THE Federal Government's control of major contractors running the Nauru detention centre meant it effectively controlled the centre, the High Court has heard.
Lawyers for a Bangladeshi woman argued the constitutional validity of the Australian Government operating and paying for offshore detention in a third country.
They argued the Australian Government had drawn up the contract with Transfield Services and Wilson Security - the operators of the centre - and paid for Nauruan visas for asylum seekers held inside.
Ron Merkel QC told the court due to the arrangements in place, Australia was effectively running the centre "on the ground" despite it being on Nauruan soil.
The hearing went ahead despite Nauruan Government pledges to process 600 refugee applications this week and create an "open centre" that would give detainees access to the rest of the island 24 hours a day.
Lawyers for the Immigration Department have been allowed to submit the Nauruan changes to the centre as part of the case, but the Court will not likely focus on the moves.
Instead, Mr Merkel's arguments centred on the validity of the Australian Government's contracts with service providers at the offshore detention centre.
The case could have implications for up to 200 other asylum seekers who have cases before the court.
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