25 September 2020
Foreign Affairs, Defence and Trade Committee
Department of the Senate
PO Box 6100
Canberra ACT 2600
The Group of Eight (Go8) is pleased to have the opportunity to comment on Australia’s Foreign Relations (State and Territory Arrangements) Bill 2020. Please note that this submission represents the views of the Go8 – which comprises Australia’s leading research-intensive universities. Individual Go8 members may also choose to present a submission.
The Go8 shares with Government a commitment to protecting the national interest and pursues this through a collaborative and outcomes focused approach.
With this in mind, the Foreign Affairs, Defence and Standing Committee will have been advised that the Go8 has expressed serious reservations with the Bill as it currently stands, not least the fact that it is an unnecessary and duplicative piece of legislation in its application to public universities.
These concerns have been raised as part of our earlier discussions with the Department of Foreign Affairs and Trade (DFAT) including the economic, regulatory, reputational and legal implications.
It is the Go8’s view that there is no evidence in any clause of the Bill to suggest consideration of whether it was fit for purpose for the inclusion of the higher education sector. There is no evidence that the sector’s global reach, which includes thousands of agreements (often long-term and economically invaluable, let alone implicitly endorsed by Government) at all levels of its daily operations, was understood.
Inexplicably it seems, the Government has chosen to suspend its own high standards for the assessment of all regulation which has more than a “minor impact on businesses, community organisations, or individuals”, by waiving the need for this Bill to be subject to a Regulatory Impact Statement (RIS). Yet this Bill heralds an unprecedented burdensome regulatory impact on universities. For a sector already impacted by the economic fallout of COVID, this new administrative and reporting load will further constrain diminished resources. This is prior to also considering the substantial administrative burden it will place on DFAT, at a time when Australia’s resources are facing the combined impact of ensuring a post-COVID economic recovery and our first recession in 29 years.
As a result, there is a real danger that the Bill will not deliver on its intent to protect Australia’s foreign relations while at the same time having a range of (presumably) unintended consequences impacting negatively on Australia’s economic well-being.
It is for these reasons that the Go8 views this submission as critical, and continues to ask Government whether this Bill is really what it intends for the higher education sector?
If the inquiry ignores the Go8’s concerns in this submission, then nothing is more sure than that the Australian economy and its citizenry will suffer in ways that will affect present and future students, research (including medical advances), the business community, and Government’s capability to advance technology such as AI and Space as well as our ability to participate in international schemes and engagements which deliver direct benefit for Australians; and that there will be embarrassing sovereign risk issues for the Government.
The legislation as it stands is so vague and so all-encompassing in its vast trawl and construct, that DFAT has been unable to set out for the Go8 what exactly it is that the Government is attempting to find and eradicate within universities. In fact, we were advised to wait and see what happens after the Bill is enacted, by which time it will be too late to seek amendments.
Nor can the Government appear to accept that this level of uncertainty simply won’t wash with overseas Governments, investment funders, business, and universities seeking to enter into negotiations with us – the Go8 and Australia.
This is not the Go8’s view alone. We have provided as an attachment to this submission a letter from Dr Tim Bradshaw, the Chief Executive of the Russell Group of Universities in the UK, which represents institutions such as the Universities of Cambridge and Oxford, King’s College London, Imperial College London and the London School of Economics and Political Science. In it, Dr Bradshaw notes that the Bill “introduces significant uncertainty, unpredictability and indeed risk, into any engagement Russell Group members might undertake with an Australian university partner”, and that this “is particularly unfortunate at a time when the UK is actively looking to develop a Free Trade deal with Australia in which we hope it will be possible to strengthen collaborative ties in research and education between our two nations”.
The Government does not appear to understand that the element of retrospectivity, the reality regarding what may or may not be allowed, which could change at any minute or be wiped out at some indeterminate point in the future by the ‘stroke of a Minister’s pen’, is a frankly baffling negotiating position for Australia to place itself in.
