New Australian Standards for AI will be legislated: Key insights for businesses and investors

On 15 July 2026, Prime Minister Anthony Albanese announced a new direction for Australia’s approach to artificial intelligence (AI), including plans to establish a national regulatory framework and governance standards. The proposals indicate a shift towards a more coordinated and strategic approach to AI policy. We outline the key aspects of the announcement below and consider what they may mean for investors and businesses operating in Australia.

Australian Standards for AI     

The government will establish a set of Australian Standards for AI, creating a national framework for AI development and large-scale AI infrastructure. The Australian AI standards will bring AI governance into a single “clear, consistent and mandatory” regulatory framework.

The framework will:

• establish a set of Australian standards for AI, creating mandatory national requirements;
• strengthen national interest and national security;
• bring large AI data centres into one regulatory regime;
• be developed through consultations with states, industry and international partners; and
• be introduced as new legislation to Parliament early next year, following National Cabinet discussions with Premiers and Chief Ministers this month in August.

Establishment of an Office of AI

A new Office of AI will be established within the Department of the Prime Minister and Cabinet. The office will serve as the central coordinating body for the development of National AI Standards, establish AI-related work and policy across the government in partnership with the Minister for Industry and Innovation and the Assistant Minister for Science, Technology and Digital Economy.

New Rules for AI in Australia

Data Centre compliance

The AI National Standards will introduce a range of requirements on large data centres, including:

• location restrictions designed to avoid conflicts with residential housing developments;
• energy obligations requiring operators to support new electricity generation, bear the full cost of grid connections and contribute at least as much energy as they consume; and
• water and efficiency requirements aimed at reducing water consumption, improving energy efficiency, and funding any necessary additional water infrastructure.

Copyright Protections for Creators

The Prime Minister revealed a proposed framework aimed at strengthening protections for creators and artists in the context of AI development. The key features include:

• ensuring artists, writers, musicians and journalists retain ownership and control over their creative works, including decisions regarding their use and commercial value; and
• prohibiting the use of Australian creative content for the development or training of AI models without the creator’s consent.

The Attorney General is currently leading consultations on the design and implementation of these proposed protections.

Key Outcomes

Although the AI legislative framework is still being developed, the Prime Minister’s speech sets out several clear objectives of the Government’s priorities, including:

• businesses developing or deploying AI systems should prepare for the introduction of a nationally consistent and mandatory AI framework, the details of which will be refined through industry consultation;
• investors and operators in the data centre sector should account for anticipated obligations concerning energy generation, water efficiency and site selection in future investment and development decisions; and
• artists, creators and other rights holders can expect stronger safeguards for the use of their intellectual property in AI training and development, although the final form of these protections has yet to be determined.

We will continue to follow the proposed reforms as the Government undertakes further consultation and seeks National Cabinet endorsement through developing the proposed legislative framework.

Deborah Edo
Associate