The opposition says it doesn't bode well that China is denying the facts around an attack on Australian navy personnel.
The Chinese government's rejection of claims one of its warships harmed Australian divers has been labelled as "regrettable".
Australian authorities say a Chinese warship injured Australian military personnel from the HMAS Toowoomba off the coast of Japan last Tuesday with sonar pulses.
The Australians were operating in international waters in support of a United Nations mission when the incident happened.
The divers suffered minor injuries to their ears.
Prime Minister Anthony Albanese called it dangerous and unprofessional.
China's defence ministry said its navy destroyer did not carry out any activities that might affect Australian diving operations and "kept a safe distance from the Australian ship".
Australia's remarks on the incident were "completely inconsistent with the facts", China said in a statement.
Opposition foreign affairs spokesman Simon Birmingham says it doesn't bode well that China isn't acknowledging the facts of the circumstances.
"That is very regrettable, because if you're not willing to acknowledge the facts, then it doesn't speak well for your willingness to change your behaviour," he said on Tuesday.
"That's really what we and so many other nations across the region need to see the Chinese military do, which is to change their operating protocols and their behaviour to be less confrontational."
Not doing so increased the risk of an accident or miscalculation in the future, he said.
"That of course, in turn, increases the risk of possible escalation with all of the devastating consequences that would bring to bear," he said.
An incident with a navy ship happened just days before the prime minister met Xi Jinping at APEC.
The prime minister remains under pressure to confirm if he directly raised the incident with Chinese President Xi Jinping when they met on the sidelines of the APEC summit.
The incident was kept under wraps for days and only made public after Mr Albanese left the summit to return home.
He has refused to detail the contents of private discussions, but Senator Birmingham said Mr Albanese had been happy to talk about the issues raised with Mr Xi when he visited China.
"So for him now to come back to Australia and say I won't reveal the content of conversations is quite disingenuous and in complete conflict with the evidence," he said.
Mr Albanese and top ministers have said Australia's objections have been made clear and raised with Chinese authorities.
"I can assure you that we raised these issues in the appropriate way and very clearly, unequivocally," Mr Albanese said on Monday.
"There's no misunderstanding as to Australia's view on this."
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