Instead we have been referred, as a comparison, to frameworks for foreign investment which have existed for some time and that nevertheless do not prevent viable foreign investment from happening. We would point out that these frameworks allow for the existence of a Foreign Investment Review Board whose advice can guide the Treasurer’s decision rather than the full responsibility resting on one Minister’s shoulders.
The Go8 asks, ‘what investor, what business, would ever enter into a negotiation where our member universities have no autonomy to sign a contract, and that contract can be disallowed, even after it is signed off and underway?’
The Go8 asks whether the Government itself would sign such an agreement with a foreign entity if the same conditions were asked of them?
This is not how the free world conducts business. It will be to Australia’s immense loss on many levels in the short, medium and long term.
There is so much at stake; too much for our nation to lose as we set a new normal economic course, post COVID. While we are continually advised that all of the current barrage of inquiry and draft legislation regarding foreign relations is country agnostic, the Go8 would much prefer Government to be clear and specific about the end-goal, ‘areas of actual concern’ and set out which foreign entities are excluded from the net on the basis of existing international intelligence-sharing agreements.
Issues with Bill as it currently stands:
- The Bill is not fit for purpose.
- The Bill does not have a clear intent in relation to higher education – it is a solution in search of a problem.
- Universities are not extensions of the government sector, do not operate as government entities and have no place in this Bill.
- It is completely wrong to state the Bill will not affect university negotiations or to assume it will only affect them in a minor way.
- The Bill will give rise to a plethora of unintended consequences.
- The Bill will damage the national economy and the Government’s global reputation.
- The Bill will cripple the ability of our universities to sign agreements/contracts with overseas entities by removing their autonomy to do so. Yet global partners are part of the DNA of leading research-intensive universities; regardless of their ‘nationality’.
- The removal of institutional autonomy referred to above could raise questions as to whether Australia’s own universities meet the requirements for “institutional autonomy” under this Bill, noting this term is yet to be properly defined.
- Decisions of this magnitude should not be at the sole discretion of a single individual and should not be able to be exercised at any, undetermined point in the future.
- There is no answer to the core question of why the higher education sector is included in a Bill that was clearly drafted to address concerns at State/Territory and Local Government level.
Firstly, and fundamentally, the Go8 believes that Australia’s Foreign Relations (State and Territory Arrangements) Bill 2020 is inconsistent with, and damaging to, the effective and efficient operation of Australian universities. Our over-riding recommendation is that universities be removed from the purview of this Bill.
If this recommendation is not adopted, then the following amendments are essential to avoid unnecessary damage to Australia’s economic well-being:
- That the centrality of international agreement activities to the core business of Australian universities is recognised, and that the scope of the legislation be narrowed to either exempt university agreements or limit to specific or exceptional circumstances.
- That DFAT work closely with the higher education sector in drafting amendments to the legislation to ensure the nation’s valuable research and teaching outputs are not adversely affected, and to avoid duplication of existing due diligence processes and broader legislation and regulatory frameworks relating to Australia’s foreign policy and interests.
- That the definition of “arrangement” as it applies to universities, be comprehensively altered; to avoid substantial and unnecessary damage to the Australian economy, to our research intensive universities, and to avoid the considerable and wasteful resource implications for DFAT and universities if the Bill remains in its current form.
- That the Go8 work with DFAT to develop a reporting matrix that would efficiently focus Government attention to where it may actually be beneficial.
- That the Bill be amended to ensure that the 30-day provision which applies to core arrangements being deemed automatically approved in the absence of Minister response be extended to non-core arrangements.
- That a longer period of 12 months (rather than the proposed six months) be prescribed by the legislation for the period by which pre-existing non-core arrangements need to be notified to the Minister.
- That procedural fairness measures be introduced, even if these are within parameters that recognise that the issues being considered may be related to the nation’s foreign relations.
- That Government clarify the specific role the Foreign Relations Bill plays within the broader context of all current and planned legislation in the security and foreign interference space, and how the regulatory landscape can work as a coherent whole. To fail to do this is to risk creating a contradictory environment that may fail to achieve its goals through unnecessary incoherence and confusion.
