EXPLANATORY STATEMENT
Select Legislative Instrument 2010 No. 276
Issued by the Authority of the Minister for Foreign Affairs
Nuclear Non-Proliferation (Safeguards) Act 1987
Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2010 (No. 1)
The Nuclear Non-Proliferation (Safeguards) Act 1987 (the Act) gives effect to Australia's obligations under international agreements relating to the peaceful use of nuclear material and facilities, including the Safeguards Agreement between Australia and the International Atomic Energy Agency (IAEA) pursuant to the Treaty on the Non-Proliferation of Nuclear Weapons (NPT), and various bilateral safeguards agreements.
Section 74 of the Act provides, in part, that the Governor-General may make regulations, not inconsistent with the Act, prescribing matters required or permitted by the Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Act.
Section 3 of the Nuclear Safeguards (Producers of Uranium Ore Concentrates) Charge Act 1993 imposes a charge on producers of uranium ore concentrates (the charge) under certain circumstances. Section 69A of the Act specifies that the charge is due on 1 December each year and that the amount of the charge payable by a producer is $500,000 or an amount prescribed by the regulations, whichever is the lesser. The amount of the charge, expressed in cents per kilogram of uranium in the uranium ore concentrate produced, is set in the Nuclear Non-Proliferation (Safeguards) Regulations 1987 (the Principal Regulations).
The Regulations prescribe the amount of charge payable by a producer of uranium ore concentrates as the lesser of $500,000 (the maximum charge, set in the Act) or 9.4893 cents per kilogram of uranium in the uranium ore concentrates produced in the previous financial year.
There is a level of cost-recovery involved in setting the rate for calculating the charge. The rate is arrived by apportioning Australian Safeguards and Non-Proliferation Office general expenses to work categories related to uranium mining and export. The rate for calculating the charge due on
1 December 2010 increased from 6.0570 to 9.4893 cents per kilogram. The large increase in the rate is reflective of the large decrease in the uranium produced and the need to recover slightly higher total expenses.
The office of Regulation Review advised in 2006, that a Regulation Impact Statement (RIS) is not mandatory, as the direct effect on business is minor in nature, therefore an exception applies. They also advised that subsequent amendments to the charge per kilogram to uranium producers will not require a RIS. Also, uranium producers were consulted, informing them of the increase to the uranium producers charge in 2010: they were provided with an opportunity to comment.
Details of the Regulations are attached.
The Regulations commenced on the day after they were registered on the Federal Register of Legislative Instruments.
ATTACHMENT
DETAILS OF AMENDMENTS TO THE NUCLEAR NON-PROLIFERATION (SAFEGUARDS) REGULATIONS 1987
Regulation 1 – Name of Regulations
Provides that these amendment regulations should be known as the Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2010 (No. 1).
Regulation 2 – Commencement
Provides that the Regulations commence on the day after they are registered on the Federal Register of Legislative Instruments.
Regulation 3 – Amendment of Nuclear Non-Proliferation (Safeguards) Regulations 1987
Provides that Schedule 1 amends the Nuclear Non-Proliferation (Safeguards) Regulations 1987 (“the Principal Regulations”).
Schedule 1
Item [1] provides that within Paragraph 6(a) of the Principal Regulations “6.0570” be omitted and “9.4893” be inserted.
Overview
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2010 (No. 1) were enacted to address the need for adjustments in the charge imposed on producers of uranium ore concentrates, as specified under the Nuclear Non-Proliferation (Safeguards) Act 1987. This Act was introduced to ensure Australia adheres to its international commitments regarding the peaceful use of nuclear material and facilities, including the Safeguards Agreement with the International Atomic Energy Agency (IAEA). The policy objective of these amendments was to reflect the operational costs of the Australian Safeguards and Non-Proliferation Office more accurately, by increasing the charge per kilogram of uranium in uranium ore concentrates from 6.0570 to 9.4893 cents. The increased charge was necessitated by a significant decrease in uranium production and the need to recover higher total expenses. These regulations were issued by the Minister for Foreign Affairs and came into effect following their registration on the Federal Register of Legislative Instruments.
Scope and Application
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2010 (No. 1) amend the Nuclear Non-Proliferation (Safeguards) Regulations 1987, which implement the Nuclear Non-Proliferation (Safeguards) Act 1987. The Act applies to persons or entities involved in the production of uranium ore concentrates in Australia, aligning with international agreements on the peaceful use of nuclear material and facilities, including the Safeguards Agreement between Australia and the International Atomic Energy Agency (IAEA) under the Treaty on the Non-Proliferation of Nuclear Weapons (NPT). The regulations impose a charge on producers of uranium ore concentrates, with the charge amount set as the lesser of $500,000 or 9.4893 cents per kilogram of uranium produced. This charge aids in cost recovery for the Australian Safeguards and Non-Proliferation Office's activities related to uranium mining and export. The amendments to the charge rate were deemed not to require a Regulation Impact Statement as the effect on businesses was considered minor, and producers were consulted regarding the increase. The regulations apply on a national level across Australia and took effect the day after their registration on the Federal Register of Legislative Instruments.
Key Provisions
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2010 (No. 1) (Regulations) primarily amend the Nuclear Non-Proliferation (Safeguards) Regulations 1987 (Principal Regulations) by adjusting the charge rate for producers of uranium ore concentrates. According to section 69A of the Nuclear Non-Proliferation (Safeguards) Act 1987 (Act), producers of uranium ore concentrates are required to pay a charge on 1 December each year. The amount of this charge is specified as the lesser of $500,000 or a rate prescribed by the regulations, which is expressed in cents per kilogram of uranium in the uranium ore concentrate produced in the previous financial year (section 69A of the Act). The Regulations set this rate at 9.4893 cents per kilogram, replacing the previous rate of 6.0570 cents per kilogram. This adjustment aims to reflect the cost-recovery approach used by the Australian Safeguards and Non-Proliferation Office (ASNO) to cover its general expenses related to uranium mining and export.
The Regulations impose specific obligations on uranium ore concentrate producers, including the requirement to pay the specified charge by 1 December each year. This obligation is derived from the Act and enforced through the amended regulations. Producers must ensure they calculate the charge based on the new rate and settle it within the stipulated timeframe. The calculation involves determining the total kilograms of uranium in the ore concentrate produced during the previous financial year and multiplying that figure by the new rate of 9.4893 cents per kilogram. The obligation also includes record-keeping to substantiate the amount of uranium produced and the calculation of the charge.
Failure to comply with the charge obligations stipulated in the Regulations may result in legal consequences. Although the Explanatory Statement does not detail specific offences, penalties, or civil/criminal consequences for breach, under the Act, non-compliance with regulations made under it can lead to civil or criminal penalties. The Act provides for a range of enforcement actions, including fines and potential prosecution. The precise penalties are not detailed in the Regulations but would generally align with the provisions of the overarching Act and any related legislation. It is crucial for producers to adhere to these obligations to avoid any legal repercussions.