22 August 2007
By using the corporations power in the Constitution, the Federal Government could take over the regulation of uranium mining and enrichment activities from the States.
Currently the regulation of uranium mining and enrichment in Australia is governed by a patchwork of laws. There are however some indications that the Federal Government is looking at taking over this area.
This week Prime Minister John Howard set out his goals if re-elected for a fifth term. One of these is to further develop a sense of "aspiration nationalism in the Federation" by moving the focus from the balance of State and Commonwealth rights to achieving outcomes for Australia.
The Prime Minister's comments follow on from the Federal Minister for Industry, Tourism and Resources, Ian Macfarlane, who has recently suggested that the Federal Government will look into its legal position to see if it can override State Government bans on uranium mining and enrichment.
Professor Greg Craven of Curtin University, a constitutional law expert, has noted that the Federal Government arguably has the potential to regulate uranium mining and enrichment through the use of the corporations power in the Constitution which was found to have a broader coverage following the High Court's decision in the Work Choices case.
The logic behind Professor Craven's opinion is that commercial mining, including uranium mining, is conducted by trading corporations and the same applies in respect of uranium enrichment. Therefore, through the use of the corporations power, the Federal Government is arguably capable of taking over the regulation of mining and enrichment activities from the States.
The regulation of uranium mining and potentially enrichment in Australia is complex and is currently shared between the States, and Federal Government.
The Federal Government maintains specific responsibilities in relation to the regulation of uranium mainly in relation to transport, export, safety, under a series of Federal legislations including:
Under the Environmental Protection and Biodiversity Conservation Act 1999 (Cth) ("EPBC Act") the Federal Government has power over the environmental management of, amongst other things, uranium mining. In April this year the Prime Minister announced a new strategy to increase uranium mining export, including a proposed amendment to the EPBC Act to remove uranium mining and milling from the additional requirements imposed under the EPBC Act. To date however there has been no amendment bill put before Parliament to implement this strategy.
States' and Territories' positions on uranium mining and enrichment
Currently there are three uranium mines operating under two different regimes: Ranger in the Northern Territory, and Olympic Dam and Beverly in South Australia. There are currently no commercial uranium enrichment facilities in Australia.
The regulatory framework for uranium mining in each State and Territory differs. South Australia and the Northern Territory currently allow uranium mining, while Western Australia and Queensland (the two other States with significant recoverable uranium reserves) allow exploration for uranium but prohibit uranium mining.
The Western Australian Parliament is currently considering prohibiting uranium mining via the Uranium Mining (Implementation of Government Commitments) Bill 2007 but this would specifically exclude the situations where the mining lease was granted before 22 June 2002 or where the mining of uranium is incidental to the mining of other minerals.
As for uranium enrichment, all the States are opposed to it and Queensland, New South Wales and Victoria all have specific legislation prohibiting it.
The recognised scope of the Commonwealth's power to legislate in areas traditionally left to the States has steadily increased since Amalgamated Society of Engineers v Adelaide Steamship Co. Ltd (1920) 28 CLR 129 (the Engineers case). This has been possible through the adoption of the broader interpretation of the corporations power in the Australian Constitution, which gives the Commonwealth Parliament power to make laws with respect to "foreign corporations, and trading and financial corporations formed within the limits of the Commonwealth".
The Commonwealth has used this power to legislate with regard to city councils, universities, providers of medical or emergency services, sporting clubs, State superannuation boards, and even the Red Cross, each of which have been deemed to fall within the definition of a trading corporation.
The High Court's decision in the Work Choices case was a further illustration that what has been perceived as the scope of the power to regulate corporations has broadened, raising the possibility for the Commonwealth to regulate almost anything done by a trading corporation.
The High Court held by a 5:2 majority that Work Choices was valid. The key finding was that a federal law regulating the "activities, functions, relationships and the business" of any constitutional corporation, that is a trading, financial and foreign corporation, is valid under the Constitution.
Implications for the States
If the Federal Government did implement valid legislation to try to override the State Government bans on uranium mining and enrichment, under the corporations power, any existing or new State legislation prohibiting uranium mining or enrichment would be in direct conflict with the Federal legislation and, by virtue of section 109 of the Constitution invalid to the extent of the inconsistency.
The Premiers of Western Australia and Queensland have both come out strongly against any proposal for the Commonwealth to regulate uranium mining and it is expected that the validity of any Federal legislation regulating uranium mining or enrichment would be the subject of a High Court challenge by the States.
For further information, please contact Stuart MacGregor.