This interim report draws upon analysis of comprehensive water market data from 2012 onwards, and the views of a broad range of people with interests in the use and trade of water in the Murray-Darling Basin.
The interim report considers options to enhance markets for tradable water rights, including to enhance their operations, transparency, regulation, competitiveness and efficiency.
The ACCC is seeking further feedback from stakeholders in response to the issues raised in the interim report, including through submissions.
Submissions to this interim report are requested by 28 August 2020.
Key problems identified:
- water market intermediaries, such as brokers and water-exchange platforms, operate in a mostly unregulated environment, allowing conflicts of interest to arise, and opportunities for transactions to be reported improperly
- there are scant rules to guard against the emergence of conduct aimed at manipulating market prices, and no particular body to monitor the trading activities of market participants
- important information, such as allocation policies and river operations policy, which can significantly impact water pricing, are inadequately communicated to the irrigators and traders who rely on these to make business decisions
- overarching governance arrangements, which result in regulatory fragmentation and overlapping of roles of different governing bodies, contribute to many of these problems, or prevent them from being addressed in an effective and timely way