In Victoria and New South Wales, practising Tai Chi with swords is controlled under legislation.
VICTORIA: Control of Weapons Act.
Under the Act, Victoria has included the sword as a "controlled" weapon, and has specific regulations controlling the selling, owning, carriage and use of swords. The TCAA has been following the regulations as they were enacted, and has gained exemptions for TCAA members to own swords and practise with them in our sport.
The process of gaining the exemptions has been further detailed in the Regulations, and the TCAA is required to guide members resident in Victoria and those bringing swords into Victoria for competitions, etc to comply with the requirements.
To apply for Exemption to own and/or practise Tai Chi with a sword under the Control of Weapons Act 1990, EXEMPTION TO POSSESS SWORDS - MARTIAL ARTS, Order in Council, complete the application form.
NSWNSW has under the SUMMARY OFFENCES ACT 1988 - SECT 11B control of "offensive implement":
11B Custody of offensive implement.
(1) A person shall not, without reasonable excuse (proof of which lies on the person), have in his or her custody an offensive implement in a public place or a school.
Maximum penalty: 50 penalty units or imprisonment for 2 years.
Notice that the "offensive implement" could be anything. The key requirement is that the person must prove that s/he has "reasonable excuse". So if you brandish your sword in public or in a school (presumed operating hours), and somebody gets scared, you will need to have a good explanation ("self-defence" is admission of offence). It is prudent therefore not to attract attention, and you should have full control of your "implement" (sheathed, in a bag tied or with lock). It helps if the blade of your "sword" is floppy and is unlikely to do damage, and you are actually on your way to or from a practice area where you are unlikely to frighten members of the public.
Do not expect every policeman to have considered whether you with your sword constitutes "custody of an offensive implement". Do not expect any consistency. A report from one member suggests that the local council may have certain agreements that permit exercising with a sword in the park, but not every police officer may know that. However, a report from another suggests that this cannot be assumed. I suggest we each exercise caution and do not tempt a clash. Keep your "implement" in its scabbard and in a bag tied up or locked) and out of your reach. Practise away from the passing public view.