Guidance Note 5 – Reporting on significant issues

Key topics covered in this guidance note are:

• the purpose and operation of section 35 of the Legal Services Directions 2025 (Directions)
• identifying a significant issue (including the types of issues that are significant for the purposes of section 35)
• the process for engaging with the Office of Legal Services Coordination (OLSC) in the Attorney-General’s Department (AGD) on significant issues.

1. Section 35 of the Directions provides that certain legal issues are considered significant and entities must report them to the Attorney-General via OLSC.

2. The purpose of this obligation is to support the Attorney-General as First Law Officer in having visibility of, and where necessary influence, the most important legal issues affecting the Commonwealth. This enables them to be managed consistently, effectively and in-line with Government policy.

3. OLSC’s role is to coordinate reporting on behalf of the Attorney-General and facilitate entities’ compliance with section 35 of the Directions. Section 35 applies to non-corporate Commonwealth entities (NCCEs) and prescribed corporate Commonwealth entities (CCEs).¹

What is a significant issue?

4. The Directions do not define what is ‘significant’. Instead, subsection 35(2) includes a list of factors which inform whether an issue is significant or not.

5. This list is not exhaustive. This reflects the fact there will always be new issues which become significant.

6. For the purposes of subsection 35(2):

• size includes cost to the Commonwealth (for example, value of contract, claim or financial impact) or the numbers impacted (for example, individuals, groups, businesses, related claims)

  • NOTE: there is no minimum ‘size’ for when an issue becomes significant. Rather this is assessed on a case-by-case basis and can differ between entities.

• the identity of the parties includes public figures, or individuals, businesses or groups who have received or are likely to receive substantial media attention
• nature of the matter includes the subject matter of the issue or the forum in which the issue is raised (for example, the High Court)
• significant level of co-ordination includes situations where more than routine engagement is required (for example, regular whole of government interdepartmental meetings as opposed to ad hoc consultation on the application of a law or policy issue).
• the existence of a dispute or disagreement includes disputes or disagreements where litigation or alternative dispute resolution mechanisms have been commenced or are foreshadowed
• significant precedential consequences include new binding or highly influential legal principles that will overturn a previous legal precedent and/or impact the way the Government of the day does business, or
• reasonable prospect includes matters which have received a legal assessment that the matter is not spurious, without merit or there is no prospect of liability, but rather there are better than even or good prospects (including a substantial risk) that liability will be found.

Examples of significant issues

7. In addition to the factors in subsection 35(2), examples of significant issues include:

• High Court proceedings commenced by the Commonwealth or entity (for example, special leave applications) or matters listed (or likely to be listed) for hearing by the Full Court of the High Court
• constitutional matters such as where government action (including programs) or Commonwealth spending is not supported by the Constitution or the constitutional issue is raised in a matter before a superior court (for example, the High Court or Full Federal Court)

  • NOTE: the mere fact that a constitutional issue (or reference to the Constitution) has been raised or a notice under section 78B of the Judiciary Act 1903 has been issued does not in itself mean that the issue is significant.

• high risk or high value contracts
• the development of legislation which will:
  • change the legal rights of the public or
  • apply retrospectively
• where the Commonwealth (or a Commonwealth entity or official) is being prosecuted²
• class actions or representative proceedings
• where there is substantial or widespread media attention or adverse public reaction, and
• Commonwealth participation in a State or Territory inquiry (for example, Royal Commissions, Special Commissions or Commissions of Inquiry), including where the Commonwealth is objecting or submitting to the powers of these powers³.

When can a significant issue arise?

8. As outlined in subsection 35(1) a significant issue can arise in the performance of any type of Commonwealth legal work. This includes legal services being provided by or for the Commonwealth (i.e. legal work being undertaken by external legal service providers or counsel).

9. Examples of Commonwealth legal work include the management of litigation and claims or dispute resolution, legal advice and legal drafting (i.e. legislative or contractual).

• NOTE: litigation and claims are defined in the Dictionary in section 4 of the Directions. For the purposes of section 35, litigation and claims include where they have been formally commenced (i.e. court proceedings filed) and/or where foreshadowed.

