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About the water markets intermediaries code

Purpose of the code

The code regulates how eligible water markets intermediaries conduct themselves with current and proposed clients. It aims to:

• improve the integrity of, and trust in, water markets intermediaries
• give greater protection and confidence to users of these intermediary services
• increase participation in relevant water markets
• apply the same types of regulatory safeguards to water markets intermediaries that apply to intermediaries in other markets.

Water rights and services the code applies to

The code applies to water rights that relate to the Murray–Darling Basin water resources. The regulation calls these water rights an eligible tradeable water right. This is a term defined in the Water Act.

Water markets intermediaries the code applies to

The code applies to a person who provides any of the following services for eligible tradeable water rights in return for a fee or commission. These services are:

• trading water rights on behalf of clients
• investigating trading possibilities for water rights on behalf of current or potential clients
• preparing the documents required to trade or transfer water rights on behalf of current or potential clients
• providing an online trading platform or water exchange for water rights
• giving specific advice about trading in water rights while providing any of the above services. The code also applies when this advice is given for free
• representing that a water right is available for sale or purchase. This only applies if they also facilitate the trade or transfer of the water right.

Anyone who supplies one or more of these services is called an eligible water markets intermediary. This is a defined term in the Water Act. These intermediaries may be:

• water brokers
• irrigation infrastructure operators
• operators of online trading platforms or water exchanges
• legal professionals
• real estate agents.

Services the code does not apply to

The code does not apply:

• to any service supplied that is not a water markets intermediary service
• when water rights automatically transfer with the sale of land
• to a right that is a financial product
• when irrigation infrastructure operators process the trade or transfer of water rights on behalf of members
• when water market authorities approve, allow or register the trade or transfer of water rights.

Exemptions to the code

The Minister for the Environment and Water can exempt intermediaries from the code. This exemption may apply to the entire code or some parts of it. This will depend on the circumstances.

When deciding whether to grant an exemption, the Minister must consider:

• if the intermediary must comply with similar requirements under another Commonwealth, State or Territory regulatory scheme
• the level of risk to water market participants if the exemption is made.

See also

Obligations of water markets intermediaries under the code

Statutory trust accounting requirements for eligible water markets intermediaries