FAQs

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?

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?

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?

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

• Online
• Email:enquiries@vsbc.vic.gov.au
• Post: VSBC, GPO Box 4509, Melbourne 3001

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?

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?

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?

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, call us on 1800 878 964 or email us.

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?

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?

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

1. How much does mediation cost?

For most commercial disputes, each party pays $300 (incl. GST) for a half-day mediation session or $600 (incl. GST) for a full-day session. The remaining fee is subsidised by the Victorian Government, making it a very low-cost alternative to litigation.

The exceptions are:

• disputes between farmers and their creditors over farm debt, which cost $195 per party for a full-day session

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

Before the mediation is arranged, the Victorian Small Business Commission (VSBC) will email both parties a payment notice for the mediation fee. Payment is required within seven days of the date on the payment notice. Payment options are BPAY or credit card. Payment at the VSBC’s Melbourne office is not available.

If payment isn’t made within seven days by both parties, the mediation session will be cancelled and a certificate may be issued noting that a party has withdrawn from mediation or refused to mediate. If one party pays the fee and the other(s) does not and the mediation is cancelled, the party who has paid will have their fee refunded.

For disputes under the Retail Leases Act 2003 and Owner Drivers and Forestry Contractors Act 2005, this certificate would allow an application to be made to the Victorian Civil and Administrative Tribunal (VCAT). VCAT can then take into account a party’s refusal to participate in or withdrawal from mediation when determining if one party should pay part or all of the costs of the other party.

For disputes under the Small Business Commission Act 2017, the VSBC can certify that a party has unreasonably refused to participate in alternative dispute resolution.

A mediation cancellation fee ($900 half day, $1,350 whole day) may be charged if the session does not go ahead. This can be due to a party’s attendance without full authority or if a party cancels or reschedules the session within five business days of the agreed mediation date.

In very limited circumstances, the VSBC may choose to provide the parties with a second mediation. The decision to do so rests solely with the VSBC and the parties will be required to cover the full costs of the mediation (i.e. there will be no subsidisation for a second mediation).

If you have any queries or would like more information, contact us on 1800 878 964 or at enquiries@vsbc.vic.gov.au.

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?

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 for the full cost of the mediation session ($900 half day, $1,350 whole day).

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 for the full cost of the mediation session ($900 half day, $1,350 whole day).

5. Where does mediation take place?

Following our 2022 review of the VSBC’s services, we decided to embed online mediation as part of our usual operating model. Online mediation, originally necessitated in response to COVID-19, has brought with it marked efficiencies, uninterrupted service delivery and positive customer feedback.

For certain situations, we still offer in-person sessions at our Melbourne mediation rooms (121 Exhibition Street Melbourne, Victoria 3000).

For disputes in regional areas, we can arrange for mediation to be held at a location that suits both parties. The VSBC will arrange for a mediator to travel to the location and organise the venue.

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?

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?

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?

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?

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?

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?

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?

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?

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?

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?

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?

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.

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?

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?

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?

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?

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?

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?

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?

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.

They can also be disputes between an independent contractor gig worker and their platform, including owner drivers who transport passengers (such as Uber and DiDi drivers) and workers who provide disability support, domestic services and a variety of other tasks (such as Mable and Airtasker workers).

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.

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?

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?

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?

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?

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?

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?

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?

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?

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?

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?

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).

For more information, see the VSBC’s guidelines What are ‘retail premises’?.

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.

For more information, see the VSBC’s outgoings web page.

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?

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?

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?

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?

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 the VSBC’s repairs and maintenance web page for more information.

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?

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?

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)?

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.

For more information, see our security deposits web page.

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?

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.

For more information, see the VSBC’s guidelines What are ‘retail premises’?.

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.

For more information, see the VSBC’s guidelines What are ‘retail premises’?.

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)?

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.

27. How can tenants and landlords access FAQs on the Victorian Government's Commercial Tenancy Relief Scheme (the Scheme)?

The VSBC’s FAQs can be accessed below:

• FAQs: 16 January 2022 to 15 March 2022
• FAQs: 28 July 2021 to 15 January 2022
• FAQs: 1 January 2021 to 28 March 2021
• FAQs: 29 September 2020 to 31 December 2020
• FAQs: 29 March 2020 to 29 September 2020
• FAQs: the VSBC’s rent relief supports after the Scheme ended

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 platforms, hirers and freight brokers. This includes gig worker owner drivers where the driver transports goods only (e.g. DoorDash and Menulog drivers).

