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This is the excellent submission that Kerry Stokes’s Seven Network has made to the Foreign Investment Review Board arguing that Sing Tel should be blocked from buying Optus.

This supplementary submission is made on the basis of further information Seven has acquired relevant to the bid. This supplementary submission addresses the nature and governance strategies of Sing Tel and its majority owner and controller, the Singapore Government. Acceptance of the Sing Tel offer would see the takeover of a significant Australian communications asset by a government whose governance practices and structures are antithetical not only to its ownership of communications infrastructure but conflict with generally accepted democratic values such as the right to privacy and freedom from surveillance.

This supplementary submission does not address all the issues which Seven wishes to canvass in its submissions. Like the preliminary submission, this submission is necessarily incomplete, due to Seven Network’s lack of information about Sing Tel’s application to the FIRB and other regulatory bodies. Seven Network has made Freedom of Information requests of various Commonwealth agencies for materials that may be significant in relation to the issue. Materials have not yet been provided in relation to any of these requests. Seven Network submits that no recommendation should be made in relation to the proposed offer without providing Seven Network with an opportunity to further supplement this submission when further information is provided.

The Singapore Government

As stated in Seven’s preliminary submission, there is no doubt that the Singapore Government controls Sing Tel’s operations and assets domestically and internationally. The Singapore Government through its wholly government-owned company Temasek Holdings, owns 78% of Sing Tel. This has serious implications for the ownership of Optus, given the governance practices of the Singapore Government.

Christopher Lingle, a former senior academic at the National University of Singapore, in his 1996 book, “Singapore’s Authoritarian Capitalism: Asian values, free market illusions and political dependency” states:

“In order to, 05govern without worrying about domestic critics, Singapore’s PAP [ruling] regime has imposed a “vicious cycle” of fear, propaganda and deception. It is noteworthy that they have especially inventive in their methods and met with remarkable success. Its idiosyncratic form of democracy (phobocracy), replacing rule by consent of the governed with “rule by fear”, has relied upon the criminalization of politics and politicization of crim. The regime has been able to manipulate most of the institutions of a civil society that might have served to limit the intrusion of government into the lives of its citizens. While the local press has been tamed by draconian press laws and indirect control imposed through partial government ownership, a variety of tactics have also been successful in deflecting criticism from the international news media.”

Sing Tel is, in effect, a vital instrument of the Singapore governing body in achieving its aims and ensuring its control. It provides the communications infrastructure to allow the Singapore Government to exert its influence and intrude on the domain of its citizens. It is a governance strategy, which of its very own nature, should exclude Sing Tel from the right to own a key Australian telecommunications asset. The ownership of Australian communications infrastructure should not be allowed to come under the control of an authoritarian regime which has demonstrated a willingness to use such technology as a tool to silence dissent and promote the ruling regime, the People’s Action Party (PAP). The PAP has ruled Singapore since its independence in 1959.

Since 1959, the Singapore Government has passed a number of media regulations aimed at increasing its control over the media and communications infrastructure. The following four legislative acts are particularly significant as an expression of the overall attitude and principles of the Singapore Government’s telecommunications and information policy :

(a) the Internal Security Act (1963), authorises the Home Ministry to prohibit the printing, publication, sale, circulation, or possession of a publication deemed prejudicial to the national interest, public order or society of Singapore;

(b) the Emergency (Essential Powers) Act (1964), prohibits members of the armed forces of the country from communicating with the media, particularly the newspapers;

(c) the Essential Information (Control of Publications and Safeguarding of Information) Regulation, allows the government to decide what is fit to be published; and

(d) the Sedition Act (1964), prohibits any act, speech, words or publications that have a “seditious tendency”. Seditious tendency is defined to include a tendency to bring into hatred or contempt or to excite disaffection against the Government and to raise discontent or disaffection amongst the citizens or residents of Singapore.

Kokkeong Wong wrote in “Political economy of media and culture”:

“According to the PAP, this legislation does not contradict or undermine freedom of speech and expression provided by the country’s constitution. Arguing that freedom is always contingent and never an absolute practice, even in such democracies as the United States, the PAP leadership indeed presents this legislation as crucial for realising and protecting freedom in the country. This was indicated as early as in January 1962 by Prime Minister Lee Kwan Yew, himself, who said (quoted in Kuo & Chan, 1983, p42):

“The rule of law talks of habeas corpus, freedom, the right of association and expression, of assembly, of peaceful demonstration , 05 But nowhere in the world today are these rights allowed to practice without limitations, for blindly applied, these ideals can work towards the undoing of organised society.”

