Submission on strengthening New Zealand’s export controls regime - February 2026

This submission is from Universities New Zealand – Te Pōkai Tara (UNZ^[1]) – the peak body for New Zealand’s eight universities. The submission has been developed through UNZ’s Research and Vice-Chancellors’ Committees. This submission responds to the invitation for feedback on the Consultation on Export Controls Proposals: Strengthening New Zealand’s Export Controls Regime | New Zealand Ministry of Foreign Affairs and Trade 

Executive summary

New Zealand’s universities support updating the country’s export controls regime and considers this necessary to prevent proliferation of military and unintended consequences (such as dual‑use technologies), to protect national security, and to meet New Zealand’s international commitments. The current arrangements do not adequately address intangible technology transfers (ITT) or the domestic sharing of sensitive research, making legislative change essential. We also see value in aligning—where possible and appropriate—New Zealand’s position with established international best practice, particularly in Australia, to maintain and protect seamless trans‑Tasman research collaborations.

In this submission, we outline areas where our perspectives align with the Ministry of Foreign Affairs and Trade (MFAT), acknowledge positive elements of the proposed direction, and identify key concerns—primarily regarding the possibility of increased compliance burdens. We also highlight considerations and make recommendations focussed on ensuring that any future legislative amendments are proportionate to actual risk. Our goal is to assist in developing a robust regulatory framework that strengthens national security on the one hand, while preserving New Zealand’s ability to collaborate internationally and contribute to global research and innovation on the other.

Commendations and Areas of Alignment

Universities welcome several elements of the consultation document,[2] many of which reflect best practice in the development of modern export controls legislation.

Consultation Process

We acknowledge and value the Export Controls team at MFAT for its sustained engagement with the university sector in recent years and the opportunity to take a partnership approach to any legislative change. Early and iterative consultation has enabled constructive dialogue and improved policy design. We look forward to continuing this collaboration as consultation feedback is incorporated, and draft legislation is further refined.

Exemptions

We strongly support the proposed exemption for fundamental (referred to in the consultation as ‘basic’) research. The definition provided—encompassing experimental or theoretical research aimed at advancing foundational knowledge rather than achieving specific practical outcomes—is appropriate and aligns with international norms.

We also endorse the exemption of information “intended for public dissemination” and “the minimum necessary information for patent applications and maintenance of non-controlled goods”. However, to avoid ambiguity, we recommend clarifying that the exemption of the former applies specifically to information already in the public domain; otherwise, it may be interpreted to mean that the exemption applies to the intention (good or otherwise) behind public dissemination. Similarly, it could potentially provide a loophole where, if the intention was good, responsibility for the consequences is avoided.

We further support the proposal that legislative changes will not apply retrospectively to individuals already working with controlled technology. We agree that, should the scope of their work or their employment circumstances materially change, a permit may then be required. Furthermore, we recommend that what constitutes ‘material’ change is clearly defined.

MFAT’s Preferred Options

The consultation document identifies MFAT’s preferred approaches across several areas. In most instances, universities support these preferences, recognising both their practicality and their contribution to an effective, trusted and robust export controls framework.

• Element 2: Disclosure of Controlled Information through Domestic Publication

Universities endorse MFAT’s preferred Option 2. While there will be compliance costs and administrative burden associated with either option, it is noted that that Option 3 would impose greater administrative burdens on both government agencies and research institutions. Option 2 presents a more proportionate and workable regulatory approach.

• Part 6: Controls on Goods and Technology Previously Supplied from New Zealand

Universities also support Option 2 for Part 6. This option balances security objectives with operational practicality, ensuring that compliance obligations remain implementable for research organisations while maintaining appropriate safeguards.

• Provision 9: Provisional Decision (Appeals) Process

Universities agree with MFAT’s preference for Option 2, which introduces a provisional decision‑making mechanism. However, we suggest universities manage these for themselves. Such a process is familiar to our sector, as universities already operate comparable systems—such as ethics approvals—that rely on structured, transparent internal decision‑making.

• Graduated Penalties

Universities support the introduction of a graduated system of warnings and penalties for lower‑level or less serious offences. A tiered approach ensures proportionality and encourages compliance, while avoiding unnecessarily punitive consequences for minor breaches.

