Australian sanctions law: a quick guide

24 August 2022

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Leah Ferris
Law and Bills Digest Section

What are sanctions?

Sanctions are punitive or coercive measures imposed by states or international organisations against other states or international organisations. Sanctions impose restrictions on activities that relate to particular countries/organisations, goods and services, themes of conduct or persons and entities. They can include diplomatic or economic measures (though generally do not involve the direct use of armed force).

What types of sanctions does Australia implement?

Australia implements two types of sanctions: sanctions imposed as a consequence of Australia’s membership of the United Nations (UN) and sanctions imposed autonomously by the Australian Government.

UN Sanctions

Australia, as a member of the UN, is required by Article 25 of the Charter of the United Nations (the Charter) to implement UN Security Council decisions.

Under Chapter VII of the Charter, the Security Council can take action to maintain or restore international peace and security, including the imposition of ‘measures not involving the use of armed force’ (Articles 39 and 41). Since 1966, the Security Council has established 30 sanctions regimes, by way of legally binding resolutions, with 14 of these regimes currently in operation.

The Security Council can only impose non-military sanctions where it has determined ‘the existence of any threat to the peace, breach of the peace, or act of aggression’, and where nine or more members have cast an affirmative vote and none of the five permanent members have used their veto power (Articles 39, 41 and 27 of the Charter).

Prior to 1993, Australia normally implemented Security Council resolutions by making Regulations under a number of Commonwealth Acts. However, due to limitations on the Government’s power to make Regulations under these Acts which would implement Security Council sanctions imposed on the Federal Republic of Yugoslavia (for example, the freezing of assets), Australia became unable to give full effect to Security Council resolutions via this practice.

In 1993, the Government amended the Charter of the United Nations Act 1945 (COTUNA) to allow for Regulations to be made which give full effect to Security Council sanction regimes. These include sanctions regimes which deal with particular countries such as Lebanon, or regimes that deal with organisations such as the Taliban.

Autonomous sanctions

Autonomous sanctions are punitive measures that do not involve the use of armed force. They are imposed unilaterally by the Australian Government (as well as other foreign governments, including the United States and the United Kingdom) as a foreign policy tool. In Australia, autonomous sanctions are implemented under the Autonomous Sanctions Act 2011 and the Autonomous Sanctions Regulations 2011. Autonomous sanctions are discretionary tools which the Australian Government can apply, alone or with like-minded countries where appropriate, to address egregious situations of international concern.

The Department of Foreign Affairs and Trade (DFAT) notes that these sanctions can be aimed at bringing a situation of international concern to an end by:

  • influencing those responsible (for example, by motivating foreign governments/leaders to adopt different policies)
  • limiting the adverse impacts of a situation (for example, by denying access to military or paramilitary goods, or to goods, technologies or funding that are enabling the pursuit of programs of nuclear proliferation) or
  • penalising those responsible (for example, by denying access to international travel or to the international financial system).

Australia’s autonomous sanctions regime also allows the Government to impose sanctions where the Security Council has been unwilling, or unable, to impose sanctions. In some cases, Australia has imposed additional autonomous sanctions which ‘complement’ Security Council sanctions already imposed by the Australian Government (for example, with respect to Libya).

What can sanctions include and who can they be applied to?

Typically, sanctions are either:

  • comprehensive: as the name suggests, comprehensive sanctions generally refer to sanctions which prohibit most, if not all, economic activities with another state
  • list-based: sanctions imposed on individuals and entities that are included in the lists published by the relevant sanctions’ regulator
  • sectoral: sanctions which target specific entities within key sectors of a target state’s economy (for example, finance, energy and defence)
  • product-specific: restrictions on the trading of certain products or services, either with a state or with specific individuals, groups or entities (for example, terrorist organisations).

Sanctions measures can vary significantly, depending on the state which is imposing them and their objectives in imposing sanctions. In some cases, a state may also employ diplomatic measures which can include cancelling or limiting diplomatic visits, or expelling diplomats.

The main types of sanctions employed by the Australian Government are:

  • designation of specific individuals or entities as subject to financial sanctions (including asset freezes)
  • travel bans on certain persons preventing them from entering or transiting through Australia
  • restrictions on trade or procurement in goods and services (for example, prohibiting the export or the import of certain goods or services)
  • restrictions on engaging in commercial activities or dealing with assets (for example, purchasing shares, granting intellectual property rights or establishing a joint venture) and
  • designation of specific vessels as sanctioned vessels, including preventing them from entering Australia.

Under Australian sanctions laws, sanctions can be applied to a range of individuals, including:

When can sanctions be imposed?

Non-military sanctions can only be applied by the Security Council where it has determined ‘the existence of any threat to the peace, breach of the peace, or act of aggression’. The Security Council has previously applied sanctions to ‘support peaceful transitions, deter non-constitutional changes, constrain terrorism, protect human rights and promote non-proliferation’.

