By Stephanie Peatling and Fergus Hunter
Embattled Labor senator Sam Dastyari has quit Parliament after a series of revelations about his links to Chinese Communist Party-aligned interests in Australia.
The 34-year-old senator and powerful former boss of NSW Labor announced on Tuesday he had decided to resign from the Senate.
His resignation caps off a damaging fortnight for Opposition Leader Bill Shorten, and could pave the way for former NSW premier Kristina Keneally to enter the Senate should she lose the Bennelong byelection on Saturday.
Senator Dastyari, a member of the dominant NSW Right faction, has been something of an embarrassment for Labor leader Bill Shorten for nearly 18 months.
Sam Dastyari announces his resignation from the Senate at a press conference in Sydney.Credit: Janie Barrett
Announcing his resignation, the senator said the decision was the best thing he could do for Labor because his presence had become a distraction.
"I know Australia needs a Labor government and I refuse to let my personal situation put that prospect at risk. I have always put the pursuit of the Labor cause first," Senator Dastyari said.
"Reflecting on the events which led to my decision, I leave knowing that I've always honoured my parliamentary oath."
He said he was a patriotic Australian and praised Mr Shorten as a "first-rate Labor leader". He also said he would would continue to speak out for "the great multicultural nation that we have become" and promised to remain an active grassroots member of the party.
In 2016, Senator Dastyari resigned from the frontbench after Fairfax Media revealed he may have broken Labor Party rules on political donations by allowing Chinese donors to make payments on his behalf for travel and legal bills.
After several months on the backbench Mr Shorten appointed him to the position of deputy opposition whip.
But Senator Dastyari again attracted controversy when Fairfax Media revealed he had given counter-surveillance advice to donor Xiangmo Huang in a face-to-face meeting at the Chinese community leader's home, telling Mr Huang his phone was likely bugged by intelligence services and directing him to conduct a conversation outside.
Fairfax Media also uncovered and released audio of a June 2016 press conference Senator Dastyari gave alongside Mr Huang in which the senator backed Beijing's position in the South China Sea. Senator Dastyari's comments contradicted Labor policy on the issue and previous claims he had merely "misspoke" during the press conference.
In an attempt to stop the controversy Mr Shorten sacked Senator Dastyari from his parliamentary position, saying he had "lost faith in him" and he had "make a significant mistake of judgement".
Mr Shorten said at the time he did not believe Senator Dastyari had broken any laws nor was he a national security risk.
On Monday, Fairfax Media revealed Senator Dastyari attempted to pressure Deputy Opposition Leader Tanya Plibersek to abandon a meeting with a pro-democracy activist opposed to Beijing's interference in Hong Kong, according to multiple sources who said the 2015 intervention surprised Ms Plibersek.
Senator Dastyari attempted to pressure Ms Plibersek to abandon the meeting, and repeatedly attempted to warn her that the encounter would upset figures in the Chinese community in Australia.
Prime Minister Malcolm Turnbull has claimed Senator Dastyari had not put Australia's interests first and Immigration Minister Peter Dutton labelled him a "double agent".
The Coalition sought to frame the Dastyari scandals as a test of Mr Shorten's leadership and, in recent days, Labor frontbenchers publicly said he should be considering his position.
Mr Shorten welcomed the resignation and said his colleague could be proud of his legacy in the Senate, which has included work on banking misconduct and corporate tax avoidance.
"Sam Dastyari is a good, decent and loyal Australian, and an effective parliamentarian, but his judgement has let him down and now he has paid the heaviest price," Mr Shorten said.
Senator Dastyari said he would co-ordinate his formal departure from the Senate with the NSW branch of the Labor Party, which will have to select his replacement.