Prime Minister Scott Morrison has announced a new code of conduct that will provide rental waivers and deferrals for commercial property tenants affected by the COVID-19 outbreak.

The code of conduct applies to all tenancies that are suffering financial stress or hardship as a result of the COVID-19 pandemic. Eligible landlords and tenants should be qualified under the JobKeeper programme and should have a turnover of $50m or less.

Under the code of conduct, landlords must not terminate leases if tenants are unable to pay rent during the outbreak. Landlords must offer tenants proportionate reductions in rent payable in the form of waivers and deferrals of up to 100% of the amount. This will be based on the reduction in the tenants' business.

Furthermore, rental waivers must constitute no less than 50% of the total reduction in rent payable.

The payment of rental deferrals should be amortised over the balance of the lease term or for no less than 24 months, whichever is greater.

The new policy also requires landlords to pass on to their tenants any reduction in statutory charges, which include land tax and council rates. Landlords are also ordered to share any benefit they receive from loan payments.

The scheme also requires tenants to remain committed to the terms of their lease, as failure to comply will forfeit any protections available.

"This preserves the lease, it preserves the relationship, it keeps the tenant in the property. The code brings together a set of good-faith leasing principles. Landlords must not terminate the lease or draw on a tenant's security. Likewise, tenants must honour the lease," Morrison said.

A copy of the mandatory code of conduct agreed upon by the national cabinet can be found here.