On 13 November 2025, the Water Management Legislation Amendment (Stronger Enforcement and Penalties) Bill 2025 passed through NSW Parliament (Bill). The Bill introduces a raft of law reforms relating to the management of water in NSW to deliver stronger enforcement and penalties, including the Water Management Act 2000 (NSW) (WM Act).
This includes a new civil penalty regime for certain breaches of the WM Act – making it the only primary environmental law in NSW that empowers its regulator to seek civil penalties. This brings NSW into alignment with jurisdictions such as Victoria, South Australia and the Commonwealth, where civil penalty frameworks are already in place.
The changes result in higher penalties and increased compliance and reputational risks for water users, addressing concerns about the ability of the Natural Resources Access Regulator (NRAR) to take comprehensive action in relation to contraventions of the WM Act and underlying regulations.
Key takeaways
Civil penalties introduced: The Bill establishes civil penalties as an alternative to criminal prosecution for contraventions of the WM Act or the regulations. Because civil penalties have a lower standard of proof than criminal prosecutions, it will be easier for NRAR to prove breaches of these provisions. For the worst breaches, the Court can impose maximum civil penalties of almost $10 million for corporations and almost $5 million for individuals.
New offences introduced: New offences, each subject to civil penalties, have been introduced for:
Providing false or misleading information to the NSW government or an NRAR authorised officer.
Hindering, intimidating or obstructing an authorised person appointed to complete unfinished works in a direction issued to a landholder.
Receiving a financial benefit from an offence or contravention proven to have been committed by a related corporation
Removing, altering or interfering with something seized by NRAR in connection with a contravention.
Expanded court orders: Courts charged with enforcing the WM Act now have new types of orders available to them when making decisions in relation to water enforcement, including orders for the forfeiture of monetary benefits obtained through contraventions.
Increased maximum criminal penalties able to be imposed by Local Court: The Bill increases the maximum criminal penalty that can be imposed by the Local Court from $22,000 to $220,000 for corporations and to $110,000 for individuals. It also increases the maximum criminal penalty that can be imposed by regulations from $2,200 to $22,000 for corporations and to $11,000 for individuals.
Enhanced and clarified NRAR powers: NRAR and its authorised officers have new and clarified compliance tools, including the ability to enter premises with drones to determine compliance at any reasonable time.
Cultural considerations: Courts must now consider the actual, likely or potential impacts of offences on Aboriginal people when imposing penalties.
Water metering and attestations: Water access licence holders who are required to periodically attest the volume of water taken under the licence cannot refuse to give the attestation on the basis that the attestation may incriminate the holder or otherwise expose the holder to a penalty.
Ministerial powers: The Minister’s powers to impose financial charges for illegal water take or unauthorised use have been broadened.
The Water Management Act
The WM Act is the principal instrument for water regulation in NSW. It seeks to provide sustainable and integrated management of the water sources of NSW for the benefit of both present and future generations. The objects of the WM Act include:
Applying the principles of ecologically sustainable development.
Protecting, enhancing and restoring water sources, their associated ecosystems, ecological processes and biological diversity and their water quality.
Recognising and fostering the significant social and economic benefits to the State that result from the sustainable and efficient use of water.
Providing for the orderly, efficient and equitable sharing of water from water sources.
The Bill strengthens enforcement and compliance mechanisms, ensuring that these objectives are effectively achieved and that water resources are managed responsibly for environmental, social and economic outcomes.
Implications for water users
The implications for water users are significant. The Bill introduces enforcement mechanisms that heighten regulatory and reputational risks for water users, including:
Greater compliance risk: The new civil penalty regime means that enforcement action will be easier to pursue and more likely to result in liability, since the standard of proof for civil penalties requires proof on the balance of probabilities (rather than higher threshold of beyond reasonable doubt). The civil penalty provisions also apply to a wide range of water management contraventions, including unauthorised water take, breaches of licence or approval conditions and metering failures.
Heightened financial exposure: The regime is designed to provide strong deterrence and improve compliance with water management laws, with the most serious breaches (e.g., unauthorised water take) attracting penalties of up to 90,900 penalty units (~$10 million) or five times the value of the water taken for corporations and 45,450 penalty units (~$5 million) or five times the value for individuals, plus daily penalties for continuing contraventions.
Reputational consequences: Under the amendments, NRAR’s public register of enforcement actions may now include the identity of persons convicted of offences under the WM Act, as well as those found to have contravened civil penalty provisions. The register will also record penalties imposed and any consequential court orders.
The WM Act is now the only primary environmental law in NSW that empowers its regulator to seek civil penalties. Environment protection laws in Victoria and South Australia as well as the federal Environment Protection and Biodiversity Conservation Act 1999 (Cth), also provide for the imposition of civil penalties.
Civil penalties are seen as a key tool to mitigate the burden associated with the detection, surveillance and investigation of environmental contraventions, made challenging by the sheer size of the NSW landmass and river system with dispersed populations.
With the introduction of the civil penalty provisions, the key enforcement mechanisms by which the WM Act attempts to achieve its objects are:
stop work orders, directions and warnings
penalty notices and cautions
civil proceedings to restrain breaches and/or impose monetary penalties
criminal prosecutions for offences.
Responding to the reforms
The reforms represent a significant tightening of water regulation in NSW, reflecting the value and scarcity of water resources. There is clear intent to deter non-compliance and promote sustainable water management. Businesses and water users should:
proactively review and strengthen their compliance frameworks
invest in accurate metering and reporting systems
prepare for increased regulatory oversight and higher penalties.
Failure to adapt may lead to serious financial, operational and reputational consequences.
How we can help
Gilbert + Tobin’s climate and sustainability team are closely tracking water reforms across Australia and we regularly help clients:
stay ahead of regulatory changes
obtain water licences and approvals
respond to incidents, investigations, or compliance actions.
To discuss how the reforms may affect your business or for assistance with engaging with the NSW water regulations, please contact us.