business Commission’s (VSBC) Responding to coronavirus (COVID-19): a small business owner’s guide to creating a mental health plan helps small business owners to:

  • identify stressors that might come up at this time
  • recognise changes that signal they might need extra support
  • plan actions that they can take in response.

Small business owners who are feeling stressed or anxious are encouraged to call Partners in Wellbeing for free mental health and financial counselling (1300 375 330 9am–10pm weekdays, 9am–5pm weekends).

The VSBC’s web page on looking after your mental health offers more information, including on crisis supports and other services that can help.

Dispute resolution FAQs

1. What matters are dealt with through preliminary assistance versus mediation?

1. What matters are dealt with through preliminary assistance versus mediation?

This is very much dependent on the issues and the nature of the parties’ dispute. Sometimes, in the case of small amounts of money, or where the legal obligations of one or both parties are clear, preliminary assistance may take place.

Equally, the respondent may receive the letter from the VSBC and decide to fix the problem upon receipt of the letter and the tenant’s application. For example, a landlord who has ignored a tenant’s request to fix a leaking roof may decide to address the issue immediately rather than go through the dispute resolution process with the VSBC.

 

2. Are there any disputes that the VSBC doesn’t handle?

2. Are there any disputes that the VSBC doesn’t handle?

The VSBC may refuse to deal with a complaint that it considers vexatious, trivial, unlikely to be resolved, or more appropriately handled by another body. We will assess this upon receiving an application for dispute or during a preliminary phone call with one or both of the parties.

The VSBC has no definition of ‘small business’ and can deal with any dispute between businesses, with local or state government bodies or not-for-profits.

3. How does the VSBC resolve disputes?

3. How does the VSBC resolve disputes?

If you are interested in dispute resolution assistance from the VSBC you will first need to complete an application form. Before you submit this we encourage you to try to resolve the dispute directly with the other party first.

When we have received an application form from a business, the VSBC will offer pre-mediation services. This process involves a dispute resolution officer who will contact both parties, by phone or email,  and attempt to resolve the dispute by working through the issues.

If this is unsuccessful, the dispute resolution officer will forward the parties to mediation.

For more information, see dispute resolution.

4. How do I notify the VSBC of a dispute?

4. How do I notify the VSBC of a dispute?

If you would like to notify the VSBC of a dispute, complete the appropriate application form:

5. What if the matter is urgent?

5. What if the matter is urgent?

The VSBC has the capacity to handle a dispute if the parties are seeking urgent mediation.

However, if you are seeking an urgent injunction (an order requiring one party to do, or stop doing, certain things), you may need to go directly to VCAT or the Courts.

6. What happens if I decline to participate in dispute resolution?

6. What happens if I decline to participate in dispute resolution?

If you decline to participate in dispute resolution or the mediation process, the VSBC can issue a certificate stating that you have refused to participate. The outcome of this differs depending on which legislation your dispute falls under.

For retail leasing, goods and freight owner drivers , and taxi, hire cars and rideshare disputes, the VSBC may issue a certificate stating that reasonable attempts have been made to arrange mediation or another form of alternative dispute resolution but have been unsuccessful because the:

  • applicant/respondent refused to take part in mediation
  • applicant/respondent withdrew from mediation
  • applicant/respondent cannot be contacted
  • respondent agreed to mediate but was unavailable for mediation for an extended period of time
  • applicant/respondent failed to attend scheduled mediation session

This certificate is necessary for the matter to be referred to VCAT.

In the case of disputes relating to small businesses, if a party refuses to engage with the VSBC in trying to resolve the complaint and the VSBC determines that refusal is unreasonable, we may issue a certificate to that effect and publish details of that certificate in the VSBC’s Annual Report to Parliament.

The certificate may be admitted as evidence in proceedings before the Victorian Civil and Administrative Tribunal (VCAT) or a court.

The Commissioner has developed Operational Guidelines on what is considered ‘unreasonable refusal’ for disputes under the Small Business Commission Act 2017.

In the case of farmers in default on a farm debt, if the farmer seeks mediation through the VSBC, the creditor requires a certificate from the VSBC to enable it to take enforcement action.

If a certificate relating to retail leasing, owner driver/forestry contractor dispute or taxi driver and operator dispute states that a party refused to mediate or withdrew from mediation, VCAT has the discretion to award costs against that party if the matter proceeds to VCAT.

7. Do I need to respond to a letter from the VSBC?

7. Do I need to respond to a letter from the VSBC?

If you have received an initial letter or email from the VSBC in regards to a complaint, you will be requested to make contact with the VSBC by the date specified in the correspondence.

If you are unsure about the letter or the complaint, Contact Us.

8. Can the VSBC help me?

8. Can the VSBC help me?

The VSBC can help if you are a small or medium business operator and need assistance on any matter relating to unfair market practices or commercial dealings. At least one party to the dispute needs to be in Victoria.

If you are unsure if our services are right for you,  Contact Us or call us on 13 VSBC (13 8722).

You can discuss your concerns with a dispute resolution officer who may suggest that you complete an application or other means for resolving the dispute.

