The last paragraph of the recreational fishing for rock lobster guide has the heading "FLOATS".
Collins Pocket English Dictionary, Float- rest on the surface of a liquid.

The end.

Quite a few years ago a friend of mine came up with the idea of having cray pots without ropes and floats, in broad terms the pots had a device attached to them that when activated caused a gas cylinder to be punctured which then allowed the gas to fill an inflatable sphere which brought the cray pot to the surface. No floats no ropes to get cut off.
The device was activated by a specific signal generated by the cray boat as it went along the line, signal on, pots come to the surface.

I was with him when he approached fisheries management with this idea to get permission to trial this concept.

Short story when the then fisheries minister came back down off the roof of his office the answer was hell will freeze over before such a thing will be approved.

Reason, how can you regulate something you can not see. A sound reason in the time before there were ways of keeping tabs on just where boats were in real time like you can do now.

 I can remember that concept a friend was an investor. Times change and technology has improved and there are a number of ways to continue to track pots even without floats.

Reading that section it does not state that they have to be above the water line, just reference to a size.

Floats must be fitted to every pot rope. They must be at least 15 cm in diameter and stamped or branded with the licence holder’s gear ID number, with lettering 6 cm high and at least 1 cm wide.

If you remember that you are showing your age . (HAHA) your right, technology has changed heaps from those days.
I think you will find that fisheries will still stick their bets to the dictionary definition of the word "float".
Your best bet though is to get it straight from the horses mouth, give them a ring, all they can say is yes or no. They can't turn you into a green frog or take away your birthday.
When you get an answer can you let us know what it is.
I think if the concept got the go ahead it would frustrate a lot of pot stealing buggers

 My brother researched this and came up with the fact that fisheries has to be able to check your fishing gear at any time. That means that they have to be able to locate and pull your pots whenever they want and a hidden float does not cut it. Call them and talk to someone in the know, find the correct law saying you can and we will all be happy. No more stolen, raped or wrecked pots.

 Have been around for years, choose among the range available for an appropriate time interval before they release the bight in the rope to allow the floats to surface. they were used over east, IIRC, by pros who wanted to keep the lcoation of their fish traps a secret. Of course, i means that someone can snag lines/drop gear all over you without realising they are doing it. And yes, we raised the issue with fisheries and the answer was a flat NO.

 Agree with most of what you are saying, however what the fisheries is saying is not reflected in the rules and therefore would never back up a prosecution. If I wasn't worried about people dropping pots on top without knowing I would consider being the test case.

 Paragraph 1 states surface float

The dictionary definition of the word surface and float clearly describe what the words mean and that is what will hold water in court.

I'm not being a pessimist it's just that at the end of the day I think you could be left disappointed and out of pocket some what if you travel down a road that a few people have been down before you and not achieved the sought after out come.

Having said that, if you feel you have a winning formula give it a go and I wish you well.