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Purpose of the obligations

The obligations aim to:

• promote fair access to market sensitive information for all market participants
• support transparency and informed trading decisions
• prevent people gaining an unfair advantage due to their access to this information.

What a water markets decision is

‘Water markets decision’ is a defined term in the   (Water Act). It captures certain decisions made by water markets decision-makers that impact eligible tradeable water rights. These decisions are prescribed by the (Water Regulations).

‘Eligible tradeable water rights’ are rights related to the taking or use of water in the Murray-Darling Basin that are able to be traded or transferred. These include but are not limited to water access rights and water delivery rights.

There are 8 types of water markets decision set out in the Water Regulations.

If a decision is a water market decision, the decision-maker must:

• first announce the decision using one of 2 methods set out in section 101B of the Water Act
• report details about the decision and its announcement to the Bureau of Meteorology (the Bureau)
• keep certain records about the decision.

These requirements only apply if the decision meets the criteria for a water markets decision.

Water markets decision-makers

Water markets decision obligations only apply to people who make water markets decisions, which are:

• Commonwealth agencies
• Murray-Darling Basin state agencies
• irrigation infrastructure operators.

Water markets decisions can be made by someone acting on an agency or operator’s behalf, or a person acting for themselves, for example, a minister.

It’s the decision-maker’s responsibility to know if a decision is subject to the obligations.

Types of water markets decisions

The Water Regulations identify the types of water market decisions that must be announced.

There are 8 types of water markets decision:

• trade decisions
• trading strategy decisions
• legislation decisions
• trading rule decisions
• allocation decisions
• carryover decisions
• inter-valley trade opportunity decisions
• distribution decisions.

Decisions that do not fall under one of these decision types, or are covered by an exception, are not considered water markets decisions.

For more information on the types of water markets decisions, visit the .

Trade decisions

A trade decision includes material decisions to:

• offer to sell an eligible tradeable water right
• invite an offer to sell an eligible tradeable water right
• purchase an eligible tradeable water right where offers to sell have not been invited.

A decision is material if it would be reasonably likely to influence the trading behaviour of people who commonly trade in the impacted eligible tradeable water rights.

Trading strategy exception

A trade decision is not a water markets decision if the trade, or proposed trade:

• is consistent with and conducted in alignment with a trading strategy that has been announced as a trading strategy decision, and
• available to the public.

If a water markets decision-maker has announced a trading strategy decision with a strategy that indicates their intended trade decisions, they do not need to announce any future trade decisions that are consistent with that strategy.

Administrative trade exception

A trade decision is not a water markets decision if the trade or proposed trade is or will be:

• for no price or value, such as zero dollar trades, and
• within the same valley or trading zone.

This exception means certain administrative trade actions are not water markets decisions that have to be announced.

Trading strategy decisions

 A trading strategy decision is a decision to either:

• publish a trading strategy about the trade of eligible tradeable water rights, or
• amend a published trading strategy if the amendment affects the scope or intent of the trading activities set out in the strategy.

A trading strategy is generally a statement or document that outlines future trade activities and whether they depend on certain circumstances.

The decision to make, draft, or develop a trading strategy is not a trading strategy decision. This is because the obligations that apply to water markets decisions do not apply at that stage. The obligations only apply when a decision is made to publish a trading strategy, or alter a strategy referred to in an already published trading strategy decision.   

Legislation decisions

A legislation decision is a material decision to make, or change, or propose to make or change Commonwealth water legislation or state water management law.

A decision is material if it would be reasonably likely to influence the trading behaviour of people who commonly trade in the impacted eligible tradeable water rights.

Commonwealth water legislation and state water management laws include:

• the Water Act and Water Regulations or any other instrument made under the Water Act
• water laws in each of the Murray-Darling Basin state jurisdictions listed in the Water Act and includes regulations and other instruments made under those laws.

