{"id":"C2004A02459","name":"Offshore Minerals (Royalty) Act 1981","slug":"offshore-minerals-royalty-act-1981","collection":"act","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":"82 of 1981","makingDate":null,"administeringDepartment":null,"currentVersion":{"id":6877,"registerId":"commonwealth-C2004A02459-current","compilationNumber":null,"startDate":"2026-03-30","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"1","sectionType":"section","heading":"Short title [see Note 1]","content":"#### 1 Short title \\[see Note 1\\]\n\n  This Act may be cited as the Offshore Minerals (Royalty) Act 1981.","sortOrder":0},{"sectionNumber":"2","sectionType":"section","heading":"Commencement [see Note 1]","content":"#### 2 Commencement \\[see Note 1\\]\n\n  This Act shall come into operation on the day on which the Minerals (Submerged Lands) Act 1981 comes into operation.","sortOrder":1},{"sectionNumber":"3","sectionType":"section","heading":"Interpretation","content":"#### 3 Interpretation\n\n  (1) In this Act, royalty period, in relation to a mining licence, means:\n    (a) the period from and including the day on which the licence takes effect to and including the next following 30 June or 31 December whichever is the earlier; and\n    (b) each period of 6 months thereafter.\n  (2) Expressions used in this Act that are used in the Offshore Minerals Act 1994 have, unless the contrary intention appears, the same meanings as they have in that Act.","sortOrder":2},{"sectionNumber":"4","sectionType":"section","heading":"Royalty","content":"#### 4 Royalty\n\n  A person who is or has been a mining licence holder must pay to the Designated Authority a royalty in respect of all minerals recovered by the holder under the licence.","sortOrder":3},{"sectionNumber":"5","sectionType":"section","heading":"Rate of royalty","content":"#### 5 Rate of royalty\n\n  (1) Subject to the succeeding provisions of this section, the Joint Authority may, by instrument in writing, determine the rate of royalty payable in respect of a mineral of a kind specified in the instrument.\n  (2) Without limiting the generality of subsection (1), the rates of royalty determined under that subsection may include a rate that is related to the landed value, or to the quantity, of the mineral of the relevant kind.\n  (3) A rate of royalty determined under subsection (1) applies in relation to any mineral of the relevant kind recovered under a mining licence during the period when the rate is in force.\n  (4) A determination under subsection (1) takes effect on the day on which a copy of the determination is published in the Gazette.","sortOrder":4},{"sectionNumber":"6","sectionType":"section","heading":"Reduction of royalty in certain cases","content":"#### 6 Reduction of royalty in certain cases\n\n  Where the Joint Authority is satisfied that, having regard to the rate of royalty determined under section 5 in respect of a mineral of a particular kind, further recovery of that kind of mineral under a mining licence would be uneconomic, the Joint Authority may, by instrument in writing, determine that the royalty in respect of that kind of mineral recovered under that licence shall be at such rate (being a rate lower than the rate determined under that section) as the Joint Authority specifies in respect of such period as the Joint Authority specifies.","sortOrder":5},{"sectionNumber":"7","sectionType":"section","heading":"Ascertainment of landed value","content":"#### 7 Ascertainment of landed value\n\n  For the purposes of this Act, the landed value of any mineral is such amount as is agreed between the the mining licence holder and the Joint Authority or, in default of agreement within such period as the Joint Authority allows, is such amount as is determined by the Joint Authority as being that value.","sortOrder":6},{"sectionNumber":"8","sectionType":"section","heading":"Ascertainment of quantity","content":"#### 8 Ascertainment of quantity\n\n  For the purposes of this Act, the quantity of any mineral recovered by a a mining licence holder during a royalty period shall be taken to be such quantity as is agreed between the holder and the Joint Authority to have been recovered by the holder during that period or, in default of agreement within such period as the Joint Authority allows, is such quantity as is determined by the Joint Authority as being the quantity of the mineral recovered by the holder during the first‑mentioned period.","sortOrder":7},{"sectionNumber":"9","sectionType":"section","heading":"Payment of royalty","content":"#### 9 Payment of royalty\n\n  (1) Royalty under this Act in respect of any mineral recovered during a royalty period is payable within 1 month after the last day of that royalty period.