Australia works to soften US defence export controls for AUKUS

Brandon How

AUKUS partners are working to amend the defence technology export controls, which are limiting the development of local defence manufacturing, Parliamentary Joint Committee on Intelligence and Security chair Peter Khalil has confirmed.

Speaking on Monday to a UNSW Canberra-led conference on ‘Advancing AUKUS’, Mr Khalil said that the partners are “working cooperatively to address gaps and barriers, and there are some gaps that need to be addressed in order to ensure that trilateral technology transfer can occur smoothly”.

In particular, work on reforming the United States’ International Traffic in Arms Regulations was highlighted by Mr Khalil.

“There are some issues with for instance US protective laws and regulations with regards to technology transfer in particular, which all of our three nations are focused on working to get through together,” Mr Khalil said.

“Similar barriers of course exist within the Australian and UK systems as well. Now some might say that these barriers are relics of the Cold War, but they do continue to serve some important purposes and with some adjustments could complement the goals of the AUKUS partnership.”

Parliamentary Joint Committee on Intelligence and Security chair Peter Khalil

Mr Khalil said if export control barriers persist it would limit domestic manufacturing and Australia would not be able to “acquire the defence assets in the quantity we need, and in the time we need them, to be a contributor to that multilateral collective deterrence”.

“It’s not going to happen without working together to open up and break down some of these barriers to Australian production of an array of weaponry and defence. It’s not going to happen unless we have smoother technology transfer and the ability to have production facilities in Australia.”

He cited the growing pressures on the United Kingdom’s and United States’ defence industries as they continue to support Ukraine against Russia.

Between 2017 and 2021, Australia was the world’s fourth largest arms importer in the world. Australian arms imports represent 5.4 per cent of the world’s total, a 73 per cent increase on 2012-16. This puts it below only India, Saudi Arabia, and Egypt, and one position above China.

Also speaking at the conference was Jim Carouso, former chargé d’affaires in the United States Embassy in Australia, and now Washington DC-based Center for Strategic and International Studies senior advisor, and the chairman of the advisory board to the Australia chair.

Mr Carouso complained that the group of people responsible for issuing export licences for critical defence technology, conditional on an assessment of whether the recipient country can be trusted or not, are often made by career civil servants and not foreign service officers.

“[They] never leave the building, never leave the job. This is the only thing they do…They look at our legislation that says how they’re to think about it writ large. AUKUS exempts Australia as I read it from these requirements, but it’s not specific enough for the bureaucrats to say that’s what it does,” Mr Carouso said.

“To be frank…if someone from the very very top doesn’t come down and say ‘thus shall be made’ and ‘you’re all protected or punished for not doing it’, it’s going to be a slow process.”

At the start of last month, Minister for Defence Industry Pat Conroy delivered a speech in the United States calling on the nation to “work more seamlessly [with Australia] across our sovereign boundaries”.

He described the “next frontier of Alliance cooperation” as breaking down the “stubborn barriers to technology transfer, information sharing and industry integration”.

Earlier this year, a report from the University of Sydney’s United States Studies Centre stated that the technological capabilities and innovation ecosystems from AUKUS would be “more consequential” and arrive sooner than the nuclear-powered submarines.

Defence Minister Richard Marles expressed a similar sentiment ahead of his trip to the United States in July. He said that non-submarine technologies would be “just as if not more important” in terms of what AUKUS ultimately delivers.

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