Senators warn AI copyright bill risks constitutional breach

Coalition senators and the recording industry have warned that proposed changes to Australian copyright law could violate the constitution. They argue that allowing artificial intelligence companies to scrape music, books, and journalism without explicit permission constitutes an acquisition of property by the government. This move could expose the federal government to massive legal action from rights holders worldwide.

Ross Cadell, a Nationals senator and member of the federal parliamentary committee on AI, stated that the government could be liable for just terms compensation for every rights holder on Earth. He raised this concern during a committee hearing on Friday, where officials from the attorney general's department admitted they were extremely alive to the issue. Cadell described the potential outcome as the biggest compensation rights case in history.

Anne Twomey, a leading constitutional expert and professor emerita of law at the University of Sydney, agreed there was potentially a concern. She noted that granting AI companies permission to scrape copyrighted material could amount to an acquisition of property under Section 51 of the constitution. Twomey emphasized that the high court has recognized several exceptions to this section, but the government must be confident about the application of the law before enacting legislation.

Michaelia Cash, the shadow attorney general, criticized the government for selling out Australian creators in a rush to entice AI investment. She stated that the constitutional question of property rights is a live issue for the Coalition. Cash reminded the government of the prime minister's own test, which requires meaningful control and fair compensation for rights holders.

Labor is currently reviewing copyright changes as part of a broader suite of AI reforms covering datacentres, online safety, and energy. Prime Minister Anthony Albanese has promised the strongest possible protection for creatives, warning that it would be theft if they were not paid. However, some AI companies have rejected existing licensing agreements as too difficult. Anthropic has proposed an opt-out model that would allow scraping unless a rightholder deploys digital protections to signal an objection.

Annabelle Herd, CEO of the Australian Recording Industry Association, called any proposal to allow scraping clearly an acquisition of property. She questioned what kind of compensation could make up for trading away rights so AI companies could monetize themselves. Chris Maund, CEO of Mushroom Records, added that AI companies could train in Australia to circumvent stricter copyright laws in other countries. He noted that international creative industries are watching the situation closely.

A spokesperson for Attorney General Michelle Rowland said the government remains committed to supporting creatives. She pledged that any future copyright changes would deliver meaningful control and fair compensation. Officials at the Friday hearing did not directly answer questions about international implications or liability for compensation to foreign rights holders.