Proposed legislation aims to unlock billions of dollars for AUKUS industry partners

The Australian Government plans to unlock billions of dollars in investment and cut red tape for Australia’s Defence industry and its AUKUS partners with the introduction of the proposed Defence Trade Controls Amendment Bill 2023. At the time of writing the Bill is undergoing Parliamentary scrutiny and has not yet passed into law.

However, critics of the proposed legislation charge that, in making it easier to do business with the UK and the UK, the bill will make it much harder to work with other allies such as South Korea and India. It would also make it much harder to employ dual-nationals or citizens of countries such as China and India, which could impact many Australian SMEs.

Under Defence’s proposed legislation Australia’s existing trade controls will be expanded to regulate the supply of controlled items and provision of services on the Defence and Strategic Goods List, ensuring the country’s leading military technologies are protected.

Australia already regulates the export of military and dual-use goods and technologies to foreign nationals and entities overseas. This legislation will extend existing controls to the supply of these items to foreign persons and entities within Australia, and between entities overseas.

Importantly, says Defence, these significant reforms will also provide a national exemption for the trade of defence goods and technologies with the United States and United Kingdom, establishing a licence-free environment for Australian industry, research and science.

“This legislation will provide Australian industry, science and research sectors with greater opportunities for collaboration and trade with our AUKUS partners without burdensome red tape,” said Deputy Prime Minister and Minister for Defence Richard Marles. “This will benefit defence industry in Australia, unlocking over $5 billion – more than half of our annual exports – to our AUKUS partners.”

The national exemption is expected to deliver $614 million in value to the Australian economy over 10 years, by reducing costs to local businesses and unlocking investment opportunities with our AUKUS partners.

Under this legislation, permits for defence exports to the United States and United Kingdom will no longer be required – removing the need for almost a third of annual export permit applications and cutting red tape from $5 billion worth of defence exports each year.

It will also see significant flow on benefits for Australian jobs, and make it easier for Australian industry and research to supply US and UK markets.

“This legislation is an important step in the Albanese Government’s strategy for acquiring the state-of-the-art nuclear-powered submarines that will be key to protecting Australians and our nation’s interests,” said Minister for Defence Industry Pat Conroy.

“It not only paves the way for greater cooperation among AUKUS partners, supporting the creation of jobs and presenting an unprecedented opportunity for Australia’s defence manufacturing industry, but will also create a more efficient and integrated industrial base across the three nations.”

Minister Marles was due to meet his US counterpart in the USA on 1 December, first at the annual Australia-United States Ministerial (AUSMIN) talks and then at a scheduled AUKUS meeting that includes the UK Secretary of State for Defence.