Chapter 3
Recommendations
Proposed amendments
3.1
The committee understands that it is the government's intention to
introduce amendments to the bill which incorporate the outcomes from the
roundtable discussions. The committee understands the effort that went into the
agreements reached during the roundtable process and wants to underline some of
the key recommendations. It is essential that the government and Defence honour
the agreements with a firm undertaking in the legislation; this will be
essential to the future relationship with the university and research sector,
and other commonwealth departments which is needed for implementation. The
committee therefore recommends that the bill incorporate or allow for:
- modification, if necessary, once the results of the pilot studies
are known.
- a non-offence transition period of no less than 24 months, and
with the possibility of an extension on the recommendations of the Steering
Group.
- pilot studies governed by the Steering Group.
- pilot studies to test outcomes from the Model.
- a formal evaluation against agreed criteria to include outcomes
of pilot studies.
-
a final report from the Steering Group to be submitted to the
Ministers to be tabled in Parliament.
- ordinary scientific communication is permissible, where the
institution and individual have complied with established guidelines which
include the institutional assessment model outlined above.
- the provisions relating to Defence Services are deleted.
- controls on foreign employees and students in Australia are
removed.
- controls on Australians overseas are removed.[1]
3.2
The committee notes in particular the agreements reached during the
roundtable discussions to:
- establish the Strengthened Export Control Steering Group;
-
have a transition period of at least 24 months with no offence
provisions in effect;
- have exemptions for basic scientific research and for information
already in the public domain; and
- test the given model as part of a pilot program.[2]
3.3
The committee believes that it would devalue the hard work put into the
consultation process, and damage the important relationship between Defence and
its stakeholders, if the above agreements were not incorporated in government
amendments to the bill.
Export Controls Steering Group
3.4
The committee believes that the Export Controls Steering Group (ECSG)
has a vital role in the design of the implementation process for the provisions
of the bill and wants to ensure that the ECSG will have both the representation
and the authority to provide timely and informed advice to the ministers and to
Parliament. The committee notes that during the second roundtable, draft terms
of reference were circulated and approved and recommends these be incorporated
in the bill under amendments establishing the ECSG. The terms of reference are
as follows:
The Steering Group’s function is to provide advice to the
Department of Defence and Minister for Defence, and the Minister for Tertiary
Education, Skills, Science and Research (the Ministers) throughout the
transition period of the Defence Trade Controls Act in relation to:
- the adequacy of organisational and government arrangements to identify,
assess and manage risks, costs and administrative burden associated with
intangible transfers of DSGL technologies;
- oversight, design and delivery of a pilot program to identify the
adequacy of the legislation, regulations, implementation arrangements and
resources for regulating intangible transfers;
-
recommendations on amendments to legislation, regulations and
implementing arrangements.
In order to fulfil its role, the Steering Group will:
(a) consider
quarterly progress reports from participants in the pilot on implementation of
the strengthened export controls;
(b) through the Chair, report to the Ministers every six
months; and
(c) if required by the Ministers, provide additional
reporting.
The Steering Group will advise the Department of Defence on
how to obtain appropriate technical expertise regarding Australian Government
consideration of the control lists of international regimes and the Australian
DSGL.
The Steering Group may establish sub-groups, as required, to
support its function. Subgroups will report back to the Steering Group.
Membership
The Steering Group membership will comprise:
- Australia’s Chief Scientist as the Chair; up to four representatives
from the industry sector, one of whom is the co-Deputy Chair;
- two representatives from the university/research sectors, one of whom is
the co-Deputy Chair;
- the CEO of the National Health and Medical Research Council, or
representative nominated by that CEO;
-
the CEO of the Australian Research Council, or representative nominated
by that CEO;
- a representative from the Department of Industry, Innovation, Science,
Research and Tertiary Education; and
- a representative from the Department of Defence.
There will be no substitutions or additional attendees unless
agreed with the Chair.
The Steering Group will be established for the period of the
transition period but the period may be extended if agreed by the Ministers.
Reporting
The Chair will report six monthly, in writing, to the
Ministers and the Department of Defence, including any dissenting membership
views.
The Steering Group will provide a final report, in writing,
at the conclusion of the two year transition period to the Ministers. The
Ministers will jointly table this report in the Parliament.