- That a high-level expert committee be established as an advisory mechanism to the Minister to guide decisions on foreign arrangements under this legislation, including industry, academic, and state government representatives.
- That the public facing register of information and any published or released details of reported arrangements strictly respect the need to safeguard and protect information and arrangements that are commercially sensitive or subject to the specific exemptions noted in the Bill; and that the requirement be removed to list those arrangements subject to specific exemptions.
Go8 universities have worked hard for global recognition, and to be recognised as global partners of choice. Putting aside for one moment the damage this legislation will do to the Australian economy more broadly, the Go8 asks the Committee if Australia can afford – especially in a post-COVID recovery context – to damage the hard-fought-for reality listed below as it relates to the excellence of the nation’s higher education sector – led by the Go8?
The Go8 has led Australia to punch well above its weight on the world stage, through achievements such as:
- Seven Go8 members are ranked in the world’s top 100 universities. This is according to the highly prestigious, research-focused Academic Ranking of World Universities (2020). Only two other countries performed better: the UK (nine), and the US (40). This places Australia ahead of countries such as China (six), France (five) and Germany and Canada (both with four).
- In 2018 the Go8 had 16,000 co-publications with the European Union and 10,600 co-publications with the US, demonstrating the high level of global interest and trust in its work. Through the EU’s Horizon 2020 program alone, Go8 participants work with 155 discrete private-for-profit entities in pharmaceutical and other health, car manufacturing, electronics, telecommunications or engineering industry, among others.
- Similarly, the Go8 attracts industry funding that is twice that of the rest of the sector combined, demonstrating established value to business, and a clearly accepted return on investment.
- The Go8 invests $3.55 billion annually in applied research and experimental development, helping to ensure that research findings can be translated into results for industry, the economy, and societal wellbeing.
- In 2017 the Go8 universities were selected by the UK based IP Group for a landmark agreement involving at least $200 million invested in finding and developing countries involved in disruptive innovation. The IP Group chose the Go8 as its partner of choice after exhaustive research when looking to diversify away from UK and US markets. As noted by the Go8 Chief Executive at the time, “It shows exactly what is at stake” if Government does not support our high achieving universities.
These achievements demonstrate a depth and breadth of knowledge and expertise that is truly remarkable for a country with a population of only 25 million people.
UFIT – a desired and world-leading result from taking the time to comprehend each other
The Go8 has demonstrated it is world-leading in other ways. In 2019 the university sector came together with Government departments and security agencies to form the University Foreign Interference Taskforce (UFIT), a process that has been globally recognised as truly world leading. The Go8 has since briefed many leading university groups in Five Eyes Plus nations on UFIT and provided UFIT process briefs to other Governments. UFIT has worked so expertly because the security agencies and the Go8 have worked carefully and exhaustively to understand each other, and because we are jointly committed to deliver the required mutually beneficial outcomes without damaging the sector’s capacity to engage internationally in ways beneficial to Australia’s national interest. This has made us the envy of many of our peers around the world.
Environmental scan – beware unnecessary borders
The Go8, and the higher education sector more broadly, cannot close our borders and remain world class. We simply cannot perform to a global standard if we are forced to go it alone. This is not how universities achieve greatness. It is the accepted norm that we work together around the world to bring ground-breaking and mutually beneficial developments to our nations. Australia suffers if we isolate ourselves, or if Government straitjackets us so we have no choice. Breakthroughs in knowledge and understanding most often come not from a single mind working in isolation, but from the best and brightest coming together to collectively pursue an idea or solve a problem.
The recent high-profile acquisition of the bio-tech start-up Inflazome by major pharmaceutical company Roche for over $600 million illustrates the economic, as well as medical, importance of supporting international research cooperation. Inflazome was founded in 2016, based on many years of research collaboration between Go8 member University of Queensland (UQ) and Trinity College Dublin (TCD). Inflazome researchers have developed a portfolio of inflammasome inhibitors leading to two drug candidates currently in clinical trials for the treatment of conditions such as cardiovascular disease, arthritis, Parkinson’s, Alzheimer’s and motor neurone disease. These drugs have the potential to change the way these types of diseases are treated by blocking the symptoms that keep accumulating with age. Consider the benefit this could bring to the nation’s health and wellbeing if predictions of a rise in COVID-related Parkinson’s disease cases prove correct.