The four legislative acts nonetheless amply arm the PAP state in its control over media content published, broadcast, and/or distributed in Singapore.”

The existence and strict enforcement of such laws and the Government’s complete control of communications infrastructure means that the Government of Singapore can “effectively, directly or indirectly, control and utilize the mass communication system to pursue its defined objectives, 05As a result, the communication pattern in Singapore is characterized by a largely one-way flow from the leadership to the masses with government and media people at various levels serving as gatekeepers.” Given the Singapore Government’s (and Sing Tel’s) record of intrusive (and often covert) surveillance, the question of “who is watching the gatekeepers” becomes a very serious one that needs a satisfactory answer before Sing Tel and the Singapore Government should be allowed to control Optus.

In An Asian Core Executive – Aspects of Contemporary Governance in Singapore, a thesis by Ross Worthington, the author states:

“Central to the power dynamics of the core executive in Singapore is the use of coercive and consent building instruments of the state, 05These complementary hegemonic strategies are based not only on legislation and public management mechanisms, 05but also on a technological capability to support these strategies being developed inside and outside the public sector, under the guidance and control of the political executive.”

Control exercised by the Singapore Government

The level of control exerted by the Singapore Government extends to all facets of Singaporean society. It includes control of media and communications infrastructure; access to information; the law and legal system; civil liberties such as freedom of expression and elections.

Christopher Lingle writes (at page 88):

“Glossy advertisements promote images of a vibrant, open economy known variously as “Singapore Unlimited” or “Singapore, Inc.” Equally well chronicled is Singapore’s reputation as a clean, crime-free city. Yet few outsiders realize that the pristine images of blissful security and prosperity conceal a dark, forbidding side. While other countries in the region have moved towards greater democracy, Singapore has been lurching in the opposite direction, 05phobocracy as “rule by fear” is an apt description of the system of government that has been put in place by the PAP in Singapore. One of the illusory results of this method of governing is a false appearance of law and order. In turn, the reality is a “lawless order” where the Rule of Law is replaced by the rule of man. The implementation of legislation and the pursuit of justice is made to serve whatever purposes the regime may see fit, including the stifling of their political rivals and critics.”

In 1991, the New York Bar Association published a report summarising three areas of human rights abuse in Singapore including the use of the Internal Security Act to detain non-violent offenders; institutionalised restrictions on the independence of the judiciary and lawyers; and restrictions on freedom of speech, association, religion and the press .

Ho Khai Leong states:

“The PAP government has developed a tight system of political control that allowed few opportunities for dissent, 05Singapore’s political elite has put into place institutions and procedures (i.e. election laws, legislative measures and policies regarding important measures such as public housing) that serve to deliberately stymie political resistance and opposition.”

Raymond Lim, founder of the political discussion group, The Roundtable, has commented that:

“In Singapore the state is extremely powerful. The Government calls the shots here. Civic organisations only test rather than determine the limits of the growth of civil society.”

At page 11 of his thesis, Worthington states:

“The Singaporean state has been variously described as an ‘extremely intrusive’ authoritarian state, ‘strong and paternalistic’, and a polity in which political discourse has been largely shaped by a single man, Lee Kuan Yew. The political system has been described as effectively oligarchic, dominated by a technocratic elite who regard political debate as “dysfunctional”, an obstacle to the achievement of rational solutions, where democratic politics is a “political perversion” and therefore has a government devoid of a ‘competent opposition’.”

A Government which adopts such governance practices should not be allowed to control significant communications infrastructure in Australia.

Control of the media and communications infrastructure

The governance strategy of the Singapore Government has a number of elements. Most relevantly in relation to the bid for Optus, this includes control of the media and the nation’s communications infrastructure.

Control of telecommunications infrastructure, television, radio and print media

As outlined in Seven’s preliminary submissions, the Singapore Government controls almost all their nation’s telecommunications infrastructure (as outlined in Seven’s preliminary submissions) and also has control of the national television and radio networks which provides the government with the opportunity to shape news and current affairs as it wishes .

The Singapore Government also exerts control over the print media in Singapore. According to Eddie Kuo and Peter Chen, authors of “Communication Policy and Planning in Singapore” this reflects the Singapore Government’s view that mass media is a powerful instrument that can be used to influence the masses. Accordingly, the Singapore Government considers that “communications media must not fall into the wrong hands or be abused to disrupt social stability. Moreover, they must be properly used for political stabilization and nation-building.”

