Dara Calleary (Mayo, Fianna Fail) | Oireachtas source

I move: "That the Bill be now read a Second Time."

I am pleased to bring the Control of Exports Bill before the House. With an ever-changing geopolitical landscape and advances in technology, there is a need to strengthen and modernise the current legislative framework for export controls in Ireland. This Bill will repeal and replace the Control of Exports Act 2008. It will ensure that Ireland continues to operate a robust framework for regulating the export of controlled items, principally dual-use and military items. I will begin by briefly summarising the nature and purpose of export controls to provide Deputies with some context. I will then outline the rationale for enhancing the current Act. I will finish by summarising the structure and main provisions in the new Bill.

Export controls are a multilateral, global mechanism that contribute to international peace and security and seek to prevent the proliferation of weapons of mass destruction, in addition to conventional weapons. Controls usually take the form of a legal obligation on exporters to obtain prior authorisation, that is an export licence, to export designated items to other countries. The success of controls is reliant on uniform and consistent multilateral implementation. A list-based approach to controlled items aims to provide regulatory transparency and certainty for exporters. While maintaining international stability and security is at the heart of export controls there is a need to strike a balance with the pursuit of free trade and the functioning of open markets. With that in mind, controls are targeted and proportionate and aim to minimise the burden on reputable exporters engaged in legitimate, low-risk trade.

The legislative framework for export controls in Ireland is established by both national and EU instruments. There are two key EU instruments relevant to this Bill. The first is EU Regulation 821 of 2021 setting up a Union regime for the control of exports, brokering, technical assistance, transit and transfer of dual-use items. Trade in dual-use items is an EU competence and this regulation has direct, legal effect in all member states. However, member states are obliged to establish in national legislation effective, proportionate and dissuasive penalties applicable in the event of infringements of the provisions of the regulation.

The EU regulation also provides member states with discretion to adopt certain additional national measures, such as control of dual-use items other than those listed in Annex 1 of the dual-use regulation. The Bill fully avails of such discretion to ensure Ireland has the most effective controls at its disposal. Dual-use items are defined as products and components, including software and technology, that can be used for both civilian and military applications. The list of items subject to export control is set out in Annex 1 to the regulation. The majority of dual-use exports from Ireland are mainstream business ICT products, both hardware and software, for example networking, data storage or cybersecurity. They are categorised as dual use as they use strong encryption for data protection purposes.

The second key EU instrument is the Council Common Position 944 of 2008 defining common rules for the control of exports of military technology and equipment. The categories of military technology and equipment to which these rules should apply are set out in the EU Common Military List. The common position sets out eight criteria against which authorisation applications should be assessed. The common position does not have direct legal effect in member states. As the export of military items is a national competence, its provisions must be given effect by national, primary legislation.

Military export controls overlap with dual-use export controls in several ways. It is vital that dual-use and military items are closely co-ordinated and that there is a common policy framework in place to ensure consistency and transparency. The Department of Enterprise, Trade and Employment is the national competent authority for export controls in Ireland. The current Act must be updated to reflect the significant advances in technology, new developments in business practices, updates to EU instruments and the evolving geopolitical risk landscape.

I will now outline the structure and key provisions of the Bill. The Bill contains eight Parts. It has been structured to set out clearly controls for dual-use and military items, provisions for authorisations, appeals, enforcement provisions and the penalties that apply for breach of controls.

Part 1, the preliminary and general Part, primarily deals with matters common to legislation, including commencement, interpretation, reporting obligations, regulations and service of documents. This Part also designates the Minister for Enterprise, Trade and Employment as the competent authority for the dual-use regulation and repeals the Control of Exports Act 2008 and associated statutory instruments.

Part 2 focuses on the control of dual-use items and sets out definitions specific to this Part. It provides for offences for breach of the directly applicable provisions in the dual-use regulation that are primarily related to dual-use items listed in Annex I of the regulation. This Part also sets out provisions in relation to discretionary national controls on dual-use items other than those listed in Annex I of the dual-use regulation. It covers the control of exports, brokering, technical assistance, transit and transfer of dual-use items.

To ensure controls are adaptable to emerging technology not listed in Annex I, the Bill provides that an exporter must notify the competent authority if they are aware that items not listed in Annex I are intended, in their entirety or in part, for purposes prescribed in the regulation. The Minister must, on receipt of notification, decide whether to make the export concerned subject to authorisation. The Minister may in restricted circumstances by order prohibit the export of a non-listed dual-use item without an authorisation. The Minister may give notice directing an exporter to apply for an authorisation to export a dual-use item not specified in Annex I of the dual-use regulation. Similar obligation, notification and direction controls are set out in sections 13 to 20, inclusive, with respect to brokering services, providers of technical assistance, transit and transfer of dual-use non-listed items.