The €380 million (over $A600 million) sale of Dublin based Inflazome to Roche is the result of IP commercialisation – including investor funding – led by UQ’s technology transfer company UniQuest. It is one of the biggest in Australian biotech history. In 30 years of operation, UniQuest has raised more than $515 million to take UQ technologies to market, with UniQuest-licensed UQ innovations generating gross product sales of more than US$13 billion to date. Yet without the foundation of international research cooperation between UQ and a host of foreign university partners, commercialisation of ground-breaking research outcomes such as the development of inflammasome inhibitors would simply not be possible and this sizeable contribution to our nation’s economy and world-leading innovation would be lost to our international colleagues.
The collaborative nature of research and development is well recognised internationally:
- The US Office of Naval Research (ONR) considers its mission to be to “build relationships between the international scientific community and the Naval Research Enterprise (NRE)”, which it does by funding a number of programs that leverage international expertise to help address naval science and technology challenges.
- The United States National Institutes of Health (NIH), the largest funder of biomedical research in the world, states that “applications for research grant support from foreign organisations are treated as if they were applications from domestic organisations”.
- The UK’s Wellcome Trust plans to spend around £5 billion over the next five years “helping people across the world explore great ideas”.
- The European Commission explicitly enables the participation of third countries in its flagship research and innovation program, Horizon 2020, badged as ‘open to the world’, to bring in international expertise that supports Europe’s research excellence and economic competitiveness.
In other words, international collaboration is not an optional extra that sits alongside any world class research system. It is one of the foundations upon which that system sits.
Any legislation or regulations that could potentially impede this process therefore threaten not just Australian universities, but Australia’s national capacity to seriously participate in a world that will be increasingly driven by science and research led developments. It is far too often forgotten that it is our IP and our standing that leads not only to university rankings, but to national rankings as an economic determinant.
This is why it is critically important that Australia ensures that legislation such as the Foreign Relations Bill is carefully calibrated. It is also critical to ensure that the Bill takes its place in a legislative or regulatory landscape that is consistent, coherent and seamless.
This is not for reasons of self-interest. The Go8 recognises geopolitical shifts are underway that have implications for all areas of industry, government and society, including universities. The Go8 has demonstrated through the UFIT process that it is willing and able to work with government in an effective, world leading way to achieve mutually agreeable outcomes. However, failing to appropriately calibrate legislation such as the Foreign Relations Bill, and failing to ensure a coherent approach across the legislative and regulatory landscape, pose a significant risk to the national interest.
This is not hypothetical. It is already happening. The Go8 is receiving disturbing reports from its member universities that concerns around the future regulatory environment are discouraging some researchers from pursuing potentially beneficial opportunities. Australia cannot afford this.
The Go8 wants to be absolutely clear: Australia cannot maintain its position as a world leading, high quality, sought-after, globally recognised research leader, if we are – either deliberately or inadvertently – unable to maintain collaborations and contracts with the world’s best researchers, or if high quality international partners are discouraged from approaching the Go8 because of concerns about Australia’s inconsistent or excessive regulatory framework.
The statements below should be viewed within this context.
In detail: Go8 recommendations
1. The definition of “arrangements”
The Go8 has significant concerns over the current definition of “arrangement” as it appears in the draft of Australia’s Foreign Relations (State and Territory Arrangements) Bill 2020. Section 9 (1) states that:
(1) An arrangement is any written arrangement, agreement, contract, understanding or undertaking:
(a) whether or not it is legally binding; and
(b) whether or not it is made in Australia; and
(c) whether it is entered before, on or after the commencement day.
As noted above, research intensive universities such as the Go8 have extensive relationships and agreements with international partners. Many of these are routine and would be of no interest from the perspective of ensuring consistency of foreign policy. Many allow students to engage in Study Abroad programs, allow Australians to work in collaboration with researchers from five eyes countries such as the US, UK or Canada, or allow Australian researchers to participate in global initiatives such as the World Mosquito Program led by Monash University, a not-for-profit initiative that is protecting communities around the world from mosquito borne diseases, such as malaria.
