The VFF supports a registry of foreign owned land and water and asks that it includes retrospective registration, transparency and reporting.
The Australian Taxation Office manages the foreign ownership registry.
The federal government released for consultation draft rules to support the Register of Foreign Ownership of Water or Agricultural Land Act 2015 (the Act) and a draft Water Registration Form which outlines the proposed data fields for water registration.
As part of the foreign investment framework reform package, the government passed the Water Register legislation effective on 1 December 2016.
The Water Register requires foreign persons to notify and update their interests in water entitlements with the Australian Taxation Office (ATO). Water entitlements will not need to be registered before 1 July 2017.
The Act provides that rules may exempt kinds of water rights from the definition of ‘registrable water entitlement’ or that certain foreign persons do not need to register.
Broadly, the draft rules propose that the following exemptions will apply to the requirement to register with the ATO:
It is proposed that ‘harvestable rights’ will be exempt from the definition of ‘registerable water entitlement’. The term ‘harvestable right’ takes a different meaning in different jurisdictions but for the purposes of the Water Register it will be a right which allows water harvested from rainfall to be used for stock and domestic purposes.
It is proposed that irrigation infrastructure operators will not need to register the water they hold for the purposes of meeting their requirements under an irrigation right with a customer, or conveyance water, which is the additional water which may be lost in transit or as a result of seepage or evaporation.
It is also proposed that foreign persons will not need to register registerable water entitlements or contractual water rights which are obtained through the enforcement of a security held for the purposes of a money lending agreement.
Submissions closed on Friday 3 March 2017
The outcomes from the submission are as follows:
From 1 December 2017, the new register will require foreign persons with holdings in registrable water entitlements or contractual water rights to notify the ATO once each year. People holding certain water rights whose foreign status changes will also be required to notify the ATO.
The ATO will make summary statistics on foreign ownership of water entitlements captured through the register. This information will be available on the ATO's website.
The Water Register will complement the government’s work to increase scrutiny of foreign investment in agricultural land and agribusiness. And provide greater transparency to the public, participants in water markets and the agricultural sector about the value, extent and trends in foreign investment in the sector.
Foreign ownership has increased in Australia with a total land mass of more than two times the size of Victoria is foreign owned, and in 2013 13.7% (1808 GL) of all water entitlements on issues had some level of foreign ownership. The Water Register will establish the depth of foreign ownership with accuracy and transparency.
Water is a vital input to Australia's agricultural production, which had a gross value of over $56 billion in 2015-16, and of which more than $15 billion is irrigated production.
Almost 8000 GL of water allocations and entitlements were traded across Australia in 2013–14.
In 2013, 13.7% (1808 GL) of all water entitlements on issue had some level of foreign ownership—an increase of 60% compared with 8.5% (1169 GL) in foreign ownership in 2010.
In Victoria, the foreign ownership of water increased from 7% in 2010 to 10% in 2013.