David Feeney (Batman, Australian Labor Party, Shadow Minister for Justice) Share this | Link to this | Hansard source

I am very pleased to rise to speak on the Defence Trade Controls Amendment Bill 2015. This is of course a bill which seeks to amend the Defence Trade Controls Act 2012, an act that received royal assent on 13 November 2012. It is a bill that was of course crafted by the previous Labor government. As a footnote to history, it is a bill that I took through the Senate in my previous life as a senator. So it is a bill with which I have a little bit of familiarity. It is a bill that has always enjoyed strong and important support, at least by the two parties of government represented here in this parliament. That bipartisanship continues today—and this is of course a bill that is being supported by the opposition.

I take this opportunity to address the House on a number of key aspects of both the bill and the amendments as they pertain to the substantive act. The act was of course implemented by the previous government so as to meet our international obligations as a nation as set out in the Wassenaar Agreement, the missile technology control regime, the Australia Group and the Nuclear Suppliers Group. Critically, the act also gave effect to the treaty that was made between the government of Australia and the government of the United States concerning defence trade cooperation. One of the remarkable things about this treaty is that it passed the US congress with such swiftness that it was implemented in the United States before it was implemented in this country. For anyone who knows anything about US politics and government, that is a rather remarkable happening.

For Australia, this act brought into place a regime that essentially gave life to our nation's commitment to counter-proliferation activities for weapons of mass destruction. It underlined Australia's commitment to stopping goods and technologies that can be used in conventional, chemical, biological, nuclear and weapons of mass destruction programs and making sure that those technologies do not get into the wrong hands. It is an act that dealt with the fact that Australia had changed obligations pursuant to its treaty with the United States and arising from the Wassenaar Agreement, which brings together the international community in a counter-proliferation regime.

Nonetheless, the act, in seeking to control technologies that can be used in conventional, chemical, biological and nuclear weapons, did mean that we were introducing a regulatory regime in Australia that involved change—for some, quite significant change. The act applies equally to the defence industries, to industry more broadly and to the university and research sectors. The act introduced new export controls on the intangible supply of technology listed in the Defence and Strategic Goods List, the prohibition of publication of Defence and Strategic Goods List technologies and the regulation of brokering activities. These were all significant things.

Brokering activities might mean an Australian entity is involved in the purchasing and sale of materials and that transaction happens entirely outside of Australia. As a consequence, that transaction would not previously have been one that was regularised by Australia, it was not controlled by any Australian agency, but by virtue of our international treaty obligations it became an activity that Australian policymakers now needed to take an interest in—and from that resolve quite a deal flows. Also important for the university and research sectors was the fact that a lot of technologies, including dual-use technologies, were now prohibited from being published—because when published they can no longer be controlled. This was potentially of great significance to our university and research sectors. Dual-use technologies might be entirely legitimate subjects for research, for business transactions and for investment but can also be used in weapons of mass destruction. As a consequence, they suddenly attract a control aspiration from government.

So there were a number of significant challenges in this act, and today's bill seeks to amend the act in certain ways that realise stakeholders' concerns and experience with the act and make sure that this regulatory regime operates all the better.

In particular, in order to strengthen Australia's export controls there are now new provisions that are aimed at stopping goods and technologies that can be used in weapons of mass destruction, as I have just described. We need to remain alert to the fact that these provisions apply equally to the industry, university and research sectors. The Defence Trade Controls Act 2012 restricts the non-physical export of military and dual-use technology through supply by electronic means, publication and brokering. I have already touched upon those briefly.

The transition period that was offered in that act was a two-year implementation period. That two-year implementation period delayed the onset of the offence provisions found within that act. So the transition period was of great importance. The provisions of the act came into force at the end of that two-year period and the offence provisions then became active.

One of the most important things about this bill that is now before the House is that the Defence Trade Controls Amendment Bill will seek to amend the act and extend the delay to the offence provisions found in the substantive act. Perhaps unsurprisingly, there is broad stakeholder support for the amendment bill. From the university sector's perspective it is important that the bill be passed as soon as possible. While this bill does not address all of that sector's concerns, it greatly improves the situation in relation to publication and verbal supply of controlled technologies. It also enables organisations to obtain broad permits at the project level, permits that would be valid for five years, and streamlined permit processing for lower-risk suppliers.

The Senate Foreign Affairs Defence and Trade Committee has played a key role in identifying problems with the original act and championing ongoing scrutiny. Following its original report in October 2012, it has been conducting regular six-monthly reviews of the implementation of the act during that 24-month transition period.

As I said, the transition period of the Defence Trade Controls Act 2012 ceases on 16 May 2015. At this time the offence provisions within that bill would activate unless this amendments bill, with a further 12-month delay to the offence provisions, is passed. So, this bill will amend the Defence Trade Controls Act 2012. It will continue to strengthen Australia's export controls. It will continue to make sure that we have a regulatory regime here in Australia that meets our international obligations. This is a bill that demonstrates that we have sought to establish a regime that is responsive to stakeholder concerns and continues, in an organic way, to listen to the concerns of stakeholders.

Due to the stakeholder concerns about the impact of the new export controls the commencement of these controls were delayed by the transition period. A Strengthened Export Control Steering Group was established under section 74A of the act, and that export control steering group was to test the legislation and continue to advise government on legislative amendments during the transition period.