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

Other relevant resources include:

• current rates and cost schedules
• the Victorian Owner Drivers Information Booklet
• the Owner Drivers and Forestry Contractors Code of Practice.

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 $300 per party for each half-day 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 parties will be required to pay the fees and expenses of VSBC conducting the arbitration.

Applications for early help, arbitration and mediation can be made via our online help portal.

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?

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?

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?

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?

The parties will be required to pay the fees and expenses of VSBC conducting the arbitration. 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?

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?

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 our web page on authority to participate in mediation.

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 a waiver certificate, visit the VSBC’s online help portal.

1. What is farm debt mediation?

Under Victoria’s Farm Debt Mediation Act 2011 (the Act), farmers have the right to be offered mediation by their creditor before the creditor can start debt recovery on their farm mortgage. Farm debt mediation is a negotiation process where the farmer and creditor come together with an impartial mediator to discuss options for managing current and future farm debt arrangements.

The service is voluntary, confidential, quick and low-cost, and can help avoid the high costs, stress and lengthy delays that come with legal recovery proceedings.

The Victorian Small Business Commission (VSBC) arranges mediation sessions.

At mediation, both the creditor and farmer are required to make a genuine attempt to mediate in good faith. This means communicating with each other and having discussions honestly and fairly with the genuine aim of reaching an agreement that they can both accept. It also involves behaving in an open and transparent manner and providing accurate and sufficient information to support negotiations.

Learn more by accessing our:

• Farm debt mediation fact sheet
• information for farmers and creditors
• guide to mediation.

2. Where are farm debt mediations held?

Farm debt mediations can be held at the VSBC’s Melbourne office or at locations across regional Victoria, depending on the needs of the farmer and creditor.

3. How much does farm debt mediation cost?

The cost is $195 per party, per session, with mediations generally being completed in one session. The service is subsidised by the Victorian Government, which makes it a very low-cost alternative to litigation. Parties are responsible for their own travel and costs for preparing to attend mediation.

Before the mediation session takes place, the VSBC will email both parties an invoice for the mediation fee. Payment is required within seven days of the date on the invoice. Payment options include EFT, BPAY, cheques and cash at over the counter service centres at regional offices or Australia Post (please note, payment at the VSBC’s Melbourne office is not available).

If payment isn’t made within seven days by both parties, the mediation session will be cancelled and if requested, a certificate may be issued noting that a party has withdrawn from mediation or refused to mediate. For information on what can happen if a creditor refuses to mediate, see question 9. For information on what can happen if a farmer refuses mediate, see question 8.

N.B. A mediation cancellation fee ($1,350, which is equivalent to the full fee) may be charged if the mediation can’t go ahead. This can be due to a party’s attendance without full authority or if a party cancels or reschedules the mediation within five business days of the agreed mediation date.

4. Can a creditor ask a farmer to waive their rights under the Farm Debt Mediation Act 2011?

Creditors cannot ask farmers to waive their rights under the Act, for example, as a condition of entering a new loan or altering existing loan agreements.

5. What are the important changes to the Farm Debt Mediation Act 2011 that took effect in 2022?

A number of significant changes were made to Victoria’s Farm Debt Mediation Act 2011 (the Act) to strengthen farmers’ rights to farm debt mediation, streamline the process and align aspects of the legislation with other states.

From 31 October 2022, the changes that took effect include the following:

• The definition of ‘farming operation’ now include aquaculture and forestry and timber production, ensuring more farmers are protected.
• The VSBC took on full administrative responsibilities for the Farm Debt Mediation Scheme from Agriculture Victoria. This means that information, guidance and approved forms for farm debt mediation are now available on our website and creditors are required to notify us directly of an agreement to mediate. The VSBC is also the first point of contact for farm debt mediation queries.
• Creditors are now required to obtain an exemption certificate in all instances before taking enforcement action (recovering debt on a farm mortgage), including when a farmer hasn’t responded to their offer to mediate.
• The VSBC now has some discretion when it comes to issuing exemption certificates and prohibition certificates (which stop creditors from taking enforcement action).

Learn more about these and other important changes to farm debt mediation in Victoria.

