Reform of the federal system appears high on the Federal Government’s agenda, with the Commission of Audit Report of 2014 recommending major reforms to our federal system. Hopefully, one area of reform will be business regulation. Access Economics has earlier documented the significant costs imposed on Australian business by the myriad of State and federal regulation to which they are subjected. One piece of the puzzle is the scope of the Federal Government’s constitutional power with respect to trade and commerce. In some respects, that head of power has been interpreted relatively narrowly. Currently, the orthodox position is that laws with respect to production and manufacture are not laws within the scope of trade and commerce, and so not able to be regulated under that head. It will be argued in this article that such an approach is unduly narrow, reflecting tainted reserved powers reasoning and may be based on misguided suggestions of State sovereignty. An Australian regulatory environment for business must reflect the reality that Australia’s future lies in global trade, not perpetuating subnational regulatory differences for the sake of it.

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