Federal Gov rules out copyright text and data mining exception for AI

On 26 October 2025, the Attorney-General, Hon Michelle Rowland MP, published a media release reiterating that the current Federal Government will not introduce a text and data mining (TDM) exception to copyright infringement in the Copyright Act 1968 (Cth) (Copyright Act).  The Attorney-General’s Department will instead engage in further consultations with members of the Copyright and Artificial Intelligence Reference Group (CAIRG) to consider licensing models for copyright material used in AI training in Australia.

The Attorney-General’s statement

The Attorney-General stated that the Albanese Government has “no plans to weaken copyright protections when it comes to AI” and explicitly ruled out amending the Copyright Act to include a TDM exception.  The Attorney-General convened the CAIRG over 27 and 28 October 2025 to discuss “three priority areas” as follows:

1. Encourage fair, legal avenues for using copyright material in AI: Examining whether a new paid collective licensing framework under the Copyright Act should be established for AI, or whether to maintain the status quo through a voluntary licensing framework.
2. Improve certainty: Explore opportunities to clarify or update how copyright law applies to material generated using AI.
3. Avenues for less costly enforcement: Make it easier to enforce existing rights through a potential new small claims forum to efficiently address lower-value copyright infringement matters.”

Context to the TDM exception

In August 2025, the Australian Productivity Commission released the harnessing data and digital technology interim report (Interim Report).  The Interim Report included six (6) draft recommendations, dealing with AI, data access, privacy regulation, and digital financial reporting.  In relation to AI, the Productivity Commission referred to concerns that:

“the Australian copyright regime is not keeping pace with the rise of AI technology – whether because it does not adequately facilitate the use of copyrighted works or because AI developers can too easily sidestep existing licensing and enforcement mechanisms.“

Faced with this, the report included three policy options:

• No policy change: Copyright owners would continue to enforce their rights under the existing copyright framework.
• Policy measures to better facilitate the licensing of copyrighted materials, such as through collecting societies.
• Amending the Copyright Act to include a fair dealing exception that would cover TDM.

Our article on the Interim Report can be read here.

Impact of a TDM exception

A TDM exemption would expand the existing ‘fair dealing’ regime in Copyright Act, which allows for the use of copyrighted material without permission where the use is for one of the specified purposes in the Act and is considered fair.  The specific purposes in the Act include:

• research or study where a fair amount of use can be proven;
• criticism or review;
• parody or satire;
• reporting news; and
• providing legal advice.

This regime can be contrasted with other jurisdictions such as the United States which apply the ‘fair use’ approach.  Under the ‘fair use’ doctrine, any non-consented use of copyright material is allowed provided the use is ‘fair’.  It need not fall within a specific purpose.  In comparison to fair dealing, fair use provides a broader exemption to copyright infringements.

In the recent example of Bartz v Anthropic, the United States Federal Court ruled in favour of generative AI firm, Anthropic, finding that its use of copyrighted books to train its ‘Claude AI’ amounted to fair use.  The judge found that the training, which involved analysing statistical relationships between text fragments to enable the generation of new original text, was “quintessentially transformative” and analogous to an aspiring writer reading a classic.  They do not seek to replicate or supplant the original work, but to learn and create something different.

See our article on this case.

What are the proposed licensing models?

The Attorney-General has specifically referred to the CAIRG exploring paid collective licensing and voluntary licensing frameworks.  These models include: a statutory licensing scheme, or a collective licensing scheme for TDM and AI, or maintaining the status quo through a voluntary licensing framework.

• Statutory licensing scheme under the Copyright Act: A statutory licensing scheme under the Copyright Act allows for certain uses of copyright material without direct permission, provided that a fee is paid to copyright owners.  These compulsory licenses are designed for specific purposes where voluntary licensing would be impractical, such as for educational institutions and government bodies, and they are managed by collecting societies that distribute the royalties to rights holders.
• Collecting society licensing scheme under the Copyright Act: A copyright collecting society licensing scheme under the Copyright Act allows for the collective administration of copyright, where societies license the use of many creative works and collect royalties from users.  These societies distribute the collected fees to their members, who are the copyright owners, after deducting administrative costs.
• Voluntary licences negotiated by parties: This autonomous flexible approach is already available to copyright owners and users and gives the parties the ability to negotiate directly with each other.  There are already Australian based businesses that have announced that they are negotiating or have negotiated voluntary licenses for the purpose of licensing content for AI training in Australia.

What does this mean for Australian businesses?

Business participating in the CAIRG will have the opportunity to provide feedback to the Attorney-General’s Department in response to each of the three priority areas outlined by the Attorney-General, and each of the potential licensing models.

After the conclusion of the CAIRG consultation period, the Attorney-General’s Department will make the CAIRG consultation paper and a summary of the CAIRG feedback publicly available.  When there is an announcement regarding the direction the Government will take when introducing a licensing scheme, Australian businesses involved in AI training will need to consider how this will impact their current model and other licensing considerations.

Key takeaways

Australia is establishing a restrictive copyright environment for AI training, and businesses must continue to treat TDM as prohibited unless licensed.

CAIRG is expected to provide further advice to the Government regarding:

• Whether AI-related copyright reform is needed;
• How to balance rights-holder protections with innovation; and
• Options for licensing, exceptions, or hybrid models.

Given the lack of a TDM exception, individuals and businesses should be cautious when engaging in AI training activities, to ensure the rights of Australians are protected and avoid copyright infringement proceedings.

Links and further references

Legislation

Copyright Act 1968 (Cth)

Cases

Bartz v Anthropic PBC, 3:24-cv-05417, (N.D. Cal.)

Other links

Productivity Commission, ‘Harnessing data and digital technology’ (Interim report, August 2025)

TDM Exception Announcement

Further information about artificial intelligence

If you need advice on copyright law, contact us for a confidential and obligation‑free discussion:

Disclaimer

This article contains general commentary only.  You should not rely on the commentary as legal advice.  Specific legal advice should be obtained to ascertain how the law applies to your particular circumstances.

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