Legislation decisions that also meet the criteria for other decisions

If a decision fits the criteria for both a legislation decision and another type of water markets decision, the decision is categorised as the other type of water markets decision, not a legislation decision.

When announcing and reporting such a water markets decision, you should categorise the decision as the other water markets decision type.

For example, if a water markets decision could be both a legislation decision and an allocation decision, it should be announced and reported as an allocation decision.

Later legislation decision exception

A legislation decision is not a water markets decision to the extent that:

• the decision (the ‘later decision’) gives effect to or implements an earlier legislation decision (the ‘original decision’), and
• the later decision does not alter the effect of the original decision.

Trading rules decisions

A trading rules decision is a material decision by an irrigation infrastructure operator to make or change trading rules.

A decision is material if it would be reasonably likely to influence the trading behaviour of people who commonly trade in the impacted eligible tradeable water rights.

Trading rules are those that govern the trade or transfer of eligible tradeable water rights within, into, or out of, an irrigation infrastructure operator’s irrigation network.

Trading rules do not include rules that relate to administrative procedures, such as:

• paying fees
• completing forms
• what information must be supplied by a person applying for a trade.

Trading rules established under state water management laws

State water management laws are water laws in each of the Murray-Darling Basin state jurisdictions listed in the Water Act. They include regulations and other instruments made under those laws.

Trading rules decisions do not capture trading rules established under state water management laws.

These may be legislation decisions. When announcing and reporting such a decision, you should categorise the decision as a legislation decision.     

Later trading rules decision exception

A trading rules decision is not a water markets decision to the extent:

• the decision (the ‘later decision’) gives effect to or implements an earlier trading rules decision (the ‘original decision’), and
• the later decision does not alter the effect of the original decision.

Allocation decisions

State water management laws are water laws in each of the Murray-Darling Basin state jurisdictions set out in the Water Act. They include regulations and other instruments made under those laws.

An allocation decision is a decision under a state water management law to increase, decrease, or maintain the volume of water allocated to an eligible tradeable water right.

They do not include circumstances where an irrigation infrastructure operator communicates the effect of an announced allocation decision to its customers.

Certain decisions may fit the criteria of both an allocation decision and legislation decision. Where this occurs, the decision is categorised as an allocation decision, rather than a legislation decision. When announcing and reporting such a decision, you should categorise the decision as an allocation decision.

Unaltered allocation decision exception

An allocation decision is not a water markets decision to the extent that the decision implements, without alteration, an allocation prescribed by or under state water management law.

Carryover decisions

A carryover decision is a decision where:

• a carryover arrangement is available for a type of eligible tradeable water right in a particular area and the volume of water covered by that arrangement, or
• a carryover arrangement is not available for a type of eligible tradeable water right in a particular area.

A carryover arrangement allows a water access right holder to retain water allocations that they didn’t take in a water accounting period. The arrangement allows the rights holders to take the water allocations in the next water accounting period.

Where a carryover arrangement is always available as part of an ongoing water management practice, then actions relating to the management of retained allocations are not considered carryover decisions. These do not need to be announced.

Inter-valley trade opportunity decisions

An inter-valley trade opportunity decision is a decision about:

• the opening of an inter-valley trade opportunity and its opening balance or available capacity
• the opening balance or available capacity of a scheduled or established opening of an inter-valley trade opportunity, or
• the closing of an inter-valley trade opportunity, except when the closure is because the available capacity is exhausted.

Distribution decisions

If an irrigation infrastructure operator decides to distribute water savings to a member or customer instead of selling or offering to sell it, and savings come from reducing transmission losses, evaporation or system inefficiencies, this is a distribution decision.

If the operator were to instead sell or offer to sell the water to a member or customer this may instead be a trade decision if it is a material decision.

Decision announcement methods

Decision-makers must use one of 2 methods to first announce a water markets decision.

Method 1: First announcement through the Bureau of Meteorology

The decision-maker can announce a decision by providing it to the Bureau for publication on their website.

