Why the reforms are particularly relevant to the Technology Sector
The Australian Government's proposed Privacy Amendment (Personal Data Protection) Bill 2026 represents a material development for all sectors, but especially the Tech Sector, because it is specifically designed to address an increasingly data-intensive, AI-enabled and interconnected technology environment. Whilst the Exposure Draft of course remains only proposed legislation (and is currently open for consultation until 18 September 2026), its direction is clear in that organisations are increasingly expected to justify not simply whether data handling is technically lawful, but whether the way personal information is collected, generated, analysed, shared, monetised, retained and protected is fair and reasonable.
For Tech Sector organisations whose services or solutions inherently collect or process customer, user or third-party data, this potentially makes privacy an increasingly important product, contractual and enterprise risk, rather than solely a compliance consideration.
What is proposed?
Key changes include:
Fair and reasonable data handling
Organisations would need to demonstrate that the collection, use and disclosure of personal information is fair and reasonable. Consent would not necessarily legitimise an otherwise excessive or unexpected practice.
More meaningful consent
Greater scrutiny of bundled consent, opaque terms and take-it-or-leave-it data practices could directly affect product design, onboarding, applications and digital interfaces.
Modernisation of personal information
The reforms are intended to clarify that personal information can extend beyond traditional identifiers to include behavioural and other data generated or collected through digital technologies. AI-generated inferences are also a particular area of focus.
Data commercialisation
Proposed restrictions on trading in personal information without clear permission have obvious implications for data brokers, adtech, marketplaces, platforms, and technology businesses whose commercial models involve profiling, targeting, or data sharing.
72-hour data breach notification
The Exposure Draft would require eligible breaches to be reported to the OAIC within 72 hours once the relevant threshold is established, significantly increasing the importance of early technical and legal investigation.
Right to erasure for large digital platforms
Proposed deletion rights would apply to certain large digital platforms which may include large social media, search, messaging, email, streaming, gaming, and AI platforms that meet proposed size thresholds of more than $500 million in gross annual revenue or 2.5 million average monthly users.
Cyber, data and technology risk
For the Tech Sector, the consequences extend beyond traditional privacy considerations, in that a SaaS provider, cloud platform, fintech, marketplace or AI business may create privacy exposure through product architecture, APIs, software development, telemetry, tracking technologies, AI models, customer configuration, third-party integrations or the handling of information on behalf of customers, even where there has been no external cyber-attack.
The reforms, therefore, reinforce several risk-management themes:
Know your data.
Organisations should be able to identify not only traditional customer records but also telemetry, behavioural information, inferred information, logs, device data, and information generated through AI.
Minimise and govern it.
Collecting and indefinitely retaining data simply because it may have future commercial value becomes increasingly difficult to reconcile with a fair-and-reasonable framework. It creates a larger exposure should systems subsequently be compromised.
Understand the technology supply chain.
Cloud providers, SaaS vendors, sub-processors, APIs and AI providers can create downstream privacy and contractual exposure. The OAIC already identifies third-party providers, including cloud computing, as part of an organisation's information-security responsibilities.
Prepare for compressed incident timelines.
A 72-hour regulatory clock creates particular challenges where an incident moves through multiple technology providers before the underlying facts can be established. Contractual notification provisions and escalation channels with critical vendors, therefore, need to support – rather than impede – the organisation's own regulatory obligations.
D&O/directors' duties
Tech Sector Boards increasingly need visibility into cybersecurity, privacy governance, AI use, data commercialisation practices, critical vendors, and product-related technology risk.
ASIC considers cyber preparedness a Board-level issue and expects Boards to ensure cyber risk is integrated within the broader risk-management framework, including oversight of the organisation's digital supply chain. ASIC has also warned that failure to address cyber risks or associated disclosure and reporting obligations adequately may constitute a breach of directors' duties.
For the Tech Sector, that means decisions concerning data collection, monetisation, security investment, AI deployment, and product design increasingly warrant the same structured governance and challenge as other material strategic risks.
Where does insurance fit?
The reforms further highlight the importance of an appropriately structured and implemented Tech E&O (PI) and Cyber programme, as well as the interaction with D&O.
Future outlook for the tech sector
Although the proposed reforms remain subject to consultation, the implications for the technology sector are already coming into focus.
As organisations increasingly develop, deploy and monetise data-driven platforms, digital services and AI-enabled solutions, privacy is evolving from a compliance obligation into a broader product, governance and enterprise risk consideration.
The proposed reforms signal greater scrutiny of how personal information is collected, generated, analysed, shared, retained and protected, requiring organisations to demonstrate that their data practices are not only lawful, but fair and reasonable.
For technology businesses, now is an opportune time to review data governance frameworks, privacy-by-design practices, contractual arrangements and risk management processes to assess whether they remain fit for purpose in an increasingly data-intensive and highly regulated environment.
The contents of this publication are provided for general information only. Lockton arranges the insurance and is not the insurer. While the content contributors have taken reasonable care in compiling the information presented, we do not warrant that the information is correct. The contents of this publication are not intended as a legal commentary or advice and should not be relied on in that way. It is not intended to be interpreted as advice on which you should rely and may not necessarily be suitable for you. You must obtain professional or specialist advice before taking, or refraining from, any action based on the content in this publication.
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