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Australia: Australian Defence trade controls may affect pharmaceutical sector - Committee says more groundwork is needed to refine proposed legislation
On 15 August 2012, the Senate Foreign Affairs, Defence and Trade
Legislation Committee (Committee) published a preliminary report on
its inquiry into the Defence Trade Controls Bill 2011 (Bill).
In doing so, the Committee acknowledged the Bill's potential
'adverse unintended consequences' for the pharmaceutical,
biotechnology and nanotechnology industries and said it is
'firmly of the view that more groundwork is needed to refine
the proposed legislation'.
The Bill
The Bill was introduced into the House of Representatives on 2
November 2011, passed on 21 November 2011 and introduced into the
Senate on 22 November 2011.
The Bill is a companion to the Customs Amendment (Military
End-Use) Bill 2011. Both Bills were referred to the Joint Committee
on Foreign Affairs, Defence and Trade, and on 10 November 2011
pursuant to a Senate Selection of Bills Committee Report the Bill
was referred to the Committee for inquiry.
The purpose of the Bill is to give effect to the Treaty between
the Government of Australia and the Government of the United States
of America concerning Defense Trade Cooperation (Treaty), which was
signed by former Prime Minister Howard and former President Bush in
2007.
In addition to giving effect to the Treaty, the Bill also:
Introduces controls on the supply of Defence and Strategic
Goods List technology and services related to Defence Strategic
Goods List (DSGL) technology and goods
Creates a registration and permit regime for the brokering of
DSGL goods, technology and related services
Introduces a number of new criminal offences to enforce the new
provisions.
Concern about 'adverse unintended consequences'
The Committee has taken evidence through submissions and public
hearings.
The Committee's preliminary report expressly acknowledges
concerns raised in submissions about the potential effect of the
Bill's proposed export controls on the university and research
sectors.
In addition, the preliminary report refers to the Department of
Industry, Innovation, Science and Research and Tertiary
Education's observation 'that the pharmaceutical,
biotechnology and nanotechnology industries may also be affected by
the strengthened export controls'.
The Department's submission agreed that there are
'...potentially negative implications of the Bill, as
originally drafted, on the Australian higher education sector,
public good research and industry, in particular the
pharmaceuticals, biotechnology and nanotechnology sectors, arising
from a large change in the regulatory environment.'
Next steps
Defence has been undertaking further consultation with relevant
industries to develop solutions to the issues identified.
However, the Committee's preliminary report notes that this
is encouraging. However, the Committee says that 'for the sake
of ensuring that there are no adverse unintended consequences, the
committee believes that more time is needed for further
consultation and consideration' and that '[u]nless Defence
can provide assurances to the contrary, the committee believes that
it would be folly to proceed with the Bill at this time while the
resolution of important matters remains outstanding.'
This publication is intended as a general overview and
discussion of the subjects dealt with. It is not intended to be,
and should not used as, a substitute for taking legal advice in any
specific situation. DLA Piper Australia will accept no
responsibility for any actions taken or not taken on the basis of
this publication.
DLA Piper Australia is part of DLA Piper, a global law firm,
operating through various separate and distinct legal entities. For
further information, please refer to www.dlapiper.com
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