Senator the Hon. Simon Birmingham
Parliamentary Secretary to the Minister for the Environment
Greater certainty for water trade
20 March 2014
The Australian Government today announced amendments to financial regulations to allow for the common sense treatment of the trade of water rights, commonly traded on Australian water markets, so they are able to be regulated in the same manner as agricultural commodities.
Parliamentary Secretary for the Environment Senator Simon Birmingham said the amendments to regulations under the Corporations Act 2001 and the Australian Securities and Investments Commission Act 2001 will ensure that trade of basic water rights is exempted from the regulatory regime that applies to financial products.
“The regulatory amendments will prevent the introduction of additional onerous and unnecessary reporting obligations, remove uncertainty, and promote stable and predictable governance frameworks in line with the Australian Government’s deregulation agenda" Senator Birmingham said.
"It will address concerns raised by market participants about the role of the Australian Securities and Investments Commission (ASIC) in Australian water markets.
"This initiative originally arose through consultation with irrigators and other water market users and will allow for the majority of ‘basic’ water trades to occur without regulation by ASIC.
"These amendments will provide long term clarity to water market participants and allow for the continued growth of Australian water markets.
“Free and effective water markets are essential to ensure that our precious water resources are applied to the mass productive purposes for the greatest benefit to the overall economy," Senator Birmingham said.
Senator Birmingham emphasised that the proposed exemption will not apply to the trade of complex derivative products which will continue to be regulated by ASIC.