9. Who is a respondent?

9. Who is a respondent?

A respondent is someone who receives notification from the VSBC asking that they engage with the VSBC to resolve a dispute. It is important to remember that, even if you are the respondent, the VSBC does not take sides. Our aim is to find a resolution that is acceptable to both parties.

10. Who is an applicant?

10. Who is an applicant?

An applicant is a person or business applying for dispute resolution services.

Mediation FAQs

1. How much does mediation cost?

1. How much does mediation cost?

For most business disputes, each party currently pays $195 per session for mediation, making it a very low-cost alternative to litigation. The exceptions are owner driver and forestry contractors, and taxi, hire cars and rideshare driver and operator disputes, which currently cost $95 per party.

If either side wants to bring along their own lawyer they can do so, but at their own cost.

Payment must be made on the day of mediation (EFTPOS or cheque) or prior to mediation by contacting the VSBC offices.

2. What happens if mediation is successful?

2. What happens if mediation is successful?

If the mediation is successful, both parties sign a Terms of Settlement.

The Terms of Settlement are legally enforceable – that is, if either party breaches the agreement (for example, by not paying money as per the agreement), the other party may take the agreement to the Victorian Civil and Administrative Tribunal (VCAT) or the courts for enforcement.

3. Can mediation be rescheduled?

3. Can mediation be rescheduled?

Yes, within reason (such as medical reasons). The rescheduled mediation must occur within 30 days of the original mediation date.

If a mediation session is arranged and you cannot participate on the day, or do not want to proceed, the VSBC must be notified at least five working days prior to the scheduled date. For any notice period of less than five days, you will be invoiced the full cost of mediation ($900).

4. What if a party doesn’t turn up?

4. What if a party doesn’t turn up?

Occasionally this will happen. In most cases, a certificate is issued stating this. The mediator engaged for the session will invoice the party who has not attended the full cost of the mediation ($900).

5. Where does mediation take place?

5. Where does mediation take place?

Victorian Small Business Commission mediation rooms:

Level 2, 121 Exhibition Street
Melbourne Victoria 3000

For disputes in regional areas, mediations can be arranged in a location that suits both parties.

The VSBC will arrange for a mediator to travel to regional locations and organise the venue. Some VSBC mediators are regionally based.

6. What happens if my dispute is not resolved at mediation?

6. What happens if my dispute is not resolved at mediation?

The answer to this question depends on what type of dispute you have. In general the VSBC has the capacity to issue a certificate stating that the mediation was unsuccessful. This certificate can enable a party to progress the matter to litigation for some disputes.

7. What documents do I need to bring?

7. What documents do I need to bring?

If you have extra documents in addition to the ones already provided to the VSBC and you plan to refer to those during the mediation, either send them to the mediator or have them available on the day of the mediation.

You don’t have to share documents with the other party, but this occurs in most cases as it can help the mediation. Sometimes, for example, a party may choose to provide documentation to the dispute resolution officer or mediator as background information only.

If you need to clarify any issues about the delivery of the documents, contact the mediator using the contact information provided in the invitation.

Reference documents relevant to the dispute may be provided to all parties before mediation.

8. How long does mediation take?

8. How long does mediation take?

The average length of mediation is around three to four hours, but it can sometimes take longer. Consider this when making your plans for the day and, if you travel by car, be sure to make appropriate parking arrangements.

9. How should I prepare for mediation?

9. How should I prepare for mediation?

It is important you are well prepared to make the most of the mediation as it may be your last opportunity to meet with the other party to try and resolve the matter before litigation. For more information about how you can prepare for your mediation see our mediation checklist.

10. What if English is my second language?

10. What if English is my second language?

If you believe you might have some language difficulties, contact the VSBC and ask for an interpreter to be at the mediation. The VSBC will provide this service free of charge. You may also have a friend or family member present to translate, if needed.

11. Can I bring along a friend or relative?

11. Can I bring along a friend or relative?

Yes, you may wish to have a support person to either attend mediation with you, or be on the phone during the process. If you intend to bring along a person for support, you must provide the name and role of the person to the VSBC prior to mediation. See see Authority to participate in VSBC mediation.

12. Can I have a lawyer present?

12. Can I have a lawyer present?

You may wish to have legal or other professional representation. If you believe you will need such representation, make sure you can afford it and make all the arrangements well in advance so these representatives can prepare and make themselves available for the mediation. You must also notify the VSBC with the names and roles of the people who will attend the mediation. See see Authority to participate in VSBC mediation.

There is no requirement for you to be represented – you make the decision.

13. Do I need to attend mediation in person?

13. Do I need to attend mediation in person?

The process of mediation works better if the parties themselves are present. However, you can have representatives in your place, as long as those representatives can make a decision, and sign a written settlement agreement at the end of the mediation on your behalf.

If you are unable to attend your mediation, you need to arrange for another person to have authority  to make decisions on your behalf. For more information see Authority to participate in VSBC mediation.

14. How long does it take to get my case to mediation?

14. How long does it take to get my case to mediation?

Mediation is generally held around 6-8 weeks after the dispute is referred to the VSBC. It can be organised much faster if both parties are agreeable, or the matter is urgent.

