As part of the continued regulation of the short term letting industry, the NSW Government has released a mandatory Code of Conduct (“the Code”) which will commence on 18 December 2020.
The Code will apply to short term rental accommodation industry participants, booking platforms, letting agents, hosts and guests.
Principal Objectives of the Code
The principal objectives of the Code are to:
- set out the rights and obligations of short-term rental accommodation industry participants;
- provide for resolution of disputes and complaints about the conduct of short-term rental accommodation industry participants;
- outline the compliance and enforcement approach that applies to contraventions of the code by short-term rental accommodation industry participants; and
- facilitate the oversight of the short-term rental accommodation industry.
The NSW Fair Trading Commissioner (“Commissioner”) will have powers to administer the Code.
Industry Participants, Booking Platforms, Letting Agents, Hosts and Guests
The Code also contains rights and obligations of industry participants and includes guidance for booking platforms, letting agents, hosts and guests.
The Code also includes a detailed complaints process for alleged contraventions of the Code and contraventions of other laws.
Where the Commissioner finds that an industry participant has contravened the Code, the Commissioner may:
- issue a warning notice informing the participant that the participant has been found to have contravened the Code and must, in the future, comply with the Code or face disciplinary action;
- issue a direction to the participant requiring the participant to act or stop acting in a manner relevant to their participation in the short-term rental accommodation industry;
- record a strike against a host, or a host with reference to specific premises, or guest, or
- record a host, or a host in relation to specific premises, or a guest on the exclusion register as an excluded host or guest under section 4.2 of the Code.
Any direction the Commissioner issues will be void to the extent it is inconsistent with any planning laws or by-laws.
If the Commissioner is satisfied that a host or guest has contravened the Code, the Commissioner can record a strike for the following reasons:
- there has been a serious contravention of the Code, or
- the Commissioner is otherwise satisfied that it is appropriate to do so, having regard to all the circumstances of the case including the number and nature of previous contraventions.
The Commissioner may take any other disciplinary action the Commissioner considers appropriate in all the circumstances.
The Commissioner may only take disciplinary action against an industry participant after affording the industry participant procedural fairness in relation to a complaint.
If the Commissioner decides to take disciplinary action against an industry participant, the Commissioner must provide a brief statement of reasons to the participant and inform the participant that they may apply to the secretary for a review of the decision.
Where an industry participant has been subject to other regulatory action for a breach of criminal laws, by-laws, or planning laws that is also a contravention of the Code, the Commissioner may only take disciplinary action against that participant for that contravention if it is necessary to protect the public or the Code’s integrity.
The Commissioner must keep and administer an exclusion register.
The Commissioner is to make publicly available on the internet a means to search the exclusion register and is to ensure the register is updated in real time to the extent possible. The Commissioner may record on the exclusion register either a host, or a host in relation to particular premises, or a guest.
The Commissioner must record on the exclusion register for five years:
(a) the guest as an excluded guest where the guest has had two strikes recorded against them in a two-year period
(b) the host in relation to specific premises where the host has had two strikes recorded against them in a two-year period and the Commissioner considers it appropriate that the host only be excluded in relation to those premises
(c) the host as an excluded host where a host has had two strikes recorded against them in a two-year period and the Commissioner considers it appropriate that the host be excluded from acting as a host in relation to any premises.
The Commissioner must also record a host or a guest on the exclusion register if the Commissioner is satisfied that:
(a) the person has been charged with a criminal offence and it is in the public interest to record the person on the exclusion register as an excluded host or guest until the criminal proceedings are determined, or
(b) the person has been convicted of an offence and it is in the public interest to record the person on the exclusion register for a specified period or indefinitely.
The exclusion register must record:
(a) for an excluded host or guest—their name and any other of their details that the Commissioner considers necessary to identify them
(b) for a host excluded in relation to specific premises—the address of the premises and the name of the host who incurred the strikes with respect to the premises
(c) any other details about an excluded host, guest or premises the Commissioner considers appropriate.
Before the Commissioner records a host or guest on the exclusion register, the Commissioner must take reasonable steps to notify the relevant host or guest of (a) the Commissioner’s intention to record the host, guest or premises on the exclusion register and (b) the period for which the record will remain on the exclusion register.
The Commissioner must promptly remove any false, erroneous or misleading information about a host, a guest or premises, from the exclusion register.
A premises owner may apply to the Commissioner for the removal of a premises from the exclusion register. The Commissioner is to remove the premises from the exclusion register if the Commissioner is satisfied that the owner is not the host against whom the strikes with respect to the premises were incurred and the host against whom the strikes with respect to the premises were incurred no longer has any direct or indirect interest in the premises.
Despite any other clause of the Code, a booking platform, letting agent or host is not required to cancel any short-term rental accommodation arrangement involving a host or premises recorded on the exclusion register where: (a) the arrangement was made before the date (the record date) on which the host or guest was recorded on the exclusion register, and (b) the occupancy period starts within one month of the record date.
Appeals against the Commissioner’s decision to record a guest, host or host’s premises on the exclusion register are covered in the Regulations.
An industry participant who has received a warning notice, direction, or strike against their name or in relation to premises may apply to the Secretary for a review of the Commissioner’s decision.
An industry participant may apply for a review within 21 days of receiving notice of the disciplinary action from the Commissioner.
The Secretary may determine the form in which a review application must be made.
A review application may include submissions to the Secretary about why the Commissioner’s decision should be changed or overturned.
The Secretary must decide a review application within 28 days.
The Secretary is to notify the applicant of the Secretary’s decision and the reasons for the decision.
The Secretary may decide to impose alternative or additional disciplinary action on the applicant as a result of the review.
If you would like to find out more, please contact us.
Disclaimer: Please note that the information contained in this article is not legal advice and should not be relied upon. You should obtain legal advice specific to your circumstances before you take any action or otherwise rely upon the contents of this article.