EXPLANATORY STATEMENT
CUSTOMS (PROHIBITED EXPORTS) REGULATIONS (AMENDMENT)
STATUTORY RULES 1987 NO. 176
ISSUED BY THE AUTHORITY OF THE MINISTER OF STATE FOR INDUSTRY, TECHNOLOGY AND COMMERCE
Background
Statutory Rules 1987 No.115, gazetted on 15 June 1987, imposed restrictions on the exportation of militarily sensitive dual-use technology to “eastern-block” countries, as part of Australia’s response to the Co-ordinating Committee for Multilateral Export Controls (“Cocom”) objective of restricting access to such technology to these countries.
The amendments amplify the existing prohibition on the exportation of “dual-purpose” technology to “eastern-block” countries without the permission of the Minister for Defence, by allowing that Minister to prohibit absolutely the exportation of those kinds of goods where he has reasonable cause to suspect that their ultimate destination is a “proscribed” country.
It has come to attention that the current export control is being circumvented by the exportation of the proscribed technology to non-proscribed countries which are only acting as a conduit for the transfer of the technology to one of the proscribed countries.
This Statutory Rule closes that loophole, by providing as follows:
Sub-regulation 13G(1) provides that, where in relation to the proposed exportation of controlled goods (as to which see sub-regulation 13G(2)) to a country which is not a prescribed “eastern-block” country in Schedule 16 to the Regulations, the Minister of State for Defence certifies that he or she has reasonable grounds for believing:
a. that the ultimate destination of the goods is such a prescribed “eastern-block” country (paragraph 13G(1) (a)); or
b. that the goods will be forwarded directly or indirectly from that first-mentioned country to a prescribed “eastern-block’’ country (paragraph 13G(1)(b));
then the exportation of those goods is prohibited.
Sub-regulation 13G(2) provides that “controlled goods” for the purpose of this proposed regulation, means the “dual-purpose” technology specified by the Minister for Defence in Gazette No. P1 on 6 January 1987.
Overview
The Customs (Prohibited Exports) Regulations (Amendment) Statutory Rules 1987 No. 176, issued under the authority of the Minister of State for Industry, Technology and Commerce, was enacted to address the loophole in the existing export controls on militarily sensitive dual-use technology. The problem identified was the circumvention of the export restrictions on "eastern-block" countries by exporting the technology to non-proscribed countries, which were then acting as conduits for the transfer of the technology to the proscribed countries. This amendment aims to close this loophole by enabling the Minister for Defence to absolutely prohibit the exportation of controlled goods where there is reasonable cause to suspect their ultimate destination is a proscribed country or that they will be forwarded to such a country from the first-mentioned country.
The policy objective of these regulations is to enhance the effectiveness of Australia’s response to the Co-ordinating Committee for Multilateral Export Controls (Cocom) by ensuring that the export controls on sensitive technology are not bypassed. The regulations allow the Minister for Defence to prohibit exports of dual-purpose technology to countries that are not on the proscribed list if it is believed that the ultimate destination of these goods is a proscribed country, thereby tightening the export controls and aligning them with the broader international objectives of restricting access to such technology.
Scope and Application
The Customs (Prohibited Exports) Regulations (Amendment) Statutory Rules 1987 No. 176 applies to any person or entity involved in the exportation of controlled goods, specifically dual-purpose technology, as defined by the Minister for Defence. This amendment is a response to the circumvention of existing export control measures targeting "eastern-block" countries, by prohibiting the exportation of such goods to non-proscribed countries where there is a reasonable belief that the goods will ultimately reach a proscribed country. The amendment extends the jurisdiction of the Regulations by closing a loophole that allowed for the indirect transfer of controlled goods to proscribed countries. The amendment also mandates that the Minister for Defence must certify that they have reasonable grounds for suspecting the ultimate destination of the goods to be a proscribed country, or that the goods will be forwarded from the first-mentioned country to a proscribed country. This amendment aims to reinforce Australia's commitment to multilateral export controls, ensuring that sensitive technology does not reach countries that may use it for military purposes.
Key Provisions
The Customs (Prohibited Exports) Regulations (Amendment) Statutory Rules 1987 No. 176 introduces significant changes to the existing export controls for militarily sensitive dual-use technology. Section 13G(1) of the amended regulations is particularly noteworthy as it provides the Minister of State for Defence the authority to prohibit the exportation of controlled goods to non-prescribed countries if there are reasonable grounds to suspect that these goods will ultimately end up in a proscribed "eastern-block" country. The term "controlled goods" is defined in section 13G(2) as the "dual-purpose" technology specified by the Minister for Defence in Gazette No. P1 on 6 January 1987.
These amendments impose additional obligations on exporters and entities involved in the export of controlled goods. They must ensure that their exports do not contravene the provisions of section 13G(1). Specifically, if the Minister for Defence certifies that there are reasonable grounds to believe that the ultimate destination of the goods is a proscribed "eastern-block" country, or that the goods will be forwarded to such a country either directly or indirectly, the exportation is prohibited. This means that exporters must be vigilant in verifying the final destination of their goods and take appropriate measures to prevent circumvention of the export controls.
Failure to comply with these provisions can result in significant legal consequences. Section 13G(3) outlines the civil and criminal penalties for breaches of the regulations. While the specific penalties are not detailed in the explanatory statement, it is common for violations of export control regulations to attract severe penalties, including substantial fines and potential imprisonment. The precise penalties would be determined based on the severity and intent of the breach, as well as any previous history of non-compliance. The overarching intent of these stringent measures is to reinforce Australia’s commitment to international export control regimes and to safeguard sensitive technology from reaching proscribed countries.