What the Act does
The Retail Leases Act 2003 (Vic) regulates leases of retail premises in Victoria. It requires landlords to give prescribed information at set times, limits what a tenant can be charged, imposes obligations whatever the lease says, makes some lease terms void, and sets a dispute process through the Victorian Small Business Commission and VCAT. The Retail Leases Regulations 2023 (Vic) fill in the detail, including the prescribed forms.
Which leases it covers
The Act applies only to leases of retail premises: premises used, or to be used, wholly or predominantly for the retail sale or hire of goods or the retail provision of services (ss 4 and 11). It does not apply where, among other exclusions:
- occupancy costs are more than $1,000,000 a year, excluding GST (s 4(2); reg 6);
- the tenant is a listed corporation, or a subsidiary of one;
- the tenant runs the business as the landlord’s employee or agent; or
- a Ministerial determination excludes the premises, business, tenant or lease.
Leases for less than a year are generally outside the Act, unless renewals or continued occupation give the tenant a year or more of continuous possession (s 12). For the detail, read does the Retail Leases Act apply to my lease.
Before the lease is signed
- Brochure and draft lease (s 15). As soon as negotiations begin, the landlord must give a copy of the proposed lease and the Small Business Commission’s information brochure. A new brochure applies to negotiations starting on or after 1 July 2026.
- Disclosure statement (s 17). At least 14 days before the lease is entered into, the landlord must give the disclosure statement in the prescribed form and the proposed lease, completed. If the statement is late, missing or wrong, the tenant has remedies, including withholding rent and ending the lease. See disclosure statements.
- Landlord’s legal costs (s 51). The landlord cannot recover its costs of negotiating, preparing or executing the lease, or of obtaining a mortgagee’s consent, from the tenant.
The 5-year minimum term (s 21)
The term, including options, must be at least 5 years. A shorter lease is not invalid; its term is extended to comply. A tenant can waive the minimum only by obtaining a certificate from the Small Business Commission, which confirms it has explained the effect of the rule, and giving it to the landlord.
Rent and rent reviews (ss 35 and 37)
The lease must say when rent is reviewed and on what basis: a fixed percentage, an index such as CPI, a fixed amount, or current market rent. A term that prevents rent from going down at a market review is void. If the landlord has not started a review within 90 days after the time the lease allows, the tenant may start it. Market reviews are done by a specialist retail valuer, with the cost shared. A cap on a CPI or market review, such as CPI but no more than 5%, is allowed: the Supreme Court decided this in December 2024, and the Court of Appeal refused leave to appeal in June 2026. See rent reviews.
Outgoings, land tax and CIPT (ss 39 to 50)
- A tenant pays only the outgoings the lease specifies, worked out and apportioned as the lease says.
- The landlord must give an itemised estimate before the lease is entered into and at least one month before each accounting period (s 46).
- An annual statement is due within 3 months after each accounting period, usually with an auditor’s report (s 47).
- Terms requiring the tenant to pay capital costs, depreciation, sinking fund contributions, the landlord’s interest or head-lease rent are void, with limited exceptions.
- Terms requiring the tenant to pay the landlord’s land tax, or commercial and industrial property tax (CIPT), are void (s 50).
Repairs and alterations (ss 52 and 53)
The landlord must maintain the structure, fixtures, plant and equipment, and landlord-provided appliances, in a condition consistent with their condition when the lease was entered into, except where the tenant’s misuse caused the problem. Where an urgent repair substantially affects the business and the landlord has not acted, the tenant may arrange it and recover the reasonable cost. The landlord must give 60 days’ notice of alterations likely to affect the business.
Security deposits (s 24)
A cash deposit must be held in an interest-bearing account. The landlord cannot unreasonably refuse a bank guarantee instead. If the tenant has met its obligations, the deposit must be returned within 30 days after the lease ends.
Relocation and demolition (ss 55 and 56)
- Relocation: only for a genuine proposal needing vacant possession, on at least 3 months’ written notice with details of comparable premises. The tenant may end the lease within a month of the notice; otherwise it receives a new lease of the alternative premises and its reasonable relocation costs.
- Demolition: only for a genuine proposal, on at least 6 months’ written notice. The tenant may leave earlier on 7 days’ notice, and is compensated for fit-out the landlord did not provide.
Options and renewal (ss 26 to 28B and 64)
The landlord must remind the tenant in writing at least 3 months before the last date to exercise an option. Where the new rent is set by a market review, the tenant may ask for it to be done early, and the tenant has a cooling-off period. Where there is no option, the landlord must say 6 to 12 months before the end whether it will renew. See options to renew.
Assignment and sub-leasing (ss 60 to 63)
A landlord can refuse consent to an assignment only on limited grounds, and is taken to consent if it does not respond within 28 days of a complete request. On the assignment of an ongoing business, a tenant who gives the incoming tenant and the landlord an accurate assignment disclosure statement in the prescribed form, and its guarantor, are released from liability for the incoming tenant’s defaults. See assigning the lease.
Unconscionable conduct (Part 9)
Landlords and tenants must not engage in unconscionable conduct in connection with a lease or proposed lease (s 77). The Act lists factors that may be considered, such as pressure to accept less than the 5-year minimum term. A claim for loss is made to VCAT.
Disputes (Part 10)
A retail tenancy dispute goes first to mediation at the Small Business Commission. VCAT can hear it only once the Commission certifies that mediation has failed or is unlikely to resolve it, unless an injunction is sought (s 87). VCAT’s jurisdiction is exclusive, with exceptions (s 89), and each party usually bears its own costs (s 92). See lease disputes.
Recent changes
| From | Change |
|---|---|
| 1 October 2020 | Disclosure period increased from 7 to 14 days; security deposits returned within 30 days; option reminder notices at least 3 months before the exercise date, with early market reviews and cooling off. |
| 15 April 2023 | Retail Leases Regulations 2023 (Vic): new prescribed forms and the $1,000,000 occupancy cost threshold. |
| 1 July 2024 | Terms passing on commercial and industrial property tax (CIPT) to a retail tenant are void, as land tax terms already were. |
| December 2024 and June 2026 | Caps on CPI and market rent reviews held permissible under s 35 (Supreme Court; the Court of Appeal refused leave to appeal). These are court decisions, not amendments. |
| 1 July 2026 | New Small Business Commission information brochure for negotiations starting on or after this date. |
Law referred to
- Retail Leases Act 2003 (Vic) ss 4, 11, 12, 15, 17, 21, 24, 26 to 28B, 35, 37, 39 to 51, 52, 53, 55, 56, 60 to 64, 77, 87, 89 and 92.
- Retail Leases Regulations 2023 (Vic) reg 6 and Schedules 1 to 4.
- Aldi Foods Pty Ltd v Northcote Shopping Centre Pty Ltd [2024] VSC 799; Northcote Shopping Centre Pty Ltd v Aldi Foods Pty Ltd [2026] VSCA 140.
Last reviewed: October 2026, by a Victorian solicitor with a current practising certificate. This page is general information about Victorian law as at October 2026. It is not legal advice about your lease.
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