This alert was written by Partner, Fiona Sears, Partner Justin McInally, and Senior Associate, Isaac Day.
On 16 September 2025, the Queensland Parliament introduced the Tobacco and Other Smoking Products (Dismantling Illegal Trade) and Other Legislation Amendment Bill 2025 (Bill).
The Bill brings in a raft of reforms to the existing tobacco laws in Queensland to disrupt the supply of illegal tobacco and nicotine products in Queensland and gives greater powers (and responsibilities) to landlords.
If passed, the Bill will require landlords to take a more proactive approach to the illegal sale of tobacco and nicotine products and includes:
- liability (both civil and criminal) if it knowingly leases premises to tenants engaged in the sale of illegal tobacco or nicotine products;
- expanded powers on Queensland Health to shut down non-compliant businesses for a period of up to three months (previously 72 hours), and now extends to possession of illegal nicotine and tobacco products (not just their supply);
- landlords will have the power to terminate a lease if a leased premises are subject to a closure order;
- expanded seizure and forfeiture powers (including to seize legal tobacco products) given to Queensland Health); and
- higher penalties for all parties involved in the supply of illicit tobacco products (including property owners who are complicit or turn a blind eye to illegal activity.
The Bill also follows recent changes in New South Wales which have given commercial landlords similar powers and responsibilities.
Landlord Termination Right
Where a “closure order” has been issued in respect of a leased premises, a landlord is then empowered to act on that order and take steps to terminate a commercial lease on giving 14-days notice.
Once a lease has been terminated by reason of a closure order, the Bill deems this to be repudiation of the lease by the tenant and allows the landlord to sue the tenant for damages, call on any lease security, and dispose of all fit out in the premises left behind by the tenant.
Importantly, the termination of a lease after a closure order has been issued will not be invalidated if subsequently it is found to have been wrongfully made or found by a court to be invalid.
The purpose of these provisions is to quell the financial implications for landlords that come with terminating a lease and gives landlords greater certainty in taking action to stamp out illegal activity.
Landlord Liability
With the expanded powers given to landlords brings greater responsibilities. The Bill seeks to impose liability on landlords who knowingly permit illegal tobacco or nicotine supply or possession on their premises. If a landlord is aware that a tenant is selling illicit tobacco or nicotine or operating without a licence and fails to act without a reasonable excuse, they may face penalties (including criminal liability) under the new laws.
A reasonable excuse may include:
- a franchisor is actively taking steps under the Franchise Legislation to terminate a franchise agreement;
- the landlord did not receive notice of a closure order from Queensland Health and had no reason to suspect illegal conduct; or
- other extenuating circumstances beyond the landlord’s control explain the continued occupation by the offending tenant.
The Bill also gives direction to whether a landlord has permitted illegal activity to occur, including:
- there has been a pattern of supply or possession of illicit tobacco or illicit nicotine products from the premises;
- whether the landlord has been notified by Queensland Health that one or more closure orders have been issued against the premises;
- evidence of a non-arm’s length relationship between the landlord and the tenant;
- the landlord was receiving rent that is significantly above market value or paid well in advance;
- the lack of a written lease or arrangement relating to the use of the premises; and
- whether the landlord has taken steps to terminate the lease or otherwise prevent the continued supply or possession of illicit tobacco or illicit nicotine products from the premises.
The maximum penalty for this offence is 1,000 penalty units, one year’s imprisonment, or both.
There are also powers given to the chief executive to apply to the court for a civil penalty order if they reasonably believe that a landlord allowed another person to use the premises for the supply or possession of illicit tobacco or illicit nicotine products in connection with a business, without a reasonable excuse.
The power given to the chief executive in such circumstances where a landlord has demonstrated a reckless indifference to the illegal supply of tobacco and nicotine products or has neglected to take reasonable measures to prevent it, despite clear warning signs or chances to intervene.
What next for landlords?
Whilst the Bill is yet to become law, given the current climate, we expect that it will become law. However, it is evident that:
- landlords will need to do greater due diligence on prospective tenants who may be selling tobacco and / or nicotine products;
- commercial leases will need to be amended to ensure greater compliance by tenants with tobacco and nicotine laws;
- landlords will need to be proactive in taking steps to quash the illegal sale of tobacco and nicotine products and can no longer turn a blind eye or be indifferent.