15. How do I get my case to mediation?

15. How do I get my case to mediation?

To apply for mediation, complete an application form.

16. What if I made an agreement at mediation and have since changed my mind or am no longer satisfied with the agreement?

16. What if I made an agreement at mediation and have since changed my mind or am no longer satisfied with the agreement?

The Victorian Small Business Commission (VSBC) cannot set aside, rewrite or enforce an agreement that has been reached at mediation.

There are, however, steps you can take. If you want to challenge or enforce an agreement, it might be appropriate for you to apply to the Victorian Civil and Administrative Tribunal (VCAT). For these applications, VCAT requires a copy of the Terms of Settlement and the VSBC file reference number. A certificate from the VSBC isn’t required.

Before applying to VCAT, you might want to consider getting legal or other professional advice.

17. What can be done if an agreement reached at mediation breaks down?

17. What can be done if an agreement reached at mediation breaks down?

The Terms of Settlement agreement (signed at the end of mediation) is a binding document and can be enforced by judicial or tribunal proceedings if necessary, for example, by applying to the Victorian Civil and Administrative Tribunal (VCAT). For these applications, VCAT requires a copy of the Terms of Settlement and the Victorian Small Business Commission (VSBC) file reference number. A certificate from the VSBC isn’t required.

Small business FAQs

1. Does the VSBC arrange mediation for all small business disputes?

1. Does the VSBC arrange mediation for all small business disputes?

The VSBC will first attempt to resolve a dispute through preliminary assistance and some ‘shuttle negotiation’ between the parties. Where this is not possible, the VSBC will determine if mediation is appropriate for the particular dispute. Factors taken into account include the amount in dispute, and whether the nature of dispute lends itself to a negotiated outcome.

2. Is there a limit to the amount in dispute the VSBC can deal with?

2. Is there a limit to the amount in dispute the VSBC can deal with?

No. The VSBC can assist with any amount in dispute, ranging from hundreds of dollars to millions of dollars.

3. Can the VSBC refuse to accept an application from a business?

3. Can the VSBC refuse to accept an application from a business?

The VSBC can determine not to deal with an application if the dispute appears trivial, vexatious or not within the VSBC jurisdiction. Otherwise, the VSBC accepts disputes from all types and sizes of businesses. There is usually a small or medium sized business involved in any dispute.

4. Does a general commercial dispute have to be brought to the VSBC?

4. Does a general commercial dispute have to be brought to the VSBC?

No. There is no statutory obligation for general commercial disputes to come to the VSBC. But they can be. Resolution rates for these types of disputes is high, keeping both parties out of expensive and distracting litigation.

5. What happens if my business dispute is not resolved at mediation?

5. What happens if my business dispute is not resolved at mediation?

If mediation takes place and a dispute is not resolved, the VSBC can issue a certificate stating that alternative dispute resolution has been attempted but has been unsuccessful. For some disputes, this certificate is necessary for the matter to proceed to litigation.

6. What happens if I don’t engage with the VSBC in a general business dispute?

6. What happens if I don’t engage with the VSBC in a general business dispute?

The VSBC cannot compel a party to engage under any Act. If a party refuses to engage with the VSBC in trying to resolve the complaint and the VSBC determines that refusal is unreasonable, they may issue a certificate to that effect and publish details of that certificate in the VSBC’s Annual Report to Parliament.

This certificate may be used before the Victorian Civil and Administrative Tribunal (VCAT) or a court.

The VSBC has developed Operational Guidelines on what it deems as ‘unreasonable refusal’.

7. What if I am a franchisee and have a dispute?

7. What if I am a franchisee and have a dispute?

If you are a franchisee and you have a dispute, the VSBC can help you by offering low-cost, speedy and high-quality mediation services.

Under the Franchising Code of Conduct, mediation of a dispute is mandatory. The VSBC mediation service satisfies the requirements of the Code.

You can find out more on our how mediation works page.

If the issue relates to your lease agreement, see the entering into a retail lease page.

8. What is a general business or commercial dispute?

8. What is a general business or commercial dispute?

A general business or commercial dispute can be described as a conflict arising from any commercial agreement between businesses, or between businesses and government or not-for-profit organisations.

9. What types of small business disputes does the VSBC handle?

9. What types of small business disputes does the VSBC handle?

The VSBC is not constrained by any legislated definition of ‘small business’. We receive complaints from businesses about all forms of commercial dealings, including disputes with other businesses, not-for-profits, and local and state government entities. We can also resolve disputes that do not fall under the jurisdiction of the other Acts administered by the VSBC. These may involve franchises, non-retail leases, buying a business, intellectual property, distribution agreements, licences, supply chains, partnership break-ups, etc.

Retail tenants and landlords FAQs

1. What do the 2020 changes to retail leasing mean for tenants and landlords?

1. What do the 2020 changes to retail leasing mean for tenants and landlords?

Commercial landlords and tenants in Victoria need to be aware of important changes under the Retail Leases Amendment Act 2020 that amended the Retail Leases Act 2003.

