Surrogacy can be a profound act of generosity and a path to parenthood for those unable to conceive or carry a pregnancy themselves. But while the emotional motivations behind surrogacy are deeply personal, the legal framework in Australia draws a strict line between what is permitted and what is not.
In Australia, only altruistic surrogacy is legal. Commercial surrogacy — where a surrogate is paid or rewarded for carrying a child — is prohibited in every state and territory. Understanding the difference between the two is essential for anyone considering surrogacy, both to comply with the law and to protect all parties involved.
What Is Altruistic Surrogacy?
Altruistic surrogacy is an arrangement in which the surrogate agrees to carry a child for the intended parents without receiving payment or reward, apart from reimbursement for reasonable out-of-pocket expenses.
These expenses may include:
Medical and hospital costs related to conception, pregnancy, and birth.
Counselling and legal fees.
Health or life insurance premiums connected to the pregnancy.
Travel or accommodation expenses for medical appointments.
Maternity clothing or other direct pregnancy-related costs.
The key principle is that the surrogate must not profit from the arrangement — she can only be reimbursed for costs that she has actually incurred.
In New South Wales, altruistic surrogacy is regulated by the Surrogacy Act 2010 (NSW). Equivalent legislation exists in other jurisdictions, such as the Surrogacy Act 2010 (Qld) and Assisted Reproductive Treatment Act 2008 (Vic), all sharing the same basic principle: surrogacy must be motivated by compassion, not commerce.
What Is Commercial Surrogacy?
Commercial surrogacy occurs when a surrogate receives payment, reward, or other material benefit for acting as a surrogate. This includes direct financial compensation, gifts of significant value, or other inducements.
Under section 8 of the Surrogacy Act 2010 (NSW), entering into or offering to enter into a commercial surrogacy arrangement is a criminal offence. The penalties are severe — up to 2 years’ imprisonment, 2500 penalty units, or both.
This prohibition extends beyond cash payments. Even non-monetary benefits, such as gifts, property, or forgiveness of debts, may be considered a reward and therefore illegal if provided in connection with the arrangement.
Commercial surrogacy is also banned in every other Australian jurisdiction. The consistent nationwide position reflects a clear public policy: while surrogacy can be an act of kindness, it must not become a commercial transaction.
Why the Law Draws the Line
The prohibition on commercial surrogacy stems from long-standing ethical and policy concerns. Lawmakers have sought to prevent:
The exploitation of women, particularly those in financially vulnerable situations.
The commodification of children, by avoiding any perception that a child can be “bought.”
Disputes over parental rights when money changes hands.
Parliamentary reviews and reports have reaffirmed these concerns, emphasising that altruistic arrangements better align with Australia’s social and ethical values.
By contrast, altruistic surrogacy focuses on informed consent, mutual trust, and the welfare of the child. It encourages openness and counselling, reducing the risk of misunderstanding or coercion.
What Counts as “Reasonable Expenses”?
One of the most common areas of confusion is what expenses can lawfully be reimbursed. The Surrogacy Act 2010 (NSW) allows repayment of reasonable expenses incurred by the surrogate as a direct result of the surrogacy arrangement.
Examples that are generally permitted include:
Medical and hospital costs associated with fertility treatment, pregnancy, and childbirth.
Counselling and legal fees.
Travel, accommodation, or childcare costs directly linked to medical appointments.
Loss of income during periods of medical incapacity (for example, time off work for bed rest or recovery).
Health or life insurance premiums taken out for the pregnancy.
What is not permitted are payments that go beyond reimbursing those direct costs — for instance:
Ongoing wages or salary replacement unrelated to medical leave.
Large “thank-you” gifts or bonuses.
Payment for the surrogate’s time, pain, or effort.
Courts take a close interest in this distinction. When considering a Parentage Order, the Supreme Court of NSW will usually require a detailed schedule of all payments and evidence that they were genuinely reimbursement, not profit.
International Commercial Surrogacy
Despite Australia’s restrictions, many Australians have pursued surrogacy arrangements overseas, often in countries where commercial surrogacy is permitted and more accessible.
However, entering into an overseas commercial surrogacy arrangement is also a criminal offence for NSW residents. Section 8(2) of the Surrogacy Act 2010 (NSW) extends the prohibition to acts done outside Australia by persons ordinarily resident in NSW.
