The Timber Development Association (TDA) said the Illegal Logging Prohibition Act 2012 would also forbid importers from buying timber that was likely to have been illegally logged or that they suspected had been illegally logged.

The bill passed the parliament on 19 November and is now awaiting approval by the Governor-General.

The maximum fines for guilty paper merchants would be $275,000, while individuals would risks fines of up to $55,000 and prison terms of up to five years, said the TDA.

Two Sides Australia national manager Kellie Northwood said the group supported certified forestry practices and was encouraged by the illegal logging legislation.

[Opinion: ProPrint backs Two Sides]

"Illegal logging damages the reputation of the industry as a whole. Despite high environmental investment and commitment from the paper and print industries, we have been stained by illegal logging practices," she told ProPrint.

"This legislation formalises what the industry has been putting into practice for some time now and supports the sustainable credentials of print as an environmental and effective communication vehicle."

The TDA's sustainability programme manager, Stephen Mitchell, said the law would only affect importers, not downstream buyers of timber or paper.

The law would also apply to Australian paper manufacturers that used imported pulp with local timber, he added.

[Opinion: Illegal logging puts reputations at risk]

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