Small Business Commissioner Regulation 2022

Mediation conference. The central dispute resolution event under the Act and Regulation. It is convened by a mediator after an application has been made under section 22 of the Act. The Regulation governs when and how that conference may be rescheduled, consolidated with other conferences, or conducted remotely.

Notice of mediation conference. A formal notice issued under section 23(5)(b)(ii) of the Act that states the time, date and place of the mediation conference. This notice triggers the two-day window for a party to request a date change under section 3 or to request consolidation of related disputes under section 4.

Two-day request period. A strict deadline. Under section 3(2), a party must ask the mediator in writing to change the conference date within two days after receiving the notice. Similarly, under section 4(1), a party must ask to mediate related disputes together within two days after the notice under section 3(1) is received. The Regulation does not specify whether these are business days or calendar days, nor does it provide for extension; practitioners should treat the period as running from receipt of the notice.

Related disputes. Defined by example but not exhaustively in the Regulation. The example given involves a chain of leases or subleases: a dispute between a sublessee and a sublessor, and a related dispute between that sublessor (who is also a lessee) and the head lessor. The concept is broader than that example; any small business disputes that arise from the same or connected factual matrix could be considered related, provided the parties and mediator agree to consolidate them.

Agreement of all parties. Consolidation under section 4(2) requires that "all other parties to the related disputes agree". This is a higher threshold than a mere majority. If even one additional party objects, the mediator cannot give a further notice consolidating the conferences. This protects each disputant's right to separate treatment, but it also means a single holdout can block efficient resolution.

Mediator's discretion. The mediator has discretion whether to change a conference date (section 3(3)) or to consolidate related disputes (section 4(2)). The Regulation does not prescribe criteria for exercising that discretion, so a mediator may consider factors such as availability, the urgency of the dispute, the likelihood of settlement, and the burden on the parties. The mediator's decision is not subject to appeal under the Regulation.

Technology for mediation. Section 5 allows mediation using "any technology allowing reasonably contemporaneous and continuous communication". The examples are teleconferencing and videoconferencing. The key requirement is that communication be reasonably contemporaneous (i.e., in real time) and continuous (not broken into disjointed exchanges). Asynchronous methods such as email or document exchange alone would not satisfy the test. Agreement of the mediator and all parties is essential; no party can unilaterally insist on a remote conference.

Fee units. The fee under section 6(1) is 350 fee units. The Regulation does not define a fee unit; that definition comes from the common state provision (often the Acts Interpretation Act or a Fees Act). Fee units are typically adjusted annually for inflation. As at commencement (3 May 2022), the dollar value of a fee unit in New South Wales (the likely jurisdiction given the Act's name) was $110, making the fee $38,500 - a significant amount. Practitioners must check the current value of a fee unit at the time of application.

Financial hardship waiver. Under section 6(2), the Commissioner may waive all or part of a party's share of the fee if payment "would cause, or would be likely to cause, the party financial hardship". This is a discretionary, individualised determination. The Commissioner likely requires documentary evidence of the party's financial circumstances. The criterion is not mere inconvenience; it requires a realistic risk of hardship.

Class-based or emergency waiver. Section 6(3) allows the Commissioner to waive fees for a class of parties for a particular period if the waiver will promote access to mediation. The Regulation gives an example: an industry sector or geographical region affected by a natural disaster or other emergency. This is a structural mechanism to respond to widespread disruption, such as bushfires, floods, or a pandemic. The Commissioner can act proactively without requiring individual applications.

Natural disaster or other emergency. Not defined in the Regulation but likely draws on common understandings and declarations under state emergency management legislation. The phrase "other emergency" is broad; it could include a public health crisis, a terrorist incident, or a major economic shock affecting a specific sector.

Mediator's power to give further notice. Under sections 3(3)(b) and 4(2), if the mediator exercises discretion to change a date or consolidate disputes, the mediator must give each party a notice stating the details. This ensures procedural fairness and clarity.

