EXPLANATORY STATEMENT
Select Legislative Instrument No. 331, 2022
Issued by the Authority of the Minister for Foreign Affairs
Nuclear Non-Proliferation (Safeguards) Act 1987
Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2022
The Nuclear Non-Proliferation (Safeguards) Act 1987 (Safeguards Act) makes provision in relation to the non-proliferation of nuclear weapons and establishes a system for the imposition and maintenance of nuclear safeguards in Australia. It also gives effect to certain obligations that Australia has under international agreements on the peaceful use of nuclear material and facilities.
Section 74 of the Safeguards Act provides, in part, that the Governor-General may make regulations, not inconsistent with the Safeguards Act, prescribing matters required or permitted by the Safeguards Act to be prescribed, or necessary or convenient to be prescribed for carrying out or giving effect to the Safeguards Act.
Section 70 of the Safeguards Act provides that powers, discretions, duties or functions under the Act are to be exercised in accordance with specified international agreements identified in the Safeguards Act, or prescribed in the Nuclear Non-Proliferation (Safeguards) Regulations 1987 (the Principal Regulations).
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2022 (the Regulations) amend the Principal Regulations in two ways. Firstly, they update the list of prescribed international agreements by adding the following to the list of prescribed international agreements:
- Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland on Cooperation in the Peaceful Uses of Nuclear Energy, date signed on behalf of Australia 21 August 2018.
This Agreement entered into force on 1 January 2021 to ensure that the United Kingdom continues to meet Australia’s uranium export policy requirements. Previously, the United Kingdom was covered by two Agreements, one which no longer applies, and the other has now been superseded. Prescribing this Agreement in the Safeguards Act publicly confirming its implementation and expressly links it to the functions of the Director General ASNO under the Safeguards Act.
Consultation and the regulatory impact for the Agreement was addressed in the Australian Treaty National Interest Analysis [2018] ATNIA 12. The Australian uranium industry, the Uranium Council and industry stakeholders indicated support to the Agreement at that time. Accordingly, additional consultation was not considered necessary in relation to this amendment, it being machinery in nature.
Secondly, the Regulations amend the charge rate used to determine the charge imposed on Australian producers of uranium ore concentrate for the cost of safeguards and security activities undertaken by the Australian Safeguards and Non-Proliferation Office (ASNO), in line with the Australian Government’s Charging Framework policy.
The Nuclear Safeguards (Producers of Uranium Ore Concentrates) Charge Act 1993 imposes a charge on producers of uranium ore concentrates under certain circumstances. Section 69A of the Safeguards Act specifies that the charge is payable on 1 December each year and that the amount of the charge payable by a producer is the lesser of $500,000 or an amount prescribed by the Principal Regulations, expressed as a charge rate in cents per kilogram of uranium in the uranium ore concentrates produced by the person in the previous financial year.
The Regulations amend the charge rate to 18.7839 cents per kilogram of uranium in the uranium ore concentrates produced. The charge rate reflects actual costs in the previous financial year (2021-22) of relevant safeguards and security activity by ASNO, and the total production and export of uranium ore concentrate in Australia. The charge is payable in the 2022-23 financial year and later financial years.
On 18 January 2006, the Office of Best Practice Regulation (OBPR) advised that as the direct effect on business is minor in nature a Regulation Impact Statement (RIS) is not mandatory, therefore an exception applies. The OBPR also advised that subsequent amendments to the charge per kilogram to uranium producers will not require a RIS. The two uranium producers have been consulted on the change to the uranium producers charge rate and were provided with an opportunity to comment.
This statement of compatibility is prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. This Legislative Instrument does not engage any of the applicable rights or freedoms described in the Human Rights (Parliamentary Scrutiny) Act 2011. Accordingly, this Legislative Instrument is compatible with human rights.
The Regulation commenced on the day after registration and is a legislative instrument for the purposes of the Legislation Act 2003.
