High Court split on implied freedom of political communication shows the debate is still not settled

The recent High Court case of LibertyWorks Inc v Commonwealth of Australia [2021] HCA 18 exposes fault lines in the High Court as to how the implied freedom of political communication is to be analysed, and, in the case of one judge, whether the implied freedom exists at all.

LibertyWorks' Challenge to the FITS Act

This case turned on the interpretation of the Foreign Influence Transparency Scheme Act 2018 (Cth) (FITS Act), which regulates activities carried out in Australia on behalf of foreign entities.

In 2019, the lobby group LibertyWorks and the American Conservative Union (ACU) collaborated on the delivery of a Conservative Political Action Conference (CPAC) in Sydney.

As a result, the Deputy Secretary of the Attorney-General’s Department issued a notice under section 45 of the FITS Act, requiring LibertyWorks to produce information and documents to enable the Deputy Secretary to determine whether LibertyWorks was required to register the delivery of the CPAC pursuant to the FITS Act, because of the involvement of the ACU. LibertyWorks did not comply with the notice and this was not further pursued.

LibertyWorks subsequently brought proceedings in the High Court to challenge the validity of the FITS Act insofar as it requires parties to register political communications carried out on behalf of a foreign entity.

The implied freedom: the structured proportionality approach

Since the cases of Nationwide News Pty Ltd v Wills (1992) 177 CLR 1 and Australian Capital Television v Commonwealth (ACTV) (1992) 177 CLR 106, a majority of the High Court has recognised the existence of a constitutionally "implied freedom" of political communication which arises from the "underlying principle" that "citizens are to share equally in political power". Statutes or parts of statutes which impermissibly burden that freedom will be invalid.

To determine whether legislation impermissibly trespasses on the implied freedom, Courts will first ask:

1. whether the law effectively burdens the implied freedom of political communications;
2. whether the purpose of the law, and the means adopted to achieve that purpose, are "legitimate", meaning "compatible with the constitutionally prescribed system of representative government"; and
3. whether the law is "reasonably appropriate and adapted to its legitimate object".

Since the case of McCloy v New South Wales (2015) 257 CLR 178, a joint majority of the High Court has favoured a "structured proportionality" approach to answering the third of these questions, which itself involves asking three further questions:

1. whether there is a rational connection between the purpose of the statute and "the measures it adopts to achieve that purpose" (Suitability);
2. whether there exists an alternative legislative measure which would be less restrictive of political communication but which would practicably achieve the same outcome as the impugned legislation (Necessity); and
3. whether "the benefit sought to be achieved by the law is manifestly outweighed by the adverse effect on the implied freedom" (Adequacy).

This approach has been the subject of a degree of criticism on the grounds that it does not arise by necessary implication from the words of the Constitution. Structured proportionality has not been accepted unanimously by the High Court (both Justice Gordon and Justice Gageler are notable opponents).

The Foreign Influence Transparency Scheme Act 2018

The FITS Act was enacted in 2018 as part of a package of legislative reforms aimed at addressing the risk of foreign interference. The FITS Act established the Foreign Influence Transparency Scheme which provides for the registration of individuals and entities who engage in ‘registrable activities’ on behalf of foreign governments or organisations.

Relevantly, ‘communication activity’ undertaken in Australia on behalf of a foreign principal for the purpose of political or governmental influence is a registrable activity. The FITS Act provides that a person undertakes communication activity if the person communicates or distributes information to the public, or provides information to be communicated or distributed to the public.

Further, the FITS Act provides that a person undertakes an activity for the purpose of political or governmental influence if the sole or primary purpose of the activity is to influence one or more of the listed processes which include those relating to a federal election, a federal government decision, proceedings of a House of Parliament and a registered political party.

How did the Court apply the implied freedom to the Foreign Influence Transparency Scheme Act Act?

The joint judgment

The joint judges (Chief Justice Kiefel and Justices Keane and Gleeson) favoured the Commonwealth’s construction of the purpose of the FITS Act. The joint judges found that the purpose may be understood as being to seek to achieve transparency in relation to the exposure of foreign influence in order to minimise the risk that foreign governments and entities will influence the integrity of Australia’s political or electoral processes. They concluded that this purpose is legitimate.

The joint judges also concluded that any burden on political communication effected by the communications activity provisions is likely to be modest.

They then undertook a structured proportionality analysis:

• Suitability: the joint judges concluded that there is clearly a rational connection between the legitimate purpose of shielding Australia from foreign interference and requiring parties to register relevant communication activities;
• Necessity: the joint judges disagreed with LibertyWorks’ submission that registration is unnecessary because disclosure under section 38 of the FITS Act is enough to achieve the purpose of the FITS Act. They instead held that, without registration, there is a risk that information will be disseminated and become influential within political discourse or public debate without the relationship between the person conveying the political communication and their foreign principal being widely known. The joint judges therefore accepted that the FITS Act as drafted met the necessity requirement; and
• Adequacy: the joint judges stated that the FITS Act’s purpose is a powerful public protective purpose, which was not outweighed by any minor burden on the freedom of political communication.

Justice Edelman, delivering his own reasons, endorsed structured proportionality as a tool of assessing whether a statute impermissibly burdens the implied freedom, and reached the same conclusions in this case as the joint judges.

Justices Gageler and Gordon - opposition to structured proportionality

In separate judgments, both Gageler and Gordon JJ took issue with the fact information provided by parties in respect of registrable activities is stored in two repositories: a public register of activities, and a private register which contains more information, and which is shared between Commonwealth and State entities for "other governmental purposes" [117].

Both judges therefore held that the FITS Act in its current form places more of a burden on political communication than would be necessary to achieve the stated goals of the FITS Act.

Neither judge adopted the structured proportionality approach advanced in the joint judgment.

Justice Steward’s judgment

In a decision which to some extent mirrors Justice Heydon's approach in Monis v The Queen (2013) 249 CLR 92, Justice Steward agreed with the conclusion of the majority, despite expressing reservations as to whether the implied freedom of political communication exists in the first place.

His Honour stated that if the content of the implied freedom, and how it is to be assessed, cannot be even be agreed upon by the Justices of the High Court, this may demonstrate that the existence of the implied freedom was never justified, and this current division of opinion may justify a reconsideration of the implied freedom's very existence.