Historically, autonomous sanctions have only been imposed by the Australian Government under the Autonomous Sanctions Act to address matters that are of ‘international concern’ in specific countries or regions. Such situations include ‘the grave repression of the human rights or democratic freedoms of a population by a government, the proliferation of weapons of mass destruction or their means of delivery, and internal or international armed conflict’.

Following the enactment of the Autonomous Sanctions Amendment (Magnitsky-style and Other Thematic Sanctions) Act 2021, the Government now has the power to impose autonomous sanctions to address particular issues (known as thematic sanctions) which include threats to international peace and security, malicious cyber activity, serious violations or serious abuses of human rights or activities that undermine good governance or the rule of law.

How are sanctions imposed?

In Australia, UN Security Council sanctions regimes are primarily implemented under the COTUNA framework. Following a decision of the Security Council to impose sanctions, a separate set of Regulations is then made domestically, giving effect to these sanctions. For example, the Security Council has previously imposed sanctions on Lebanon (Resolutions 1636 and 1701) and Australia has given effect to these sanctions via the Charter of the United Nations (Sanctions — Lebanon) Regulations 2008.

Part 4 of the COTUNA also allows the Australian Government to give effect to Security Council resolutions dealing with terrorism through the listing of individuals, entities and assets as being subject to sanctions.

A different process applies to the imposition of autonomous sanctions. Instead of making separate Regulations for each autonomous sanctions regime, Part 2 of the Autonomous Sanctions Regulations prescribes the criteria for the Minister for Foreign Affairs (Foreign Minister) to apply sanctions with respect to a particular region or thematic situation. The Foreign Minister must then separately designate and/or declare (collectively referred to as listing) a person or entity as subject to sanctions. This is often referred to as a two-step process, as generally the Government will need to amend the Autonomous Sanctions Regulations to expand the criteria for imposing sanctions, before making the relevant determinations/declarations required to impose sanctions on specific individuals/entities. Determinations/declarations made by the Foreign Minister can be accessed via the Federal Register of Legislation.

For example, on 24 February 2022 the Governor-General made the Autonomous Sanctions Amendment (Russia) Regulations 2022,which amended the Autonomous Sanctions Regulations to broaden the scope of individuals and entities on which Australia can impose sanctions following Russia’s invasion of Ukraine. The Foreign Minister consequently made a number of amendments to the Autonomous Sanctions (Designated Persons and Entities and Declared Persons – Russia and Ukraine) List 2014 to list certain individuals and entities as being subject to sanctions.

In amending the Autonomous Sanctions Regulations to provide for sanctions, the Foreign Minister must be satisfied that doing so ‘will facilitate the conduct of Australia’s relations with other countries or with entities or persons outside Australia; or will otherwise deal with matters, things or relationships outside Australia’. In applying sanctions, the Foreign Minister is not required to consider whether the imposition of the sanctions are proportionate to give effect to their objective.

In order to give effect to sanctions, the Government is also required to amend other legislative instruments including the Customs (Prohibited Imports) Regulations 1956, the Customs (Prohibited Exports) Regulations 1958 and the Defence and Strategic Goods List 2021.

What sanctions has Australia implemented?

Australia has currently implemented UN Security Council sanctions on certain persons/entities connected to Iraq, Somalia, the Democratic Republic of the Congo, Sudan and South Sudan, Lebanon, the Democratic People’s Republic of Korea (DPRK), Iran, Libya, Guinea-Bissau, the Central African Republic, Yemen, and Mali, as well as against ISIL (Da’esh), Al-Qaida and the Taliban. Australia has also implemented counter-terrorism sanctions imposed by the Security Council.

Australia has implemented autonomous sanctions on certain persons/entities connected to the DPRK, Iran, Libya, Myanmar, the Former Federal Republic of Yugoslavia, Russia/Ukraine, Syria and Zimbabwe. Australia has established thematic sanctions regimes with respect to significant cyber incidents, serious violations or abuses of human rights, and serious corruption.

Is the Foreign Minister required to report to Parliament on any sanctions they have imposed?

Currently, in Australia there is no requirement for the Foreign Minister to report to the Parliament the basis on which persons have been declared or designated under Australia’s sanctions regime and what assets, or the amount of assets that have been frozen.

Persons and entities who are the subject of financial sanctions are required to be published on a list maintained by DFAT, referred to as the ‘Consolidated List’. The list includes details such as a person’s citizenship, address, place and date of birth, passport number and the reason why they are the subject of sanctions. While DFAT may give advance notice to a person or entity before designating them as being subject to sanctions, there is no requirement that they must do so.

Can a decision to impose sanctions be challenged?

A person who has been designated or declared to be the subject of sanctions may apply for judicial review of the Foreign Minister’s decision under the Administrative Decisions (Judicial Review) Act 1977 and under common law. In reviewing the decision, the court will examine whether the Foreign Minister made an error of law in imposing the sanctions.

