Two Labor MPs and the Nick Xenophon Team’s Rebekha Sharkie are not eligible to sit in parliament because they were British citizens when they nominated, according to expert legal advice released by the prime minister’s office.

The opinion, provided by David Bennett QC, concludes that Sharkie, Justine Keay and Susan Lamb are ineligible because the high court’s “citizenship seven” decision sets a strict test that dual citizens cannot nominate unless foreign law “irremediably” prevents them giving up their citizenship.

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The warning shot fired by Malcolm Turnbull comes as an impasse has developed in the citizenship eligibility crisis, with Labor and the Coalition still not agreed on a new disclosure mechanism and the Liberal MP John Alexander unsure about his citizenship status.

The legal advice will contribute to a combustible political situation, after Turnbull refused to rule out referring Labor MPs to the high court and accused Bill Shorten of attempting to game new requirements to protects his MPs.

The trio of MPs have refused to resign or refer themselves to the court because they took “all steps reasonably required” to renounce their dual citizenship before the nomination date, relying on a less strict interpretation of the decision.

Bennett was asked to assume facts on the public record that all three had sent in renunciation forms by the 9 June 2016 nomination deadline but Sharkie’s renunciation was effective on 29 June, Keay’s was effective on 11 July and Lamb’s was also after the deadline.

He advises that the “all steps reasonably required” test applies only when a foreign law unreasonably prevents someone renouncing their citizenship, in a way that infringes the constitutional imperative of representative democracy in section 34 of the constitution.

His advice states that nothing prevented the trio from renouncing their citizenship before the nomination date. They therefore were not “irremediably” prevented from renouncing foreign citizenship, which is the only exception to the general rule that dual citizens are ineligible.

In fact, the circumstances showed that Britain allows its citizens to renounce and gives effect to renunciation requests “relatively swiftly”, he said.

Bennett argues that the high court has implicitly already concluded that British law is not an unreasonable hurdle when it decided the cases of Fiona Nash and Malcolm Roberts.

He hedged slightly by noting that his conclusions “cannot be expressed with absolute certainty” because it is possible the court may retreat from its strict literalism by creating a new exception.

Constitutional experts are divided on the question but several, including the University of Sydney’s Anne Twomey, have warned that on a strict reading “a person is disqualified if he or she is a dual citizen at time of nomination regardless of what steps were taken beforehand”.

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“The other view is that a person is not disqualified if he or she has taken all the necessary steps to renounce citizenship under the requirements of the foreign country and that delay in processing the renunciation should not prevent a person from being elected,” Twomey said.

The University of Queensland’s Graeme Orr has backed Labor’s view that it is sufficient to have taken all reasonable steps because otherwise eligibility to run for Australian parliament will be hostage to the uncertainty of how long a wait for foreign bureaucracies to process renunciations is reasonable.

On Friday the Greens leader, Richard Di Natale, said he thought it was “unlikely” that Sharkie, Keay and Lamb were ineligible but there were “legitimate questions that should be resolved by the high court”.

Labor and the Greens have both said they have legal advice that supports the less strict view and would allow Sharkie, Keay and Lamb to remain in parliament but they have refused to release the advice.