In a joint media conference announcing the Bill held by Prime Minister Hon Scott Morrison MP, and Minister for Foreign Affairs, Senator the Hon Marise Payne, on the 27 August 2020, the PM referred to around “130 agreements from 30 countries” as being potentially captured by the Bill.
While this may reflect the reality of other types of State and Territory entities, it seriously under-estimates the reality within its universities. The Go8 advises that the Bill, as currently drafted, could potentially capture thousands of arrangements, most of which enable activities such as student exchanges, study abroad programs, joint degrees, research contracts and academic conferences. In fact, as explored in more detail below, a desktop audit conducted across Go8 members indicated a total of almost 16,000 current active formal arrangements, with a further 200,000 informal arrangements at one university member alone that would certainly need to be considered for notification and could be potentially captured by the vague and all-encompassing nature of the current definition of “arrangement” used in the Bill.
The Go8 strongly questions whether diverting the resources required to have DFAT review over 200,000 “arrangements” – some of which could comprise a simple email communication between academics – is a justifiable use of taxpayer money at a time when Australia is facing its first recession in 29 years.
We also question whether this was really the intent at the time this Bill was drafted. It appears, at face value, a powerful example of the substantial differences between State/Territory governments and universities, and brings us back to the fundamental – and as yet unanswered question – of why universities were included in the Bill in the first place.
Most certainly, it would be a long bow to draw to suggest that university arrangements could impact Australia’s national sovereignty in the same way that might be possible with arrangements entered into by State, Territory and Local Governments.
Furthermore, universities report that implementing legislation such as the Defence Trade Controls Act 2012 (DTCA) shows that only a small proportion of research projects that are presented to the Department of Defence under this system are assessed as requiring some form of control. This suggests it is also likely to be the case with the Foreign Relations legislation.
The Go8 therefore does not believe that the extensive scope represented by the current definition of “arrangements” is justified.
Consultations between the Go8 and Department of Foreign Affairs and Trade (DFAT) revealed that the Department is lacking any substantial data to inform expectations on the number of university engagements likely to be captured.
The Go8 therefore agreed to undertake a scan across its eight members to provide the Department with an evidence-base. The results outlined below demonstrate the need for the definition of “arrangement” as it applies to universities to be reconsidered in light of this evidence, and of the likely considerable resource implications for DFAT of leaving it unchanged. As noted above, early feedback from our members confirms that there are some 15,988 formal ‘arrangements’ currently in place that could be captured by this legislation – with a conservative interpretation of the current definition of an ‘arrangement’.
And what of the substance of these arrangements?
Examples include the Strategic Alliance and Cooperation in Research, Education and Administration between Monash University and the University of Warwick (England), which seeks to “articulate and realise an ambitious vision of globally-connected higher education” through, amongst other initiatives, a student mobility agreement. Monash has over 150 such student exchange agreements, including with Peking University (PKU, China). That agreement has, since 2015, expressly recognised that both institutions, as independent universities, must conform to the specific Commonwealth and State legislation governing privacy and data protection, education services for overseas students and relevant national codes. As with other such arrangements across the university sector, the international exchange of students is expected to enhance the academic experience of students and provide benefits to host nation universities.
Important commercially sensitive and beneficial arrangements are a feature of Go8 universities, with the benefits shared at times with our closest neighbours. The Australian Government has actively supported initiatives such as the Partnership for Australia-Indonesia Research (PAIR) which brings together the efforts of 11 leading universities from our two countries to tackle the challenges of ‘Connectivity, People and Place’. This cooperative model demonstrates a research pathway-to-impact model that spans countries and institutions and that can be applied to any problem or location. The model seeks to achieve two end-of-program outcomes; better quality of researched evidence that is relevant to and that addresses key policy challenges, and building a network of researchers that conducts demand-driven, applied and interdisciplinary research. Current negotiations with the Indonesian Ministry of Research and Technology (RISTEK) on finalising an MOU involving funding to the PAIR program are likely to stall if there are uncertainties around institutional autonomy and the impacts of this Bill. The program concludes in 2022 so there are clearly time imperatives associated with maintaining certainty for agreements such as this one.
