Code of Conduct for Leasing of Retail Premises in Singapore

The key objectives of the Code are:

  • To serve as a set of mandatory guidelines to provide guidance to landlords and tenants of qualifying retail premises to enable a fair and balanced lease negotiations
  • To provide landlords and tenants of Qualifying Retail Premises with a governance framework to ensure compliance with the Code.
  • To provide an accessible dispute resolution framework for both landlords and tenants.

The Code is divided into four main sections

Part A Conduct and Spirit of Negotiations
Part B Leasing Principles for Key Tenancy Terms
Part C Leasing Principles for Confidentiality Clauses and Data Transparency
Part D Dispute Resolution & Enforcement of Code of Conduct

Conduct and Spirit
of Negotiations

Landlords and tenants must adopt a consensual approach to negotiate in good faith, which includes acting honestly and fairly having regard to the legitimate interests of the other party and observing accepted or reasonable commercial standards of fair dealing in the performance of identified obligations. Neither party shall attempt to unfairly profit, or take unfair advantage of the other party, from the known ignorance of the other party.

Leasing Principles for Key Tenancy Terms

There are a total of 11 key tenancy terms such as exclusivity, pre-termination by landlords due to landlord’s redevelopment works, sales performance, pre-termination by tenants. where the Code of Conduct set out the leasing principles for landlords and tenants.

To see the complete list of terms covered, please download the Code of Conduct for Leasing of Retail Premises in Singapore (version 3) – (Amended per Corrigendum No 1)

Leasing Principles for Confidentiality Clauses and Data Transparency

Lease agreements may contain a confidentiality clause, meaning landlords and tenants agree not to share lease details. This applies to both parties but allows for disclosure as required by laws or for legal proceedings. Landlords must share sales data metrics by trade category (i.e., total monthly sales, total floor area) on a one-on-one basis before the signing of the lease agreement and to existing tenants on a bi-annual basis if they collect sales data from tenants as part of the Gross Turnover rent formula.

Dispute Resolution & Enforcement

For non-compliant practices, parties can report these cases to the FTIC. The FTIC will collate and monitor the reported cases. All lease agreements issued must be accompanied by a checklist of clauses within the Code of Conduct and all clauses which deviate from Code of Conduct must be flagged by landlord for tenant’s attention. For clauses where the Code of Conduct allows for deviation, a joint declaration of deviation shall be filed with FTIC within 14 days of signing of lease agreement if both parties agree with the deviation. Should there be a dispute or disagreement arising from the lease agreement, either party may escalate the matter to Singapore Mediation Centre (SMC). Once escalated, both parties must approach SMC and shall comply with the resolutions of the SMC.

Download a sample checklist template that is to accompany all retail lease agreements.