Show download pdf controls
  • Water register terms and definitions

    This is a guide to the water entitlement terms and definitions for the purpose of assisting foreign investors understand their water entitlement registration obligations.

    A

    B

    C

    D

    E

    F

    G

    H

    I

    J

    K

    L

    M

    N

    O

    P

    Q

    R

    S

    T

    U

    V

    W

    X

    Y

    Z

    See also:

    A

    Act, the

    Refers to the Foreign Acquisitions and Takeovers Act 1975.

    C

    Contractual water right

    A contractual water right is a contractual right, including a deed. It involves the right that a person or other entity holds (alone or jointly) to another person’s registrable water entitlement.

    Where a foreign person acquires a contractual water right it will only be registrable if the rights contracted will be for a period of longer than five years. This includes any options to extend or renew the contract.

    A contract between an irrigator and irrigation infrastructure operator (IIO) for the irrigator to receive water is an irrigation right. It's not a contractual water right even though a contract might be involved. The contractual water right is intended to include only those entitlements which are leased or otherwise obtained from a person. This right doesn't include an irrigation infrastructure operator, who holds that water entitlement.

    Example

    Quartz Quarry Pty Ltd is an Australian owned company. It holds a state government-issued water access right that provides access to a maximum of 150 ML of water from an aquifer in a given period. This right meets the definition of a registrable water entitlement conferred under a state law – taking water from a water resource and meets the definition of a registrable water entitlement. However, Quartz Quarry Pty Ltd doesn't need to register this entitlement as it isn't a foreign person.

    On 15 September 2018, Quartz Quarry leases part of its entitlement to Gemstone Exploration Ltd. Gemstone Exploration holds a contractual water right and is a foreign person. The term of the lease is for an initial period of four years, with the ability to extend the lease for another six years. Gemstone Exploration Ltd must notify us of the contractual water right.

    End of example

    Conveyance water

    The volume of water that can be attributed to conveyance water is the additional water that is required to deliver water to users. This includes water lost in transit from its source to end users due to seepage, leakage, evaporation or other similar effects.

    Note that the exemption for conveyance is only available to an irrigation infrastructure operator (IIO), not to individual entitlement holders.

    Example

    Dynamic Water Cooperative (DWC) is a foreign IIO providing irrigation services in New South Wales. DWC has a small number of water access entitlements, known in New South Wales as water access licences (WALs). DWC uses WAL1234, whose nominal volume is 2,500 ML, partly to account for:

    • irrigation distribution system losses (conveyance)
    • customer’s irrigation rights
    • its own trading purposes.

    At the end of the year, DWC establishes that a volume of 1,500 ML is subject to its customers’ irrigation rights. It estimates that annual conveyance losses are in the order of 750 ML. DWC is therefore required to register WAL1234, with a volume of 250 ML, with the ATO.

    End of example

    F

    Foreign government investor

    Foreign government investors and foreign governments are foreign persons for the purposes of the section 4 of the Foreign Acquisitions and Takeovers Act 1975 and section 18 of the Foreign Acquisitions and Takeovers Regulation 2015External Link. This means that the requirements imposed by Foreign Acquisitions and Takeovers Act 1975 apply to all foreign government investors, unless an exemption in the Foreign Acquisitions and Takeovers Regulation 2015External Link applies.

    Foreign person

    Example 1

    Ms Smith is an Australian citizen. She resides in the United Kingdom, which has been her permanent home for the last 15 years. As Ms Smith is not ordinarily resident in Australia, she is a foreign person.

    Example 2

    Mr Huang is a Singaporean national who owns an agricultural holding and water entitlements. As Mr Huang is not a citizen of Australia and is not a permanent resident who is ordinarily resident in Australia, he is a foreign person.

    Example 3

    The Cattle Company Pty Ltd is incorporated in Australia. It owns farmland in Australia and runs a cattle station. A foreign company owns 24% of the shares in the Cattle Company Pty Ltd. The Cattle Company Pty Ltd is a foreign person.

    Example 4

    The Orchard Company acts as trustee for the Orchard Unit Trust. 30% of the units in the Orchard Unit Trust are owned by a foreign person. The Orchard Company acting as trustee for the Orchard Trust is a foreign person.

    Example 5

    The Orange Company is general partner of the Orange Limited Partnership. The Limited Partnership is 40% owned by three foreign companies from the United States, the United Kingdom and Japan. The Orange Company is considered a foreign person because they are a general partner of the Orange Limited Partnership which has 40% or more of the interests in the partnership held by foreign persons.

    Example 6

    The Department of Agricultural Acquisitions is part of a body politic of a foreign country. The department is a foreign person.