Part 3 deals with the control of military items. It focuses on the control of military items and sets out definitions specific to this Part. Section 23 establishes a prescribed list of military items known as the national military export control list. This list will primarily comprise items from the common military list of the EU. Section 24 provides that it is an offence to export a military item without an authorisation. Section 25 sets out that it is an offence to provide brokering services in respect of a military item without an authorisation. Section 26 sets out controls in respect of the transit of a military item through or from the State without an authorisation. Section 27 provides exemption for temporary export of military items by the Defence Forces or the Garda Síochána.

Part 4 describes provisions related to authorisations. Sections 33 to 36, inclusive, set out the following in respect of authorisations for dual-use and military exports: the procedure for applying for an authorisation; the assessment of an application; prohibition on transfer of an authorisation; record-keeping requirements; revocation, suspension or modification of an authorisation; and the process for lifting the suspension of an authorisation. The Minister may prescribe certain matters relating to an authorisation, including the application procedure and any fees to be paid. This section provides for consultation with other Ministers of the Government where appropriate. Reasons for an authorisation denial must be provided to an applicant. In certain narrow circumstances it may be necessary for the Minister to withhold information to protect the security and public order of the State.

Part 5 sets out provisions related to internal review and appeals. It consists of five chapters. This Part balances the need to ensure fair process with the security requirements of the State while also complying with recent case law. Chapter 1 provides for a process for internal review of an application that has been denied. It also sets out the process for an internal review. Chapter 2 sets out provisions in relation to adjudicators who will hear formal appeals. Sections 39 to 41, inclusive, provide for the appointment of persons as adjudicators, the conditions of appointment, revocation of their appointment and the liability of adjudicators. Section 42 provides that rules may be prescribed in relation to appeals to be determined by an adjudicator. Provision is made for consultation with named Ministers and other Ministers that may be deemed appropriate. Chapter 3 provides for the details of a review of a relevant decision in the Bill, provides that an adjudicator may determine an appeal without an oral hearing, and provides that the adjudicator shall decide to allow the appeal and remit the matter to the Minister, or affirm the relevant decision. Chapter 3 also details provisions regarding sensitive material and evidence in exceptional circumstances. As part of the decision-making process, highly sensitive information may be shared with the Minister. Section 43 provides that the adjudicator may determine whether disclosure of information to an appellant would create a risk to the security or public order of the State and make certain directions regarding the disclosure of such relevant information. Chapter 4 provides for a further appeal to the High Court.

Part 6 deals with monitoring compliance of export controls and the enforcement of same. This Part provides for the appointment of authorised officers and their powers. It aims to ensure there are clear and reasonable powers for an authorised officer to carry out their functions under the Act. An authorised officer will investigate cases where violations of the controls are suspected and will carry out both desk-based audits and site visits to ensure exporters are aware of, and are fulfilling, their obligations in respect of conditions attached to authorisations. Section 57 provides that an authorised officer may request relevant information or records and enter any premises that has been or is being used in connection with a relevant activity. Section 58 sets out the powers of an authorised officer upon entry to a premises and the conditions on the use of those powers. Section 61 provides that an authorised officer may give a compliance notice to a person suspected of contravening a provision of the Act and sets out the rules of such notice. Sections 62 to 67, inclusive, provide further details on matters related to the courts, forfeiture and legal privilege.

Part 7 sets out offences and penalties for breaches of the Act. Offences are threaded throughout the Bill and are summarised together with associated penalties in this Part. The Bill establishes a range of penalties to provide for a proportionate response to breaches. This aims to be proportionate in dealing with minor infringements and gross negligence or misconduct. In addition to potentially facing a compliance notice for infringements of the Act, exporters may be prosecuted for violations of national legal provisions in relation to dual-use and military trade controls. The Bill increases penalties set out in the 2008 Act to establish levels more consistent with other member states and should act as a deterrent to exporters.

Part 8 provides for miscellaneous and transitional provisions. It provides a transparent framework for information-sharing between the Minister for Enterprise, Trade and Employment and the named bodies relevant to export control. It also provides for transitional arrangements for authorisations issued prior to the commencement of this Act.

In summary, the Control of Exports Bill 2023 provides that Ireland has a sound legal basis for administering export controls by providing for controls related to dual-use items; controls related to military items; the establishment of a national military export control list; the rules and conditions for obtaining and using authorisations; the establishment of an independent adjudication panel to hear appeals and disclosure requests; an effective enforcement capability for authorised officers; establishment of a comprehensive set of offences for infringements of the controls; and proportionate, graduated and dissuasive penalties for breaches.

I commend the Bill to the House and look forward to contributions from Deputies.

See this speech in context