The companies strangling WikiLeaks are partly relying on the Australian government's discredited claims about the illegality of WikiLeaks' publication of diplomatic cables.

Giant US financial intermediary Visa is partly relying on the Gillard government’s claims that WikiLeaks acted “illegally” to justify its ongoing financial blockade of the whistleblower and media outlet, new material obtained by WikiLeaks has revealed.

WikiLeaks’s campaign against the illegal blockade, which has strangled the organisation of more than 90% of its funds, has suffered a setback this week after the European Commission declined to investigate the blockade (specifically, of the company DataCell, which WikiLeaks had been using) despite the European Parliament resolving last week that the Commission should seek to prevent the “arbitrary refusal of payments by credit card companies”.

WikiLeaks has obtained some of the material used by the US financial giants Visa and Mastercard to justify the blockade to the Commission (the material, in large PDFs, is here and here). Citing its own secret legal advice, Visa Europe told the Commission:

“… the legal position of WikiLeaks’ activities remains uncertain … for this reason, the suspension of the processing of payments for the benefit of WikiLeaks over the Visa network continues, although if it was finally determined that WikiLeaks is not carrying out any illegal activities then the question of suspension would not arise.”

As part of its justification for claiming that the legal status of WikiLeaks was unresolved, Visa Europe cited the statement of then-attorney-general Robert McClelland in December 2010 about the release of the diplomatic cables that “you would have to assume that there is a reasonable case that the act of sourcing the information did involve illegal events”.

McClelland’s statement was a shift from the position of the Prime Minister, who a week earlier had called WikiLeaks’s publication of the cables “illegal”. She was then embarrassed when the Australian Federal Police declared that WikiLeaks had broken no laws. Like McClelland, the Prime Minister then shifted to saying that the documents had been obtained, rather than published, illegally.

Crikey understands that, like Visa Europe, Mastercard Australia has privately indicated that it too is relying on the statements of the Prime Minister and the then-attorney-general to justify its financial blockade, although it has dismissed online claims that it was “directed” by the government.

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But no prosecution has been mounted anywhere against WikiLeaks’ publication or sourcing the cables. A grand jury in the United States has been investigating the circumstances of the leak of the cables and other secret information, but no indictment has yet been revealed of anyone beyond the accused leaker, Bradley Manning, currently facing a Kafkaesque military trial at Fort Leavenworth in Kansas, despite efforts to manufacture a relationship between Manning and Julian Assange.

Media outlets routinely publish secret material that has been leaked without examination of their legal status; indeed, key US newspapers such as The New York Times and The Washington Post rely heavily on anonymous leaks of secret information from US government sources.

Visa Europe’s position, however, can be maintained indefinitely. Saying the blockade will be lifted when it is “finally determined” that WikiLeaks is not acting illegally relies on proving a negative. The absence of prosecutions for any aspect of WikiLeaks’s activities so far has plainly been insufficient, and no government is going to permanently grant legal indemnity to any organisation into the future.

Mastercard and Visa have also failed to apply the test of whether an organisation has been “finally determined” to have not acted illegally in other circumstances. Rupert Murdoch’s News International has already admitted in court to the crimes of phone hacking and computer hacking and its current and former staff are facing charges of bribery, with claims that complicity in those crimes goes into senior management levels; News Corporation itself is also under investigation in the US for bribery of foreign officials.

By this logic, both News International and News Corporation itself should have been blockaded by Visa and Mastercard long ago, and remain blockaded until the resolution of all pending investigations and court actions arising from their activities.

The government has been repeatedly invited to withdraw its description of WikiLeaks’s activities as illegal and has so far declined to do so. “This is a matter for Visa Europe and the EU,” a spokesperson for current Attorney-General Nicola Roxon told Crikey.