Recommendation: that the centrality of international agreement activities to the core business of Australian universities is recognised, and that the scope of the legislation be narrowed to either exempt university agreements or limit to specific or exceptional circumstances.
Recommendation: that the definition of “arrangement” as it applies to universities be comprehensively altered; to avoid substantial and unnecessary damage to the Australian economy, to the Go8, and to avoid the considerable resource implications for DFAT and universities if the Bill remains in its current form.
2. Refinement of the Reporting/Notification Process
The Go8 believes that the Bill would be further enhanced by the introduction of a streamlining process to focus attention only on those arrangements of genuine national concern. This will have a range of benefits, including:
- Reduce the need for unnecessary and wasteful use of departmental and university resources in assessing agreements that are of no interest with respect to foreign policy.
- Reduce the need for unnecessary administration, which will divert resources away from core activities of teaching and learning and research.
- Reduce the potential for arrangements that are of actual interest or concern being overlooked due to the volume of arrangements being reviewed.
- Reduce the potential to discourage beneficial international engagements from taking place, due to concerns about regulatory over-reach.
The Go8 recommends the introduction of a reporting matrix; one that classifies arrangements by level of potential interest. The Go8 has stated its willingness to work with DFAT to develop a template that could be used in reporting to direct departmental and university resources to where they could be better utilised.
The Go8 notes the discrepancy in that far greater certainty is offered to the higher tier core arrangements, in that if the Minister does not make a decision within 30 days on a notified proposal to negotiate or enter the arrangement, then the Minister is taken to have given approval for the proposal. Non-core arrangements such as the universities will be considered to have are offered no such certainty, instead left hanging indefinitely.
The Go8 also notes that a significant risk can arise from having certain sensitive arrangements such as university contracts serving Australia’s own defence needs even being listed on the public facing register. The Go8 recommends that those arrangements that come under exemptions under the Bill from having specific details reported in the register also be exempt from being listed AT ALL.
Recommendation: that the Go8 work with DFAT to develop a reporting matrix that would efficiently focus Government attention to where it may actually be beneficial.
Recommendation: that the Bill be amended to ensure that the 30 day provision whereby the negotiation or entering of a non-core arrangement is deemed to have been approved if the Minister does not make a decision in that timeframe be extended to non-core arrangements.
Recommendation: that a longer period of 12 months (rather than the proposed six months) be prescribed by the legislation for the period by which pre-existing non-core arrangements need to be notified to the Minister.
Recommendation: that the public facing register of information and any published or released details of reported arrangements strictly respect the need to safeguard and protect information and arrangements that are commercially sensitive or subject to the specific exemptions noted in the Bill; and that the requirement be removed to list those arrangements subject to specific exemptions.
3. Coherence and consistency with existing legislation
Australia already has a suite of legislative instruments and regulations in place that are aimed at managing security concerns within the broad geopolitical context. These include the Defence Trade Controls Act 2012, the Foreign Influence Transparency Scheme 2018, and the National Security Legislation Amendment (Espionage and Foreign Interference) Act 2018.
Universities are also subject to the Guidelines to Counter Foreign Interference in the University Sector, and the newly announced TEQSA Integrity Unit.
While the Go8 understands that the stated intention of the Foreign Relations legislation is to ensure a degree of consistency of State/Territory and university agreements with national foreign policy, it is critical to the national interest that the regulatory environment forms a consistent and coherent whole.
If gaps, contradictions or inconsistencies exist, this creates not only the potential for behaviour or agreements of concern to slip through the net unnoticed, but could also have the effect of tying up resources and attention on unnecessary activities so that attention is not being directed to where it is most needed. It also risks the ineffective use of resources at precisely the time that Australia enters its first recession in 29 years.
