The 2023 Defence Strategic Review made clear that Australia’s strategic environment has radically deteriorated. We now face an Indo-Pacific defined by major power competition of unrivalled intensity and the rapid militarisation of emerging and disruptive technologies. To keep pace with these challenges, it is critical that Australia has a robust export control regime.
On 27 March 2024, the Parliament passed the Defence Trade Controls Amendment Act 2024 (the Act) in response to these changes in Australia's strategic environment. This legislation will ensure the protection and safeguarding of Australian technology and information, as well as that of key partners.
The Act amends Australia’s defence export control framework by:
- creating 3 new criminal offences in the Defence Trade Controls Act 2012 for the:
- supply of Defence and Strategic Goods List (DSGL) technology to a non‑exempt foreign person within Australia (section 10A)
- supply of goods and technology on Part 1 (Munitions) and Part 2 (Dual Use) ‘Sensitive’ and ‘Very Sensitive’ Lists of the DSGL, that was previously exported or supplied from Australia (section 10B)
- provision of DSGL services related to Part 1 of the DSGL to foreign nationals outside of Australia (section 10C).
- providing a national exemption to the United Kingdom and the United States from Australia’s export control permit requirements under the Defence Trade Controls Act 2012.
Australia’s export control framework is a permissive system designed to permit the responsible transfer of controlled goods and technology – these reforms do not change this underlying principle.
The Act strikes a balance between protecting Australia's national security and supporting economic prosperity and research collaboration. This will be achieved by narrowing the scope of the Act to those items and activities that could prejudice Australia's security, defence or international relations.
On 18 July 2024, the Governor General signed the Defence Trade Controls Amendment Commencement Proclamation 2024 at the Executive Council meeting. This means that the Act and Regulations will commence on 1 September 2024. The Governor General also made the Defence Trade Legislation Amendment Regulations 2024 at the same Executive Council meeting.
AUKUS licence-free environment
Australia, the United Kingdom (UK) and the United States (US) are streamlining the flow of defence trade between AUKUS partners to pursue greater advanced scientific, technological and industrial cooperation. This includes the creation of an export licence-free environment, which removes barriers to defence trade, collaboration, co-development, research and innovation between the AUKUS partners.
The licence-free environment is being operationalised by the 3 AUKUS nations providing national exemptions for each other from their export control licencing requirements. These exemptions will remove the licencing requirements for most military goods and technology items exported, re-exported or transferred (in-country) to or within the 3 AUKUS partners.
From 1-31 May 2024, the AUKUS partners each released the mechanisms for the national exemption in each nation for public consultation. This consultation sought to ensure the exemptions, taken together, support the goals of all 3 governments and the collective interests.
- Australia’s national exemption under the Defence Trade Controls Amendment Act 2024
- The US Department of State's draft national exemption for military goods and technology under the International Traffic in Arms Regulations (ITAR)
- The US Department of Commerce's interim final rule (in effect) national exemption for dual-use goods and technology under the Export Administration Regulations (EAR)
- The UK’s draft national exemption for military and dual-use goods and technology under an AUKUS-specific Open General Export Licence (OGEL).
Implementation
The Act will commence on 1 September 2024. The offences will come into effect a further 6 months after commencement of the Act.
Defence has established 2 working groups to provide advice to Defence in relation to the Act and its implementation:
- the Industry and Investment Working Group
- the Higher Education and Research Sector Working Group.
The working groups are made up of representatives from the peak bodies in each sector and individuals and organisations who have engaged with Defence during the development of the legislation.
Education and guidance materials to support stakeholders to understand and interpret the offences and exceptions are being co-designed and developed with the Industry and Investment Working Group and Higher Education and Research Sector Working Group.
To ensure implementation is effective, Defence is:
- developing a suite of education and guidance materials for the Defence Export Controls website to support stakeholder decision-making on permit requirements
- co-designing online learning modules for the Defence Export Controls website with the working groups
- upgrading the ICT case management system to ensure it is user-friendly
- recruiting additional staff to process permit applications.
Defence has also developed a Future Law Compilation of the Defence Trade Controls Amendment Act 2024 and Defence Trade Legislation Amendment Regulations 2024. These can be accessed below:
Defence Trade Controls Act 2012 (PDF, 1.12 MB)
Defence Trade Controls Regulations 2013 (PDF, 589.6 KB)
Customs (Prohibited Exports) Regulations 1958 (PDF, 1.48 MB)
Defence has also finalised the supporting legislative instruments. These can be accessed on the Federal Register of Legislation and below:
Contacts
For further information on the Act or implementation of the legislative changes, email:
exportcontrol.reform@defence.gov.au