Defence exports now licence-free among AUKUS nations

The three AUKUS nations Australia, the UK and the US have established an export licence-free environment, opening up investment and export opportunities for industry.

Defence Minister Richard Marles first raised the possibility of removing barriers to procurement, investment, information and data sharing systems, and export requirements with the government in 2022, and described today’s announcement as a ‘generational legislative reforms’.

According to a statement national exemptions remove the licencing requirements for most controlled goods, technologies and services exported, re-exported or transferred to, or within, AUKUS nations.

This is considered critical in driving scientific and technological collaboration, including under AUKUS Pillar II Advanced Capabilities.

Marles said: “These critical reforms will revolutionise defence trade, innovation and cooperation, enabling collaboration at the speed and scale required to meet our challenging strategic circumstances.”

From 1 September 2024, AUKUS partners will operate in this new export licence-free environment, supporting scientific, technological and industrial cooperation and fast‑tracking the delivery of high-end capabilities to the Australian Defence Force.

Importantly, the new licence-free environment reduces costs to local businessesof trade between the three nations.

The changes to export control mechanisms will enable:

• Licence-free trade for over 70 per cent of defence exports from the US to Australia that are subject to International Traffic in Arms Regulations
• Licence-free trade for over 80 per cent of defence trade from the US to Australia that are subject to Export Administration Regulations
• The elimination of around 900 export permits required under the previous export controls from Australia to the US and UK valued at $5 billion per year
• And The removal of approximately 200 export permits required for defence exports from the UK to Australia valued at over $129 million per year.

Australia has implemented national exemptions for the UK and the US through the Defence Trade Controls Amendment Act 2024 and associated regulations.

The US provided national exemptions through amendments to its International Traffic in Arms Regulations and Export Administration Regulations, and the UK provided national exemptions through an AUKUS-specific Open General Export Licence.

The federal government committed $28 million in the 2024-25 Budget to implement reforms to accelerate trade between AUKUS partners.

Further reading:
Marles pledges stronger defence industry, integration with allied supply chains

Picture: Richard Marles