Meetings
The frequency and timing of meetings of the Steering Group is
at the discretion of the Chair, however it is expected to meet at least
quarterly, supplemented by out of session consideration of matters as
necessary.
A quorum of the Steering Group will be met when there are a
minimum of the Chair, two public sector representatives, one industry
representative and one university/research representative.
Secretariat
The Steering Group will be supported by a Secretariat
provided by the Defence Export Control Office.
The Secretariat will:
(a) prepare and circulate agendas in conjunction with
the Chair;
(b) work
with the authors of agenda papers to ensure quality and timeliness;
(c) ensure
that the agenda approved by the Chair and papers are received by members at
least one week before each meeting;
(d) prepare
and provide to the Chair, within one week of the meeting, the minutes, outcomes
and actions arising;
(e) circulate
the meeting outcomes to all members following clearance by the Chair; and
(f) maintain Steering Group records.[3]
3.5
The committee notes that a model is to be used as part of the pilot
program to test the regulatory impact of the regime. The committee recommends
that the pilot program and the model to be adopted for the test are as set out
in the agreed outcomes from the roundtable.[4]
3.6
The committee takes this opportunity to emphasise that amendments to the
bill must fully and accurately reflect the outcomes of the roundtable
discussions. This principle must also apply to regulations made under this
legislation.
3.7
As noted in previous chapters, the committee drew attention to
recommendations made in the committee's preliminary report. They are given
below in full.
Recommendation 1 (preliminary report): The committee
recommends that the government consider including in the bill the criteria
provided in the explanatory memorandum in relation to permits issued under
clause 11 so that the Parliament can scrutinise them properly and potential
applicants can be clear as to the criteria that will be used to assess their
applications.[5]
Recommendation 2 (preliminary report): In consultation
with all relevant sectors, the committee recommends that Defence provide
examples to illustrate the scope of the definition of 'intangibles' and
'intangible transfer' in the explanatory memorandum.[6]
Recommendation 3 (preliminary report): The committee
recommends that Defence include the definition of 'arrange' in the bill, and
that in defining the term Defence consult with submitters who have raised
issues regarding the scope of the term.[7]
Recommendation 5 (preliminary report): The committee
recommends that Defence undertake consultation with industry in order to
eliminate unnecessary record-keeping.[8]
Recommendation 7 (preliminary report): The regulations are
an important part of the implementation of the strengthened export controls.
Defence has proposed that the regulations will be amended in line with any
amendments made to the bill. The committee recommends that the regulations form
an integral part of the consultation process.[9]
Reporting
3.8
The committee believes that an important part of the ECSG's work will be
the vital contribution that the pilot program provides to the development of
the implementation of provisions in the bill. While the committee hopes that
the good will demonstrated during the roundtable discussions will continue, the
committee is mindful of the concerns expressed by the University of Sydney and
Universities Australia regarding the outstanding issues to be resolved. The
committee sees significant benefits in its oversight continuing after its final
report has been tabled.
Recommendation 1
3.9
The committee refers to its previous recommendation 8[10],
and asks that the regular reports of the ECSG provided to the minister also be
provided to the committee.
Recommendation 2
3.10
In light of the ongoing concerns held by stakeholders, the
committee believes that implementation of the bill would benefit from further
scrutiny. The committee therefore recommends that during the 24 month
transition period, the Senate Foreign Affairs, Defence and Trade Legislation
Committee conduct a six-monthly examination of progress of the implementation
of the provisions of the bill and report to the Senate.
Conclusion—final recommendations
3.11
Committee recognises the importance of the strengthened export controls
regime in the bill. The committee appreciates the cooperation of all parties
involved in the consultation processes.
Recommendation 3
3.12
Given the advice detailed in this final report, the committee
recommends that the bill, with the proposed amendments outlined in this report,
should proceed to debate in the Senate. The committee recommends that the bill,
amended as outlined in this report, be passed.
Recommendation 4
3.13
The committee further recommends that Defence use the
implementation process for the provisions of the Defence Trade Controls Bill to
foster closer links with the research and university sectors and with the Department
of Industry, Innovation, Science, Research and Tertiary Education and other
relevant departments.
Senator the Hon
Ursula Stephens
Chair
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