The Safeguarding Australia’s Military Secrets Amendment Act 2024 (Cth) (Act) came into force on 6 May 2024. It inserted Part IXAA into the Defence Act 1903 (Cth). It is aligned with Australia’s Defence Trade Controls Act.
Offences
The Act is intended to strengthen protection of Australia’s military knowledge and prevent the disclosing or exploiting of that knowledge. It is an offence if:
former members of the Australian Defence Force (ADF), the Australian Submarine Agency or Defence Australian Public Servants work for a foreign military or government body; or
Australian citizens or permanent residents provide training to a foreign military or government body relating to Part 1 of the Defence and Strategic Goods List or military tactics, techniques or procedures
unless they hold a ‘foreign work authorisation’ (FWA) before performing that ‘work’. Some limited exceptions apply. ‘Work’ includes volunteer work and any work done in a capacity as an agent, officer or employee of a corporation (in Australia or otherwise) and notably, could be in any field, including those completely unrelated to defence. For the second ‘training’ offence, the training may be volunteer, formal or irregular and is considered regardless of the capacity in which it was given.
The Act is part of a sweeping package of reforms that on the one hand are intended to relax restrictions on technological exchange with Australia’s AUKUS partners but on the other hand tighten restrictions on technological exchange with other foreign countries.
The Act has a potentially very broad reach. Some estimates place the numbers of those affected by FWA requirements at 70,000 ex-ADF civilians. As noted, the type of ‘work’ caught is also broad.
The Five Eyes community (United States, United Kingdom, New Zealand and Canada) are exempt countries.
As the requirements for both offences are similar, we will refer to work and training collectively in this post as ‘services’. Provision of services includes services provided in the capacity of an agent, officer or employee of a corporation that is engaged to provide the services. Questions may arise in relation to when work has been done ‘on behalf of’ a relevant organisation, such as in multi-level subcontracting arrangements.
Both offences carry a maximum imprisonment term of 20 years. This makes careful due diligence and compliance crucial where even a small risk exists.
Due diligence considerations
The Commonwealth expects individuals to conduct their own due diligence to prevent providing the aforementioned services to or on behalf of ‘military organisations or government bodies’. That said, organisations whose personnel are potentially providing relevant services should very carefully consider the potential application of the Act to their personnel and the need to obtain a FWA.
Careful due diligence will be especially important for those providing services to foreign corporations or entities that are not obviously associated with a foreign government. Individuals should consider whether the entities they deal with are subject to more than 50% of share capital or voting power being held by a government agency or if a government exercises de facto control over the decision-making of the entity and that entity therefore enjoys special rights or privileges. Such entities are considered ‘government bodies’ and relevant personnel providing services to them without a FWA will likely be committing an offence. The de facto control threshold may pose particular challenges when dealing with entities in nations where governments impose expansive control over corporations (including covertly).
Foreign Work Authorisations
Although the requirements are expansive, there are a number of avenues through which services may be permitted.
A FWA enables citizens and foreign work restricted individuals to conduct work which would ordinarily constitute one of the new offences. There is no Government charge to submit an application for a FWA. To obtain a FWA, individuals must submit detailed information about their past roles, responsibilities and any access to sensitive information during their tenure with the ADF or related agencies. For ex-ADF personnel, specifics about their proposed work and the foreign organization they intend to work with are crucial considerations. Non-ADF personnel seeking authorisation for training activities must similarly outline the nature of their proposed training and its intended recipients. The Minister will use this information to grant permits or refuse permits if the work or training would ‘prejudice the security, defence or international relations of Australia’. These authorisations can be granted only for a maximum period of 3 years. It is a lesser offence to breach the conditions of a permit, with a maximum imprisonment of 5 years. Defence says that it will conduct comprehensive risk assessments. We suggest that FWA applications be lodged as soon as a potential need is known as we don’t expect FWAs to be granted quickly.
There is a right of internal or merits review within 28 days for refusal to grant a FWA or grant of a FWA subject to different authorisations or restrictions than were requested.
Individuals already providing services for which a FWA would be required, must submit an application for a FWA by 7 August 2024. They can keep providing services pending notification of the outcome of their application. If those individuals don’t submit an application by that date and keep providing services, they risk committing an offence.
Other exceptions
Not all situations where work or training are provided will require a FWA. The Act also includes exceptions to mitigate undue burdens on certain activities. For instance, work or training sanctioned by written agreements with the Commonwealth, participation in certain ministerially-authorised foreign armed forces or engagement in humanitarian aid missions under international bodies like the UN or Red Cross are exempt from the above provisions.
For further information please contact Brett Cowell in our Defence team.
Brett Cowell wishes to thank Alex Dorrington for his contribution to this insight.
This publication has been prepared for general guidance on matters of interest only and does not constitute professional legal advice. You should not act upon the information contained in this publication without obtaining specific professional legal advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication and to the extent permitted by law, Cowell Clarke does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting or refraining to act in relation on the information contained in this publication or for any decision based on it.