Concerns Over Australian Law Firms Providing Advice to Beijing-Linked Entities

Cyber expert Robert Potter says some firms are handling sensitive government information on the same server as Chinese clients.

A surveillance camera points at a terrace of a shopping mall overlooking the skyline of the Central Business District on a polluted day in Beijing, China, on Nov. 5, 2021. Thomas Peter/Reuters

Australian law firms are being sought out by state-owned Chinese Communist Party (CCP)-linked enterprises for legal counsel on ownership of critical Australian infrastructure.

The new report from cybersecurity firm, Internet 2.0, warned some firms were extending their role beyond legal services, including endorsements for Beijing’s contentious Belt and Road Initiative programs, as well as the semiconductor industry.

Their actions comprise a security risk to Australia, according to the “Law Firms in Australia” report.

Some law firms that service CCP entities are also offering legal services to Australian government entities responsible for national security and foreign policy.

The Allegations Against Australian Law Firms

The report suggested that confidential client files stored by Australian law firms may be accessible to authorities in Beijing.

According to one of the report’s authors, Canberra-based cyber security expert Robert Potter, firms were using the same email servers to handle sensitive Australian government work as well as China-related work without “any of what we would expect in terms of technical separation of their infrastructure”

There are also concerns that law firms are engaging in Chinese activities that could potentially threaten Australia’s national security as well as its humanitarian obligations.

Major Australian law firm Allens provides services to Chinese state-owned enterprises involved in acquiring critical mineral assets in Australia, as well as in renewable energy, mining, power, oil and gas, agribusiness, and real estate.

The Epoch Times reached out to Allens regarding the report and was told they would not comment.

Another major law firm, Ashurst, secured over 200 Australian Department of Defence contracts between 2019 and 2023, yet at the same time represented Chinese telco Huawei—deemed a high-risk vendor by the Australian government.

In a statement, Ashurst told The Epoch Times, “Ashurst takes compliance with law and client requirements seriously, and has stringent controls in place to assess risk, manage conflicts and safeguard client confidentiality.”

King and Wood Mallesons has provided counsel for over a thousand projects associated with the Belt and Road Initiative across 65 participating nations.

These projects span various sectors, including energy, transportation, information technology, infrastructure, finance, manufacturing, and services.

King and Wood Mallesons said they advised clients in China on a “broad range of corporate and government clients in Australia, the region and internationally.

“China is of course Australia’s major trading partner and Hong Kong is an international financial centre and we advise clients on legal, regulatory and compliance matters as they invest and do business in these and other markets.”

They also stated that their Australian IT systems were separate from other parts of the network and that these “systems are subject to rigorous security audits to satisfy our internal and client obligations and expectations.”

Lack of Transparency

The report suggests that adjustments should be made to Australia’s Foreign Influence Transparency Scheme (FITS) to eliminate exemptions for legal advice or representation.

The FITS is a scheme that requires individuals and entities to register certain activities that they undertake in Australia on behalf of a foreign principal, for the purpose of political or governmental influence.

Currently, FITS laws do not extend to cover legal advice or representation, which could pose a risk as foreign principals can engage legitimate legal services to achieve outcomes that could be detrimental to Australia’s national interest.

Shadow Minister Voices Deeply Concerned

Shadow Minister for Home Affairs and Cyber Security James Patterson said the report was deeply concerning and emphasised that Australia’s foreign influence laws required immediate and significant reform.

Mr. Patterson said, “Some of Australia’s largest law firms are not even taking the most basic cyber security mitigations to protect the sensitive information they hold ... frankly it’s negligent not to at the very least separate their systems.”

He then went on to say that it was evident that the FITS scheme is not operating as envisioned and that there are individuals who should be enrolled in the scheme but are not.

The Epoch Times has reached out to the Minister for Cyber Security the Honourable Clare O'Neil MP for comment.