South Australia now has the toughest illicit tobacco and vape laws in the country. Most of the commentary has focused on retailers and wholesalers, but the reforms that commenced on 5 June 2025 also reach landlords. If you own or manage commercial premises, you carry new exposure and, importantly, new rights and obligations to act.

A new offence for landlords

The amendments to the Tobacco and E-Cigarette Products Act 1997 (SA) which came into force on 5 June 2025 create an offence for an owner, or a person responsible for premises, who knowingly allows the premises to be used for prohibited conduct.

Turning a blind eye to a tenant selling illicit tobacco or vapes is no longer a safe option. Once you are on notice, inaction carries risk.

A landlord in breach of these obligations may now face fines of up to:

• $25,000 for a first offence and $50,000 for a second or subsequent offence, if the landlord is a body corporate; and
• $10,000 for a first offence and $20,000 for a second or subsequent offence, if the landlord is an individual.

Consumer and Business Services (CBS) can now share information with building owners, managers and insurers about alleged illicit activity at a premises. In practice, that means you may be told directly. Ignoring that notice will expose you to unnecessary risk.

A new right to terminate

The reforms also include an amendment to the Retail and Commercial Leases Act 1995 (SA). Where a tenant is issued a long-term closure order by CBS, a landlord may now have grounds to terminate the retail lease.

Closure orders have real teeth: the Minister can order a short-term closure of up to 28 days, and a Magistrates Court can now order a long-term closure of up to 12 months, doubled from the previous six. It is also an offence to be on the premises while a closure order is in force.

The penalties driving all of this are severe. A business breaching a closure order faces penalties of up to $1.1 million, and up to $700,000 for an individual. Possession of a large commercial quantity of prohibited product can expose an individual to a penalty of $2.1 million, and a company a penalty of up to $4.5 million, for a first offence.

What if you cannot terminate?

The statutory right to terminate attaches only to a long-term closure order. If your tenant is instead subject to a short-term or interim closure order, that right does not arise, and the legal position is not clear. What you can do will turn on the terms of your particular lease, including any provisions dealing with breach, unlawful use and remedies, and on the circumstances of the case. Acting too quickly carries risk, and so does doing nothing. Before you respond either way, contact us about where your lease and the facts leave you.

What landlords should do

Three practical steps. First, check your permitted use clauses and consider express rights to terminate on a closure order or unlawful use. Second, run proper due diligence on tobacco and vape tenants before you sign. Third, if CBS contacts you, get advice promptly, because your response, or your silence, now has legal consequences.

If you own or manage premises leased to a tobacco or vape retailer, we can review your lease and advise on your position. Please contact Jonathan Khoury, Special Counsel.

This information is general in nature and does not constitute legal advice.