A Ministerial Determination dated 12 August 2016 made pursuant
to Section 5(1)(d) of the Retail Leases Act 2003
(Act) was published in a Special Gazette last
week. The Ministerial Determination was made in response to the
increasing uncertainty surrounding the application of section
4(2)(d) of the Act which excludes from the definition of
"retail premises" and therefore the Act "premises
the tenant of which is – a body corporate whose securities
are listed on a stock exchange, outside Australia and the external
territories, that is a member of the World Federation of
Exchanges". Section 4(2)(d)(ii) also excludes subsidiaries of
such bodies corporate.
The fluctuating membership of the World Federation of Exchanges
and the uncertain status of stock exchanges who are not members of
the World Federation of Exchanges in their own right but are
subsidiaries of member exchanges has posed an ongoing problem in
determining the application of the Act. The Ministerial
Determination dated now operates to exclude from the Act premises
the tenant of which is a body corporate listed on a Stock Exchange
outside of Australia or a subsidiary of such a body corporate.
Holding Redlich first raised concerns about the fluctuating
membership of the World Federation of Exchanges with the Shopping
Centre Council of Australia in 2011 when we became aware that the
New Zealand Stock Exchange had resigned its membership. After
lobbying by the Shopping Centre Council of Australia the
Ministerial Determination dated 20 December 2011 was made which
excluded from the operation of the Act leases to tenants who are
companies whose securities are listed on the New Zealand Stock
Exchange or tenants who are subsidiaries of such companies.
Ironically, the New Zealand Stock Exchange has subsequently
re-joined the World Federation of Exchanges. The latest Ministerial
Determination revokes the 2011 Ministerial Determination.
In early 2015 we alerted the Shopping Centre Council of
Australia to the resignation of the London Stock Exchange and the
uncertain status of stock exchanges who are not members of the
World Federation of Exchanges in their own right but are
subsidiaries of member exchanges such as New York Stock Exchange.
The outcome of this was that a number of major tenants, including
McDonalds, had the protection of the Act which was clearly contrary
to the policy objectives of the Act.
The Ministerial Determination dated 12 August 2016 finally
addresses the problems associated with the practical application of
Section 4(2)(d) of the Act which means that landlords and tenants
can negotiate lease terms with certainty. A copy of the Ministerial
Determination can be
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