11 March 2016
by Fleur Anderson

It's on Defence's head: FIRB chairman on Darwin Port

The top official for vetting foreign investment was so concerned the Port of Darwin would be leased to a Chinese company that he asked three times for the Department of Defence and intelligence agencies to consider the national security implications "at the highest possible level".

The Foreign Investment Review Board (FIRB) and the Department of Defence are under scrutiny over the Northern Territory's decision to lease the port to Landbridge, which has links to the People's Liberation Army, and was allowed to take place through a legal loophole that made it exempt from federal approval.

The board's chairman, Brian Wilson, said he became aware of the deal in late 2014 and asked for a response from Defence and intelligence agencies in early 2015 and again in March. After a second response from Defence expressing no reservations to the deal, Mr Wilson asked for it to be considered a third time "at the highest possible level".

Had he known the Australian Navy would have guaranteed access to the port for only the first 25 years of Landbridge's 99-year lease: "I would have asked the question of the Navy again for the fourth time, and I would have had to accept it."

"It is truly on their heads; they are the experts here," he said.

National security committee
There are calls to shift the decision making on foreign investments out of the Treasurer's portfolio into a stand-alone authority reporting to cabinet's national security committee to deal with an influx of sensitive foreign investment proposals for Australian major infrastructure and utilities.

Former ASIO and ASIS chief David Irvine, who has been brought into FIRB following the outcry over the Port of Darwin deal, said if he had been in the FIRB during the deliberations he would have insisted the Defence Department and ASIO explain their reasons for not having a problem with a Chinese government-linked business having a 99-year lease over a port used by the Australian Navy.

"Had I been on the board at the time, I would have sought the fullest possible explanation and on each occasion I would have asked [why] on three separate times whether their conclusion was right," Mr Irvine told a parliamentary inquiry on Thursday.

"If I was there from that time … I would have asked them to consider the potential for sabotage, the potential for espionage. And my sense is that is what happened."

Mr Wilson and Mr Irvine declined to publicly name the officials in Defence and ASIO who were repeatedly asked about the Port of Darwin deal.

Defence and intelligence agencies have admitted an oversight in not consulting Australia's allies about the deal, in the light of unhappiness from the United States, which has troops regularly rotating through Darwin. US President Barack Obama raised the issue with Prime Minister Malcolm Turnbull.

Defence experts from the Australian Strategic Policy Institute say the FIRB, currently in Treasury, gives insufficient consideration to national security and instead tough decisions on critical infrastructure investments should go to cabinet's national security committee rather than the Treasurer.

South Australian independent Senator Nick Xenophon will propose more transparency in Australia's foreign investment framework to "finally make foreign investment in Australia genuinely open and accountable unlike current rules, which are clear as mud".