The Regulation directly affects parties to small business disputes that are the subject of an application under section 22 of the Small Business Commissioner Act. Those parties are typically small business owners, landlords and tenants, franchisors and franchisees, suppliers and customers, and others engaged in commercial relationships that fall within the definition of a small business dispute under the Act. The Regulation does not itself define "small business dispute" or "small business"; those definitions are in the Act. However, the example in section 4 - involving a sublessee, a sublessor, and a head lessor - indicates that lease-related disputes are a prominent category.

Small business operators are the primary intended beneficiaries. They can apply for mediation, and once a conference is scheduled, they may request date changes or consolidation. They must pay their share of the 350 fee units, but they can seek a hardship waiver or benefit from a class waiver declared by the Commissioner. They must act quickly: any request under section 3 or 4 must be made within two days of receiving the notice.

Mediators appointed under the Act are given procedural powers and duties. They must consider written requests within two days (though no time limit for decision is specified), decide whether to change a date, decide whether to consolidate related disputes (only if all other parties agree), and decide on the mode of conference (remote or in-person) with the consent of the parties. They must issue new notices when changes are made. They have broad discretion but must act fairly and impartially.

The Small Business Commissioner is responsible for administering the fee regime under Part 3. The Commissioner may waive fees on grounds of financial hardship for an individual party, or for a class of parties for a particular period to promote access. The Commissioner must be satisfied that the payment would cause or be likely to cause hardship, or that the waiver will promote access. The Commissioner can act in response to natural disasters or other emergencies affecting industry sectors or geographical regions.

Parties to related disputes. Even if a party is not part of the original application, they may become involved through a consolidation request under section 4. Their agreement is required before the mediator can give a further notice. This gives them a veto power over consolidation, which may affect strategic dynamics.

Legal and professional advisers. The two-day time limits mean that advisers must monitor communications from the Commissioner's office closely and be ready to file requests quickly. They need to understand fee unit calculations and prepare hardship applications if appropriate.

Industry sectors and geographical regions. The class waiver provision (section 6(3)) means that entire sectors (e.g., hospitality, tourism) or regions (e.g., flood-affected areas) may be given fee relief for a period. This affects all small businesses in that class, not just those who individually apply for mediation.

The Regulation does not affect parties outside small business disputes. It does not apply to consumer disputes, employment disputes, or matters where the Act does not confer jurisdiction. It also does not affect mediators or the Commissioner in a general administrative capacity; only when a mediation application has been made.

Right to request a date change. A party who receives a notice of mediation conference under section 23(5)(b)(ii) of the Act has the right to ask the mediator in writing to change the conference date. That right must be exercised within two days of receiving the notice. The request may propose a new date no later than seven days after the original date. The mediator has discretion to grant or refuse the request; the party has no further right of appeal under the Regulation.

Right to request consolidation of related disputes. Under section 4(1), a party may ask the mediator in writing to mediate related disputes together at the same conference. Again, the request must be made within two days after the notice under section 3(1) is received. However, this right is conditional: the mediator may only give effect to it if all other parties to the related disputes agree. So the requesting party has a right to ask, but not a right to compel consolidation.

Duty to pay the fee. The fee for an application under section 22 of the Act is 350 fee units, and it is payable by the parties to the dispute in equal shares (section 6(1)). This appears to be a joint and several obligation: each party must pay their share. If one party fails to pay, the other party may be required to pay the full amount? The Regulation does not specify consequences of non-payment, but the Act may allow the Commissioner to refuse to proceed until the fee is paid. Practitioners should assume the fee must be paid before mediation proceeds.

Right to seek a fee waiver on hardship grounds. A party may apply to the Commissioner for waiver of all or part of their share of the fee if payment would cause or be likely to cause financial hardship (section 6(2)). The Commissioner must be satisfied of the hardship. There is no prescribed form or evidence required; the party should provide financial statements, tax returns, or other proof. The waiver is discretionary; the Commissioner may grant a partial waiver.