10. Generally, Commonwealth legal work captures all areas of law (for example, public law, environmental law, commercial and contractual, and civil claims)

• Section 35 does not apply to Commonwealth prosecuting authorities instituting or carrying on criminal prosecutions and related proceedings but does apply when the Commonwealth (or entity) is being prosecuted.⁴

Who is responsible for identifying a significant issue?

11. Entities are responsible for identifying when an issue has become significant and complying with section 35.

12. If an entity is unsure about whether the issue is significant, they should engage with OLSC by emailing OLSC@ag.gov.au for further guidance or assessment. When engaging with OLSC, entities should provide:

• background information about the issue (including the context or Commonwealth legal work the issue has arisen in)
• any relevant supporting documents (for example, court documents or legal advice), and
• any other relevant information (for example, entity considerations/preliminary assessment).

Attorney-General and OLSC’s role

13. The Attorney-General may also determine that an issue is significant and require an entity (or entities) to report the issue.

• This may include a time limited issue and an issue which is specific to an entity or all entities.
• Where this occurs, OLSC is responsible for notifying entities.

14. OLSC may also contact entities seeking information about an issue which has come to its attention to determine whether section 35 of the Directions applies. As part of this process, OLSC may determine that the issue is significant and request the entity report the issue.

When can an issue become significant?

15. An issue can become significant at any stage and in different forms during the provision of legal services. Likewise, an issue may have been assessed as not significant may later become significant due to new information received.

• For example, consistent with subsection 35(2)(a) of the Directions a class action automatically becomes significant at the time it is foreshadowed or commenced due to its size even though advice has not be received.

16. Entities are responsible for continuously assessing whether a significant issue has arisen at every stage of the legal services being provided.

17. Examples of when an issue may become significant in the course of legal services include:

• advisory stage
• pre-litigation or foreshadowed claim
• upon being served with Court documents
• during the management of formal claims and court proceedings
• during policy design or legislation drafting, and
• throughout the course of managing litigation and claims.

Process for reporting a significant issue

When do entities need to provide a report or updated report?

18. Section 35 provides that OLSC should be:

• notified as soon as practicable after a significant issue arises or the entity becomes aware of it, and
• updated on any developments in the significant issue as soon as practicable after they occur or the entity becomes aware of them.

19. In practice, entities should (at a minimum) provide new and updated reports to OLSC on a quarterly basis, with reports due no later than 30 days after the end of the quarter (unless OLSC advises otherwise such as if the quarter ends on a weekend or a public holiday):

• Quarter 1: 1 January to 31 March (reports due by 30 April)
• Quarter 2: 1 April to 30 June (reports due by 31 July)
• Quarter 3: 1 July to 30 September (reports due by 31 October)
• Quarter 4: 1 October to 31 December (reports due by 31 January).

20. If an entity is unable to meet this deadline, then an extension should be sought from OLSC by emailing OLSC@ag.gov.au.

21. Entities should not wait until the end of the quarter to notify OLSC of new or updated significant issues.

• NOTE: a failure to notify OLSC of a new significant issue or updated significant issue is non-compliance with the Directions.
• NOTE: entities will not comply with section 35 by complying with another obligation under the Directions (for example, the tied work or counsel rate obligations).

22. If a significant issue arises during a time sensitive situation, the entity should provide an interim notification to OLSC as a priority and then complete and submit the significant issues reporting template as soon as practicable.

What types of developments require update?

23. Examples of when an update may be required for a significant issue include:

• new legal advice is received
• policy or ministerial approval has been given
• new legal issues or risk are identified
• the entity is proposing to make a concession (or similar)
• certain court documents are filed (for example, statement of claim, submissions or interlocutory application on an issue of substance)
• the matter is listed for hearing or alternative dispute resolution (including outcome of)
• the bill is before parliament (including the outcome), and
• the notification of judgment (both at time of listing and once delivered).