During this transition phase the Department of Defence, in partnership with that Strengthened Export Control Steering Group and the Department of Industry has conducted extensive consultation on the potential impacts of the act, and proposed measures to reduce those impacts. And there have been significant conversations and discussions there about the cost to universities, research and industry of the regulatory impacts of this bill.

The consultation has informed the development of the amendments to this bill and, in broad terms, the amendments found in this bill provide an additional 12-month implementation period before the offence provisions that are found in sections 10, 13, 14, 15 and 18, and the record-keeping requirements in subsections 58(1) and 58(2) commence operation.

It provides two new exceptions to the supply offence in section 10—firstly, for the oral supply of defence and strategic goods listed technology, where the supply is not the provision of access to DSGL technology and is not for use in a weapons-of-mass destruction program or for a military end use; and, secondly for the supply of dual-use DSGL technology, where the supply is preparatory to the publication of part 2 DSGL technology. It extends the exception to the offence of supplying DSGL technology without a permit to or from members of the Australian Public Service, the Australian Defence Force, the Australian Federal Police, the state and territory police and to include employees of the Australian Security Intelligence Organisation and the Australian Secret Intelligence Service.

The bill allows for applicants to apply for supply and brokering permits on behalf of projects and for permits to be issued to project participants. It narrows the publication offence to publishing military DSGL technology where no approval has been given or the publication is in contravention of a condition of an approval.

It allows the minister to prohibit publication of military or dual-use technology where that technology would prejudice the defence, security or international relations of Australia. It allows the Secretary of the Department of Defence to issue an interim prohibition notice for the publication of military or dual-use technology where the secretary considers there may be grounds for the minister to introduce a prohibition notice.

Further, the bill amends the brokering definition of 'arranges' to be an exhaustive definition and to include that the broker must receive money or a non-cash benefit, which includes property or services in any form other than money.

The bill narrows the scope of the brokering offence in section 15(1) of the act to apply to the brokering of goods or technology listed in part one of the DSGL and it establishes new offences for brokering dual-use goods or technology without a permit or in contravention of a condition of a permit where the broker knows, is reckless or negligent as to whether there goods or technology may be for a weapon of mass destruction program or even a military end use. The bill extends the exception for the brokering offence to include employees of ASIO and ASIS.

The bill includes two additional exceptions to the brokering offence found in section 15(1). Firstly, where either the brokered supply is from or the broker conducts their brokering from within a state that is a member of the four main export control regimes—those are the ones I mentioned at the beginning of my remarks—the Wassenaar Arrangement, the Missile Technology Control Regime, the Nuclear Suppliers Group and the Australia Group; and that that state is listed in a legislative instrument or the brokered supplier is in connection with a contract specified in a legislative instrument, and these contracts may include a government business.

The bill also allows the minister to direct a person to seek a permit for the brokering of dual-use goods or technology so that such conduct, where identified, can be regularised. It requires the minister, a delegate of the minister or the secretary of the department to consider criteria prescribed in the regulation and have regard for any other matters the decision maker considers appropriate before making any decision under the act that requires the decision maker to consider whether an activity would prejudice Australia's security, its defence or its international relations.

Perhaps, finally, the bill provides for the continuing review of the operation of the act except for parts 3 and 4. The review will occur initially two years after the commencement of section 10 and then, subsequently, at intervals of not longer than five years. The minister must table a copy of the review report in each house of parliament so that the scrutiny of this legislation remains front and centre for our legislators.

It is fair to say that the original act raised serious concerns for a number of universities in relation to both publication in the formal sense and restrictions on verbal supply of information about potential dual-use technologies. They of course can range from engineering products to information about biological diseases. There was opportunity for those concerns to be considered prior to the passage of the act following a Senate Foreign Affairs Defence and Trade Committee report on the original legislation in October 2012. The Strengthened Export Controls Steering Group was established to work through the issues for universities and other research bodies and that group has been led, and led well, by the Chief Scientist.

This continues to be a legislative regime that is of great importance to Australia. It is our continuing claim to be a nation that supports strengthened international regimes that counter the proliferation of weapons of mass destruction, and that we are an international citizen that seeks to work in multilateral forums collaboratively with other nation states to make sure that these sorts of technologies are not misused and do not contribute to a heightened threat in our world. In that sense, our work in this space goes to Australia's international reputation and our conduct as a nation.

In this act, we find Australia gave expression to and realised its treaty obligations, and now in this bill we see that our legislative regime is subject to continuing strengthening and refinement as Australia seeks to meet its treaty obligations and demonstrate its credentials as a power committed to opposing proliferation.

Scott Morrison (Cook, Liberal Party, Minister for Social Services) Share this | Link to this | Hansard source

In summing up the Defence Trades Control Amendment Bill 2015 on behalf of the minister responsible, I note that the bill will enable Defence to focus its regulatory attention on higher-risk activities with respect to the non-physical supply and transfer of defence control goods while dealing more efficiently with lower-risk activities.

The original act established a two-year transition period during which stakeholders had an opportunity to work with Defence to address concerns and provide feedback through the Strengthened Export Controls Steering Group chaired by Australia's Chief Scientist, Professor Ian Chubb AC.

The steering group has tested the legislation over the past two years and has advised the government on the amendments contained in this bill. The work of the steering group has been critical to the development of these amendments, and the government will seek to extend the steering group's appointments to cover the extended implementation period detailed in this bill.

I thank the opposition for their support of this important legislation and I commend the bill to the House.

Question agreed to.