    Example 7

    Irrigation Fifty Co-op is an IIO which is owned by its 200 member irrigators, 85 members are foreign persons. As the IIO is a limited partnership where two or more foreign persons hold an aggregate substantial interest of at least 40%, the IIO is a foreign person.

    Example 8

    Merry River Irrigation is an IIO which is owned by its 100 member irrigators and 15 members are foreign persons.

    As the IIO is a limited partnership where two or more foreign persons do not hold an aggregate substantial interest of at least 40%, the IIO is not a foreign person.

    Example 9

    Sunny Valley is an IIO which distributes water in the Sunny Valley region, its member irrigators are also company shareholders. Four foreign companies each hold 10% in Sunny Valley which makes Sunny Valley a foreign person.

    Sunny Valley holds 100 water entitlements. They hold 98 water entitlements for members, who hold irrigation rights against Sunny Valley in relation to those entitlements. Of the remaining two registrable water entitlements, one is held by Sunny Valley for conveyance water and the other for investment purposes.

    Sunny Valley is only required to register its interests in the water entitlement held for investment purposes.

    End of example

    G

    GL / Gigalitre

    A metric unit of capacity equivalent to 1 billion litres (equivalent to 1,000 megalitres (ML)).

    Ground water

    Under section 4 of the Water Act 2007External Link ground water means either:

    • water occurring naturally below ground level (whether in an aquifer or otherwise)
    • water occurring at a place below ground that has been pumped, diverted or released to that place for the purpose of being stored there.

    This does not include water held in underground tanks, pipes or other works.

    I

    Irrigation infrastructure operators (IIO)

    Section 7(4) of the Water Act 2007External Link defines an irrigation infrastructure operator (IIO) as an entity that operates water services infrastructure for the purposes of delivering water for the primary purpose of it being used for irrigation.

    IIO requirements to register

    An IIO will only be required to register water holdings and interests if:

    • the IIO meets the definition of a foreign person
    • the IIO holds water entitlements (or portions of entitlements) that are not subject to irrigation rights
    • the IIO holds water entitlements (or portions of entitlements) that are not used for conveyance purposes.

    Irrigation right

    Under section 4 of the Water Act 2007External Link this means a right that:

    M

    ML/ Megalitre

    A metric unit of capacity equal to one million litres.

    O

    Ordinarily resident

    Section 5 of Foreign Acquisitions and Takeovers Act 1975 defines ordinarily resident as:

    An individual who is not an Australian citizen is ordinarily resident in Australia at a particular time if and only if:

    • the individual has actually been in Australia during 200 or more days in the period of 12 months immediately preceding that time, and
    • at that time, the individual is in Australia and the individual’s continued presence in Australia is not subject to any limitation as to time imposed by law, or
    • the individual is not in Australia but, immediately before the individual’s most recent departure from Australia, the individual’s continued presence in Australia was not subject to any limitation as to time imposed by law.

    Without limiting paragraph (1)(b), an individual’s continued presence in Australia is subject to a limitation as to time imposed by law if the individual is an unlawful non-citizen within the meaning of the Migration Act 1958External Link.

    R

    Registrable water entitlement

    Under section 5A of the Register of Foreign Ownership of Water or Agricultural Land Act 2015 a registrable water entitlement is:

    Exclusions

    The following types of water rights will be excluded from the definition of a ‘registrable water entitlement’:

    • stock and domestic rights, and harvestable rights used for stock and domestic purposes
    • riparian rights
    • annual water allocations
    • rights held by an IIO to the extent that either another person holds an irrigation right in relation to that right, or they are for conveyance water.

    Example 1

    Simone is a foreign person and holds a right to receive 6.3 ML from the Lower River Irrigating Cooperative (which is an IIO). This right is an irrigation right and must be registered with us.

    Example 2

    Pyrite Exploration Corporation (PEC) is a foreign company that conducts mining operations in a remote area in the state of Queensland not covered by a water resource plan. The Queensland government issued PEC with a 5,000 ML ten-year licence .

    The licence allows PEC to take, hold and interfere with the specific groundwater resource in accordance with the licence conditions. This licence is a right conferred under a state law to hold and take water from a water resource within Australia and is a registrable water entitlement. PEC must register the water entitlement.

    Example 3

    Anthony and Leah Block are foreign persons who have a dam on their property in Victoria to capture water for the purpose of providing drinking water for their cattle. This is considered a harvestable right used for stock and domestic purposes and so they are not required to register.

    Example 4

    Laurent Dubois is a foreign person who has a water right issued by the state of New South Wales. It allows him to capture and store rain which falls on his property. Mr Dubois owns an intensive piggery business and is allowed to use the first 20 ML of this right for stock and domestic purposes The remainder is used for commercial purposes in his piggery.

