Common questions and answers about the exemptions from certain regulations when performing commercial property work.
Since 15 August 2016, unnecessary regulations for real estate agents undertaking certain commercial property agency work have been removed.
The following work is excluded from real estate agent functions covered by the Property and Stock Agents Act 2002 (the Act):
- if a person is doing commercial property agency work on behalf of an affiliate of the person
- if a person is doing commercial property agency work for an entity that owns any property having:
- an aggregate market value of $40 million or more, or
- an aggregate gross floor area of 20,000 square metres or more.
This exclusion is found in clause 4 of the Property and Stock Agents Regulation 2014 (the Regulation).
Frequently asked questions
Why has the exemption been introduced?
The NSW Government is implementing recommendations from the Independent Pricing and Regulatory Tribunal (IPART) final report: Reforming licensing in NSW.
The report recommended that the NSW Government should remove red tape by exempting certain commercial property agents from the Act’s requirements. This concerns agents who sell or manage property for either a related corporate entity or a large commercial property owner.
The exemption recognises that the protections provided by the Act are not relevant for this work.
How does the exemption work?
For the exemption to apply, the person must be doing commercial property agency work for:
- an affiliate of the person, or
- on behalf of an entity that owns any property that meets the thresholds specified in clause 4(2) of the Regulation.
If so, the person is exempt from all requirements of the Act when performing this type of work.
What does ‘commercial property agency work’ mean?
Commercial property agency work is defined in clause 3 of the Regulation to mean selling, purchasing, exchanging, leasing, managing or otherwise dealing with property that is not residential property or rural land.
What is an example of an ‘affiliate of the person’?
An example is where the person might be a property management company that is owned by the owner of a large shopping centre. The affiliate of the person is the owner of the large shopping centre. That owner may use the property management company to lease shops in the shopping centre (on behalf of the owner).
At which thresholds does the exemption apply?
For commercial property agency work on behalf of an entity, the exemption applies where the entity owns any property that has:
- An aggregate market value of $40 million or more, or
- An aggregate gross floor area of 20,000 square metres or more.
These thresholds were decided following consultation with industry stakeholders.
As a real estate agent, I'm unsure if the exemption applies to commercial property agency work that I'm considering undertaking - what should I do?
If you’re still not sure whether the exemption applies to your circumstances after you have read the Fair Trading web pages and the Regulation, you could:
- call Fair Trading on 13 32 20 or lodge an enquiry
- raise the matter with an industry body (if you have membership), or
- seek legal advice on the matter.
Ultimately, it is your responsibility to ensure that you follow the law.