How Regulatory Compliance is Governed by States in Australia

Australia operates under a federal system in which regulatory compliance arises from multiple layers of government — the Commonwealth (federal), the states and territories, and sometimes local governments. For organisations (especially in energy, resources, infrastructure, software subject to the Security of Critical Infrastructure Act 2018 (SOCI) regime) understanding state-based regulation is critical because compliance obligations may vary significantly by jurisdiction.

State-based regulation in Australia is a critical layer in the compliance architecture. While federal laws provide broad frameworks, many essential obligations — licences, WHS, environment, taxation, local business regulation — vary by state. For organisations supporting regulated industries (like energy, resources, software for critical infrastructure), managing this complexity is central to a mature compliance programme.

Legal Architecture: Federal vs State

• The Commonwealth Parliament enacts national laws which apply across Australia — for example the Corporations Act 2001 (Cth), the Privacy Act 1988 (Cth), etc.

• States and territories (e.g., Western Australia, New South Wales, Queensland) legislate in areas that the Constitution allows them and traditionally regulate many “on-the-ground” compliance obligations: e.g., workplace health & safety (WHS), environmental protection, property, mining, licensing, local business regulation.

• Some regulation is nationally harmonised, meaning states adopt or align their legislation by model laws or inter-governmental agreement; other regulation remains state-specific.

• For companies operating across multiple states, state-specific regulations introduce complexity: employment laws (e.g., leave, payroll tax), tax/stamp duty, licensing, local environmental rules, industrial relations.

Key Features of State-Based Regulation

1. Licensing and Permits
   Many business activities require state licences or local authority permits (for example mining leases, extraction operations, land use, waste disposal). States set these regimes and enforce compliance.

2. Workplace Health & Safety (WHS / OHS)
   Whilst there is a model WHS Act in many jurisdictions, states each administer their workplace safety regulators. Businesses must ensure compliance with the applicable state regime.

3. Environmental / Natural Resource Regulation
   States regulate mining, land use, pollution, waste, conservation. Differences between states may create differing compliance burdens. For example, one report states regional businesses must navigate “overlapping federal, state and local regulations. … an example is an agricultural business in Victoria that must comply with 90 state and 37 federal regulations”.

4. Local Business Laws & Consumer Protection
   State-based agencies regulate fair trading, property and tenancy, local business licensing, state taxation (e.g., payroll tax), stamp duties.

5. Enforcement and Regulatory Powers
   States maintain their investigative/enforcement regimes. They grant regulators powers such as monitoring, investigation, infringement notices, injunctions, civil penalties. At the Commonwealth level, the Regulatory Powers Act 2014 (Cth) standardises such powers; states often mirror similar constructs. Attorney-General's Department