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Court rules asylum seekers cannot be sent to Malaysia as part of a refugee swap deal in a major blow to Prime Minister Julia Gillard Australia’s highest court has ruled against government plans for a refugee swap with Malaysia in a major policy setback for embattled Prime Minister Julia Gillard, already trailing badly in opinion polls and facing defeat at the next election. Australia and Malaysia signed an agreement in July under which Australia was due to accept 4,000 asylum seekers currently in Malaysia, in return for sending 800 arrivals in Australia to Malaysia where their refugee claims would be processed. “It’s a slap in the face for the Gillard government, it’s a huge setback for the Malaysian solution,” said Marianne Dickie, an expert on migration law at Australian National University. “It effectively hobbles it (the policy), if not ending it.” Gillard signed the Malaysian deal to deter people smugglers, and to fight perceptions her government was soft on asylum seekers. But lawyers for two asylum seekers asked the High Court to declare the people swap illegal, because Malaysia had no legal guarantees to protect the rights of asylum seekers. Australia is a signatory to the UN convention on refugees but Malaysia is not. Australia has already begun negotiations with Papua New Guinea to re-open the mothballed Manus Island immigration detention centre, which closed down in 2004. The High Court ruling means Australia might also need to re-open a detention centre on the remote Pacific islands nation of Nauru. Both the Manus Island and Nauru detention centres were used by the former conservative government under its controversial Pacific Solution, where asylum seekers who arrived by boat were sent to other countries to have their refugee claims processed. Australia Malaysia Julia Gillard Refugees guardian.co.uk