Is there an AI law in Australia? Not yet. That doesn’t mean anything goes. The laws you already follow apply when you use AI, and a couple of things change soon.

Here’s the plain-English version for a small business. It’s general information, not legal advice. If something here affects a big decision, check it with your adviser.

Privacy is where most businesses trip

Australia’s privacy regulator recommends not putting personal information, especially sensitive information, into publicly available AI tools. In practice, client details stay out of free AI tools. If you need AI to work on something about a client, swap the names for “Client A” or “Staff 1”. The AI still does the job.

For work, use business accounts with training switched off. Free plans often use your chats to improve the product.

Next, work out whether the Privacy Act covers you. If your turnover is over $3 million, it does. Under $3 million, you’re still covered if you provide a health service, trade in personal information, or hold certain government contracts.

If you’re covered, there’s a date to know: 10 December 2026. From then, your privacy policy has to explain when software makes, or substantially helps make, decisions using personal information that could significantly affect someone. That can include rule-based tools, spreadsheets and chatbots. A human checking the result doesn’t take it out.

One more applies at any size. Since June 2025, people can sue for a serious invasion of privacy, and the small business exemption doesn’t apply.

If AI wrote it, you said it

Consumer law applies to what AI writes in your name. Maximum penalties for companies went up to $100 million in March 2026, or more based on turnover or benefit.

So a person fact-checks AI copy before it goes out. Website pages, ads, emails and quotes all count. And don’t overclaim. No promises about results you can’t back up, and no “AI-powered” if it isn’t.

Talk to your team first

Safe Work Australia’s AI guidance names surveillance, work intensification and unfair decisions as workplace hazards. If you’re bringing in a tool that tracks work or hands it out, talk to your staff first. Many awards and agreements already require it.

For big decisions about people, like hiring, pay and performance, AI can help you prepare. A person makes the call.

NSW businesses have one extra thing to watch. The digital work systems duty passed in February 2026, and it starts once SafeWork NSW publishes its guidelines.

Content and copyright

Only use images and content you have the rights to, and keep the licence or source for anything you didn’t make. Your own work is protected too. The government ruled out a copyright exception for AI training in October 2025, so AI companies need permission to train on Australian creative work.

Get ready for 2027

National AI standards are coming, and the government plans to legislate in early 2027. The detail isn’t out yet, so start with the basics. They take about ten minutes:

  1. One person is in charge of AI. They know what’s being used and who to ask.
  2. You keep a list of the AI tools you use: what each is for, who uses it and what kind of information goes in.
  3. A person signs off on anything big. That’s anything going to a customer, costing money or deciding something about a person.
  4. Someone has skimmed the government’s Guidance for AI Adoption. It’s voluntary, with six practices covering who’s accountable, risk, testing, transparency and human oversight.

Get the checklist

We’ve put every rule above on one page, with tick boxes and the sources. Grab the Australian AI rules checklist and work through it with your team.

If you’d like help putting the basics in place, set up your own AI Operating System is a good start. Work with Brightwaters covers how we do it with you.