\n  (2) Where an amount of royalty under this Act is not paid as provided by subsection (1), there is payable to the Designated Authority by the mining licence holder an additional amount calculated at the rate of one‑third of 1% per day upon the amount of royalty from time to time remaining unpaid, to be computed from the time when the royalty became payable until it is paid.\n  (3) An additional amount is not payable under subsection (2) in respect of any period before the expiration of:\n    (a) if the rate of royalty payable in respect of the mineral recovered is related to the landed value of the mineral—7 days after the landed value of the mineral was agreed or determined under section 7; or\n    (b) if the rate of royalty payable in respect of the mineral recovered is related to the quantity of the mineral—7 days after the quantity of the mineral was agreed or determined under section 8.","sortOrder":8},{"sectionNumber":"10","sectionType":"section","heading":"Royalty and penalties debts due to Commonwealth","content":"#### 10 Royalty and penalties debts due to Commonwealth\n\n  (1) Royalty under section 4, and an amount payable under subsection 9(2), are debts due to the Commonwealth by a person who is or has been a mining licence holder and are recoverable in a court of competent jurisdiction.\n  (2) Royalty and other amounts referred to in subsection (1) received by the Designated Authority shall be deemed to be received by the Designated Authority on behalf of the Commonwealth.","sortOrder":9}],"analysis":{"flash_summary":{"complexity_score":5,"scope_assessment":{"changed":false,"description":"The supplied text establishes a compact framework: who must pay royalties, how rates are set and reduced, how landed value and quantity are ascertained, payment timing and penalties, and recovery as Commonwealth debts. There is no indication in the provided instrument that its substantive scope has been altered from that framing."},"complexity_factors":["Discretionary rate-setting power vested in the Joint Authority (s5) creates administrative levers and potential variability in treatment between licences.","Power to reduce royalty where further recovery would be uneconomic (s6) requires economic assessment and introduces case-by-case discretion.","Valuation mechanism allows agreement or, failing that, unilateral determination by the Joint Authority (s7), creating dispute and evidentiary risk for holders.","Quantity determination similarly permits agreement or Joint Authority determination (s8), affecting measurement disputes and compliance reporting.","Payment timing and a daily interest/penalty formula (s9) impose cashflow and compliance costs on licence-holders and a predictable enforcement mechanism.","Royalty and penalty amounts are declared Commonwealth debts and recoverable in court (s10), linking administrative determinations to legal enforcement.","Cross-reference to Offshore Minerals Act 1994 for undefined terms (s3(2)) adds interpretive complexity and dependency on external definitions.","Roles of 'Joint Authority' and 'Designated Authority' are central but not defined in this text, increasing reliance on other instruments or provisions."],"plain_english_summary":"This Act requires holders of offshore mining licences to pay royalties on minerals they recover, sets how royalty rates are fixed and when payments are due, and allows the Joint Authority to lower a rate if further recovery would be uneconomic.\n\nThe Joint Authority decides rates and, where parties cannot agree, determines the mineral’s landed value and quantity; unpaid royalties incur daily interest and are recoverable as Commonwealth debts. It therefore affects licence-holders’ costs, valuation and reporting obligations and creates administrative decision points for authorities."},"flash_summary_failed":{"failed":true,"reason":"Unauthenticated. Configure AI_GATEWAY_API_KEY or use a provider module. Learn more: https://ai-sdk.dev/unauthenticated-ai-gateway","source":"analysis-cron"},"summary":{"complexity_score":4,"scope_assessment":{"changed":false,"description":"The Act appears to have remained focused on its original and narrow purpose: establishing a royalty payment framework for offshore mineral extraction. While definitions were updated to reference the Offshore Minerals Act 1994 (replacing the original Minerals (Submerged Lands) Act 1981 reference), the core scope — imposing royalties on mining licence holders, setting rate-determination mechanisms, and providing for collection — has not materially broadened or narrowed from its original intent."