The Australian Government has announced it intends to legislate mandatory artificial intelligence safety and security requirements for frontier AI companies operating in Australia, with a new regulatory framework designed to strengthen oversight of increasingly sophisticated models.
The proposed Australian AI Standards legislation will apply to all frontier AI companies seeking to operate in the country.
Under the proposed framework, a new targeted AI safety regulator would oversee compliance, working alongside the Australian AI Safety Institute to provide technical expertise.
The regulator would have powers to impose significant penalties on companies that fail to meet their mandatory obligations.
Under the legislation, companies will be required to maintain security controls throughout the development and deployment of AI models, identify and manage serious risks, and allow independent evaluations of their systems.
They would also face mandatory rapid reporting of incidents to the Australian Government, alongside requirements to maintain and publish safety and security frameworks. The proposed standards would also require companies to adapt to updated rules as AI technologies evolve.
The government said the measures would provide earlier warnings of emerging threats from rogue AI agents and enable faster, coordinated responses to serious AI incidents.
"Artificial intelligence presents enormous opportunities for Australia, but we must also be prepared for the new risks that come with rapidly advancing technology.
"These protections will ensure we keep Australians safe and secure our national interests, while seizing the generational opportunities that AI offers,” Prime Minister Anthony Albanese said in a statement
“Our world-leading AI in Australia’s Interests agenda aims to provide Australians confidence that frontier AI companies are taking steps to improve safety and security, and provide certainty for investors – boosting productivity, building economic resilience, while bolstering sovereignty.”
The proposed protections are aligned with interim report recommendations from the Joint Select Committee on Artificial Intelligence.
Tony Burke, the Minister for Home Affairs and Cyber Security, said “Those who want to cause us harm have access to the latest technology.”
“We need to make sure we have the same, or better.
“But it’s not a free-for-all, there needs to be clear guardrails to protect Australians.”
David Hayes, Regional Vice President, APJ, Arctic Wolf, said the legislation is a move towards greater accountability and transparency for Australian businesses.
"Cybercriminals already use AI to move faster and attack at greater scale. Defenders need the same technology and strong guardrails around it. We see this every day. Our Aurora Superintelligence Platform uses more than 300 AI agents to resolve 22,000 investigations each week.
"The focus on rapid incident notification and independent evaluation matches what we hear from customers. They want transparency and accountability from every AI system they rely on. Published safety and security frameworks will help organisations make informed choices.
"We look forward to working with Government and industry as the regulation develops and continue to support businesses to lead in AI that is both safe and productive.”
The ACTU has also welcomed the proposed legislation, with ACTU Assistant Secretary, Joseph Mitchell, calling the government a “world-leader in digital protections”.
“The Medicare breach shows we can’t trust these large AI companies to do the right thing. The tech bros want us to believe that we, as a country, are powerless,” Mitchell said.
“But we are not; we absolutely can take the action to protect our rights and the fair go, and we congratulate Prime Minister Albanese for his strong action in this direction.
“We need to make sure workers’ rights are fit for purpose, and workers have genuine protections against job displacement and against bosses using AI for intrusive monitoring and surveillance to undermine the quality of work to make a quick buck, and for decisions that shape our working lives.”
Further details of the Australian AI Standards legislation are expected as the government completes a period of policy work and consultation.
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