From 15 August 2016, unnecessary regulations for real estate agents dealing with certain commercial property agency work, has been removed.
The exemption applies in the following circumstances:
- if the agent is doing commercial property agency work on behalf of an affiliate of the agent.
- if the agent is doing commercial property agency work for an entity, or joint entity, that owns any property with:
- an aggregate market value of $40 million or more, or
- an aggregate gross floor area of 20,000 square metres or more.
Frequently asked questions
Why has the exemption been introduced?
The NSW Government is implementing all recommendations from the Independent Pricing and Regulatory Tribunal (IPART) Final Report, Reforming licensing in NSW.
The Report recommended that the 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 real estate agent must be doing commercial property agency work for:
- an affiliate of the agent, or
- on behalf of an entity (or joint entity) that owns any property that meets the thresholds specified in the 2014 Regulation.
If so, the agent is exempt from the operation of all of the Act’s requirements when performing this type of work.
What does ‘commercial property agency work’ mean?
Commercial property agency work means selling, purchasing, exchanging, leasing, managing or otherwise dealing with property that is not residential property or rural land. This comes under Clause 3 of the Property, Stock and Business Agents Regulation 2014.
What is an example of an ‘affiliate of the agent’?
An example is where the agent might be a property management company that is owned by the owner of a large shopping centre. The affiliate of the agent 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 do the exemptions apply?
For commercial property agency work on behalf of an entity, the exemptions apply 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 based on 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?
If you’re still not sure whether the exemption applies to your circumstances after you have read the Fair Trading web pages and the exemption provision in the 2014 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.