},"complexity_factors":["Multiple interacting bodies with authority (Joint Authority and Designated Authority), whose roles and composition are defined in separate legislation, requiring cross-referencing","Rate-setting mechanism is flexible and discretionary rather than fixed, creating uncertainty for licence holders about future obligations","Royalty calculation depends on either 'landed value' or 'quantity', each requiring a separate agreement or determination process that can delay finality","Late payment penalty provisions include conditional grace periods that differ depending on which calculation method applies, adding a layer of procedural complexity","Key definitions and terminology are imported by reference from the Offshore Minerals Act 1994, meaning the Act cannot be fully understood in isolation","The Act has been in force since 1981 but references 1994 legislation, suggesting amendment history that may require tracing to understand the current state of the law"],"plain_english_summary":"The Offshore Minerals (Royalty) Act 1981 requires holders of licences to recover minerals from Australian offshore areas to pay royalties to the Commonwealth. Rates — set by the Joint Authority and based on value or quantity — and timing rules govern payments, with penalties for late payment and mechanisms to reduce royalties where standard rates would make mining uneconomic. It ensures the public shares in profits from publicly owned offshore resources."},"issue_detection":{"absurdities":[],"contradictions":[]},"kimi_summary":{"content_quality":"ok","complexity_score":3,"scope_assessment":{"changed":false,"description":"The legislation maintains its original narrow purpose of establishing a royalty collection framework for offshore minerals. It has not expanded beyond this core function of setting rates, determining value/quantity, and enforcing payment."},"complexity_factors":["Short statute with only 10 operative sections","Minimal defined terms (only 'royalty period' explicitly defined in section 3)","Heavy reliance on external definitions via section 3(2) incorporating meanings from the Offshore Minerals Act 1994","Simple conditional structure with basic exceptions (section 9(3) provides a grace period exception to penalty accrual)","No nested exceptions or complex cross-referencing beyond the single reference to the companion Act","Straightforward administrative framework with clear deadlines and penalty calculations"],"plain_english_summary":"**What this law does:**\n\nThis Act creates a system for collecting **royalties** (payments made to the government for the right to extract natural resources) from companies that mine minerals in Australian offshore waters.\n\n**Who it affects:**\n\n- **Mining companies** that hold licences to extract minerals from Australia's offshore areas (under the seabed beyond state coastal waters)\n- The **Designated Authority** (the government body that administers these licences)\n- The **Joint Authority** (the decision-making body that sets royalty rates and makes determinations about value and quantity)\n\n**Key rules:**\n\n- Mining licence holders **must pay royalties** on all minerals they recover\n- The **Joint Authority sets the royalty rates** by written instrument, which can be based on either:\n  - The **landed value** of the minerals (their market value at the point of landing/delivery), or\n  - The **quantity** of minerals extracted\n- If mining becomes **uneconomic** due to royalty rates, the Joint Authority can **reduce the rate** for a specific period\n- If the company and the Joint Authority **can't agree** on the value or quantity of minerals, the Joint Authority **decides unilaterally**\n- Royalties are paid **every 6 months** (within one month after each \"royalty period\" ending 30 June or 31 December)\n- **Late payment penalties** apply at 0.33% per day (roughly 10% per month), though there's a 7-day grace period after value/quantity is determined\n- Unpaid royalties are **debts owed to the Commonwealth** and can be recovered through the courts\n\n**Why it matters:**\n\nThis law ensures Australia receives fair compensation for the extraction of its offshore mineral resources. It balances the government's revenue interests against the economic viability of mining operations, with built-in flexibility to reduce rates if projects would otherwise become unprofitable."}},"importantCases":[],"_links":{"self":"/api/acts/offshore-minerals-royalty-act-1981","history":"/api/acts/offshore-minerals-royalty-act-1981/history","analysis":"/api/acts/offshore-minerals-royalty-act-1981/analysis","conflicts":"/api/acts/offshore-minerals-royalty-act-1981/conflicts","importantCases":"/api/acts/offshore-minerals-royalty-act-1981/important-cases","documents":"/api/acts/offshore-minerals-royalty-act-1981/documents"}}