Australian Capital Territory
Residential Tenancies Amendment Regulation 2018 (No 1)
Subordinate law SL2018–5
made under the 
Residential Tenancies Amendment Act 1997 
EXPLANATORY STATEMENT

	

OUTLINE

Residential tenancies in the ACT are regulated by the Residential Tenancies Act 1997 (RTA). It is not mandatory for an ACT residential landlord (lessor) to receive a bond when entering into a residential tenancy. If a bond is received, it must be lodged with the Territory at the Office of Rental Bonds.  
The RTA allows a lessor to accept a commercial guarantee or indemnity as an alternative to a bond. The commercial guarantee or indemnity is a promise to pay the lessor for damages that occur during a tenancy. The guarantee or indemnity is only enforceable to the maximum amount a bond would have been. A commercial guarantee or indemnity is not an insurance product in this context. 
The Residential Tenancies Amendment Act 2017 amended the RTA to provide consumer protections for tenants and lessors who enter into a commercial guarantee or indemnity contract. 
The Amendment Act prevented these guarantees from being accepted as an alternative to a bond prior to the development of this Regulation. 
The Amendment Act allowed a lessor to accept a commercial guarantee as an alternative to a bond if the related standard guarantee contract is registered. It also established the process for a provider of a commercial guarantee contract to apply to the Commissioner for Fair Trading (the Commissioner) for registration. 
If a standard guarantee contract is not registered, a commercial guarantee contract is not enforceable. 

Regulation Impact Statement
A statement on regulatory impacts was provided with the explanatory statement to the Residential Tenancies Amendment Bill 2017.

Human rights implications
Nil comment.  

CLAUSE NOTES

Clause 1	Name of regulation

This clause provides for the name of the regulation. 

Clause 2	Commencement

This clause allows for the Regulation to commence on the commencement of the Residential Tenancies Amendment Act 2017, schedule 2. Under section 79 of the Legislation Act 2001, the schedule is to commence on 7 May 2018.

Clause 3	Legislation amendment 

This Regulation amended the Residential Tenancies Regulation 1998.  

Clause 4 	New section 1AA

This clause defines the operation of notes within the Regulation.

Clause 5 	New sections 6 and 7

This clause inserts new sections 6 and 7.

Clause 6	Refusing registration of standard guarantee contract–Act, s 136 (2) (c) (i)

This clause sets out items, any of which, if found in the standard guarantee contract, are a basis for the Commissioner for Fair Trading to mandatorily refuse to register the standard guarantee contract.  The items bring any approved standard guarantee contract – and therefore associated individual contracts – in line with requirements of the Residential Tenancies Act and residential tenancy agreements in terms of protections for parties.

Clause 7 	Commercial guarantee exclude matters–Act, s 136 (2) (c) (ii)

This clause requires that the standard guarantee contract not contain terms that allow any of the items in section 6 (1) to occur.