Essential safety measures – a landlord can now pass on the costs of repairing and maintaining or installing as part of a fit out, essential safety measures to their tenant – but only if the lease and disclosure statement or annual estimate of outgoings says so.

Security deposits (bonds) – a landlord must give the deposit back to their tenant within 30 days of the lease ending, if the tenant has met their obligations.

Disclosure statements – a landlord must give their tenant a disclosure statement and copy of the proposed lease no later than 14 days before the lease is entered into. If changes are made to the copy of the proposed lease that had been given to the tenant, the landlord must notify the tenant of these changes when giving them the updated lease no later than 14 days before the lease is entered into. If the disclosure statement and lease is given later than 14 days, the start date is taken to be 14 days after they are given to the tenant. For renewed leases, the landlord must notify the tenant of any changes to the previous disclosure statement.

Option to renew, early rent review and cooling off – a landlord must notify their tenant at least three months before the option is no longer valid of:

  • the latest date the lease can be renewed
  • rent for the first 12 months
  • the availability of an early rent review and cooling off period – tenants now have 14 days after exercising an option to change their mind and not continue with the next lease term.

2. Does a tenant have to pay GST under the lease?

2. Does a tenant have to pay GST under the lease?

If a landlord is registered for GST then GST is payable on rent and outgoings. However, often there can be confusion about whether a lease is inclusive of exclusive of GST. It is therefore important that a lease specifies whether GST is inclusive or exclusive.

The landlord’s disclosure statement for new leases (Schedules 1 and 2) makes provision for the landlord to outline whether GST is inclusive or exclusive.

More information about how GST applies to outgoings for retail leases can be found on the Australian Taxation Office (ATO) website or by contacting the ATO on 13 28 66.

3. What happens if a tenant receives a notice of default from their landlord?

3. What happens if a tenant receives a notice of default from their landlord?

If a landlord deems that their tenant has breached the lease, the landlord may issue a notice of default to the tenant. Default notices are often given to tenants for non-payment of rent. The process for issuing a notice of default will usually be what is outlined in the lease i.e. the lease may state that if a tenant is behind in rent, the landlord may issue a breach notice to the tenant giving the tenant 14 days (or another time period stated in the lease) to remedy the breach, otherwise the landlord may re-enter the premises.

Relevant legislation is Section 146 of the Property Law Act 1958, which covers restrictions and relief against forfeiture of leases and under-leases.

If a tenant has concerns that the landlord may re-enter the premise, the matter can be referred to Victorian Civil and Administrative Tribunal for an urgent injunction.

4. What happens at the end of a lease?

4. What happens at the end of a lease?

If no option exists, the landlord must notify the tenant in writing within 6-12 months of the date the lease expires whether the landlord will offer a lease renewal or not, and if so, the terms of any renewal.

If an option exists, the landlord must notify the tenant of the last date the tenant can exercise the option 6-12 months before that date.

An option may not be exercisable by the tenant if the tenant has not remedied any notified lease default or has persistently defaulted throughout the lease term.

If an option is exercised or the lease is to be renewed, the landlord must provide a disclosure statement at least 21 days before the end of the lease.

The landlord must give the security deposit (bond), including interest, back to their tenant within 30 days of the lease ending, if the tenant has met their obligations.

Read more about options and renewals and security deposits.

5. What happens during a lease?

5. What happens during a lease?

Following changes under the Retail Leases Amendment Act 2020:

  • a landlord can now pass on the costs of repairing and maintaining essential safety measures (ESM), and the costs of installing ESM as part of a fit-out, to their tenant as outgoings, though only where the tenant’s lease and disclosure statement or annual estimate of outgoings enables them to do so
  • a tenant can agree to carry out repairs and maintenance works to an ESM
  • a landlord must return the security deposit to the tenant within 30 days of the lease ending if the tenant has met their obligations under the lease
  • a landlord must give the tenant a disclosure statement and copy of the proposed lease no later than 14 days before the lease is entered into – if these documents are given less than 14 days before the lease is to be entered into, the lease start date is taken to be 14 days after they are given to the tenant
  • if changes are made to the copy of the proposed lease that had been given to the tenant, the landlord must notify the tenant of these changes when giving them the updated lease no later than 14 days before the lease is entered into – a failure to do so may mean the landlord is liable to a penalty (50 penalty units for a natural person or 250 penalty units for a body corporate)
  • a landlord must notify the tenant at least three months before the option is no longer valid of:
    • the latest date the lease can be renewed
    • rent for the first 12 months
    • the availability of an early rent review and cooling off period – tenants now have 14 days after exercising an option to change their mind and not continue with the next lease term.

