Making a decision on an issue that has made headlines across the region, the Australian High Court ruled 6-1 to make permanent an injunction that prevents Australia from transferring 800 asylum seekers to Malaysia in return sending 4,000 registered refugees for resettlement.
The court found that under Australian law the government could not send asylum-seekers to be processed in a country which was not bound to adequately protect them.
In a statement, it said that Malaysia has not signed the U.N. Convention on Refugees and that the deal with Australia did not legally bind Malaysia to recognize the status of refugees under its domestic law. It said any suitable third country must have obligations under international or domestic law to protect asylum seekers and refugees.
The ruling may have ramifications on Australia's other off shore processing of refugees and asylum seekers, including its plan to send asylum-seekers to Papua New Guinea, and the possibility of re-opening a detention centre on the Pacific island of Nauru.
The judgement is a major blow to the ruling labour government, having already launched an unsuccessful bid to set up a regional processing centre for refugees in East Timor earlier this year.
Report: Australia's high court rejects Malaysian asylum seeker deal (The Guardian, 31 August 2011)
Elsewhere, rights groups such as Amnesty International celebrated, welcomed the ruling as "a landmark victory for human rights."
The case was brought to the court by 16 asylum seekers who were to be the first to be flown to Malaysia from the Australian territory of Christmas Island.
Their lawyer, David Manne, who leads the Melbourne-based Refugee and Immigration Legal Center, called on the government to quickly process his clients' refugee claims "rather than leaving them locked up in limbo."
After the ruling, the media and government officials warned that there would be a spike in boat arrivals with Immigration minister Chris Bowen suggesting there could bee a rush to Australia's shores. He echoed Prime Minister Julia Gillard's statement, who said said that the High Court ruling was a missed opportunity "to enhance our region's response to the evil of people-smuggling".
He said the government was now seeking urgent legal advice on the ruling's ramifications and that it would consider its options.
Asylum seekers who arrive by boat are an issue of heated political debate in Australia, despite the fact that they represent only 3% of annual immigration in the country.
Report: Australia works to salvage asylum-seeker policy (AFP, 1 September 2011)
Report: Court voids Australia's refugee deal with Malaysia (AP, 1 September 2011)