Overview
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2022 were introduced to update the regulatory framework underpinning the Nuclear Non-Proliferation (Safeguards) Act 1987, an Act established to ensure the non-proliferation of nuclear weapons and to enforce nuclear safeguards in Australia. Enacted by the Parliament of Australia, the primary objective of this legislation is to align Australia's regulatory framework with its international obligations regarding the peaceful use of nuclear material and facilities. The 2022 amendments primarily focus on updating the list of prescribed international agreements to reflect current treaties, specifically adding the Agreement between Australia and the United Kingdom concerning the peaceful uses of nuclear energy, and adjusting the charge rate applied to uranium producers to better reflect the actual costs incurred by the Australian Safeguards and Non-Proliferation Office. These amendments were made without the need for a Regulation Impact Statement due to the minor effect on business entities, as advised by the Office of Best Practice Regulation.
Scope and Application
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2022 amends the Nuclear Non-Proliferation (Safeguards) Regulations 1987 to update the list of prescribed international agreements and to adjust the charge rate for uranium ore concentrate producers under the Nuclear Safeguards (Producers of Uranium Ore Concentrates) Charge Act 1993. These regulations apply to Australian producers of uranium ore concentrate and are intended to ensure compliance with international agreements related to the non-proliferation of nuclear weapons and the peaceful use of nuclear energy. The updated list of international agreements includes the Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland on Cooperation in the Peaceful Uses of Nuclear Energy, which came into effect on 1 January 2021. The amendment to the charge rate is based on actual costs incurred by the Australian Safeguards and Non-Proliferation Office for safeguards and security activities in the previous financial year, and reflects the total production and export of uranium ore concentrate in Australia. The changes to the charge rate were consulted with the relevant industry stakeholders and do not require a Regulation Impact Statement as the effect on business is minor. The Regulations are a legislative instrument for the purposes of the Legislation Act 2003 and commenced on the day after registration.
Key Provisions
The Nuclear Non-Proliferation (Safeguards) Amendment Regulations 2022, which amend the Nuclear Non-Proliferation (Safeguards) Regulations 1987, introduce two key changes. Firstly, they add a new agreement to the list of prescribed international agreements, specifically the Agreement between the Government of Australia and the Government of the United Kingdom of Great Britain and Northern Ireland on Cooperation in the Peaceful Uses of Nuclear Energy (section 3). This addition ensures that the United Kingdom continues to meet Australia's uranium export policy requirements, reflecting the current framework of agreements in place. Secondly, the Regulations amend the charge rate for Australian producers of uranium ore concentrate, setting it at 18.7839 cents per kilogram of uranium in the uranium ore concentrates produced (section 4). This adjustment aligns with the Australian Government’s Charging Framework policy and is based on the actual costs incurred by the Australian Safeguards and Non-Proliferation Office (ASNO) for the previous financial year.
These Regulations impose specific obligations on the parties they govern. For instance, Australian producers of uranium ore concentrate are now required to pay a charge calculated at the new rate of 18.7839 cents per kilogram of uranium produced, as per section 69A of the Safeguards Act. Additionally, the inclusion of the new agreement with the United Kingdom mandates that all activities under this agreement must comply with the Safeguards Act and the relevant international obligations, as stipulated in section 70 of the Safeguards Act. This ensures that all nuclear-related activities align with Australia's non-proliferation commitments and international agreements.
Failure to comply with the requirements set out in these Regulations may lead to various consequences. Under section 69A of the Safeguards Act, producers who fail to pay the specified charge may face civil penalties. Additionally, non-compliance with the obligations under the prescribed international agreements could result in breaches of international law, with potential diplomatic and legal repercussions. While the Regulations themselves do not detail specific penalties for non-compliance, the overarching Safeguards Act and associated legislation provide a framework for enforcement, which may include fines and other administrative actions. It is important to note that the charge rate amendment is designed to reflect actual costs and does not introduce new obligations beyond those already specified in the Safeguards Act.