AWB as fall guy not good enough
Cole inquiry must also investigate any breaches of international law 

Ben Saul
April 5, 2006
The Australian
Original Source: http://www.theaustralian.news.com.au/common/story_page/0,5744,18712227%255E7583,00.html


IT is important for the Cole inquiry into AWB and kickback allegations to uncover any breaches of Australian criminal law. But the more critical question is the responsibility of the Australian Government under international law for allowing its companies to break UN sanctions. The Cole inquiry's terms of reference go nowhere near investigating this question.

To be sure, Australia deserves credit for creating a commission to investigate whether its companies violated the criminal law in breaching UN sanctions against Iraq. 
Few countries have shown Australia's commitment to uncovering the truth, though the size of AWB's contracts and its alleged wrongdoing exceed those of any other company. 
But what is spectacularly missing from the Australian Government's effort to ensure accountability is any serious attempt at self-reflection. The Department of Foreign Affairs and Trade insists it was merely a postbox for contracts between Australian companies and Iraq, passing them on to UN officials for legal scrutiny. 
Yet the Volcker report faulted countries' UN missions for not acting when they were responsible for approving their national companies to do business with Iraq. The Government's indifference to sanctions-busting by an Australian company is a startling insight into its casual approach to international law. 
The Government's responsibility is not merely a political issue for parliament. Under international law, all countries were required by Security Council resolutions to prevent unauthorised transactions with Iraq. 
Resolution 661 of 1990 required all countries not to trade or transact with Iraq except for limited humanitarian purposes. The UN later accepted that port charges and transport costs on foodstuffs could be paid at customary and reasonable rates but should not profit Iraqi entities. Inland transportation fees of the kind paid by AWB were not permitted, nor were after-sales service fees, another illegal kickback. 
Under the international law of state responsibility, governments are responsible for the actions of their officials and agents, as well as for non-governmental bodies where the government directs or exercises control over those bodies. After its privatisation in 1999, AWB was no longer an organ of the Australian Government and its staff were not Australian officials. Nor did the Government direct or exercise day-to-day control over the business activities of AWB. 
That does not mean that Australia bears no international legal responsibility. Although the Government may not be responsible for the acts of AWB, it may be separately responsible for its own failures, omissions or negligence in not upholding its international obligations. In particular, by signing the UN charter, Australia agreed to implement Security Council resolutions to maintain international security. Australia supported the council in imposing binding legal sanctions on Iraq. The sanctions were designed to compel Iraq to disarm after the 1991 Gulf War. Ignoring those resolutions is a serious breach of international law. 
Under the resolutions, Australia had a legal duty to be more than a postbox. 
It was required to carefully scrutinise the business dealings of its companies with Iraq and to exercise a special standard of due diligence because of the serious threat Saddam Hussein was thought to pose to international security. Australia was not entitled to turn a blind eye to the contracts when all the warning signs of kickbacks were there. 
The Cole inquiry should be asked to examine whether the Australian Government breached international law and which ministers were responsible. If Australia is found in breach of international law, the more difficult question is determining what remedies are available against Australia under international law. 
What amount of compensation could Australia pay to make up for allowing $300 million in bribes to end up in Saddam's pocket? At a minimum, Australia would owe an apology to the international community and would need to put in place measures to prevent similar breaches of UN resolutions in the future. As an act of good faith, Australia could also set up a fund for the welfare of Iraqis injured in Australia's invasion of Iraq. 
So far, the Cole inquiry has helped to expose Australia's breathtaking hypocrisy on Iraq. On the one hand, the Government thought Iraq was such a grave security threat that it had to be invaded and its government deposed. On the other hand, the Government could not be bothered to properly check whether its companies were illegally funding Saddam's war machine. AWB should not be the fall guy for the Government's negligence. Until his terms of reference are amended, commissioner Terence Cole's work is not yet done. 
Ben Saul is a lecturer in law at the University of NSW.