At the time of publication, the Federal Court of Australia was currently in the process of hearing an application for judicial review filed by Mr Alexander Abramov, arguing that he should not be the target of sanctions.

Who must comply with sanctions and what are the consequences for non‑compliance?

Australian sanctions laws apply to activities which occur:

  • in Australia
  • by Australian citizens and Australian-registered bodies corporate located either overseas or on foreign vessels or aircraft and
  • on board Australian aircraft or vessels.

Australian entities operating overseas may also have to comply with sanctions imposed by other countries.

The COTUNA legislative framework and the Autonomous Sanctions Act prohibit the following activities:

  • making a ‘sanctioned supply’ of ‘export sanctioned goods’
  • making a ‘sanctioned import’ of ‘import sanctioned goods’
  • providing a ‘sanctioned service’
  • engaging in a ‘sanctioned commercial activity’
  • dealing with a ‘designated person or entity’
  • using or dealing with a ‘controlled asset’ or
  • the entry into or transit through Australia of a ‘designated person’ or a ‘declared person’.

It is an offence to contravene Australian sanctions law, with penalties ranging from fines (with higher penalties applying to body corporates) to the maximum penalty of 10 years imprisonment. A recent example of where a person has been convicted for breaching Australian sanctions laws was R v Choi (No 10) [2021] NSWSC 891, where Mr Choi was sentenced to imprisonment for a fixed term of three years and six months for providing sanctioned services to North Korean entities.

In some cases, the Foreign Minister may authorise certain activities which would otherwise be prohibited through the granting of a permit. However, if a permit is granted on the basis of false or misleading information, then it is taken never to have been granted and the person or entity who supplied the information can be prosecuted.

Which government agency is responsible for administering Australia’s sanctions laws?

The Australian Sanctions Office (ASO), within DFAT, is the Australian Government’s sanctions regulator. It was established on 1 January 2020 and is responsible for administering Australia’s sanctions law. Other government agencies, including the Department of Defence, the Department of Home Affairs and the Australian Federal Police, also play a key role in regulating and enforcing sanctions.

Australia also plays a role in enforcing UN sanctions, including through Operation ARGOS which is the Australian Government’s commitment to the international effort to enforce UN Security Council sanctions on North Korea until it takes concrete steps towards denuclearisation. The Australian Defence Force contributes by deploying a Royal Australian Air Force P-8A Poseidon maritime patrol aircraft to monitor and deter illegal ship-to-ship transfers of sanctioned goods.

What are Magnitsky sanctions?

Legislation that governments have enacted to impose sanctions on an individual who has committed human rights abuses or is guilty of significant corruption is often named, or referred to as, ‘Magnitsky legislation’.

Sergei Magnitsky was a Russian-based tax lawyer employed by American businessman Bill Browder to investigate tax fraud in Russia. Mr Magnitsky was arrested and allegedly tortured by Russian authorities in 2009 after he uncovered extensive corruption by Russian officials. He later died in prison.

In response to these events, the United States passed the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of Law Accountability Act 2012 (Magnitsky Act 2012) to require the President to identify and impose sanctions on any person determined to have been involved in the detention, abuse, or death of Magnitsky. Subsequently, the United States Government passed the Global Magnitsky Human Rights Accountability Act 2016 (Global Magnitsky Act 2016) to allow the President to impose sanctions on individuals or entities identified as engaging in human rights violations or corruption. Other countries, such as the United Kingdom and Canada, have also enacted Magnitsky legislation.

Has Australia imposed Magnitsky sanctions?

In its 2020 report titled Criminality, Corruption and Impunity: Should Australia Join the Global Magnitsky Movement?, the Human Rights Sub-committee of the Joint Standing Committee on Foreign Affairs, Defence and Trade recommended that the Australian Government enact stand‑alone targeted sanctions legislation to address human rights violations and corruption, similar to the United States’ Magnitsky Act 2012.

The Morrison Government agreed in principle with this recommendation. On 2 December 2021, the Parliament passed the Autonomous Sanctions Amendment (Magnitsky-style and Other Thematic Sanctions) Act 2021 (Magnitsky Sanctions Act) which amended the Autonomous Sanctions Act to allow for sanctions to be imposed on individuals and entities responsible for, or complicit in, egregious conduct. While previous sanctions imposed by Australia have been country‑focused, these reforms allow the Government to impose sanctions to address a wider range of conduct (for example, human rights abuses), irrespective of where the conduct occurs.

The Government has committed to undertaking a comprehensive review of Australia’s sanctions framework within 12 months of the commencement of the Magnitsky Sanctions Act, ‘to ensure the framework is aligned with contemporary foreign policy objectives’ and will include consideration of whether additional legislative reform is necessary.


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