Former New South Wales Labor minister Eddie Obeid has been ordered to hand over his passports, as prosecutors fear he will flee to Lebanon.

The call came after his court appearance on charges of misconduct in public office.

Mr Obeid is being charged over allegations he campaigned to have lucrative Circular Quay cafe leases awarded to a family-linked business. 

Obeid has seven days to surrender his passports.

He had been on unconditional bail, but prosecutor Daniel Noll argued in court that Obeid may use his dual citizenship to abscond to Lebanon, from where it would be very difficult to extradite him.

Mr Noll said that if the 71-year-old Obeid was to fall ill overseas, he might be prevented from returning.

Justice David Davies gave Obeid seven days to surrender his passports, but noted there was no evidence he had tried to abscond yet.

Outside court Obeid told reporters that this week’s appearance was “round one” and he was “here to fight”.

Mr Obeid has strong ties in Australia and in Lebanon, where he has family and some property holdings.

If he wants to travel to Lebanon now, he would have to apply to the court.

Obeid's barrister John Stratton SC, told the judge Obeid was a man with “extremely strong community ties”, who had cut short his holiday to come to court.

The judge also ordered him not to approach key crown witness Steve Dunn.