A former SAS soldier accused of the wartime murder of an Afghan villager has been granted bail after a magistrate ruled he was at risk of being attacked by Taliban sympathisers while in prison.

Oliver Schulz, 41, was arrested last week and charged with war crime - murder by the Australian Federal Police.

The AFP has alleged that Schulz murdered Dad Mohammad in a wheat field while deployed in Afghanistan with the Australian Defence Force.

He is alleged to have shot Mohammed, a father and struggling farmer, in the Uruzgan Province in May, 2012, the court was told today.

He is the first Australian serviceman or veteran to be charged with a war crime under Australian law.

Helmet cam footage showed Schulz shooting Mohammad three times, the court heard yesterday.

Magistrate Jennifer Atkinson told the court that Mohammad appeared to stop moving after the first shot and was on his back with hands and knees raised.

During a bail application on Monday, Schulz’s barrister Phillip Boulten SC argued his client was at a “grave risk” of being attacked in jail by Islamic extremists and inmates who were ideologically opposed to the war in Afghanistan.

Boulten pointed to the “horrific” case of Bourhan Hraichie, who was convicted of attacking his cellmate, a former soldier, by attempting to “waterboard him” and carving words into his forehead.

Atkinson said she took into account the risks posed to Schulz inside jail given fellow prisoners might be hostile to the ADF’s deployment in Afghanistan.

“It’s clear it’s going to be a very difficult, if not dangerous, environment,” Atkinson said, noting Corrective Services could not provide him with 24-hour protection.

The allegations were first aired when the ABC’s Four Corners show broadcast footage in March 2020 and the ex-soldier was suspended from the ADF.

Boulten said his client had known he was under investigation by the Office of the Special Investigator and the AFP since then, including when his home was raided in May 2022.

On Monday, Boulten argued Schulz did not pose a risk given the alleged offence occurred in armed conflict in Afghanistan a decade ago.

Boulten also said Schulz was not a flight risk given he had known about the investigation for several years and had not fled the country.

Barrister Sean Flood, acting for the Commonwealth DPP, argued there was a different flight risk associated with being investigated and being charged.

But Atkinson said nothing on Schulz’s criminal record indicated that he posed a threat to Australia or its citizens.

She also said his trial would be affected by lengthy delays and may not be heard until late 2024 or early 2025.

Atkinson also took into account that he would have trouble communicating with his lawyers in prison and preparing for his trial given the national security sensitivities around the case.

She agreed to release Schulz on bail on strict conditions including that he hand over a $200,000 surety and not leave his home between 10pm and 5am.

He must also report to police daily, not communicate with any witness, hand over his passport and provide officers with access to his phone.

Schulz also applied for a non-publication order that would prevent the media from naming him because of fears for his safety.

However, Atkinson declined to make that order.

- Steve Zemek, news.com.au