Other changes during the term of a lease include the following:

  • If the lease provides for a rent review, it must state when the review is to take place and the basis on which the review will be made.
  • A lease cannot prevent the reduction of the rent when rent is reviewed or adjusted.
  • A tenant is only liable to pay outgoings specified in the estimate of outgoings and the lease.
  • The landlord must provide estimates of outgoings and statements of outgoings during the course of the lease.
  • Capital costs relating to the premises are not recoverable from the tenant.
  • Land tax is not recoverable from the tenant.
  • The landlord is responsible for maintaining the premises in a condition consistent with its condition when the lease was entered into (including the structure and fixtures, plant and equipment, and appliances, fittings and fixtures relating to specified services), subject to changes under the Retail Leases Amendment Act 2020 relating to ESM (see above).
  • The tenant may arrange for urgent repairs, subject to complying with prescribed procedures.
  • The landlord must notify the tenant in writing at least 60 days before any proposed alterations or refurbishments that may affect the tenant’s business. The tenant may be entitled to compensation.
  • A landlord may be liable to pay a tenant compensation for loss or damage resulting from the landlord’s actions or in-actions affecting the tenant’s trading at the retail premises.

6. What happens if I want to sell the business?

6. What happens if I want to sell the business?

If you are selling the business and assigning (transferring) the lease:

  • a landlord is only entitled to withhold consent to the assignment (transfer) of a lease in certain, limited circumstances
  • an assignment of a lease is taken as a continuation of that lease
  • a landlord can recover from the tenant reasonable legal and other expenses incurred in connection with an assignment (or sublease).

Read more about assigning a retail premises lease.

7. Can a tenant be prevented from assigning a lease?

7. Can a tenant be prevented from assigning a lease?

No, provided none of the limited grounds in section 60 of the Retail Leases Act 2003 exist on which a landlord may withhold consent to assignment.

Section 61 of the Act contains the procedure that a tenant must follow in order to obtain consent to assign the lease. The landlord has an obligation to act reasonably in consenting to a transfer of lease (section 144 of the Property Law Act, 1958).

Read more about assigning a retail premises lease.

8. Does a ‘repainting’ clause mean the tenant has to repaint to a new condition even though the condition was poor to start with?

8. Does a ‘repainting’ clause mean the tenant has to repaint to a new condition even though the condition was poor to start with?

Yes, if this is what the tenant has agreed to in the lease. It’s very important that tenants check a lease’s ‘make good’ and maintenance requirements. Wherever possible, tenants and landlords should agree on a condition report at the start of a lease to avoid future disputes.

9. What should I be aware of before entering a lease?

9. What should I be aware of before entering a lease?

Before entering into any leasing arrangement, you should understand your rights, responsibilities and expectations as a tenant or landlord. If you are unsure, seek legal advice.

It’s also important to be aware of the following:

  • As soon as negotiations start, the landlord or landlord’s representative must give the tenant (or the person they start negotiations with) a copy of the proposed lease and a copy of the Victorian Small Business Commission’s information brochure – Retail leases: important facts for tenants.
  • A disclosure statement must be given to the tenant at least 14 days before entering into the lease.
  • A lease must be in writing and signed by all the parties to it, and the landlord must give the tenant a copy signed by both parties.
  • The landlord can’t pass onto the tenant the cost of preparing the lease or disclosure statement.
  • A lease term under the Retail Leases Act 2003 (including any options) must be at least five years, though a tenant can request a shorter term.
  • Money paid as a security deposit (bond) must be held by the landlord in an interest bearing account, with the interest forming part of the security deposit.

The Act (with the exception of the dispute resolution provision) doesn’t apply to a lease with a term of less than one year and where the tenant hasn’t been in continuous occupancy for more than one year.

10. What happens if my retail leasing dispute is not resolved at mediation?

10. What happens if my retail leasing dispute is not resolved at mediation?

For disputes under the Retail Leases Act 2003, if mediation at the VSBC is unable to resolve the dispute, a certificate can be issued to enable a party to proceed to the Victorian Civil and Administrative Tribunal (VCAT).

The VSBC can also certify that a party has refused to participate in the mediation or alternative dispute resolution process and this may have cost implications at VCAT for the party that refuses to participate.

11. Does the Retail Leases Act 2003 apply to offices?

11. Does the Retail Leases Act 2003 apply to offices?

This depends on the use of the premises under the terms of the lease. If the use is wholly or predominantly for the retail provision of services and the premises are wholly located within the ground, first and second storey, then yes.

A service business on the third storey (where there is a ground, first and second storey) and above is not covered by the Act, though the dispute resolution provisions do apply (Part 10 of the Act).

See VSBC Guidelines ‘What are “retail premises”? for more information.

12. Do all outgoings have to be listed in a commercial lease to enable the tenant to be charged?

12. Do all outgoings have to be listed in a commercial lease to enable the tenant to be charged?

Yes, this is provided for under section 39 of the Retail Leases Act 2003.

See Outgoings for more information.

13. When does a variation of a lease become a new lease?

13. When does a variation of a lease become a new lease?

This depends on the variation involved. In certain circumstances a variation can constitute a new lease, but it would depend on the variation in question.

A variation of lease occurs when a substantial change to the original lease is made.

Many variations will not necessarily cause a surrender and re-grant of a lease. If it is not the intention of the parties to create a new lease, legal advice should be obtained before a lease is varied, especially if such variations are to be extensive.

Note: If a new retail lease is created via a variation, the landlord must provide the tenant with a new Disclosure Statement.

