Defence Trade Controls Act 2012

Overview

The Defence Trade Controls Act 2012 was enacted by the Australian Parliament to address the need for stringent control over the trade and transfer of defence and strategic goods and technologies, both within Australia and internationally, particularly in alignment with Australia's obligations under the Defense Trade Cooperation Treaty with the United States. The Act regulates activities involving goods and technologies listed in the Defence and Strategic Goods List, which includes military goods, dual-use items, and sensitive technologies. It also governs the activities of brokers and members of the Australian Community as defined by the Treaty. The primary policy objective of the Act is to protect Australia's security, defence, and international relations by ensuring that the transfer of such goods and technologies is conducted in a manner that does not prejudice these interests. Offences are established for unauthorised supplies, services, and arrangements concerning defence and strategic goods and technologies, with specific provisions addressing constitutional supplies and brokering activities. The Act provides mechanisms for the Minister to issue permits, approvals, and notices to regulate these activities, and it outlines processes for reviewing and appealing decisions made under the Act. Furthermore, it includes provisions for monitoring compliance, gathering information, and maintaining records to enforce its regulations effectively.

Scope and Application

The Defence Trade Controls Act 2012 regulates the dealings in items listed in Part 1 or 2 of the Defence and Strategic Goods List and in items covered by the Defense Trade Cooperation Treaty between Australia and the United States of America. Part 1 of the Defence and Strategic Goods List encompasses military goods and technologies as well as non-military lethal goods and technologies. Part 2 covers dual-use goods and technologies. The Act applies to Australian persons, which include the Commonwealth, States, Territories, and authorities of those governments, Australian citizens, permanent residents of Australia, and bodies corporate incorporated under the law of any of these entities. The Act also extends to acts, omissions, matters and things outside Australia. Offences under this Act include the supply, provision, or arrangement of DSGL goods or DSGL technology without a permit or approval, publishing DSGL technology in Part 1 of the Defence and Strategic Goods List without an approval, and brokering certain supplies in relation to the Defence and Strategic Goods List. There are also offences for contravening notices issued by the Minister or Secretary, which can prohibit certain activities relating to DSGL goods or DSGL technology. Permits and approvals may be issued by the Minister or Secretary, subject to certain conditions, and these can be varied, revoked, or suspended. Registered brokers can also obtain permits to arrange for the supply of DSGL goods or DSGL technology. The Act provides for the appointment of authorised officers, who can enter premises and exercise various monitoring powers, such as searching premises and requiring individuals to answer questions or produce documents. Record-keeping obligations are imposed on permit holders and approval holders, and the Secretary can obtain and inspect relevant information and documents. Decisions made under this Act, such as permit refusals or revocations, are subject to internal review by the Minister and external review by the Administrative Review Tribunal. The Act also includes provisions for forfeiture, injunctions, and the delegation of functions and powers by the Minister and Secretary. Certain activities involving US Defence Articles and their control are specifically addressed, including offences for unauthorised dealings and the ability for the Minister to issue notices to Australian Community members regarding their compliance with the Act. The Act allows for the creation of the Defense Trade Cooperation Munitions List by the Minister and mandates the establishment of a Strengthened Export Controls Steering Group to advise on export controls and provide recommendations for amendments to the Act.

Key Provisions

• The Defence Trade Controls Act 2012 (the "Act") regulates the dealings in items listed in the Defence and Strategic Goods List ("DSGL") and items covered by the Defense Trade Cooperation Treaty between Australia and the United States of America. The Act establishes primary offences related to the supply of DSGL goods or technology, provision of DSGL services, arranging for supplies, and publishing DSGL technology. It also sets out a process for registered brokers to obtain permits and for individuals to apply for registration as a broker. The Act includes provisions for the Minister to issue notices prohibiting certain activities and for the Secretary to issue interim prohibition notices for the publication of DSGL technology. Failure to comply with these notices can result in criminal penalties.
• The Act imposes several obligations on parties or entities it governs. Permit holders must comply with any conditions specified in their permits, and a breach of a permit condition is an offence of strict liability. Similarly, a registered broker must comply with any conditions specified in their registration, and a breach of a registration condition can lead to the cancellation of the registration. The Act also requires the Minister to have regard to various factors when deciding whether to approve a body corporate as a member of the Australian Community under the Defense Trade Cooperation Treaty, such as the entity's convictions, financial position, and whether they have breached previous conditions. Additionally, the Act mandates that the Secretary maintain a Register of Brokers that includes details of each registered broker and is made available for inspection on the Department's website.
• The Act provides for several offences and penalties. Supplying, arranging for the supply of, or providing DSGL services without a permit or approval can result in imprisonment for up to 10 years or a fine of up to 2,500 penalty units, or both. There are also offences for publishing DSGL technology without an approval, with the same penalties applying. Furthermore, if a person breaches a condition of a permit or registration, or contravenes a notice issued by the Minister or Secretary, they can be fined up to 60 penalty units. The Act contains provisions for forfeiture, where goods, technology, or other items supplied in contravention of the Act are forfeited to the Commonwealth and may be destroyed or dealt with according to the prescribed procedures.
• The Act further imposes civil and criminal consequences for breaches. For example, if an Australian person supplies goods or technology listed in the Defense Trade Cooperation Munitions List without appropriate authorisation, they can be fined up to 2,500 penalty units or imprisoned for up to 10 years, or both. If an Australian Community member contravenes a condition specified in a notice given by the Minister, they can be fined up to 12,500 penalty units. The Act also allows the Federal Court of Australia to grant injunctions to restrain or require certain conduct related to the Act. These injunctions can be granted even if the person has previously engaged in the prohibited conduct or intends to continue doing so. The maximum penalties for various offences under the Act are detailed in the relevant sections, with the highest being imprisonment for 10 years or a fine of 2,500 penalty units, or both.

Legal classification tags

Area of Law

International Trade Law

National Security Law

Instrument

Act

Concepts

Definitions & Interpretation

Offence Provisions

Enforcement Powers

Regulatory Standards

Review & Sunset Clauses