Australian copyright proposals draw constitutional warnings

Both options under consideration would let copyright owners opt out to keep online material out of AI training without a licence.[3] One government option would allow AI companies to train on material without digital protections if they paid a central body and met other conditions.[3] The proposal would not provide additional payments to creators or rights holders beyond deals negotiated to meet the quota.[3] Government proposals also included penalties for ignoring opt-outs, protections for Indigenous cultural and intellectual property, and transparency and audit requirements.[3] Anthropic separately suggested an opt-out model in which it could scrape content unless rights holders used digital protections to object.[1]

Section 51 permits Commonwealth laws for the acquisition of property on just terms.[1] The concern raised is that giving AI companies a new right to use copyrighted material while diminishing copyright holders’ rights could potentially trigger constitutional issues.[1] Nationals senator Ross Cadell questioned whether an opt-out model would mean the government was acquiring other people’s intellectual property rights.[1] He warned Australia could face compensation claims on behalf of rights holders around the world.[1] At a committee hearing with the attorney general’s department on Friday, officials said they were conscious of the issues but did not directly answer questions about international implications and liability to foreign rights holders.[1]

Australian Recording Industry Association chief executive Annabelle Herd said a proposal permitting AI scraping would clearly amount to an acquisition of property.[1] Mushroom Records chief executive Chris Maund argued that existing copyright law was working and AI companies should use licensing arrangements, noting that Spotify had made AI-related deals.[1] Attorney General Michelle Rowland’s office said any future changes would provide meaningful control and fair compensation.[1] Rowland has also said voluntary licensing arrangements are the government’s first-best option and that it wants stronger protections for Australian artists, including audit and transparency requirements.[4]

The copyright debate forms part of a broader package of AI reforms Labor was considering, covering datacentres, online safety, workforce, energy and the economy.[1] Draft laws were expected by the end of the year, with parliamentary consideration due in 2027.[2] Twomey said lawmakers should be confident about how section 51 applies before passing legislation.[1] Shadow attorney general Michaelia Cash said the government should not weaken protections for Australian creators and rights holders to attract AI investment.[1] The proposals therefore remain a subject of policy debate, with both compensation arrangements and constitutional questions still in focus.[1][2]