    The 20 ML of his right which is for stock and domestic purposes will not meet the definition of a registrable water entitlement, and will not need to be registered with us. To the extent that the remaining part of Mr Dubois' right is not a stock and domestic right, it will meet the definition of registrable water entitlement and must be registered with us.

    End of example

    Riparian rights

    The right of the owner of the land, through whose property a natural water resource runs, to use water from the resource for use on the land, such as for drinking water or irrigation.

    T

    Take

    Under section 4 of the Water Act 2007, take water from a water resource means to remove water from, or to reduce the flow of water in or into, the water resource including by any of the following means:

    • pumping or siphoning water from the water resource
    • stopping, impeding or diverting the flow of water in or into the water resource
    • releasing water from the water resource if the water resource is a wetland or lake
    • permitting water to flow from the water resource if the water resource is a well or watercourse.

    It also includes storing water as part of, or in a way that is ancillary to, any of the processes or activities referred to in the dot points above.

    Timing

    See When to register

    W

    Water access entitlement

    Under section 4 of the Water Act 2007External Link this is defined as:

    A perpetual or ongoing entitlement, by or under a law of a state or territory, to exclusive access to a share of water resources of an area in the state or territory.

    Water access licence

    A type of water access entitlement.

    Water access right

    Under section 4 of the Water Act 2007External Link water access right means any right conferred by or under a law of a state to do either or both of the following:

    • hold water from a water resource
    • take water from a water resource.

    It includes the following rights:

    Water allocation

    Under section 4 of the Water Act 2007External Link this means the specific volume of water allocated to water access entitlements in a given water accounting period.

    Water delivery right

    A right to have water delivered by an infrastructure operator.

    Water entitlement

    See Registrable water entitlement.

    Water holdings and interests requiring registration

    Foreign persons will need to register their interests in a registrable water entitlement or a contractual water right. Both of these terms are defined in the Register of Foreign Ownership of Water or Agricultural Land Act 2015.

    When to register

    A foreign person will need to register their interest in a registrable water entitlement or contractual water rights with us at the time of the event or within 30 days of the end of each financial year an event occurred.

    However, if the acquisition and disposal of the same registrable water entitlement or contractual water right occurs during a single financial year, there is no need to notify us of either event.

    Similarly, if a person who holds a registrable water entitlement or contractual water right begins to meet the definition of a foreign person during a financial year but does not meet the definition by the end of the same year, the person will not be required to register.

    If you anticipate multiple transactions during the year, it is recommended that you wait until year end to register the relevant event and volume of water held.

    Example 1

    Binny Jenkins is a foreign person who owns an asparagus farm in New South Wales and has an irrigation right with ABC Irrigation Ltd. She enters into the contract with ABC Irrigation Ltd in February 2018.

    The irrigation right meets the definition of a registrable water entitlement. Binny has until then end of July 2018 to register the irrigation right with us.

    Example 2

    Pippa Storey is a foreign person who purchases a new 10 ML water allocation in a catchment in Queensland in February 2018. Pippa already holds another water allocation for 20 ML with the same characteristics in that catchment, which has been previously registered with us.

    Pippa has until the end of July 2018 to register her new water allocation. However, before registering her new water allocation Pippa decides to amalgamate the latest water allocation with her existing holding for ease of administration and does this before 1 July 2018.

    As a result of the amalgamation, the volume against Pippa’s existing water allocation changes and she must notify us of this event.

    Example 3

    Pine Growers Australia is a foreign person who buys a new water access licence in a catchment in New South Wales on 6 February 2018. The company decides to wait until the financial year end to register with us.

    However, in May 2018, they sell the company and all assets including the water access licence to Gum Growers Victoria.

    As Pine Growers Australia bought and sold the entitlement during the 2017–18 financial year, it has no requirement to register the purchase or the sale with us.

    Example 4

    Antonia owns a vineyard in the vicinity of Shepparton Victoria and is a foreign person. In November 2019, due to the dry conditions in recent years and the forecast that such conditions may extend over several more years, Antonia takes a 10-year lease of 100 ML of her neighbour Luigi’s water share. Luigi has a water share in excess of his needs.

    The contract between Antonia and Luigi over Luigi’s water share meets the definition of a contractual water right. As the term of this contract exceeds five years, Antonia must register the contractual water right with us before the end of July 2020.

    Example 5

    Saffron is a foreign person and acquires a registrable water entitlement on 13 October 2018. Her solicitor registers her acquisition of the entitlement on 22 October 2018. Saffron becomes a permanent resident on 6 March 2019. Because she has notified us of her acquisition earlier in the financial year, she has until the end of July 2019 to advise us that she has become a permanent resident. She does not need to be on the register.

    End of example
    Last modified: 27 May 2020QC 52592