14. Can a landlord force a tenant to move premises?

14. Can a landlord force a tenant to move premises?

The landlord can only force a tenant to move premises if a there is a relocation clause in the lease.

If the lease does not contain a relocation clause, the landlord cannot move the tenant.

If the lease does contain a relocation clause, it should specify the conditions under which the landlord can relocate the tenant.

Under the Retail Leases Act 2003 certain conditions for relocation apply to the lease. For example:

  • the new premises must be ‘reasonably comparable’ to the existing premises
  • the rent for the new premises is to be generally the same as for the existing premises
  • the landlord must pay the tenant’s reasonable costs of the relocation

In addition to the lease, the Act also provides that the Disclosure Statement (provided by the landlord to the tenant) must specify whether the lease contains a relocation clause and if the landlord has any plans for the building in which the premises are located during the term of the lease which may invoke the relocation clause.

Section 55 of the Act covers the issue of relocation of the tenant’s business.

15. Under what circumstances can a tenant claim compensation from a landlord?

15. Under what circumstances can a tenant claim compensation from a landlord?

Under the Retail Leases Act 2003, a tenant can claim reasonable compensation for interference from a landlord under the following circumstances:

  • if a landlord inhibits the tenant’s access to the premises
  • unreasonably taking action that causes significant disruption to the tenant’s trading at the premises
  • failing to rectify as soon as is practical any breakdown of plant or equipment that is not under the tenant’s care or maintenance.

Section 54 of the Act covers the issue of relocation of the tenant’s business. Disputes over compensation can be referred to the VSBC for dispute resolution.

16. Who determines the rent for a retail lease?

16. Who determines the rent for a retail lease?

For new retail premises leases, the rent will be negotiated and decided upon by the landlord and prospective tenant.

For existing leases, the rent will be determined by the rent review provisions in the lease and specifications in the lease.

Rental increases may occur throughout the lease – if the lease provides for it – by a fixed percentage or amount, or by a certain figure determined by the consumer price index (CPI).

If renewing a lease, the lease usually provides for a market review of the rent to determine the value. In this case a range of factors are considered, for example, the location, size and condition of the premises. If the parties cannot agree on the rental for the new term, the parties may require a valuer to determine the rent. If the parties cannot agree on the valuer’s appointment, the VSBC can assist parties in appointing a specialist retail valuer.

17. What should a tenant do if the landlord won’t maintain the premises?

17. What should a tenant do if the landlord won’t maintain the premises?

The landlord is obliged to maintain the premises consistent with the condition of the premises at the start of the lease. This requirement under the Retail Leases Act 2003 overrides any lease provisions to the contrary.

It is the landlord’s responsibility to repair the premises so the tenant can carry on their business uninterrupted.

See Repairs and maintenance for more information.

18. What if a tenant leaves the premises without notifying the landlord?

18. What if a tenant leaves the premises without notifying the landlord?

A retail lease is a legal document and is binding to all parties who sign it.

If a tenant must still fulfil obligations under the lease, but has left the premises without notifying the landlord and is no longer paying rent, then the landlord has:

  • a legal right to re-enter and terminate the lease on the grounds that the tenant has abandoned the premises
  • the right to take action against the tenant to recover any money lost because of the tenant’s departure

We may suggest taking part in mediation with the tenant, or obtaining an order from the Victorian Civil and Administrative Tribunal (VCAT) that the tenant pay the outstanding money.

Contact us to discuss your options.

19. What if a tenant wants to get out of a retail lease?

19. What if a tenant wants to get out of a retail lease?

A retail lease is a legally binding document and therefore both parties must agree to end a lease.

If the landlord does not wish to end the lease, the tenant may be responsible for the landlord’s reasonable out-of-pocket expenses in finding a new tenant.

The actual amount the tenant is responsible for is a matter of negotiation between the parties, but the costs may include rent until the premises are re-let and the agent’s re-letting fees.

20. What if a landlord won't provide a tenant with a copy of the lease?

20. What if a landlord won't provide a tenant with a copy of the lease?

Under the Retail Leases Act 2003 a landlord must give the tenant a copy of the lease signed by both parties within 28 days of the date of the tenant giving the signed lease to the landlord.

If this does not happen with the 28-day timeframe, a tenant may give the landlord notice to terminate the lease.

For more information, see the Victorian Small Business Commission’s information brochure – Retail leases: important facts for tenants.

21. What can a tenant do if a landlord or real estate agent won’t return the security deposit (bond)?

21. What can a tenant do if a landlord or real estate agent won’t return the security deposit (bond)?

A landlord or real estate agent must return the security deposit (bond) to the tenant (including interest earned on the security deposit) within 30 days of the lease ending if the tenant has met their obligations under the lease.

Any dispute concerning its return can be referred to the VSBC for dispute resolution, for example, if the security deposit (and any accrued interest) is not returned or only part of the amount has been returned.

See our security deposits page or more information.

