Federal MPs are being urged to develop national principles to protect Aboriginal cultural heritage following the destruction of the Juukan Gorge rock shelters.
But the mining industry says legislation should be left to the states and the Commonwealth's role should be limited to better funding native title groups.
A federal parliamentary committee is investigating mining giant Rio Tinto's destruction of the 46,000-year-old Juukan Gorge sites in Western Australia earlier this year.
The committee on Friday heard evidence from the Law Council of Australia, which has called for federal intervention to prevent a repeat of such incidents.
It says there should be substantial review and reform of the Aboriginal and Torres Strait Islander Heritage Protection Act.
"What we're talking about in this sector are competing rights and the need for clarity as to how those rights intersect, and what the differing parties who possess those rights are able to do in any given circumstance," Indigenous barrister Tony McAvoy SC said.
"In my view, it needs a legislative response rather than an administrative response."
WA's government has developed a new draft Aboriginal Cultural Heritage Act, which will provide Indigenous people with the same appeal rights as land users and scrap the Section 18 approvals process that enabled the Juukan Gorge blast.
Association of Mining and Exploration Companies chief executive Warren Pearce told the committee the mining industry did not oppose strengthening heritage legislation but saw no need for additional federal involvement.
"It's not about restricting or removing or reducing Aboriginal heritage protection," he said.
"It's simply about saying lets get it right in one piece of legislation and not create additional administrative costs."
He said the Commonwealth should provide greater funding to prescribed bodies corporate (PBCs) under the Native Title Act and play a more hands-on role in their governance.
PBCs will play a key role under WA's draft heritage scheme by acting as Local Aboriginal Cultural Heritage Services, which will negotiate agreements with mining companies.
Heritage professionals have expressed concerns about the legislation, particularly in relation to the power imbalance between miners and Aboriginal groups.
Mr Pearce said miners had doubled down on consultation with traditional owners in the wake of the Juukan incident but said he was unsure how many AMEC members had paused work on projects under Section 18 approvals.
Rio Tinto has promised to modernise its participation agreements with traditional owner groups in the Pilbara.
Fellow mining giant BHP has pledged not to act on any existing Section 18 approvals without extensive consultation.