Australian Prime Minister Anthony Albanese sits opposite the leader of the opposition Liberal Party Peter Dutton in the House of Representatives at Parliament House in Canberra on October 16, 2023. (Photo by DAVID GRAY/AFP via Getty Images)
SYDNEY — The Australian government is trying to rapidly push through arms export legislation that some experts from Australia and America are sharply criticizing, saying it would cede Australian sovereignty and criminalize a wide swath of commercial activity, leading to a loss of access to the most nimble companies.
“It looks like Australia just gave up its sovereignty and got nothing for it,” Bill Greenwalt, former US deputy undersecretary of Defense for industrial policy and one of America’s foremost experts on arms export laws and regulations, told Breaking Defense. He wrote many of the current laws governing both arms exports and defense acquisition while a congressional staff member.
“It appears that the Australians adopted the US export control system lock, stock and barrel, and everything I wrote about in my USSC (US Studies Center) piece in the 8 deadly sins of ITAR section will now apply to Australian innovation. I think they just put themselves back 50 years,” Greenwalt said in an email.
The Australian Ministry of Defence late last week quietly published draft legislation that it said was designed to lower the barrier for sharing of technology between Australia and its AUKUS partners, the US and the UK. Submarine technology, especially the nuclear-related bits, are among the most closely controlled secrets in the American arsenal.
“These proposed reforms would create an export licence-free environment to support industry, higher education and research sectors in all 3 countries, including by reducing barriers to technology transfer and costs of trade,” the summary says. “The reforms are designed to promote cooperation, collaboration and innovation between Australia, the UK and the US and are a critical step in building a seamless industrial base between AUKUS partners.”
While analysts agreed it does accomplish better sharing for the AUKUS security arrangement, they said other measures in the proposed bill may harm Australia’s excellent commercial research and development, as well as its fundamental scientific research. Interested parties have only until this Friday to comment on the bill.
The president of the Australian Academy of Science’s President, Chennupati Jagadish, said at a Monday night dinner that his organization may welcome closer cooperation between the AUKUS countries, but worries about the new law’s impact on collaboration with other countries.
“It says I can collaborate freely with the US and the UK — which certainly has its benefits — but I would require an approved permit prior to collaborating with other foreign nationals. Without it, my collaborations would see me jailed. So, it expands Australia’s backyard to include the US and the UK, but it raises the fence,” Jagadish said, according to a transcript provided by the academy.
He offered an example from his own experience of what might change. “For my research group, which consists entirely of PhD students, post-docs, technicians and senior researchers from countries other than the US and the UK, we will need permits for all that we do.
“And members of my group will need to operate in a closed environment to not unintentionally share knowledge that may have a dual use. Discussion at international conferences, where unpublished knowledge is shared freely to solve research problems and enable collaboration, seems unlikely if this Bill becomes law,” he said.
He was not optimistic. “My ability to attract the best and brightest in the world, wherever they are, will diminish. It’s timely to ask what Australia is really seeking to secure if we are restricting the development of technologies that are critical for the future of our country?”
The academy’s chief executive, Anna-Maria Arabia, called on the government to think about the costs of complying with such legislation, noting the grim fact that some actions will now carry criminal penalties.
“This includes resources to establish secure research facilities, to educate and train the research workforce to make it more security-aware especially as non-compliance — accidental or otherwise — will be a criminal offence, and to create opportunities to widen low-risk international collaborations, such as through association with Horizon Europe,” Arabia said.
The criminal penalties and the fact that, according to Greenwalt, much Australian collaboration outside of AUKUS will now mean the technology will now “carry the taint of ITAR,” the rules, regulations, policies and laws governing American arms exports.
Even within the AUKUS tent, civilian companies that the Pentagon and Australian military have increasingly relied on for the latest technology delivered at speeds much faster than the traditional military companies can deliver, are likely to shy away from doing business with the Department of Defence here, he said.
“Thus, I expect the incentives inherent in this draft will reverberate throughout the entire Australian innovation system and likely stifle interaction between the traditional defense industry and the more dynamic portions of the commercial industry to include future interactions with Silicon Valley in the US,” he said. “Why — because now in Australia — if this goes through — technology or knowledge whenever it touches defense, just like it does in the US, will forever taint that interaction. Commercial firms who are leading in tech development (say in quantum or autonomy) will have to make a decision to either entirely be a defense firm or a commercial one.”
That will be “compounded by criminalization. In the US system criminalization has a huge disincentive to move fast on anything as the lawyers take a very risk averse stance on when to do anything that might trigger an issue. Better just to not deal with DoD, and that is what smart companies do. That of course impacts the solutions available to defense,” the veteran acquisition expert said. “I expect this will happen in Australia as well with this proposal.”
Australia, he noted, currently has a “comparative advantage” over the US because of its “current civil-military integration of its tech base.” That is likely to fade if commercial companies decide it is “better just to not get involved” in sensitive military work that could entail criminal penalties.
This all takes place in the face of China’s rapid rise to scientific superpower and the competition to develop advanced technologies such as quantum computing, hypersonics and artificial intelligence.
At the Australian Academy of Science dinner, former Prime Minister Kevin Rudd — now Australia’s ambassador to the United States of America — broadly addressed the issue of scientific collaboration between the two great scientific powers, China and the United States, noting that the chill in the air between the two powers could impede scientific collaboration.
He said that “if you are at the hard edge of the sciences which are nearest and closest to the revolutionary intersections involving artificial intelligence … it’s going to be harder and harder as both sides seek to de-risk their engagements for what we would describe as normal scientific collaboration to occur.”