Right to benefit from a class-based waiver. Even without individual application, a party may benefit if the Commissioner has declared a waiver for a class of parties for a particular period (section 6(3)). For example, if the Commissioner waives fees for businesses in a flood-affected region, any eligible party automatically pays a reduced or zero fee. The party should confirm whether such a waiver is in effect at the time of application.

Right to request or agree to technology-mediated mediation. Under section 5, if all parties and the mediator agree, the mediation may be held using technology that allows reasonably contemporaneous and continuous communication. Each party has a right to withhold consent; no one can be forced into a remote conference. If all agree, the mediation can proceed without physical attendance.

Duty to respond to mediator's notices. When a mediator issues a new notice under section 3(3)(b) or section 4(2), each party must attend at the new time and date. There is no express penalty for non-attendance in the Regulation, but the Act may treat it as a failure to participate.

Mediator's duty to give notice. If a mediator changes a conference date, the mediator must give each party a notice with the new time and date. If a mediator consolidates disputes, the mediator must give each party a further notice stating the details, including time and date and which parties are to participate. This ensures procedural fairness and avoids confusion.

Commissioner's duty to consider waivers. While not expressed as a duty, the Commissioner must exercise the waiver power reasonably and not arbitrarily. If a party demonstrates hardship, the Commissioner should consider the application. Similarly, when issuing a class waiver, the Commissioner should have a rational basis for doing so.

The Regulation itself does not create any offence provisions or monetary penalties. It is a procedural and fee-setting instrument. Enforcement of the mediation process and any consequences for non-compliance would arise from the Small Business Commissioner Act, not from this Regulation. However, a few points can be noted.

If a party fails to pay its share of the 350 fee units, the mediator or Commissioner may refuse to convene or continue the mediation. The Regulation does not say this explicitly, but it is implicit: the fee is prescribed "for section 22(c) of the Act", meaning it is a condition of a valid application. If the fee is not paid in equal shares, the application may be incomplete.

If a party makes a false or misleading statement in support of a hardship waiver application, that could attract penalties under general law (e.g., fraud or giving false information to a public official). The Commissioner could revoke a waiver obtained by misrepresentation.

If a party ignores a mediator's notice and fails to attend the rescheduled conference, the Act may treat that as a failure to participate in good faith, potentially allowing the other party to terminate mediation and pursue other remedies. The Regulation does not address this; the Act is the source of any such consequences.

The two-day time limits in sections 3 and 4 are strict. If a party misses the deadline, they lose the right to request a date change or consolidation. The mediator has no power under the Regulation to extend the time. The party must attend the conference as originally scheduled.

The mediator's discretion to change a date or consolidate disputes is not subject to review or appeal under the Regulation. If a party is dissatisfied with a mediator's decision, they may have recourse under the Act (e.g., seeking a different mediator) or under general administrative law principles, but that is outside the scope of this subordinate legislation.

The class-based waiver provision (section 6(3)) could theoretically be challenged if the Commissioner acted beyond power, but the discretion is broad and the example (natural disaster or other emergency) is illustrative, not exhaustive.

There are no enforcement powers given to the Commissioner or mediator under the Regulation. The focus is on facilitating mediation, not punishing non-compliance. The primary enforcement mechanism is that the mediation process cannot function properly if parties do not meet their obligations, and the dispute may remain unresolved.

The Regulation is made under, and must be read with, the Small Business Commissioner Act (the Act). The Act establishes the office of the Small Business Commissioner, sets out the Commissioner's functions, defines what a small business dispute is, and provides for the making of regulations. The Regulation fills procedural gaps left by the Act, such as the fees, the mechanics of rescheduling, consolidation, and technology use. Where the Act and Regulation conflict, the Act prevails.