22. Who is responsible for paying land tax under the Retail Leases Act 2003?

22. Who is responsible for paying land tax under the Retail Leases Act 2003?

Section 50 of the Retail Leases Act 2003 states that a landlord cannot pass on land tax to a tenant.

23. What are retail premises?

23. What are retail premises?

Retail premises are more than just ‘shops’. The Retail Leases Act 2003 also covers premises used for consumer, business, trade services or hire of goods (for example, estate agents, doctors and mechanics). This excludes any area intended for use as a residence.

Premises that do not constitute retail premises are defined in Ministerial Determinations.

See VSBC Guidelines What are “retail premises? for more information.

24. What is the coverage of the Retail Leases Act 2003?

24. What is the coverage of the Retail Leases Act 2003?

Retail leases legislation applies to premises that are used wholly or predominantly for the sale or hire of goods by retail or the retail provision of services, and where the occupancy cost is less than $1 million per year (the occupancy cost of retail premises is the combined cost of rent and outgoings).

Retail leases legislation does not apply to:

  • tenants in the business of wholesaling, manufacturing or storage
  • tenants that are listed corporations or subsidiaries of listed corporations
  • leases for a term of less than one year unless consecutively renewed
  • premises or businesses that are excluded under Ministerial Determinations.

See VSBC Guidelines What are “retail premises? for more information.

25. Can a landlord or small business tenant go to the Victorian Civil and Administrative Tribunal (VCAT) with their leasing dispute without first going to mediation?

25. Can a landlord or small business tenant go to the Victorian Civil and Administrative Tribunal (VCAT) with their leasing dispute without first going to mediation?

In some cases, yes. The tenant or landlord can choose to go straight to VCAT if the matter is about:

  • rent only (i.e. recovering rent that is owed but hasn’t been paid), where the matter doesn’t relate to the Commercial Tenancy Relief Scheme
  • relief against forfeiture (i.e. an application by a tenant to stop a landlord from evicting them)
  • an application for an injunction or to recover key money.

In other circumstances, parties must obtain a certificate from the Victorian Small Business Commission (VSBC) stating that mediation has failed or is unlikely to resolve the dispute before making an application to VCAT. This usually means parties need to attend mediation with the VSBC to try to reach a resolution before a certificate can be issued. Examples include disputes over:

  • rent relief
  • repairs, maintenance and outgoings under a retail lease
  • transferring a retail lease.

If the dispute is about a guarantee, the tenant or landlord can choose to go VCAT, which would require a certificate from the VSBC, or go straight to a court. Learn more about the VSBC, VCAT and the courts.

26. Does the Victorian Small Business Commission hold commercial (including retail) tenancy security deposits (bonds) or bond information (as the Residential Tenancy Bond Authority does for residential bonds)?

26. Does the Victorian Small Business Commission hold commercial (including retail) tenancy security deposits (bonds) or bond information (as the Residential Tenancy Bond Authority does for residential bonds)?

No. Many retail leases require the tenant to pay a security deposit (bond) or include an agreement for one as a guarantee. By law, a security deposit for a retail lease must be held by the landlord in an interest bearing account. Security deposits are not reported to or lodged with the Victorian Small Business Commission or any other body. Read more about security deposits.

Owner drivers and forestry contractors FAQs

1. What does the Owner Drivers and Forestry Contractors Act 2005 cover?

1. What does the Owner Drivers and Forestry Contractors Act 2005 cover?

The Act regulates and promotes best practice in the relationship between small business owner drivers transporting goods (not passengers), using up to three vehicles supplied by them, and their hirers and freight brokers. This includes owner drivers working for online platform businesses.

The Act provides a dispute resolution mechanism accessed through the Victorian Small Business Commission (VSBC).

Other relevant resources include:

2. What does alternative dispute resolution under the Owner Drivers and Forestry Contractors Act 2005 include?

2. What does alternative dispute resolution under the Owner Drivers and Forestry Contractors Act 2005 include?

Alternative dispute resolution under the Act includes free assistance early on (over the phone or via email) and low-cost mediation and arbitration.

Mediation with the VSBC is $95 per party for each session.

When mediation isn’t successful or where both parties agree it’s unlikely to succeed, the VSBC can arrange for a binding arbitration. The cost of arbitration is $290 per party.

3. What is arbitration?

3. What is arbitration?

Arbitration is a dispute resolution process where parties in a dispute present arguments and evidence to an independent person (the arbitrator) who will make a final and binding decision. The arbitration process is less formal, quicker and cheaper than going to court.

4. What is the difference between arbitration and mediation?

4. What is the difference between arbitration and mediation?

Mediation is a dispute resolution process where an independent person (the mediator) helps both parties to reach their own legal binding agreement. In arbitration the arbitrator makes a final, binding decision.

5. Can we go directly to arbitration or do we need to do mediation first?

5. Can we go directly to arbitration or do we need to do mediation first?

Arbitration can only happen if both parties agree. You can make an application for arbitration instead of going to mediation or in instances where you went to mediation but it wasn’t successful in resolving the dispute.

