Committee recommends ‘substantial reform’ to foreign influence transparency scheme

THE Parliamentary Joint Committee on Intelligence and Security (PJCIS) today tabled the report of its review of the Foreign Influence Transparency Scheme Act 2018.

The Foreign Influence Transparency Scheme (FITS) was established to provide the public with visibility of the nature, level and extent of foreign influence on Australia’s government and politics. The scheme creates an obligation for people and organisations who undertake certain activities on behalf of a ‘foreign principal’ (a foreign government or political party, or a related entity or individual) to be listed on a public register.

During the inquiry, the scheme was criticised for its limited effectiveness in achieving its intended transparency outcomes. The committee noted with concern the low number of registrations and minimal compliance and enforcement activity during the six years since the scheme was established.

Chair of the PJCIS, Peter Khalil MP said, “The committee was satisfied that the scheme’s objective of shining a light on both legitimate and malign foreign influence activities in our society remains worthwhile and necessary.

“Nevertheless, given the significant flaws in the scheme, the committee considers that substantial reform is required if the FITS is to meet its original intent and justify the compliance burden and resources required to administer it.”

The committee’s bipartisan report makes 14 recommendations to improve the scheme and its administration, including by amending the current FITS Act to:

  • Update key components of the definition of ‘foreign principal’, including to capture a wider range of company, governance and management structures that can enable a foreign principal to exert control over an entity.
  • Review all current and potential exemptions to the scheme to ensure they are operating as intended and are not being exploited for the purpose of covert malign influence.
  • Insert new enforcement options into the scheme, including the ability for the Secretary of the Department to register a person who is liable to register but has failed to do so.

The committee has also recommended that the government review the resourcing of the administering department of the FITS to ensure both the level and capacity of its staffing is sufficient.

The Foreign Influence Transparency Scheme is distinct from, but sits alongside, the framework for combatting espionage and foreign interference in Australia. The committee has recommended that Australia’s espionage and foreign interference laws should also be referred to it for review.

Further information on the inquiry can be obtained from the Committee’s website.



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