The Water Regulations set out the information that must be provided to the Bureau as well as its format.

For more information about method 1, visit the .

Method 2: First announcement through the decision-maker’s public website

Instead of method 1, decision-makers can announce their decision on their website or by following any legal requirement to publish in a particular way.

The announcement must be free and easy to access if using this method.

If using method 2, the decision-maker must also report the announcement and supporting information to the Bureau. This must happen no later than the end of the next business day. The Bureau will then publish details about the decision on its website.

Decisions that must be gazetted

In some cases, Commonwealth water legislation or state water management law may require water market decisions to first be published in another way, such as in a gazette. If so, making the first announcement online under method 1 or method 2 is not appropriate.

Where a water market decision is first announced by gazette, it must then be published on the decision-maker’s website. The decision-maker must then also report the announcement and decision details to the Bureau by no later than the end of the next business day.

For more information about method 2, visit the .

Details to be provided to the Bureau of Meteorology

Depending on whether a water markets decision is announced using method 1 or 2, certain details about the decision and the announcement must be provided to the Bureau.

To provide this information, you must register with the .

When a water markets decision is first announced, either by method 1 or 2, the information that is required to be provided to the Bureau includes:

• whether announcement method 1 or 2 was used
• the decision entity name
• contact email address
• the type of water markets decision
• the title of the decision
• the date and time the decision was made
• full text of the announcement or, if unreasonable and using method 2, a relevant extract or record containing the full text
• geographic areas the decision relates to
• types of water resources the decision relates to
• relevant eligible tradeable water rights
• if applicable, a link to any additional information or documents about the decision
• if applicable, any additional information about the relevant eligible tradeable water rights
• relevant calculation or methodology if announcing an allocation, carryover or inter-valley trade opportunity decision.

If a water markets decision is first announced by method 2, the information that is required to also be provided to the Bureau in addition to the above includes:

• a link to the first announcement of the decision
• the time and date it was announced.

The Water Regulations set out how to format these details and you can visit the .

Record keeping

Decision-makers must keep records of water markets decisions.

Records must be kept for at least 5 years after the date of the decision.

Decision-makers are required to keep records capturing:

• the fact that a decision was made
• the date on which the decision was made
• a copy of the decision as made.

If a water markets decision is announced using method 1 you are required to also keep records capturing:

• all the details reported to the Bureau
• the date and time the decision was reported to the Bureau.

If a water markets decision is announced using method 2 you are required to also keep records capturing:

• all the details reported to the Bureau, except the announcement method, and full text or an extract or record containing the full text of the announcement
• the date and time of the announcement
• when these were reported to the Bureau
• the date, time, manner and content of the announcement of the decision.

Written notices from the ÌÇÐÄÔ­´´

Under section 101D of the Water Act the ÌÇÐÄÔ­´´ can issue a written notice to water markets decision-makers requiring them to:

• provide information about the records they were required to keep
• produce the records or other documents to the ÌÇÐÄÔ­´´ within 21 days.

This period can be extended, if the person receiving the notice requests an extension and the ÌÇÐÄÔ­´´ grants that request in writing.

People receiving a notice from the ÌÇÐÄÔ­´´ must comply with the notice and not provide false or misleading information.

More information about the legal requirements for issuing and complying with these notices can be found in sections 101D-G of the Water Act.

If we require information and documents beyond these record keeping obligations, and we believe they can be provided, we can also issue notices under section 239AJ of the Water Act.

For more information on 239AJ notices, see Compulsory information gathering powers under section 239AJ of the Water Act.

Penalty

These provisions are civil penalty provisions. Failure to comply with the announcement obligations can attract a pecuniary penalty.

For more information see compliance and enforcement of water markets integrity provisions.

See also

• Water markets manipulation prohibitions
• Water markets insider trading prohibitions
• Compliance and enforcement of water markets integrity provisions
• Compulsory information gathering powers under section 239AJ of the Water Act