Review of the Legislation

A formal review of the new legislation should be undertaken within three to five years of implementation to ensure the framework remains proportionate to the level of risk and continues to operate effectively. This review should enable amendments where necessary to maintain an appropriate balance between security objectives and practical compliance demands.

Regulatory Impact Statement

We welcome MFAT’s commitment to address the implications for universities and research organisations within the regulatory impact statement submitted for Cabinet’s consideration. This inclusion is essential to ensuring that policy decisions fully recognise sector‑specific operational realities.

Forthcoming Guidance

The sector looks forward to MFAT’s forthcoming guidance on several key areas, including:

• best‑practice expectations for data encryption,
• considerations relating to service providers and server locations, and
• the development of internal compliance systems designed to prevent unauthorised access and protect intellectual property.

Such guidance will be critical in supporting consistent, high‑quality compliance across the research system.

An additional objective

We also agree that all five objectives and criteria referenced in Questions 2 and 3 remain relevant and aligned with contemporary security and research‑sector needs. We suggest adding a sixth objective- ‘to enable safe and productive international research collaboration'. This will highlight New Zealand’s intent to continue its active participation as a trusted partner in international collaborations.

Concerns, Considerations, Clarifications, and Recommendations

In response to Question 1 of the consultation document, universities acknowledge that the current legislative framework is not equipped to regulate the domestic transfer of sensitive technology or ITT. These transfers may occur through channels such as knowledge‑sharing, teaching, on‑the‑job training, collaborative research, or services conducted overseas. We therefore support the development of legislation that enables New Zealand to:

• meet its international export‑control obligations;
• maintain its status as a trusted partner for international collaboration, inward technology transfers, and research funding; and
• safeguard its people and intellectual property.

We also agree that all five objectives and criteria referenced in Questions 2 and 3 remain relevant and aligned with contemporary security and research‑sector needs.

However, we highlight real concerns, considerations, and areas where clarification would likely reduce unnecessary compliance burden. To be clear: our recommendations are intended to minimise implementation costs for the universities while seeking to strengthen the proposals, consistent with the proposed objectives and criteria. Given current fiscal constraints, managing more compliance obligations efficiently and effectively remains a primary concern for all research organisations.

Compliance Costs

Universities acknowledge that implementing the new legislative framework will inevitably introduce new and (currently) unbudgeted compliance‑related costs. These costs will arise regardless of the specific regulatory settings and will be associated with activities such as tracking controlled technology, upgrading IT systems, managing permit applications and exemptions, and training staff and students. While the proposed exemption criteria may initially only involve modest numbers of  staff (and students) who will require vetting and ultimately a permit, the administrative burden that will fall to each institution is likely to be considerable and significant, especially if this demands system change and the imperative to develop specialist internal capability across the organisation to meet compliance obligations.

While universities accept that with the introduction of any new legislation, some level of cost is unavoidable; we encourage MFAT to explore ways to mitigate the burden that will fall to each institution—for example, through targeted financial and/or administrative support. A phased implementation, supported by capacity‑building initiatives, would strengthen compliance outcomes while ensuring the regime remains effective, proportionate, and sustainable. Similarly, early strategic investment will help ensure long‑term system resilience and contribute to New Zealand’s international research competitiveness.

Where Universities Prefer ‘Option 3’ 

Unlike MFAT, universities prefer option 3 in two cases.

 

• Part 4: ITT from New Zealand to Persons Overseas

Universities prefer Option 3, which narrows the range of ITT, subject to controls and introduces exemptions for transfers to selected countries. This approach recognises the value of trusted international partners and helps avoid unnecessary permit applications, reducing administrative burden without compromising security.

• Part 5: ITT Made by New Zealand Citizens and Permanent Residents While Overseas

For exports made abroad by New Zealand citizens and permanent residents, universities support Option 3, which applies controls to NZSGL Part 1 ITT with fewer country‑based exemptions. This option is preferred because:

• it is grounded in a risk‑based approach;
• it aligns with recognised best practice Australian regulatory settings, thereby facilitating smoother multilateral collaboration; and
• it enhances operational efficiency while maintaining robust security outcomes.

The ‘trusted supplier’ model

Universities would welcome the opportunity to continue working with MFAT officials on Element 1: Deemed Export / Domestic Controls – Controlled Technology Transfers.