6. What is the process for arbitration?

6. What is the process for arbitration?

The VSBC appoints a qualified independent and neutral arbitrator to carry out the arbitration under the Act. The arbitrator will decide whether a conference or hearing with the parties is needed. Where this isn’t needed, the arbitrator will make a decision by evaluating the facts, relevant law and evidence provided by the parties.

At the start of the process you will be provided with the arbitration rules which set out the timeframes that need to met. When an arbitrator is appointed, you will be provided with copy of the Arbitration Agreement that needs to be signed before proceeding. For more information, refer to the Arbitration Rules.

7. How much does arbitration cost?

7. How much does arbitration cost?

The cost of arbitration is $290 per party, making it a low-cost alternative to going to court. Both parties will be asked to pay this fee after the arbitration agreement has been signed.

8. What happens if my owner driver and forestry contract dispute is not resolved at mediation?

8. What happens if my owner driver and forestry contract dispute is not resolved at mediation?

Where mediation is unable to resolve a dispute under the Act, the VSBC will write to both parties to offer arbitration. In arbitration, both parties agree to enter into this dispute resolution process, the outcome of which is a decision that is final and binding.

Alternatively, a certificate can be issued to enable a party to proceed to the Victorian Civil and Administrative Tribunal (VCAT).

The VSBC can also certify that a party has refused to participate in the alternative dispute resolution process (ie. assistance early on, mediation or arbitration). This may have cost implications at VCAT for the party that refuses to participate.

9. Can I have legal representation?

9. Can I have legal representation?

There is no requirement for you to be represented – the decision is yours to make.

If you are a contractor, you can be represented by an association, including a trade union, that represents contractors or a class of contractors.

If you are a hirer, you can be represented by an association that represents hirers or a class of hirers.

If you can’t attend your mediation session, you will need to arrange for another person to have authority to make decisions on your behalf. For more information see Authority to participate in VSBC mediation.

10. How do I apply for a waiver certificate for the minimum period of notice of termination?

10. How do I apply for a waiver certificate for the minimum period of notice of termination?

Under the Act owner drivers and forestry contractors who have been in an ongoing engagement for more than three months are entitled to a minimum period of notice of termination of their contracts (except in cases of serious and wilful misconduct). The period of notice may be worked out, or paid in lieu.

The minimum period required to be given by either party to terminate a contract is:

  • three months’ notice for vehicles in excess of 4.5 tonnes gross vehicle mass
  • one month’s notice for other vehicles.

If this notice requirement does not suit the owner driver or forestry contractor, the requirement can be waived by the owner driver or forestry contractor obtaining a waiver certificate from the VSBC.

To apply for waiver, download the Waiver request form.

Farmers and farm creditors FAQs

1. What happens if my farm debt mediation dispute is not resolved at mediation?

1. What happens if my farm debt mediation dispute is not resolved at mediation?

If the mediation was conducted under the Farm Debt Mediation Act 2011, a creditor may request an exemption certificate to commence debt recovery proceedings if the VSBC considers satisfactory mediation has occurred.

However, if the VSBC considers a creditor has refused to mediate, or failed to mediate in good faith, it can issue a prohibition certificate, which prohibits the creditor from taking further recovery action for up to six months.

If the VSBC considers a farmer has refused to mediate, or failed to mediate in good faith, it can issue an exemption certificate to the creditor enabling it to commence recovery action.

2. Where can I find out more about the process?

2. Where can I find out more about the process?

All details relating to the process for mediation under the Act can be found on the Agriculture Victoria website.

The farm debt mediation scheme is administered by Agriculture Victoria — please contact the Farm Debt Mediation Officer on 136 186 for further information.

3. What is the VSBC role with farm debt matters?

3. What is the VSBC role with farm debt matters?

The VSBC mediates farm debt disputes under the Farm Debt Mediation Act 2011.

The legislation aims to resolve farm debt disputes efficiently and equitably by requiring a creditor to provide a farmer with the option to mediate before taking possession of property or other enforcement action under a farm mortgage.

There are two types of mediation available under the Act. The first is creditor-initiated mediation, which results from a creditor issuing a notice under section 8 of the Farm Debt Mediation Act 2011. The second is farmer-initiated mediation, where a farmer takes the initiative to request mediation with their creditor.

Read more on the VSBC’s  farm debt mediation page

Taxi, hire car and rideshare FAQs

1. When can applications for mediation with the VSBC for taxi driver and operator disputes be lodged?

1. When can applications for mediation with the VSBC for taxi driver and operator disputes be lodged?

Applications must be lodged with the VSBC within 30 days of a certificate being issued by the Commercial Passenger Vehicles Victoria (CPVV). The application form must be accompanied by a copy of the CPVV certificate.

2. How does the VSBC deal with disputes between taxi, hire car and rideshare drivers and their operators?

2. How does the VSBC deal with disputes between taxi, hire car and rideshare drivers and their operators?

Disputes between drivers and operators over a Driver Agreement must first be lodged with the Commercial Passenger Vehicles Victoria (CPVV). If the CPVV is unable to resolve the dispute and it is amenable to mediation, the CPVV will issue a certificate for the parties enabling them to lodge an application for mediation with the VSBC.

Related information