From patchwork to playbook: the Joint Select Committee on AI and what it means for business

For businesses already navigating a crowded field of AI inquiries, standards and expectations, the newly established Committee signals a shift towards a coordinated, whole-of-Parliament approach, and it gives industry a fresh opportunity to shape the settings that will govern AI investment, adoption, risk and governance.

The establishment and scope of the Committee

The Committee was established by resolutions of each of the House of Representatives and the Senate. It began as a Coalition initiative and the Government agreed to support it, giving the Committee bipartisan endorsement. This recognises that AI poses "moral, strategic and economic challenges to Australia" and that a national response is required.

As a joint select Committee, its membership is drawn from both Houses and from both the Government and the Opposition. Specific details of membership and reporting timeframes are currently being settled, but the broad mandate (as stated by the terms of reference) is for the Committee to examine the economic, legal, security and social dimensions of AI and its impact of AI on national security, productivity, competitiveness and the living standards of Australian communities. Practically, the Committee will inquire into specific issues such as the adequacy of existing laws and the importance of data sovereignty, and report to Parliament with findings and recommendations.

The Committee in context

The Committee arrives against a backdrop of intense regulatory activity. Over the past 3 years, AI has attracted sustained attention from Australian policymakers. The Senate Select Committee on Adopting Artificial Intelligence reported in late 2024 and the Government tabled its response in April 2026. In December 2025, the Government released its National AI Plan, setting out an ambition for Australia to be a leader in responsible and inclusive AI. In March 2026, it published the Commonwealth's expectations for data centres and AI infrastructure (albeit providing guidance rather than binding law at that stage).

Momentum has since accelerated. As we explored in From principles to power points: what the Government's "AI in Australia's interests" means for business, the Government announced a new Office of AI within the Department of the Prime Minister and Cabinet, signalled a set of mandatory Australian Standards for AI and foreshadowed legislation expected in Parliament early in 2027.

Running alongside these federal moves is a Senate inquiry into AI and data centres, which we unpacked in Watts on the line? Unpacking the Senate's data centre and AI inquiry, a NSW parliamentary Inquiry into the development and regulation of data centres and, most recently, a Royal Commission into AI has been announced in South Australia.

The new Committee sits above much of this activity, and its whole-of-Parliament vantage point gives it scope to draw the threads together and potentially shape the legislative agenda that follows.

The key issues the Committee is likely to examine

While the detailed program of work will emerge over time, the Committee's stated focus on 13 areas and the current policy landscape points to several key themes.

1. AI governance and the adequacy of existing laws

   A central question is whether Australia's existing legal frameworks are fit-for-purpose in the AI era. Australia relies on a patchwork of general laws including privacy, competition and consumer protection, corporations, anti-discrimination, e-safety, employment, copyright and sector-specific regulation. Several reviews have already assessed the adequacy of these laws resulting in some changes made or planned, and some reviews are still pending.

   The laws are also supplemented by government guidance on essential AI practices.

   The Committee is likely to test whether that patchwork leaves gaps, and whether further mandatory guardrails are needed for higher-risk use cases. Its conclusions may influence the nature of regulation that the Government has flagged for 2027.

2. A coordinated national approach

   While a single economy-wide AI regulatory framework has been ruled-out, the Committee's work coincides with a clear move towards a more coordinated national approach.

   This seems desirable as many of the relevant issues fall both across federal portfolios and also across State and Territory responsibilities.

   We expect close attention will be paid to how mandatory Australian Standards for AI should be designed, who they should apply to and how they interact with existing regulatory regimes. In announcing the standards, the Prime Minister did not say who they would apply to, but it seems likely that they would at least apply to AI companies and data centre infrastructure developers. For business, practical questions remain about scope, thresholds, major obligations and timing.

3. Data sovereignty, security and infrastructure

   Data sovereignty and national security feature prominently in the Committee's mandate. That focus connects directly to the infrastructure underpinning AI, including data centres, compute capacity, energy and water. The Committee is likely to examine where Australia's data is stored and processed, how critical AI infrastructure is secured, and how the country balances the economic benefits of AI investment against sovereignty and resilience concerns.

4. Productivity, competitiveness and workforce impacts

   The Committee is tasked with weighing AI's effect on productivity, competitiveness and living standards. This raises questions about skills, jobs, adoption incentives and the distribution of AI's economic benefits, issues that will shape the policy environment for businesses investing in AI-driven transformation.

5. Intellectual property

   The Committee is tasked with examining the interaction of AI with existing intellectual property and copyright laws, including the use of Australian creative, cultural and media content in the training of AI models. This is one of the most actively contested areas of AI policy in Australia and a critical dependency to enable AI training and open the pipeline of data centre investment by AI companies. The inquiry arrives against the backdrop of the Government's ongoing copyright reform consultations and sustained advocacy from the creative industries for protections against unauthorised use of their works. Key questions are likely to include whether new licensing and transparency obligations should attach to frontier model developers, and how Australia should position itself relative to international approaches and obligations. For businesses deploying or developing AI, the outcome may affect data sourcing practices, infringement risk allocation and the cost of compliance and AI services generally.

What this means for business: governance, risk, compliance and opportunity

The Committee's establishment and the breadth of its remit is a strong indicator of the widespread impact of AI on the Australian economy and that it is a critical time for policy setting. Takeaways for business include the following:

• Build AI governance into strategy. Boards and executives should ensure AI governance is embedded in enterprise strategy and risk management, not bolted on. That means clear accountability, appropriate board oversight, and a culture that treats responsible AI as central to value creation. Our AI Governance white paper offers a practical starting point.

• Manage AI risk proactively. Businesses that map their AI use cases, assess associated risks, and implement and document their governance and technical and operational controls now will be better placed to meet standards as they crystallise.

• Prepare for a shifting compliance baseline. A move towards mandatory Australian Standards for AI, layered onto existing privacy, consumer, intellectual property, corporations and critical infrastructure regimes, will change what "good" looks like. Organisations should treat current guidance frameworks (such as the Guidance on AI Adoption) as a floor rather than a ceiling and build compliance programs that can flex as the rules harden and/or as their AI use evolves.

• Engage with the process. Parliamentary Committees invite submissions and evidence. For businesses with a stake in how AI is supported and regulated, this is an opportunity to provide a view and shape federal policy. Industry participants should consider making submissions to the Committee, and track its progress, noting that submissions close 14 September 2026 and the Committee is due to present its final report by 30 November 2026.