Australia Seeks Foreign-Meddling Curbs After China Dust-Up

(Bloomberg) -- Australian Prime Minister Malcolm Turnbull said he would introduce legislation to limit political meddling by foreign powers, citing reports of Chinese influence over a local lawmaker and Russia's U.S. election interference.

People or organizations acting in the interests of foreign powers would be required to register and disclose their ties, Turnbull said, adding that foreign political donations would also be banned.

“Foreign powers are making unprecedented and increasingly sophisticated attempts to influence the political process,” Turnbull told reporters in Canberra on Tuesday. “We will not tolerate foreign-influence activities that are in any way covert, coercive or corrupt.”

Senator Sam Dastyari resigned from a senior position with the opposition Labor Party last week after he acknowledged warning a Chinese businessman linked to the Community Party that his phones were being tapped by Australian intelligence agencies. Dastyari, who remains in parliament, had previously said that a Chinese company with links to Beijing had paid a A$1,670 ($1,275) travel bill for him.

“We have recently seen disturbing reports about Chinese influence,” Turnbull said, adding the reforms were not targeted at any one country. Asked about Dastyari, Turnbull said: “Senator Dastyari's solicited money from a Chinese national. It was as blatant an act of political interference you could imagine.”

Australians were familiar with the “very credible reports” that Russia sought to actively undermine and influence the U.S. election, Turnbull said.

Espionage, Treason

Under the legislation, which wasn't expected to be voted on until next year, the definition of espionage and treason would be updated to make failing to report the receipt of information -- not just passing it on -- an offense.

“Foreign intelligence services are engaged in covert influence and interference on an unprecedented scale,” Turnbull said. “This activity is being directed against a range of Australian interests, from our political systems, to our commercial interests, to expatriate communities who have made Australia their home.”

Australia has long sought to balance its military alliance with the U.S., which bases as many as 2,500 Marines in the country, and China, which is its largest trading partner. China's rising soft-power influence and militarization of the South China Sea have become an increasing concern in the Asia-Pacific region.

Chinese Ministry of Foreign Affairs spokesman Geng Shuang told a regular briefing Tuesday in Beijing that he hadn't seen Turnbull's comments, but said that “China has no intention of interfering in Australia's domestic politics and has no intention of using political contributions to influence Australia's domestic affairs.”

“We once again urge Australia to discard prejudice and use a fair and objective attitude to view China and China-Australia relations,” Geng said. “A stable China-Australia relationship is not only in the interest of China. It is also in the interest of Australia.”

--With assistance from Peter Martin

To contact the reporter on this story: Jason Scott in Canberra at jscott14@bloomberg.net.

To contact the editors responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net, Jason Koutsoukis, Brendan Scott

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