The Act's section 22 is the source of the power to prescribe fees; the Regulation sets that fee at 350 fee units. The value of a fee unit is not in the Regulation; it is defined in the state's general interpretation legislation (e.g., the Interpretation Act 1987 (NSW) or the Fees Act). That external statute governs how the dollar amount is calculated and how fee units are adjusted over time. Legal practitioners need to consult the current fee unit value at the date of application.

The concept of "small business" is likely defined in the Act, and that definition determines who can seek mediation. The Regulation does not add to or modify that definition.

If the dispute involves a retail lease, there may be interaction with the Retail Leases Act (or equivalent state legislation). The Small Business Commissioner Act may be a separate dispute resolution scheme, or it may be an alternative to retail lease tribunals. The Regulation does not address this; the Act does.

The provision for technology-mediated mediation (section 5) interacts with the Electronic Transactions Act (state or Commonwealth), which validates electronic communications and signatures. The Regulation does not require any specific form of technology; it only requires contemporaneous and continuous communication.

The class-based waiver for natural disaster or other emergency (section 6(3)) may interact with state emergency management legislation, such as the State Emergency and Rescue Management Act. The Commissioner may rely on a declared disaster or emergency to trigger the waiver, but the Regulation does not require a formal declaration.

The fee waiver for financial hardship (section 6(2)) may interact with general administrative law principles of natural justice. The Commissioner must consider each application on its merits and must not act arbitrarily. Decisions may be subject to judicial review under the relevant administrative review act.

The Regulation does not interact with other federal or state small business codes (e.g., the Franchising Code of Conduct) unless the Act itself incorporates them. The Regulation is purely procedural.

The Regulation is cited as the Small Business Commissioner Regulation 2022. It commenced on 3 May 2022 (section 2). As provided in the source text, there are no amending instruments listed. The Regulation appears unamended since its commencement. However, because it is subordinate legislation, it may be amended by subsequent regulations or by the Act. Any amendments would be published in the official government gazette or legislation register. Practitioners should check the current version for any changes to fee amounts, time limits, or other provisions. Fee unit values change annually, but that is not an amendment to the Regulation itself.

The source text does not mention any cases. The Regulation is recent (2022) and narrowly procedural; there is likely little or no reported case law directly interpreting its provisions. However, the underlying Small Business Commissioner Act may have been litigated. The Regulation's provisions on time limits and fee waivers might be challenged in administrative review proceedings if a party alleges that the Commissioner or mediator acted outside power. For example, a party might argue that a mediator unreasonably refused to change a date or that the Commissioner wrongfully denied a hardship waiver. As of the information provided, no such cases are noted. The absence of litigation does not mean the provisions are untested; it may simply reflect the low-value nature of small business disputes or the preference for alternative dispute resolution.

The two-day deadline in sections 3(2) and 4(1) is a classic trap. It runs from the date the notice is received, not from the date it is sent. Parties must monitor postal mail, email, and any electronic portal immediately after making an application. If a party is on holiday, the deadline could expire before they see the notice. There is no provision for extension. The only solution is to designate a person to receive and act on notices promptly.

The fee of 350 fee units is substantial. If a fee unit is $110, the total fee is $38,500, split equally between parties. That is $19,250 each - a significant cost for a small business. Many parties may be unaware of this until they receive an invoice. The hardship waiver is discretionary and requires the Commissioner's satisfaction; it is not automatic. A party should apply for a waiver as early as possible, ideally at the time of making the application or as soon as the fee is due.

The mediator's discretion to change a date under section 3(3) is broad. The mediator may refuse even a reasonable request. There is no appeal mechanism in the Regulation. If a party has a genuine conflict (e.g., medical appointment), they must still attend the original date unless the mediator agrees. The only fallback is to request the other party's support and hope the mediator accommodates.

Consolidation under section 4 requires the agreement of "all other parties to the related disputes". This is a high bar. Even if only one party to a related dispute objects, consolidation cannot proceed. That party may have strategic reasons to refuse, such as wanting separate mediations to increase costs or delay. The requesting party has no recourse.