Again, the Go8 notes the absence of a high-quality evidence-based impact assessment in the form of a RIS in the drafting of this legislation and in the parliament’s hurried consideration of it. A RIS would, of course, consider the current legislative and regulatory landscape within which this legislation will operate and would provide the detailed and systematic appraisal of its provisions, including costs and benefits, that is missing. It is not clear to the Go8 how this legislation will achieve its desired objectives in relation to universities and certainly DFAT has not been able to articulate these either. What is clear for universities, is that the regulatory costs (direct and indirect, economic and societal), will significantly outweigh any potential benefits. Proportionality and a fit-for-purpose mindset were key considerations during the development of the Guidelines through UFIT and should also be a clear underlying focus of the Foreign Relations Bill.
The Go8 reinforces the real danger of inadvertently compromising the Government’s own aspirations and intents for foreign relations – including those advocated through such policies as the Global Innovation Strategy and the establishment of Landing Pads around the world – which themselves have encouraged and driven universities to pursue foreign arrangements.
It is also very possible that some university arrangements that support our national security and sovereignty by capitalising on foreign talent and capability to foster domestic research and innovation may also be compromised. The effective and efficient operation of Australian universities is not inconsistent, nor should it be, with our foreign relations interests, however mutable. To mitigate these risks, the Go8 proposes that a high level expert advisory body be established to advise the Minister at least on the potential implications of decision frameworks for industry, research and innovation capability, national sovereignty, supply chains, if not on specific decisions around individual arrangements.
Recommendation: that Government clarify the specific role the Foreign Relations Bill plays within the broader context of all current and planned legislation in the security and foreign interference space, and how the regulatory landscape can work as a coherent whole. To fail to do this is to risk creating a contradictory environment that may fail to achieve its goals through unnecessary incoherence and confusion.
Recommendation: that DFAT work closely with the higher education sector in drafting the legislation to ensure the nation’s valuable research and teaching outputs are not adversely affected, and to avoid duplication of existing due diligence processes and broader legislation and regulatory frameworks relating to Australia’s foreign policy and interests.
Recommendation: that a high-level expert committee be established as an advisory mechanism to the Minister to guide decisions on foreign arrangements under this legislation, including industry, academic, and state government representatives.
4. Other implications
The Go8 has concerns there will be serious potential for significant issues to arise in negotiations with international partners if this legislation is permitted to pass in its current form.
For example, it currently allows for the Minister to vary arrangements retrospectively.
Universities would be forced into the position of having to attempt to negotiate contract clauses that allow them to terminate the contract at any point without penalty to themselves, conditions which are unlikely to be acceptable to any negotiating party, or at the very least put Australian universities at a significant disadvantage in negotiations.
Without the Go8 attempting such a clause, our universities could find themselves subject to significant damages claims should the Minister at some undetermined point in the future decide to retrospectively terminate the agreement.
In summary, Government is creating an impossible negotiating environment – which will have two damaging outcomes: discouraging universities from pursuing beneficial agreements in the national interest and discouraging international partners from pursuing agreements with Australia.
Recommendation: that the Committee consider how best the legislation can be drafted to avoid a chilling impact on Australia’s ability to engage with strategic international partners in the national interest and for national benefit
In closing, the Go8 appreciates the Committee’s consideration of this most difficult and problematic legislation and urges it to please carefully consider the very real issues raised in this submission.
We are, as always, available to work with DFAT or other areas of Government to ensure legislation is appropriate and fit for purpose.
The Go8 looks forward to further engagement, and I can be contacted via email (email@example.com); or personally via my mobile on 0417 808 472 at any time if I can be of further assistance.
A small sample of Go8 Examples of Foreign Arrangements at risk
1. Revitalising Informal Settlements and their Environments (RISE)
Monash University led project, funded by the Wellcome Trust and the Asian Development Bank, with project sites in Indonesia and Fiji.
