Register of foreign-owned water entitlements

• There is no compelling case for major changes to the Register of Foreign Ownership of Water Entitlements (the Register). It plays a small, yet useful, role and apart from a few tweaks should continue for now, provided its costs remain low.
• Foreign investment provides capital for businesses to grow, introduces new technologies, practices and technical expertise, and enables Australians to enjoy higher standards of living than they otherwise would.
  • There is support for foreign investment within the agricultural and mining industries, but a sizeable share of the broader community has some unease with foreign investment. Foreign investment can also be conflated with other water market concerns, such as water market manipulation.
• The Register requires foreign persons to notify the ATO if they acquire a specified water asset or if there are changes to their foreign status or water entitlement holdings.
  • It shows that of the share of Australian water issued as entitlements, about 11 per cent is foreign owned.
• The transparency provided by the Register helps maintain community confidence in Australia’s approach to foreign investment. It gives ministers, government agencies and other interested parties an authoritative source of information on foreign ownership of water entitlements in Australia. There is no other source for this information.
• The information provided by the Register is sufficient for its limited purpose.
  • The high‑level summary of Register data contained in the statistical reports published by the ATO provides the necessary transparency. These reports are generally clear and easy to use.
  • Compliance and enforcement activities are proportionate to the minimal risks associated with non‑compliance.
• There is not a compelling case to provide more granular information on foreign ownership, such as at the water source or catchment level. Such information could risk being used to identify registrants, violating confidentiality provisions.
• There is no alternative approach to the current Register that would provide the appropriate transparency at a lower cost.
• There is scope for some tweaks to the current Register.
  • The statistical reports should include data on the proportion of foreign owners of water entitlements that also hold agricultural land. This would be of low cost and improve the effectiveness of the Register.
  • The statistical reports should clarify several misperceptions, including by clearly stating that registration is compulsory, and that foreign ownership need not entail foreign control.
  • The States and Territories should link to the Register from their water information portals.

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• Preliminaries: Cover, Copyright, Transmittal letter, Terms of reference, Acknowledgments, Contents and Abbreviations
• Overview
  • Key points
  • 1 The Register
  • 2 The inquiry’s focus
  • 3 The Register is a resource for fact checking
  • 4 Pre‑empting a problem
  • 5 The Register cannot address all concerns …
  • 6 … but its design is appropriate for its narrow uses
  • 7 Costs associated with the Register are low
  • 8 There are no better alternatives
  • 9 Can the Register be improved?
• Findings and recommendations
• 1 About the inquiry
• 2 Setting the scene
  • 2.1 How the Register of Foreign Ownership of Water Entitlements operates
  • 2.2 What does the Register show about foreign ownership of water in Australia?
  • 2.3 Australia’s foreign investment policy landscape
  • 2.4 Key features of Australian water markets
• 3 Rationales for the Register
  • 3.1 What is the purpose of the Register?
  • 3.2 How does the community feel about foreign investment in water?
  • 3.3 Maintaining public confidence in foreign investment in water markets
  • 3.4 The Register cannot address all concerns
  • 3.5 Information for policymakers
• 4 How is the Register performing?
  • 4.1 Filling an information gap
  • 4.2 Access to Register information
  • 4.3 Clarity and timeliness of the statistical reports
  • 4.4 Register administration and compliance
  • 4.5 Regulatory compliance burdens
• 5 Reconsidering the Register
  • 5.1 Is a Register still needed?
  • 5.2 Are there better alternatives?
  • 5.3 Can the Register be improved?
• A Consultation
• References