6. What is the VSBC’s role with farm debt matters?

Under Victoria’s Farm Debt Mediation Scheme, the VSBC provides early help to farmers and creditors who have agreed to mediate. This includes discussing rights and obligations, informing farmers about the free and independent support offered by the Rural Financial Counselling Service, appointing a mediator and arranging a suitable time and place for mediation to happen.

7. How does farm debt mediation work?

There are two types of mediation available under the Farm Debt Mediation Act 2011 (the Act). The first is creditor-initiated mediation, which commences when a creditor issues a notice under section 8 of the Act to advise the farmer that farm debt mediation is available. The second is farmer-initiated mediation, where a farmer takes the initiative to request mediation with their creditor.

8. What if a farmer refuses to mediate?

If a farmer has refused to mediate and is in default, and no prohibition certificate is in force in relation to the farm mortgage, their creditor can request an exemption certificate from the VSBC. This certificate enables a creditor to start enforcement action.

A creditor is required to obtain an exemption certificate in all instances before taking enforcement action under a farm mortgage, including when the farmer has not responded to their offer of mediation.

The VSBC has some discretion in the issuing of exemption certificates. For example, we may refuse to issue this certificate where we are satisfied that the farmer is justified in refusing or failing to mediate and intends to do so within a reasonable timeframe.

The farmer will be advised of a creditor request for an exemption certificate and of the issue of this certificate. An exemption certificate remains in place for three years.

9. What if a creditor refuses to mediate?

If a farmer is in default under a farm mortgage and has requested mediation with their creditor and the creditor has refused to mediate, the farmer can request a prohibition certificate from the VSBC. This certificate prevents a creditor from taking enforcement action.

The VSBC has some discretion in the issuing of prohibition certificates. For example, we may refuse to issue a prohibition certificate if we believe the creditor’s failure to respond to a request to mediate is justified and the creditor intends to mediate within a reasonable timeframe.

A prohibition certificate remains in place for six months or until the day the farmer and creditor enter into mediation.

If the farmer is not in default under a farm mortgage and has requested mediation with their creditor and the creditor has refused to mediate, there is no further action. The VSBC encourages farmers in this position to contact their local Rural Financial Counselling Service (RFCS). Rural financial counsellors can help farmers who are experiencing difficulty to understand their financial position and the viability of their enterprise, and develop and implement plans to improve their situation.

10. What happens at the end of mediation?

Under the Farm Debt Mediation Act 2011 (the Act), the creditor can request an exemption certificate on the basis that satisfactory mediation has taken place. This certificate enables the creditor to start enforcement action under a farm mortgage. Satisfactory mediation means that mediation has resolved the matter or that mediation has proceeded as far as it reasonably could though hasn’t resolved the matter. In situations where mediation Terms of Settlement are in force, the creditor should not proceed with enforcement action where the said Terms of Settlement are being met.

A farmer can request a prohibition certificate if they consider that the creditor has failed to take part in mediation in good faith. A prohibition certificate stops a creditor from taking enforcement action for up to six months or until the day the farmer and creditor enter into mediation.

The VSBC determines whether or not exemption and prohibition certificates are issued based on the requirements of the Act.

11. Where can farmers and creditors access the forms and guidance on processes?

Via the VSBC website, farmers and creditors can access:

• the forms for farm debt mediation
• the creditor-initiated mediation process and forms
• the farmer-initiated mediation process and forms
• support and information for farmers
• information for creditors.

12. Which services are available to support farmers before, during and after farm debt mediation?

The VSBC encourages all farmers taking part in farm debt mediation to contact their local Rural Financial Counselling Service (RFCS) for support, or their solicitor, accountant or another suitably qualified professional.

The RFCS is a free and independent service that can provide a rural financial counsellor to help a farmer prepare for mediation, assist them on the day and help them with any actions that need to be undertaken after mediation. Help includes providing wellbeing, emotional and decision-making support, financial analysis and scenarios, and guidance on options for resolving the matter.

Farmers can find their local service by calling 1300 771 741 or visiting Agriculture Victoria’s RFCS web page.

13. Where can farmers and creditors access more information?

For more information or queries about farm debt mediation (including in relation to the processes and required forms), contact the VSBC by calling 1800 878 964 or emailing enquiries@vsbc.vic.gov.au.

For more information about mediation, including cancelling, rescheduling and adjourning mediations, accessing free interpreter services and having a friend or relative attend on the day, see our mediation FAQs and guide to mediation.

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?

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.