Several universities support Option 3, the ‘trusted supplier’ model, as it:

• aligns with regulatory frameworks in other areas such as ethics and biological safety;
• reduces compliance burdens for universities and government, allowing universities to meet requirements without hindering research activity;
• leverages local expertise and knowledge of the research; and
• will lead to an intuitional culture of awareness of risks around TR-PSR, thereby reducing overall risk over time.

However, several universities have also identified challenges with Option 3. In particular, the ‘trusted supplier’ model:

• might shift substantial administrative responsibility to universities, requiring them to assess and authorise activities for which they may not have complete, current, or specialised information such as classified intelligence
• requires specialised capability, and MFAT is better positioned than universities given its access to relevant intelligence, expertise, and resources; and
• may not be acceptable to New Zealand’s international partners.

Option 2 also presents challenges. It is likely to create complexity when enrolling international postgraduate students or hiring staff from non‑exempt countries, potentially resulting in delays and additional administration for the university sector.

As a sector, universities would welcome further engagement with MFAT officials to work through these issues and to help ensure New Zealand adopts a model that is both effective and efficient in managing technology transfer risks.

Academic Freedom and Collaboration

We acknowledge that the intent behind introducing new controls is not to limit academic freedom or constrain international collaboration, but rather to regulate who is eligible to participate in certain activities in certain circumstances. Nonetheless, in practice, controls on ITT and the domestic sharing of sensitive information may indeed restrict or limit universities' ability to create the conditions in which academic freedom can be exercised by staff and students, or be perceived to do so. This includes academic freedom in teaching, supervision, and collaborative research —particularly within STEM disciplines. A good option to limit the impact on academic freedom and collaboration would be to develop a trusted supplier model. Universities would still be required to obtain General Consents to export technical data and for ITT transfers but would have internal processes to approve addition of specific people to these permits. This would enable universities to have an efficient approach, minimising the compliance burden whilst retaining appropriate security.

We also note that requiring foreign students or offshore research partners to obtain permits may be perceived as burdensome and potentially at odds with the principles of open science. It also has the potential to create addition administrative burden to reduce international research collaboration to the detriment of the advancement of society through research. Preserving academic freedom and recognising the inherent international nature of research are therefore essential considerations.

In keeping with international best practice, ITT controls in New Zealand should not restrict academic activities themselves but should instead regulate who is permitted to participate in activities involving technologies listed on the New Zealand Strategic Goods List. For this reason, universities recommend adopting the preferred options outlined earlier in our submission. We recognise that it may be impossible to completely avoid restricting academic freedom, but by adopting our preferred options, the impact can be minimised.  

Longer Lead‑In Period for Implementation

An extended education and outreach period of 24 months, rather than the proposed 6–9 months, is critical to ensuring effective implementation of the new regulatory framework. At present, most universities do not yet have the internal expertise, capability, or compliance culture required to operationalise the proposed controls. A phased, more gradual transition—supported by targeted government investment to build institutional capability and sector‑wide system maturity—will help prevent disproportionate impacts on smaller or resource‑constrained universities.

Clarification

The consultation document states that the term “Persons” includes both natural persons and legal entities (e.g., corporations) (p. 8). To support consistent application of the legislation, further clarification is required on how enforcement and prosecution will distinguish between individuals and organisations. For example, if a professor’s research is found to be non‑compliant, it is unclear whether liability would apply to the individual, the university, or both.

To avoid ambiguity, we recommend that MFAT clarify:

• that the controls will apply consistently and exclusively to NZSGL Part 1 items and Sensitive/Very Sensitive Part 2 items; and
• how “technical know‑how” (p. 19) will be defined for the purposes of compliance and enforcement.

 

[1] Universities New Zealand is the operating name of the New Zealand Vice-Chancellors’ Committee, a body established under Part 19 of the Education Act 1989. It has statutory responsibilities for university quality assurance, the approval and accreditation of university academic programmes, entrance to universities, and scholarships. It also represents the interests of the universities on a wide range of other matters, such as education and research policies.

[2] Noting that Part 7 does not apply to universities given it refers to the need to replace component items or to provide support for the ongoing operation of a primary system (such as through a help line) i.e., commercial operations.