Under the Newspapers and Printing Presses Act (NPAA) the Government is able to exercise comprehensive, and far-reaching control over the print media. Newspaper corporations must issue both management and ordinary shares. Management shares have 200 times the voting power of ordinary shares. Management shares can only be issued to Singapore citizens approved by the Government .

There are Government nominees on the board of directors of all media organisations and management and editorial appointments are “also approved (and therefore effectively made) by the Government” .

The Government may restrict the sale or distribution of foreign publications which have been declared as having “engaged in the domestic politics of Singapore.” In 1986, the Government restricted the circulation of Time Magazine for publishing an article entitled “Silencing the Dissenters”, which dealt with the trial of an opposition Member of Parliament. In 1987, the Government restricted the circulation of The Asian Wall Street Journal following the publication of an article criticising the formation of a Singapore stock exchange by the Government. The Government has also imposed restrictions on the circulation of Asiaweek, The Far Eastern Economic Review and The Economist .

In 1990, the Government amended the NPAA to regulate the sale and circulation of foreign publications produced outside Singapore which carried articles commenting or reporting on politics and current affairs in Southeast Asian countries. Such publications had to apply for a permit to be sold in Singapore. One of the conditions of the permit is a requirement to provide a specified deposit ($200,000) to meet the costs of legal proceedings arising in connection with the publication .

Worthington states, at pages 332-333 of his thesis:

“, 05This reflects the external focus of the government’s media based consent building orientation; while control of the domestic media is complete, all possible sanctions will be used to stop foreign media from criticism of issues with which the government has a particular sensitivity, whether they be political, social or cultural.”

As well as such restrictions, the Government has also vigorously attacked the media to subjugate it to the Government’s agenda. Christopher Lingle states:

“Attacks on freedom of the press by Singapore’s government have earned it a fair amount of external criticism. Certainly their actions violate the spirit of Article 19 of the Universal Declaration of Human Rights that endorses the freedom of opinion and expression. During 1994, 2 lawsuits were filed against IHT by Mr Lee Kuan Yew, Singapore’s strongarm-ruler. In one instance, he reacted to a reference by Mr Philip Bowring on the existence of dynastic politics in parts of East Asia, including Singapore. Many observers consider that there is considerable evidence to support Mr Bowring’s observations including the elevation of Mr Lee’s elder son, Lee Hsien Loong to the rank of brigadier general at the age of 31 after serving only 5 years in a peace time army. Then six months later he was elected to the parliament and rose quickly in the PAP party hierarchy to become Deputy Prime Minister.

“Nevertheless, even after the executives of the paper published an apology in response to his demands, Mr Lee carried out his threat and sued the paper for libel.

“The intension behind this campaign is to attack the financial base of media owners rather than invoke human rights concerns by arresting editors or banning publications. Charges of libel and defamation are freely interpreted and argued by the state prosecutors, who, like the judges, have all been appointed by the governing party during its uninterrupted rule over the past 30 years.”

In court cases against foreign media publications, spokespersons for the Singapore Government have testified that the high amount of damages sought in action was to serve as a warning that they will impose increasingly heavy costs upon anyone who challenges their authority .

Lingle describes the other restrictions imposed on the media:

“Besides libel judgments, newspaper owners’ pocketbooks are hit by enforcing limits upon the quantity of issues in circulation (“gazetting”) that can be imposed when publications have refused an (unconditional) right of reply to officials in Singapore’s government. Insistence by the Singapore government for a right of reply requires that the words of the regime’s respondents must appear in print regardless of the length or any other editorial considerations. Besides refusal to accept this uncompromising demand, these restrictions might be imposed for any “interference with domestic politics”.”

Government’s attitude to the media

Lee Kuan Yew in 1971, in a speech to the general assembly of the International Press Institute, clearly stated the Government’s attitude to the media:

“The Singapore Government has the responsibility to neutralise the attempts of foreign agencies and communists to make political gains by shaping opinions and attitudes of Singaporeans, 05in such a situation , 05freedom of the press, freedom of news media, must be subordinated to the overriding needs of the integrity of Singapore, and to the primacy of purpose of an elected government.”

