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ARTICLE · 23 JUNE 2026

Australia | How To Use Contracts To Manage AI Development Risk: A Practical Guide

Spruson & Ferguson Lawyers
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Australia's existing technology-neutral legal frameworks readily apply to AI systems, yet AI procurement contracts remain critical tools for managing developer risk. From copyright exposure in training data to privacy compliance and regulatory change mechanisms, organisations commissioning bespoke AI solutions must address unique challenges across the development lifecycle through carefully structured contractual protections.

AustraliaCorporate/Commercial Law
Sylvie Tso
Sylvie Tso
Nadine Martino
Nadine Martino
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While Australia has no dedicated AI legislation, existing technology-neutral frameworks, including the Privacy Act 1988 (Cth), the Copyright Act 1968 (Cth), Australian Consumer Law, and anti-discrimination statutes, readily apply to regulate the deployment and use of AI systems and their outputs.

Regulatory considerations aside, AI engagements carry the same project delivery risks familiar to any complex technology procurement: performance management, milestone slippage and personnel dependency. 

For businesses commissioning bespoke AI tools, whether custom-trained models, automated workflows or AI-powered integration solutions, the development contract is a key instrument that may be utilise to manage risk. It can shape what the developer builds, how it builds it, and what data it uses along the way.

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