Australia’s export controls are contained in legislation that includes the Customs Act 1901, the Defence Trade Controls Act 2012 (DTCA), Weapons of Mass Destruction (Prevention of Proliferation) Act 1995 and Military End-Use provisions (section 112BA) and by sanctions. The Department of Foreign Affairs and Trade (DFAT) administers the implementation of sanctions, which restrict or prohibit the export of specified goods to particular countries or individuals or entities.

This article provides an outline of Australia’s sanction’s regime. 

Department of Foreign Affairs and Trade (DFAT)

DFAT, through the Australian Sanctions Office (ASO), manages the administration and enforcement of Australia’s sanctions regime. This regime restricts or prohibits the export of specified goods and services, imposes travel bans, and applies targeted financial sanctions against designated countries, individuals, and entities.

Sanctions can apply whether goods or services are exported from within Australia or from a foreign location by an Australian citizen or company. The two main types of sanctions imposed are:

1. United Nations Security Council (UNSC) sanctions – Obligatory for all UN member states, including Australia.

2. Autonomous sanctions – Unilaterally imposed by the Australian government as part of its foreign policy objectives.

In some cases, an export may require dual permits—a DFAT sanctions permit and a Defence Export Control (DEC) permit—particularly when the item is also listed under the Defence and Strategic Goods List (DSGL).

Compliance 

Violating Australian sanctions laws is a serious criminal offence. Individuals and entities found in breach may face up to 10 years’ imprisonment and significant financial penalties. The ASO maintains the Consolidated List of designated persons and entities subject to targeted sanctions. This list includes identifying details such as names, aliases, date of birth, citizenship, and address.

Entities must not:

• Directly or indirectly make an asset available to or for the benefit of a listed person or entity.

• Use, deal with, or dispose of an asset owned or controlled by a listed person or entity (commonly known as an asset freeze).

“Asset” in this context includes tangible or intangible property, whether movable or immovable, and acquired by any means.

If goods or services to be exported are also listed in the DSGL, additional approval from the Department of Defence is mandatory.

Financial Oversight and AML/CTF Laws

Australia has a comprehensive legal and operational framework for counter-proliferation financing, anti-money laundering (AML), and counter-terrorism financing (CTF). This is governed under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 and its associated rules.

These obligations apply to reporting entities such as banks, which are overseen by AUSTRAC—Australia’s financial intelligence agency. These institutions must risk assess transactions involving designated services and often request detailed information for international transactions to ensure compliance.

Licensed customs brokers and freight forwarders generally fall outside the reporting scope unless they hold a financial services license or deal in financial instruments as agents. Financial institutions such as banks that have banking relationships with foreign entities must however conduct a stringent due diligence assessment of the services provided to each party in a transaction, as opposed to only conducting a customer due diligence assessment of the foreign entity itself. This is why further details may sometimes be sought by your bank as they relate to foreign transactions.

U.S. Dollar (USD) Payments 

Australian entities making USD payments through U.S. financial institutions may be subject to U.S. sanctions law, which gives U.S. authorities jurisdiction over any dollar-denominated transaction cleared through their banking system. As such, Australian banks may flag, question, or restrict transactions involving certain parties, especially when these involve sanctioned jurisdictions or goods.

AUSTRAC also monitors specific AUD transactions, applying similar due diligence requirements.

Sanctions on Russia and Belarus

In response to Russia’s invasion of Ukraine, supported by Belarus, Australia has imposed sanctions and trade restrictions on both countries. These include:

• A 35% additional customs duty on imports that originate in Russia or Belarus.

• Ineligibility for tariff concessions or GST exemptions normally available under Schedule 4 bylaws or Tariff Concession Orders (TCOs).

• Export and import restrictions on goods listed under the Autonomous Sanctions (Export Sanctioned Goods – Russia) Designation 2022, including arms, petroleum products, coal, and related equipment.

• Prohibition on commercial activities involving specified Russian financial institutions and companies under the 2015 Sanctions Specification.

Designated goods, such as gold and energy products from Russia or the occupied Ukrainian regions, are banned. Also prohibited are transactions involving financial instruments issued by publicly owned or controlled Russian entities.

A sanctions permit may be granted by the Minister for Foreign Affairs only if deemed to be in the national interest.

Due Diligence Requirements

Entities must conduct due diligence before engaging in any international transaction that may involve a sanctioned person, entity, or country. This includes understanding:

• The identity and structure of the customer, or final recipient.

• The origin and end-use of goods or services.

• Whether any party to the transaction is listed on DFAT’s Consolidated List.

Minimum Due Diligence Expectations by DFAT:

• Conduct checks on all individuals and entities involved in the transaction.

• Investigate the company’s ownership structure and any ties to designated persons.

• Identify the end user and end use of goods or services.

• Screen all involved parties against the Consolidated List.

• Keep comprehensive records of all due diligence activities.

Where uncertainty exists—especially if a transaction may involve a listed person or entity—it is strongly recommended to seek legal advice before proceeding. If an entity finds itself in possession of an asset owned or controlled by a listed party, it must freeze the asset and notify the Australian Federal Police (AFP) immediately.

Summary

Australia's export controls and sanctions regime is broad, intricate, and carries serious legal obligations. With overlapping responsibilities between DFAT, Department of Defence, AUSTRAC, and AFP, any person or entity engaged in cross-border trade must ensure full compliance. This includes securing the proper permits, understanding the nature of their transactions, identifying all counterparties, and conducting appropriate due diligence. Australian businesses must therefore remain vigilant and current with all regulatory obligations to avoid legal exposure and reputational risk. This article reflects the author's views and not necessarily those of the Export Controls Australia Group.