The Australian government kept documents about its multibillion-dollar submarine project secret from the public to avoid offending a foreign power, and spent $150,000 over four years to stop their release.

Australia’s growing involvement in the international arms trade is frequently shrouded in secrecy. The government has routinely blocked freedom of information requests for documents on arms deals, including weapons exports to countries like Saudi Arabia and the United Arab Emirates, by citing national security or potential harm to international relations.

The secrecy has extended to major arms purchases – including of the new $50bn submarine fleet – which have helped make Australia one of the biggest arms importers in the world. Data released by the Stockholm International Peace Research Institute on Monday shows Australia is now the world’s second biggest arms importer behind only Saudi Arabia, up from fourth the year prior.

In 2015, Senator Nick Xenophon and later his successor, Rex Patrick, used FOI law to seek unclassified documents showing the process Australia used to award the submarine contract to French company DCNS.

The decision had embarrassed the Japanese government, a rival bidder to DCNS, and left key Japanese officials feeling “raw”, according to one diplomat, who said it contributed to “a precarious time in Australia’s relationship with Japan”.

Xenophon’s FOI request was initially denied, in part because it would harm relations with Japan, and the case ended up in the administrative appeals tribunal in 2017.

Correspondence between the Australian and Japanese governments show how Australian officials approached the head of the Japanese defence ministry’s weapons and warship division, informing him that an Australian politician was seeking documents about the submarine project.

The documents were relatively standard tender records, and many had already been made public. The documents were not sensitive or classified and did not specifically relate to Japan’s bid. All three bidders for the submarine project were forewarned about Australia’s FOI laws, and the two other bidders, including DCNS, had raised no objection to Xenophon’s request.

Japan asked Australia not to release the documents, including – initially at least – material that was already publicly available.

When asked why it would be harmful to release documents already in the public realm, the senior Australian diplomat Graham Fletcher, told the tribunal: “If the information is out there the material damage is perhaps less but that’s not really the question, the question is will our relationship with Japan be damaged, if we override their objection or disregard and then release the information. And based on my knowledge our relationship will be damaged.”

“It would reopen some sensitivities about the whole history of this issue, which we hope to put behind us.”

The defence department this month won the tribunal case, although they were ordered to release some additional documents to Patrick.

Patrick told Guardian Australia he had unsuccessfully sought a meeting with Japan’s ambassador to Australia, Sumio Kasaka, about the issue.

“I have seen the documents that are being withheld from release and I am of the strong view that Japan is being rather precious and somewhat disrespectful to Australia’s principles of transparency over their release,” Patrick said.

“The decision raises questions as to whether we should invite Japan to tender for future defence projects.

“It cannot be the case that, just because Japan tenders for a contract, Australians are then not permitted to the transparency over public expenditure that they are supposed to enjoy.”

The defence department acknowledged the tribunal’s decision and said it accorded with its views on the release of the documents.

“The tribunal’s decision aligns with the views of defence, specifically that it was necessary to protect the competitive evaluation process in order to uphold the strong standing of our international relationships,” a spokeswoman said.

The department said it would release information that has otherwise been made public since the original FOI request four years ago.

“Since the original FOI request, which was made on 21 September 2015 while the competitive evaluation process was still underway, some information has become publicly available in the ordinary course of announcements, this includes [Australian national audit office] audits and proceedings such as senate estimates.”

“Defence will release the publicly available information which was identified during the proceedings, in accordance with the tribunal’s decision.”