I am a British citizen but reside permanently in Australia on a BF-111 visa. I recently tried to board a flight from MEL to DPS in Bali, Indonesia, but was denied uplift by the airline who cited a "Do Not Board" directive from Border Force, apparently due to my Australian visa not being linked with my current passport.

While I understand I would not have been able to board the return flight given this situation, I am confused why Australia would be able to limit the outbound travel of a British national.

Is this the expected outcome? Is it lawful to restrict the outbound travel of a non-citizen?

Is this the expected outcome?

Yes.

Is it lawful to restrict the outbound travel of a non-citizen?

Apparently the Australian executive authorities have determined that it is. It's possible that the courts would find otherwise, but finding out would be expensive and time consuming.

I can't answer why Australia maintains this policy, but I can say that the Migration Act 1958 (as amended) does indeed include authority to require departing travelers to present evidence of lawful status in Australia (section 175). The act does not say what the consequence for a traveler would be in the event of being unable to present the requested evidence. Presumably there are some secondary instruments, regulations, or whatever they are called in Australia, that give more detail, but I do not know my way around Australian legislation well enough to get to that information efficiently.

I would also call your attention to the following public information from the Australian government:

From Border Force's page on Advance Passenger Processing, heavily edited to remove the detailed instructions on how to report the new passport along with information not relevant to your case:

Responding to a ‘Do Not Board’ (8502) directive

A ‘Do Not Board’ directive means we could not find a valid record based on the information entered. It could mean:

• the passenger or crew genuinely does not have a valid visa for travel to Australia
• the information was not entered correctly.

A check-in agent should:

• check and resubmit the information using accurate data from the bio-data page of the traveller’s travel document. This is important as most mistakes occur in the nationality code, travel document number or the spelling of the names
• then seek assistance from the BOC.

If required, an airline can use TIETAC to apply for an Electronic Travel Authority.

Using the 'A' and 'G' overrides

Airlines can use either an 'A' or 'G' override when they receive '8502 - ' directive in the Advance Passenger Processing (APP) system.

'A' (airline) override

After an ‘8502 - ’ directive is generated, an ‘A’ override will allow an airline to submit passenger's information to the APP and board a passenger only in certain circumstances.

Inward APP

[omitted]

Outward APP

An airline may use an 'A' overrde to board a traveller in certain circumstances when:

• they have a New Zealand passport – current, not expired (not on the system)
• they have an Australian passport – current, not expired (not on the system)
• they have no travel document, however their entry to destination and transit country has been approved
• they are military personnel travelling on movement orders with military ID.

For more detailed information about when you may use an ‘A’ override, see the Advance Passenger Processing (APP) Arrivals and Departures manual (864KB PDF).

We recommend that airlines' Departure Control Systems (DCS) have an ‘A’ override capability.

'G' (government) override

[omitted -- essentially this override applies when the airline consults with the Border Operations Centre and received instructions from them, outside the system, to board the passenger.]

Checking in traveller with a valid visa in an old passport

Passengers may present at check-in with 2 passports – a valid passport and an expired or alternate passport containing a valid Australian visa.

Use the details of the new valid passport for checking in the passenger into the APP system. This applies, even if we issued the person’s visa on the expired or a different passport. All passport information entered into the APP system should only be the current, valid passport.

This applies to all visas, both paper and electronic, except for the Electronic Travel Authority (ETA).

You have a new passport

You need to tell us when you get a new passport so that we can link it to your visa or application. The quickest way to do this is to update your passport details in your ImmiAccount.

...

Update Details - ImmiAccount

[omitted]

Passenger has notified Home Affairs of new passport

[omitted]

Passenger has not notified Home Affairs of new passport

The APP system will not return an ‘OK TO BOARD’ response if:

• the passenger has not notified Home Affairs of the new passport
• the person’s personal details in the new passport are different.

If the passenger cannot link the new passport to the person’s record, you will need to contact the BOC.

After the details are updated:

• the ‘OK TO BOARD’ message will be generated using the new passport
• airlines will not receive a 'Contact BOC' response whenever the passenger presents this passport for international arriving or departing flights for Australia. This will apply for the life of this travel document.
• the APP system will find the links for Australian dual nationals for their international flight check-in. Linking is available for Australian/foreign and foreign passports of the same nationality.
• advise passengers to use the passport that they used at check-in when using SmartGates. The check-in process will facilitate SmartGate clearance as the APP report will pre-populate the passport and flight details. This will help with faster processing.

From this it appears that the overrides do not apply to you, but that the airline is advised to give you an opportunity to link the new passport with the visa. Since this can take up to 72 hours, however, it seems like it won't be of use in most cases. They can also call the Border Operations Centre, which presumably would have told them to use a G override if they had done so, but it doesn't appear to be mandatory.

The above information implies that the Border Force's systems have matching logic in place that would allow them to match your new passport to the old one automatically unless there has been some change in the "personal details" in the document. For whatever reason, in your case this logic did not find a match.

From Travel documents for Australian citizens and permanent residents:

New passports

Generally, you must obtain a new passport if your old passport has either:

• expired
• been damaged or reported missing, lost or stolen.

If you get a new passport and your visa is still valid for travel, you must provide us with your new passport details. Find out how you can let us know you have a new passport. We will link your new passport details to your current visa (and other records). There is no fee for this service.

From Immigration and Citizenship's page Change in your situation > You have a new passport:

Tell us when you get a new passport so that we can link it to your visa or citizenship application, or your existing visa. The quickest way to do this is to update your passport details in ImmiAccount.

You can also do it with a web form. From the same source:

Processin​​g times

• ImmiAccount: 3 business days​
• New Passport Details web form: 14 days