Imagine that you rent a shop for your small or medium enterprise (SME). One of your chief concerns would be just how this rent is negotiated: Am I paying too much? How can I balance this with my staff payroll?
Minister of State for Trade and Industry Low Yen Ling worked with various tenants and landlords, as well as with trade associations and industry groups, to solve thorny problems like this with the landmark new Lease Agreements for Retail Premises Bill which supports fair and balanced bargaining positions between landlords and tenants. The Bill mandates a Code of Conduct for all to adhere to.
“The Code not only benefits tenants and landlords, but the Code also supports a vibrant and healthy lifestyle sector and contributes to our tourism industry,” said MOS Low to Parliament this Thursday afternoon (Aug 3).
This is good news to the many small- and medium-sized businesses and talents in the retail and tourism sector. Fairer lease terms for businesses can positively affect the jobs of some 420,000 people here.
Source: Low Yen Ling/ Facebook
Levelling the playing field for tenants
The Bill provides this support through three main ways: Mandating compliance with the leasing principles in it, establishing the Fair Tenancy Industry Committee and having an accessible and affordable dispute resolution process whenever differences arise.
“In my various engagements with many tenants and landlords, their overall feedback has been positive and constructive,” said MOS Low regarding the early adopters of the Code.
“Tenant representatives also share that the code has helped level the playing field somewhat and enabled the parties to find some common ground in these negotiations.”
Allaying concerns
The PAP MPs lauded this Bill, but also raised concerns of the Code’s feasibility for implementation and ability to keep pace with the market’s rapidly changing needs.
“While there should be flexibility, transparency and certainty for businesses are also important. Can Minister share how frequently the Code of Conduct will be modified?” asked MP Louis Ng (Nee Soon GRC).
“Since the Code was first published in March 2021, it has been updated twice. We’re seeing the third version,” answered MOS Low about how this living document will keep evolving to meet industry needs.
MP Saktiandi Supaat (Bishan-Toa Payoh GRC) observed that some parties may deliberately structure their lease in multiple 11-month renewal periods so that they do not have to comply with the Bill.
“If any party suspects that their lease terms are being deliberately shortened to circumvent compliance with the Code and the Bill, they can report to the FTIC such practices for going against the spirit of the Code,” responded MOS Low.
MP Saktiandi, alongside MP Murali Pillai (Bukit Batok SMC) and MP Lim Biow Chuan (Mountbatten SMC), also asked about the qualifications of the Code’s meditators and adjudicators.
“The mediators will comprise both legally-trained and non-legally-trained individuals who must pass SMC’s [Singapore Mediation Centre] training program with a Distinction grade, and all adjudicators have to be legally-trained individuals,” answered MOS Low.
Summing up, MOS Low said that this unprecedented Bill is also a landmark for the government.
“We have tabled a Bill that mandates compliance with principles that’s drawn from a Code that’s developed by the industry that’s owned by the industry. And it is because the industry and the stakeholders recognise the need for this Code, and the benefits, the collective benefits that it can bring to the stakeholders of the retail sector.”