RISE brings together global expertise from Monash University in Australia and its campus in Malaysia, the Australian CRC for Water Sensitive Cities, Stanford University, Emory University, The University of Melbourne, University of Cambridge, Fiji National University, Hasanuddin University, The University of the South Pacific, United Nations University, Melbourne Water, South East Water, Oxfam, WaterAid, and Wellcome Trust Sanger Institute.
For this project it is challenging to imagine any adverse impact on Australia’s foreign relations objectives. However, some partners involved may potentially fall into the category of not having ‘institutional autonomy’ under the Bill as drafted and therefore a range of uncertainties may be created over arrangements that serve no useful purpose while making the Australian sector harder to work with. In an environment where there have been concerns about our relative influence in our near north, arrangements such as this should not be impeded.
2. The Partnership for Australia-Indonesia Research (PAIR)
PAIR is an initiative of the Australia-Indonesia Centre (AIC), which focuses on the importance of knowledge production and research capability building to support development, planning and policy making for both countries.
PAIR brings together an interdisciplinary team of researchers from across the AIC’s network of partner universities – Universitas Indonesia, Universitas Gadjah Mada, Institut Teknologi Bandung, Institut Teknologi Sepuluh Nopember, Universitas Hasanuddin, Universitas Airlangga, IPB University in Indonesia and Monash University, University of Melbourne, University of Queensland and University of Western Australia in Australia. The research is demand-driven and tackles the challenges of ‘Connectivity, People and Place’.
Indonesia is investing heavily in building stronger physical linkages, especially in roads, ports, air and rail and between cities, towns, villages and islands, connectivity will have a significant impact and open up new possibilities for local communities. PAIR researchers work with Indonesian government stakeholders (at National, Provincial and District levels) to explore how newly connected communities can take advantage of new opportunities.
key national Government partner is the Indonesian Ministry of Research and
Technology (RISTEK). AIC is presently in the process of finalising an MoA with
RISTEK, which involves funding to the PAIR program. Uncertainties around
Institutional autonomy would likely stall the progress of this MoA and the
funding. The program concludes in 2022.
3. Hong Kong’s MTR Corporation
Monash University has had a long and mutually beneficial relationship with Hong Kong’s MTR Corporation (a major railway operator) via the Monash Institute of Railway Technology. As an example of their work with MTR, Monash provides real time network monitoring of its Hong Kong network and evidence/research-based advice that supports MTR’s daily operations. While MTR operates as a publicly listed corporation, the majority of shares in MTR Corporation are owned by the Hong Kong government. We are unclear if this relationship would fall within the scope of the Bill.
The recent high-profile acquisition of the bio-tech start-up Inflazome by major pharmaceutical company Roche for over $600 million illustrates the economic, as well as medical, importance of supporting international research cooperation. Inflazome was founded in 2016, based on many years of research collaboration between Go8 member University of Queensland (UQ) and Trinity College Dublin (TCD). Inflazome researchers have developed a portfolio of inflammasome inhibitors leading to two drug candidates currently in clinical trials for the treatment of conditions such as cardiovascular disease, arthritis, Parkinson’s, Alzheimer’s and motor neurone disease. These drugs have the potential to change the way these types of diseases are treated by blocking the symptoms that keep accumulating with age.
The €380 million (over $A600 million) sale of Dublin based Inflazome to Roche is the result of IP commercialisation – including investor funding – led by UQ’s technology transfer company UniQuest. It is one of the biggest in Australian biotech history. In 30 years of operation, UniQuest has raised more than $515 million to take UQ technologies to market, with UniQuest-licensed UQ innovations generating gross product sales of more than US$13 billion to date. Yet without the foundation of international research cooperation between UQ and a host of foreign university partners, commercialisation of ground-breaking research outcomes such as the development of inflammasome inhibitors would simply not be possible and this sizeable contribution to our nation’s economy and world-leading innovation would be lost to our international colleagues. It is even possible this discovery could be invaluable to Australia as a nation if predictions of a rise in COVID-related Parkinson’s disease cases prove correct.
 Australia’s Foreign Relations (State and Territory Arrangements) Bill 2020, p.10.
 This would at least reflect the existence of a Foreign Investment Review Board for the parallel issue of foreign investment.