Use of communications infrastructure and media for surveillance and control

Accordingly, the Singapore Government’s control of the media and communications infrastructure is complete. This control provides the Government with the mechanisms to underwrite a surveillance and control system which it has used extensively in the past and continues to extensively use. It is the means by which the Government intrudes on virtually every aspect of the lives of its citizens. The practice of systemic surveillance by the Singapore Government has often involved Sing Tel as the instrument of that surveillance. Lingle writes (at page 159):

“Given the regime’s insistence that the interests of the community always be placed above those of any individual, there is an understanding that private space will not be respected, 05most citizens and expatriate residents expect that their telephone conversations are monitored by the authorities. Similarly, there is a pervasive suspicion that the content of any other modes of conversation may be compromised by informers or other modes of eavesdropping. This is confirmed by the knowledge that access to the internet is closely controlled by the government.”

As stated in Seven’s preliminary submissions, the Singapore secret police have incorporated special postal and telecommunications surveillance units in Singapore Post and Singapore Telecom installations. There are dedicated interception facilities in all major Sing Tel switching nodes.

In his book, “Beyond Suspicion: The Singapore Courts on Trial”, Francis Seow states at pages 157-158:

“Surveillance is not necessarily confined to telephones and faxes. It also includes the Internet, 05In this connexion, the US State Department’s 1999 Report on Singapore is germane:

‘Divisions of the government’s law enforcement agencies, including the Internal Security Department and the Corrupt Practices Investigation Bureau, have wide networks for gathering information and highly sophisticated capabilities to monitor telephone and other private conversations and conduct surveillance. It is believed that the authorities routinely monitor telephone conversations and use of the Internet, and there were credible reports of such practices, 05′”

Seow states (at pages 94-95) that Lee Kuan Yew has a:

“keen interest in electronic surveillance and intelligence, and for the government’s investment of tens of millions of taxpayers’ dollars in that acquisition – and the continual upgrading – of powerful computers, sophisticated electronic intelligence and surveillance gadgets and equipment, among others, for the ISD, and other security agencies.

Christopher Lingle (at pages 155-156) states:

“Apparently, the PAP’s intention is to exploit the information revolution by using the electronic media to expand their authoritarian control.

“By defining an explicit role for the Young PAP (the youth arm of the ruling party) to police the internet, this may be the first time a political party has attempted to manipulate the electronic media for its own specific political purposes. In January 1995 the regime undertook a more explicit attack on privacy. The authorities applied a complex computer program that sifted through 80,000 private electronic mailboxes in search of pornography. Obviously, the same program would allow them to copy e-mail messages and could be used to detect politically sensitive key words in such correspondence. Except for large corporate users, private internet users must enter through Singnet, which is served by the government telephone monopoly. Therefore, there are no restrictions upon the access by government to files sent over electronic mail. With the government’s track record, it is predictable that they intend to implement very efficient internet censorship and install an effective “surf police”.”

At page 346 of his thesis, Worthington states:

“While tapping of the domestic and international telephone systems had been common practice in colonial times and has continued, this has been supplemented by interception of electronic mail (email) and other data streams including the development of a considerable capacity to infiltrate personal computers connected to the internet and private data systems.”

He continues at pages 347-349:

“Surveillance of mobile voice and data was enhanced in 1995 with the installation for Singapore Telecommunications (Sing Tel) on behalf of the ISD, of a national system for intercepting cellular telephone signals, reportedly using Siemens technology, which was enhanced in 1998 to also include the capability to intercept and decode CDMA signals, 05This interception system is reportedly managed through Sing Tel’s Information Security Department and includes staff seconded from ISD, SID and has liaison arrangements for access by the CPIB, CAD and MSD based on requests from these agencies, 05enhancements have included the acquisition and use of high performance computers and specialised software for communications traffic surveillance, the implementation of a dedicated high security network within the civil service data and communications network and the development of software engineering and manufacturing capabilities for covert network surveillance.”

In April 1999, a Singapore Internet user, Ann Lee, a student at the National University of Singapore complained that a Home Affairs Ministry officer had scanned her computer without authorisation. It subsequently emerged that the Home Affairs Ministry IT Security Unit had been asked to scan 200,000 online PC’s by Sing Tel supposedly to look for a trojan horse virus . Without telling their customers, Sing Tel engaged Home Affairs to do the spying.

The attitude of the Singapore Government and Sing Tel to surveillance was clearly illustrated by the evasive answers given by Brigadier General Lee Sien Yang, Chief Executive Officer of Sing Tel in a recent interview. The transcript of the interview records:

“REPORTER: It`s been widely reported in Singapore that Sing Tel is used as a surveillance tool by the Singaporean Government, and particularly against opponents of the Singaporean Government. Is that true?