Technology under section 5 requires the agreement of both the mediator and all parties. If one party insists on in-person mediation, the entire process must be in person, even if the mediator and other parties prefer remote. This can create practical difficulties if parties are geographically dispersed.

The class-based fee waiver under section 6(3) is for a "particular period". It is not permanent. A party must check whether the waiver is still in effect when they make their application. If the period has expired, they must pay the full fee.

The Regulation does not specify what happens if a party fails to pay their share of the fee. The Act may allow the Commissioner to decline to proceed. It is wise for the other party to ensure the fee is paid in full, even if they have to pay the entire 350 fee units and seek reimbursement from the non-paying party later. This avoids delay.

The examples in the Regulation are illustrative but not exhaustive. The example of related disputes (sublessee/sublessor/lessor) is limited. Other types of related disputes (e.g., franchisor/franchisee and supplier disputes) may also qualify, but parties cannot be certain.

Finally, the Regulation uses "within 2 days" and "no later than 7 days". These are calendar days unless the governing interpretation legislation says otherwise. If the 2-day period ends on a weekend or public holiday, it likely ends on the next business day, but that is not stated in the Regulation. Confirm with the relevant Acts Interpretation Act.

For a party involved in a small business dispute who has applied for mediation under the Act, compliance with the Regulation requires careful attention to time limits and fee obligations.

Step 1: Pay the fee. Upon making an application under section 22 of the Act, the applicant must arrange for payment of 350 fee units. The fee is payable by the parties in equal shares. If you are the applicant, you must pay your half promptly. If you are the respondent, you will be notified; pay your share within the timeframe specified by the Commissioner. If payment would cause financial hardship, apply to the Commissioner for a waiver under section 6(2) as early as possible, providing evidence of your financial circumstances. Check if the Commissioner has issued a class-based waiver under section 6(3) that covers your industry sector or region; if so, you may not need to pay.

Step 2: Monitor for the mediation notice. The Commissioner (or the appointed mediator) will issue a notice under section 23(5)(b)(ii) of the Act stating the time, date and place of the mediation conference. From the moment you receive that notice, the clock starts. You have two days to consider whether to request a date change or consolidation.

Step 3: Decide on date change. If the scheduled date does not work for you (e.g., a key witness is unavailable), write to the mediator within two days of receiving the notice. State the reason and propose a new date that is no later than seven days after the original date. The mediator is not obliged to accept, but a clear, reasonable request improves your chances. If the mediator agrees, they will issue a fresh notice.

Step 4: Consider consolidation. If your dispute is related to another small business dispute (for example, the sublease example in section 4), ask the mediator in writing within two days to mediate them together. You must also obtain the agreement of all other parties to the related disputes. Contact those parties and explain the benefits; if they agree, inform the mediator. The mediator may then issue a further notice consolidating the conferences.

Step 5: Agree on technology. If you prefer a remote mediation, discuss with all other parties and the mediator. If everyone consents, confirm this in writing. The technology must allow reasonably contemporaneous and continuous communication - videoconferencing is preferred; telephone may suffice if video is not available. Ensure you have a stable internet connection or telephone line.

Step 6: Attend the mediation. Whether in person or remote, attend at the scheduled time. Bring all relevant documents. Be prepared to negotiate in good faith.

Step 7: Keep records. Retain copies of all notices, requests, and correspondence with the mediator and Commissioner. These may be needed if a dispute arises over compliance or if you need to prove you acted within the two-day period.

For the mediator, compliance involves promptly acknowledging receipt of requests, exercising discretion reasonably, issuing new notices as required, and ensuring that any consolidation only occurs with unanimous consent of all parties to the related disputes. The mediator should keep a record of decisions.

For the Commissioner, compliance involves processing fee waivers fairly, declaring class-based waivers when appropriate, and ensuring the fee regime is administered consistently with the Act.

By following these steps, all participants can ensure the mediation proceeds efficiently and within the legal framework set by the Regulation.