The ACCC welcomes the Australian Government’s plan to legislate new functions for the ACCC as the water market conduct regulator in the Murray-Darling Basin.
This week, the Government released the Water market reform: final roadmap report and announced its intention to implement all of the recommendations.
The ‘roadmap’ built on the findings and recommendations of the ACCC's 2021 report on Murray-Darling Basin water markets.
“These are important reforms that can help to restore trust and confidence in Murray-Darling Basin water markets,” ACCC Deputy Chair Mick Keogh said.
“The recommendations the Government has accepted involve the ACCC enforcing new Basin-wide laws that address harmful market conduct, including through bans on market manipulation, stronger insider trading rules, and a mandatory code of conduct for water market intermediaries.”
“The benefits of well-functioning Murray-Darling Basin water markets will flow through the entire Australian economy,” Mr Keogh said.
The roadmap presents ways to improve the functioning and governance of water markets, apply safeguards similar to those in place to regulate the conduct of participants in other comparable trading markets, and improve confidence in Basin water markets. It was developed in consultation with Basin states and key stakeholders, including targeted consultation with the ACCC.
In response to the roadmap report, the Government has committed to legislating new water market integrity and conduct reforms, including an enforceable mandatory code of conduct for water market intermediaries.
“We look forward to working constructively with the Australian Government, Basin states, industry and other key stakeholders as the recommendations are implemented,” Mr Keogh said.
On 8 August 2019 the then Treasurer, the Hon Josh Frydenberg MP, directed the ACCC to conduct an inquiry to examine markets for tradeable water rights in the Murray-Darling Basin. The ACCC provided its final report to the Treasurer on 26 February 2021 and published the report on 26 March 2021.
Throughout the inquiry, the ACCC heard various concerns from irrigators and other market participants about Basin water markets and found that trading behaviours that can undermine the integrity of markets, such as market manipulation and insider trading, are not adequately regulated.
The ACCC’s final report made 29 recommendations to enhance the operation, transparency, regulation, competitiveness, and efficiency of Murray-Darling Basin water markets.
In response to the ACCC’s final report, the previous Australian Government appointed Daryl Quinlivan AO to consider the ACCC’s recommendations and create a roadmap for the implementation of any suitable reforms.
On 16 December 2021, Mr Quinlivan provided preliminary advice to the then Minister for Resources and Water, the Hon Keith Pitt. His final advice, including the roadmap, was provided to the new Minister for Environment and Water, the Hon Tanya Plibersek MP, in September 2022 and released on 11 October 2022.