24. On occasion, OLSC may request more regular reporting from an entity for a specific significant issue due to the significance of the issue. When this occurs, OLSC will liaise with the relevant entity to arrange a more frequent reporting schedule for that particular issue and/or an alternative format for reporting.

• Note: OLSC may also request copies of documents (for example, legal advice received, court orders, draft submissions) about the issue as part of this.

Issue is no longer significant

25. If an entity considers that the issue is no longer significant it should engage with OLSC to confirm that no further reporting is required. This should be done by emailing OLSC@ag.gov.au.

How to report

26. There are two templates which entities should use to report significant issues:

• New report form – this template should be used if it’s the first time a significant issues report has been provided to OLSC by the entity, and
• Update report form – this template should be used if the entity has previously reported the issue to OLSC (i.e. already completed the new report template), including when the issue is being reported as finalised.

27. Additionally, for quarterly updates entities should also use the quarterly cover sheet.

28. Completed forms should be emailed to OLSC@ag.gov.au.

29. Once received, OLSC will provide the entity with an OLSC identification number for the issue and confirm if any further information is required. The identification number is to be used for all future engagement with OLSC the significant issue.

What information should be provided in a significant issues report?

30. Entities should complete all requested information in the form but keep reports succinct.

• NOTE: for new reports entities should aim for a maximum of 2 pages for the discursive sections. OLSC will contact entities if further information is needed.

31. For new reports, entities are asked to outline:

• why the issue is significant
• status of issue/next key steps.
• background to the issue (including legal risks and sensitivities),
• a summary of legal advice received or being obtained and
• mitigation activities being undertaken or explored.

32. For updated reports (including final reports), entities should provide a status update and confirm if there are any new legal risks, issues or sensitivities that the Attorney-General should be aware of. Entities should not duplicate information provided in earlier reports.

33. Generally, entities do not need to provide copies of supporting documents (for example, legal advice or court documents) with their reports but must do so if requested by OLSC.

• NOTE: legal privilege is not waived in providing this information to OLSC but entities should advise of any secrecy or other statutory disclosure limitations.

Multiple entities involved

34. The approach to reporting a significant issue involving multiple entities can differ from matter to matter. Often, a pragmatic approach is adopted where one entity reports on behalf of all.

• In these circumstances, the primary reporting entity is responsible for consulting and collaborating with other entities.

35. Where each entity’s involvement is sufficiently discrete, separate reports can be provided.

36. If entities are unsure or cannot reach agreement about who should report the issue, then OLSC can provide guidance. Entities should notify OLSC by emailing OLSC@ag.gov.au.

What happens with a significant issues report?

37. As noted above, the purpose of the significant issues obligation is to support the Attorney‑General in their role as First Law Officer.

38. In this context, OLSC uses significant issues reports to:

• identify trends or systemic issues impacting multiple entities or the government as a whole, which may benefit from coordinated action
• identify if other entities should be involved in an issue, or would benefit from becoming aware of it
• identify if the Attorney-General should be advised of, or updated on, an issue
• identify issues that would benefit from consideration by the Significant Legal Issues Committee (SLIC⁵)
• allow OLSC to be aware of matters where settlement approvals may be required in the future, both to assist OLSC planning its own workload and to enable it to provide proactive support and guidance to the entity about settlement
• support OLSC’s administration of other obligations under the Directions in connection with the matter, such as counsel rate approvals, tied work or engaging with the jurisdiction of state and territory bodies, and
• allow OLSC to have information on hand, should the Attorney-General seek urgent information on a legal issue that has come to their attention.

39. Reports received by OLSC may be used to inform briefs to Attorney-General or SLIC, as well as other areas within the department.

• This may include information received from an entity in complying with its reporting obligations (for example, legal advice or court documents).

40. The Attorney-General may also use the information to discuss the issue with their ministerial colleagues.

Where can I get further help?

41. If you have any questions about reporting significant issues, please contact OLSC at olsc@ag.gov.au.

Office of Legal Services Coordination
Phone: 02 6141 3642
E-mail: olsc@ag.gov.au
Issued: March 2026

This guidance material is of a general nature only and does not convey or contain legal advice.