BRIGADIER GENERAL LEE SIEN YANG: I think you would understand in all countries, there are rules by the authorities for monitoring activities in relation to proper procedures, and clearly whether we are in Australia, whether we`re in the US or the UK or Singapore, there is due process for this and if the authorities deem that there`s a reason to do it, we have to obey the laws of the country.

REPORTER: So Sing Tel is used as a surveillance tool against political opponents of the Singaporean Government?

BRIGADIER GENERAL LEE SIEN YANG: I think that in any country, we`ll comply with the laws of country.”

Such government strategies and attitudes directly conflict with Australian values relating to freedom from surveillance and the right to privacy, as evidenced by recent Australian privacy law amendments to strengthen protection for individuals under privacy legislation. The incongruence of such an organisation controlling the second largest telecommunications carrier in Australia is strikingly clear.

The roles of the Singapore Government and Sing Tel in the surveillance of communications including telephone and email would be particularly repugnant to Optus subscribers and users, who reside in Australia. It must also be antithetical to the very basis of the operations of a large telecommunications carrier whose aim is to provide safe, secure and reliable transmission of data.

Worthington states, at page 361, that the surveillance and technological intrusion employed by the Singapore Government, through entities such as Sing Tel, is part of the government “policy that all data collected by the government belongs to the government and may be used at the government’s discretion.” It is not difficult to see how an entity which has, for so long, operated under such a culture and regime, would be unable to resist using its newly acquired asset for such purposes. In a recent interview, Francis Seow, the former Solicitor General of Singapore stated: “Optus is actually a security industry, and it’s one of great use and benefit, advantage, to the Singapore government.”

Indeed the Singapore Government’s track record in this area is not good. Notwithstanding assurances by Sing Tel and the Singapore Government in the past that it would not engage in such activities, it has continued to do so. It has simply chosen to do so in more subtle ways so as to hide evidence of its intrusion and surveillance. Worthington states, at page 363:

“The core executive, 05has introduced a strategy of hiding the coercive instruments of the state as much as possible, developed greater subtlety in its management of these instruments and is busily attempting to meet the challenges of a highly educated population and a globalised economy, 05 However the apparent openness of many of the new consent building strategies is now underwritten by a state surveillance system with greater capabilities than any of its predecessors, 05”

Although Optus as an entity will continue to be subject to Australian law at a theoretical level, practical difficulties may arise in attempting to enforce Australian law against, in effect, a foreign government. In sensitive areas such as privacy and freedom of speech, international relations issues may intrude into the process, making enforcement of our law problematic. One should remember that the Singapore Government has never been shy in the past about criticising foreign governments and newspapers for interfering in what it calls its “domestic affairs”. Eddie Kuo and Peter Chen state that the fear of foreign control of the mass media has become a “common theme and has been presented as a legitimate reason for imposing political control and stringent legal constraints on communications systems in Singapore” .

The Singapore Government has stated on many occasions that foreigners have no right to interfere in the domestic politics of Singapore. Lee Kuan Yew stated:

“Singapore’s domestic debate is a matter for Singapore. We allow American journalists into Singapore in order to report Singapore to their fellow countrymen. We allow their papers to sell in Singapore so that we can know what foreigners are reading about us. But we cannot allow them to assume a role in Singapore that the American media play in America, that of invigilator, adversary, and inquisitor of the administration. If allowed to do so, they will radically change the nature of the Singapore society, and I doubt if our social glue is strong enough to withstand such treatment.”

In a similar vein, Jek Yeun Thong, the then Minister for Culture stated:

“Management will be free to operate the newspapers as commercial enterprises, provided that they ensure that there is no manipulation by foreign elements and that no attempt is made by them, or through their proxies, to glorify undesirable viewpoints and philosophies.”

There is a risk that Optus may be run by Sing Tel for the Singapore Government in the same manner. There are no guarantees that once the Singapore Government, through Sing Tel gaining control of Optus, will not decide that, in the interests of its “domestic affairs” Optus assets should be used for surveillance purposes. Any attempts to interfere or inquire would be dismissed as attempts by foreign entities to meddle in Singapore’s domestic affairs.

The Singapore Ministry of Communications and Information has defined engaging in domestic politics as “publishing materials, which are intended for Singapore readers; to generate political, ethnic and religious unrest; indulging in slanted, distorted or partisan reporting; or persistently refusing to publish Government’s replies to refute misreporting and baseless allegations.”

Continued here.

Peter Fray

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