Richard Marles (Corio, Australian Labor Party, Minister for Defence) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

Introduction

It is my privilege to present the Defence Trade Controls Amendment Bill 2023.

This bill will bolster Australia's national security and protect our sensitive defence goods and technology by enhancing our defence trade controls.

It will also unlock defence trade, innovation and collaboration with our AUKUS partners.

Background

To keep pace with the difficult strategic circumstances we face, it is essential that Australia has a robust protective security framework.

Australia's export control system is a key element of our protective security framework.

It aims to prevent military goods and technologies from being transferred to foreign individuals or entities in ways that prejudice Australia's interests.

Many countries already administer an export control framework to manage these activities.

This bill strengthens Australia's existing export control system by enhancing the protections around the supply of controlled goods and technology within and outside of Australia.

It also streamlines the transfer of defence goods and technology among and between Australia, the UK and the United States in order to support collaboration, innovation and trade between all three countries.

The reforms in this bill are expected to provide a net benefit to the Australian economy of $614 million over a 10-year period.

Australia is not making these reforms alone. The United Kingdom and the United States are also reviewing their export control frameworks to support the creation of a licence-free environment between AUKUS partners.

The US Congress is currently considering several legislative proposals to provide Australia and the UK with a national exemption from United States export licensing requirements.

Australia's access to this national exemption will require Australia to have comparable export control laws, regulations and policies to those of the US.

Complemented by the Defence Amendment (Safeguarding Australia's Military Secrets) Bill that the government introduced earlier this year, the reforms in this bill are expected to achieve this comparable standard.

The UK is also examining its export control regime to streamline the flow of defence trade among AUKUS partners.

Substantive measures

This bill amends the Defence Trade Controls Act 2012 in four ways.

First, it regulates the supply of military and dual-use technology on the Defence and Strategic Goods List from Australia to foreign nationals within Australia.

Second, it regulates the supply of military and dual-use goods and technologies on the Defence and Strategic Goods List within or from a foreign country where those goods or technologies were previously exported or supplied from Australia.

Third, it regulates the provision of services related to military items on the Defence and Strategic Goods List to foreign nationals or entities.

Fourth, it creates a licence-free environment for the supply of Defence and Strategic Goods List goods and technology and the provision of Defence and Strategic Goods List services from Australia to the UK and the US.

To give effect to these changes, the bill creates new offences with appropriate penalties and exemptions.

The penalty for engaging in the new activities regulated under this bill without a permit is a maximum of 10 years imprisonment or a fine of 2,500 penalty units, or both.

There are also a number of exceptions to the offences created by this bill.

These include certain exemptions for supplies by employers to their foreign national employees from countries on the Foreign Country List, for supplies undertaken in the course of employment or engagement by the Commonwealth, and for people holding covered security clearances.

These reforms are not intended to prevent foreign nationals from working with Australia on DSGL goods or technologies. They are not intended to prevent foreign students or academics from engaging with Australian academic institutions.

Indeed, much of the existing collaboration and trade between Australia and international partners will be unaffected by these changes.

Rather, the policy intent of the bill is to prevent sensitive defence goods and technologies from being passed to foreign individuals or governments in a manner that may harm Australia's interests.

Individuals or entities who want to supply controlled goods or technology on the DSGL to certain persons or from certain foreign countries will be required to first seek permission to do so.

This is to ensure their activities are not damaging Australia's national interests.

This bill will enable the Minister for Defence, or their delegate, to consider each permit application on a case-by-case basis.

Permits may be granted subject to conditions and may be varied or revoked in certain circumstances.

A permit will be refused if the minister, or delegate, is not satisfied that the activity would not prejudice the security, defence or international relations of Australia.

The measures in this bill are serious and, in some aspects, complex.

To this end, I intend to refer the bill to the Senate Foreign Affairs, Defence and Trade Legislation Committee for inquiry and for report.

The government looks forward to a thorough inquiry into this bill by the committee, including any recommendations on whether sensible amendments can be made to ensure the bill is fit for purpose.

I encourage all interested stakeholders to participate in the important work of the committee, and the parliament, in scrutinising—and potentially improving—this bill.

The bill also includes a transition period for Australians to better understand how these amendments may impact their activities and what, if any, permits may be required.

The offences under this bill will not apply during this period, and the government will work with industry, academia and research communities to ensure there is an understanding about obligations under the amended defence trade controls framework.

Our government continues to support research and collaboration, and these amendments will assist that to continue while also protecting Australia's national interests.

Conclusion

This bill seeks to improve the government's ability to protect our sensitive defence goods and technology.

It will also unlock defence trade, innovation and collaboration with our AUKUS partners.

These tasks are central to preserving Australia's national security and to keeping Australians safe.

I commend the bill to the House.

Debate adjourned.