Buying a BioBank site

The Biodiversity Offsets Scheme under the Biodiversity Conservation Act 2016 commenced on 25 August 2017 visit Biodiversity Offset Scheme.

The information on this page only remains relevant for savings and transitional arrangements under former legislation and policy. Visit Biodiversity Offset Scheme Transitional Arrangements for more information.

When you purchase a property subject to a BioBanking agreement you are joining a community of landowners who are protecting, managing and restoring our biodiversity. But before you purchase an existing BioBank site you should understand the general obligations required of BioBank owners and be familiar with the particular obligations of the BioBanking agreement on the site in question, including what management actions are being undertaken.

Understanding BioBanking agreements

For comprehensive information on BioBanking agreements prospective buyers should review the Guide to Establishing a Biobank site and the information for landowners page which contain useful information about the obligations of a BioBank site owner. A brief summary is also provided here.

A BioBanking agreement is a legal agreement between the landholder and Minister for the Environment. The land that is subject to the agreement is called a BioBank site. The agreement identifies management actions that must be undertaken on the site and places restrictions on how the site can be used. These actions are designed to maintain or improve biodiversity values of the Biobank site. The obligations will also include the responsibility to record information about certain management actions and to report annually on the management of the site.

When a BioBanking agreement is entered into, a convenant is placed on the title of the land. The BioBanking agreement and convenant are ‘in-perpetuity’ and ‘run with the title of the land’. This means that except in some very particular circumstances the BioBanking agreement lasts forever and new owners of a BioBank site are bound by the BioBanking agreement.

The establishment of a BioBank site creates biodiversity credits. The sale of these credits will result in money being invested in a BioBanking Trust Fund to fund ongoing management of the site. Once a sufficient amount has been invested in the BioBanking Trust Fund, annual management payments are paid to the owner of a BioBanking site to assist with the cost of undertaking management actions. If you become the new owner of a BioBanking site you will receive these annual management payments from the BioBanking Trust Fund. Owners of BioBanking sites will also be eligible for land tax exemptions.

What documents should I look at and what should I consider?

As a prospective BioBank site owner you should understand the obligations of the BioBanking agreement, how many years the site has been managed and what progress has been made in managing the site. You should also understand financial matters associated with the Biobanking agreement including whether annual management payments have commenced and that the site is eligible for land tax exemption. To help to understand these things it is recommended that prospective buyers of a BioBank site request from the current landholder complete copies of the following documents:

  • the BioBanking agreement: this includes management plans detailing the actions that must be undertaken on site and the payment schedule showing the amount which will be paid to the BioBank site owner each year if management actions have been completed.
  • all annual reports submitted to the Office of Environment and Heritage (OEH): these reports are prepared by the BioBank site owner each year and set out the management actions undertaken that year
  • the most recent annual audit report provided to the landholder by OEH: this reports details OEH’s assessment of the management actions and identifies any actions that have not been completed adequately
  • the most recent financial statement for the site’s account in the BioBanking Trust Fund provided by the Trust Fund Manager
  • any additional records not mentioned above that are required to be kept under Annexure D of the BioBanking agreement
  • maps of the BioBank site, which are contained with the BioBanking agreement. These maps will identify the areas were restrictions and obligations apply under the agreement . They will also identify the areas where management actions are required.

When reviewing these documents it is suggested you particularly consider:

  • What activities are allowed on the site?
  • What are the management obligations?
  • What management actions have been completed since the most recent annual report was prepared by the landholder?
  • What are the annual payment amounts?
  • How much of the Total Fund Deposit (the “TFD”, which is the in-perpetuity management funding for the site) has been paid into the BioBanking Trust Fund so far?
  • Have active management obligations and annual management payments started?
  • Did the most recent audit report from OEH identify any actions that have not been completed adequately?

Prospective buyers may wish to engage an accredited BioBanking assessor to help them understand the BioBanking agreement, management requirements and audit reports. Prospective buyers may also wish to seek legal advice and/or financial advice.

What happens when a BioBank site changes ownership?

When a BioBank site changes ownership, the previous landowner must notify OEH in writing and provide contact details for the new landowner. The previous landowner must provide the new owner with all the records listed in Annexure D ('Monitoring, reporting and record keeping requirements') of the BioBanking agreement.

For the reporting year that the site changes hands, both the previous and new landowners must complete an annual report for the period for which they were the landowner. Prospective purchasers should be aware that as a new BioBank site owner they would take on the responsibility for any management actions required under the agreement from the date they took ownership of the land. The previous landowner will have been paid the annual payment to cover the cost of these management actions. The new landowner will not receive additional funding for the actions required for that reporting period. The new landowner must ensure they are able to cover the cost of the required actions until the next annual report is due. Funding will not be provided to the new landowner until the next annual report is submitted and required actions are shown to have been completed. Funding is then provided to complete the actions required in the coming year.

What happens to unsold credits?

Unsold Biobanking credits remain the property of the landowner who originally entered into the BioBanking agreement. This is important to note if the site is not yet in active management. Active management will only commence when the original l;andowner sells further credits and the credit sale price brings the TFD above 80%. Until 100% of the TFD has been paid all proceeds from credit sales are required to be deposited into the Biobanking Trust Fund.

Page last updated: 28 August 2017