Even when the overseas arrangement itself is lawful in that country, the Australian legal consequences can be significant:
The intended parents may face prosecution under NSW law.
The child may face delays or uncertainty in obtaining Australian citizenship.
Australian courts may refuse to recognise the overseas parentage arrangement, leaving legal parentage unresolved.
For this reason, anyone considering surrogacy abroad should seek legal advice before proceeding, both to understand potential criminal liability and to plan for parentage recognition and citizenship.
The Role of the Supreme Court
In NSW, every surrogacy arrangement must ultimately be approved by the Supreme Court through a Parentage Order. One of the court’s key functions is to ensure that the arrangement was genuinely altruistic.
The court examines:
The surrogacy agreement and accompanying legal advice certificates.
Counselling reports.
Itemised evidence of all payments or reimbursements.
Statements confirming no commercial benefit was provided.
If the court identifies any indication of commercial payment, it may refuse to make the Parentage Order — meaning the intended parents remain without legal recognition. The court’s priority remains the best interests of the child, but it must also uphold the integrity of the surrogacy framework.
Common Misunderstandings
“Can we give the surrogate a gift as thanks?”
Small tokens of appreciation — such as flowers or a meal — are unlikely to cause problems. However, anything of substantial value may be treated as a prohibited reward. When in doubt, seek legal advice and keep full records of any gestures or expenses.
“Can we pay the surrogate’s lost income?”
Limited reimbursement for lost wages during periods of medical incapacity is allowed, but not full-time income replacement for the duration of the pregnancy.
“If the surrogate lives overseas, can we still reimburse her?”
Yes, but only for genuine expenses. If she resides outside Australia, the risk of breaching NSW’s criminal provisions is high if any part of the arrangement is commercial.
Why Early Legal Advice Is Essential
Because the distinction between altruistic and commercial surrogacy can be nuanced, obtaining legal advice before conception is critical. A specialist family lawyer can:
Confirm the arrangement is compliant with NSW law.
Draft or review the surrogacy agreement.
Clarify which expenses can be reimbursed safely.
Advise on potential cross-border issues.
Early involvement of lawyers for both parties — as required by law — also protects everyone’s interests and ensures the process remains transparent and ethical.
Key Takeaways
Altruistic surrogacy (reimbursement only) is legal in Australia.
Commercial surrogacy, including overseas commercial arrangements, is prohibited and carries criminal penalties.
All payments must be limited to reasonable, documented expenses.
Compliance with the Surrogacy Act 2010 (NSW) is essential for a valid parentage order.
Legal advice and counselling must occur before conception.
Surrogacy in NSW
Having explored how altruistic and commercial surrogacy arrangements are treated in Australia, you may also find it helpful to review our other related guides that cover the legal and practical aspects of surrogacy more broadly:
Surrogacy in Australia — an overview of how the surrogacy framework operates nationally, including the prohibition on commercial arrangements.
The Legal Process of Surrogacy in NSW — a detailed walkthrough of the specific procedures, documentation and eligibility factors under New South Wales law.
Who Are the Legal Parents in a Surrogacy Arrangement — clarifies how legal parentage is established and transferred following a surrogacy arrangement.
How Courts Decide Parentage Orders in NSW Surrogacy Cases — examines the criteria, court involvement and timing of parentage orders in NSW.
What Happens If a Surrogacy Arrangement Breaks Down — discusses potential legal risks, fallback options and what happens when the arrangement does not proceed as expected.
International Surrogacy: What Australian Parents Need to Know — guides you through the additional complexities when surrogacy involves cross-border arrangements, recognition of parentage and immigration issues.
By reviewing these resources together you will gain a more comprehensive view of how surrogacy works in Australia—not just the differences between altruistic and commercial models—but the full spectrum of legal steps, responsibilities and practical considerations.
Need Guidance on a Surrogacy Arrangement?
At Thornton + King, our specialists in family law can guide you through the legal and ethical requirements of surrogacy in Australia. We help intended parents and surrogates understand their rights, avoid legal risk, and prepare compliant agreements. We’ll make the law simple, so you can focus on creating your family with confidence. To speak to a surrogacy law specialist, give us a call or submit an enquiry now.
