Quick Hit

On 19 December 2025, the Productivity Commission released its final report in its ‘Harnessing data and digital technology’ inquiry.

The Productivity Commission did not recommend the introduction of a text and data mining exception. Instead, it recommended that the Australian Government “wait and monitor” the development of AI and its interaction with copyright, both in Australia and overseas, before taking any policy action.

The interim report and the text and data mining proposal

In August 2025, the Productivity Commission released an interim report which called for submissions on, amongst other issues, a proposal to introduce a fair dealing exception for text and data mining (see our background article here).

In October 2025, the Australian Government ruled out introducing a text and data mining exception for training Generative AI models, which we discussed in more detail in this article.

Productivity Commission identifies three key uncertainties in a policy response

In its final report, the Productivity Commission said that most AI training is conducted overseas and observed that Australia’s copyright laws make domestic AI training less attractive. However, in designing an effective policy response, there were three key areas of uncertainty:

  • The scope and feasibility of AI-related copyright exceptions is unclear. While some countries have AI-training related copyright exceptions (for example, fair use in the United States and TDM exceptions in the EU), there are legal uncertainties in how those exceptions will apply.
  • The effect of AI training on creators, and incentives to create new content, is uncertain.
  • Some rights holders have begun licensing their work to AI developers. However, it is unclear how voluntary licensing markets will emerge, particularly for open-web material that cannot currently be feasibly licensed.

The Productivity Commission considered submissions on the proposed TDM exception and concluded that it is “too soon” to introduce such an exception.

Another option considered by the Productivity Commission was “extended collective licensing”, involving a collecting society licensing works to AI developers, and then collecting and distributing fees to participating copyright holders.

The Productivity Commission’s “wait and monitor” recommendation

Ultimately, the Productivity Commission recommended that the Australian Government monitor the development of AI and its interaction with copyright holders over the next three years globally, focusing on monitoring the three key areas of uncertainty.

If those uncertainties remain after three years, the Productivity Commission said that the Australian Government could establish an independent review of Australia’s copyright settings and the impact of AI.

We’ll continue to monitor copyright and AI policy issues. For now, it seems like any legislative reform in this area is likely to be several years away.

For assistance or more information on copyright licensing and infringement issues, please contact Adam Simpson, Clare Young, Ian McDonald or Anna Spies.