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Senior public servant accused of 'act of foreign interference'

David Irvine, Director-General of Security with the Australian Security Intelligence Organisation (ASIO).

David Irvine, Director-General of Security with the Australian Security Intelligence Organisation (ASIO). Photo: Alex Ellinghausen / Fairfax

Australia's domestic spy agency has lost a legal battle to censor the details of alleged foreign espionage activities by a friendly nation. But the Federal Court in Canberra has kept a gag order in place until April 22 to give ASIO time to appeal the decision.

Read the court's full decision

Justice Lindsay Foster, in a judgment published on Thursday, found keeping details of the spying secret could not be justified as the information would not affect Australian national security.

The legal stoush relates to the case of Yeon Kim, a senior federal public servant who had his decade-long secret security clearance revoked by ASIO in 2011 amid allegations he had unreported contact with foreign agents. He was accused of an ''act of foreign interference'' in allegedly passing information about top level negotiations between Australia and country X - which still cannot be named - concerning a bilateral trade agreement. The judgment noted that while country X was generally friendly, its economic interests often rivalled Australia's.

Without the security clearance, Mr Yeon's career in his field would end, so he took the matter to the Administrative Appeals Tribunal and then the Federal Court to get a review of the adverse security assessment. The appeal has not yet been fixed for hearing.

ASIO applied to keep from the public information that would reveal the name of country X, the name of the intelligence service of country X or the names of the spooks working for that foreign agency. The spy organisation said it had discovered that agents located in Australia from country X had taken steps to cultivate Australian officials and public servants to obtain sensitive information relevant to government-to-government negotiations concerning matters of trade.

In a confidential affidavit, ASIO's chief, David Irvine, said the organisation had addressed the issue and believed that the inappropriate activities had ceased. The affidavit said country X had asked ASIO to do all in its power to prevent public disclosure of the fact that its intelligence service had conducted clandestine operations within Australia.

''The [Director-General of Security] said that disclosure of the activities of the intelligence service of country X in Australia would have a detrimental impact on the ongoing relationship between the two countries,'' the judgment said.

''He said it would have an impact on the level of co-operation received from that country. In addition, he said that revealing the names of the relevant intelligence officers of the intelligence service of country X would effectively prevent them from ever acting in such a capacity in the future.''

But Mr Yeon's lawyers, Colquhoun Murphy, argued the purpose of ASIO's application was political or diplomatic and had been sought to avoid embarrassment for country X.

They noted that publication of his name would leave little doubt about which foreign country was involved.

''A reasonable observer might well take the view that it is a matter of legitimate interest to citizens of Australia to know if agents of friendly nations have engaged in activities inconsistent with diplomatic cover involving an attempt to cultivate a senior public servant in Australia,'' Mr Yeon's written submission said.

Justice Foster ruled that keeping the information secret could not be justified.

''It may well be that the unnecessary imposition of secrecy on material ultimately works to the prejudice of the applicant in the two sets of proceedings which he has brought in this court.

'''The court should do everything in its power to prevent such an outcome,'' the judge said.

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