Under Australia's Constitution, the States and Territories are largely responsible for regulating road transport. Each State and Territory has traditionally made its own laws in such areas as road rules, vehicle standards and driver licensing.

Over time the differences between these laws became more and more of an impediment to movement between jurisdictions, especially for heavy vehicle freight transport.

The National Road Transport Commission (NRTC) was established in 1991 to develop uniform arrangements for vehicle regulation and operation, and consistent charging principles for vehicle transport registration.

On 15 January 2004, the National Transport Commission (NTC) replaced the NRTC with a broader charter that continues the role of reforming road transport regulation and operations and also undertakes reform of rail and intermodal regulation and operations. The NTC is established under the National Transport Commission Act 2003 and a commitment by the Federal, State and Territory Governments in the Inter-Governmental Agreement for Regulatory and Operational Reform in Road, Rail and Intermodal Transport.

The new Commission's role is to undertake research and consultation and prepare proposals for model legislation for the approval of Federal, State and Territory Transport Ministers who together form the Australian Transport Council (ATC). Following agreement by the ATC, the States and Territories implement the proposals.

For some reforms, the Australian Government is also required to implement changes to the Federal Interstate Registration Scheme. The Commission has a role in overseeing the implementation of agreed reforms and is placing an increased emphasis on keeping implemented reforms up to date so that national uniformity is maintained 'on the ground'.