The government believes there will be around 10 injunctions every year to force ISPs to block piracy-related websites under a new law designed to combat online copyright infringement.
The estimate is included in answers to a question on notice from the 1 May hearing of a parliamentary inquiry into the government's Copyright Amendment (Online Infringement) Bill.
The bill will allow rights holders to apply for a court order that will compel an ISP to block its customers from accessing an 'online location' (such as a website).
A letter (PDF) from the Attorney-General's Department to the Senate Standing Committees on Legal and Constitutional Affairs said the estimate was based on the experience in the UK where injunctions "were only sought against major service providers".
"The estimated cost burden on [carriage service providers] was calculated on the basis that 10 injunctions would be sought each year," the letter states.
The explanatory memorandum accompanying the bill estimates complying with the new site-blocking system will cost ISPs $130,825 per year.
"So the estimate did not go as specifically as: 'What is the cost per ISP of each block?'," Senator Jacinta Collins asked department representatives at the only public hearing held so far into the legislation.
"No, but it did factor in the size of ISPs and whether it was likely that they might already have existing systems in place, and whether they might be automated systems and things like that," replied Sam Ahlin of the department's Commercial and Administrative Law Branch.
The impact on ISPs of the new regime is "a very significant concern," Choice CEO Alan Kirkland told the same hearing.
"This bill, of course, comes on top of the recent data retention laws and the copyright code that has been developed by the Communications Alliance.
"When you put all of them together, we have a growing bundle of red tape that is stifling our internet industry at a time when we really should be liberating it and making it efficient, flexible, nimble and as fast as possible."
"The uncosted copyright notice scheme, which has yet to be registered and implemented, and the metadata retention legislation are expected to add hundreds of millions of dollars of operating costs across the industry, industry has an obligation to maintain its profits for shareholders and will have to — it has no choice — pass these costs on to its consumer base, to recoup them," Australian Communications Consumer Action Network CEO Teresa Corbin told the inquiry.
"To minimise impact on consumers, it is our preference that the costs of this amendment be kept to an absolute minimum," the ACCAN chief executive said.
"We believe the most equitable cost allocation would see rights holders pay for the ISP costs of implementing and maintaining the blocking capability.
"This is equitable because it shifts costs onto those who will derive benefit. In contrast, cost on ISPs are likely to be passed on to consumers equally, regardless of their ability to pay or whether in fact they are using any of those services."
ISPs have also argued that rights holders should pay the cost of complying with the new regime.
The inquiry's report is due to be tabled on 13 May.