Laws passed by parliament will aim to increase competition in the airline sector at Australia's busiest airport, following allegations carriers were deliberately cancelling services to maintain valuable slots at terminals.
Under the changes, the federal transport department will be responsible for the slot management scheme at Sydney Airport and will have the power to force airlines to provide information about their misuse.
A failure to use the slots properly will result in fines for airlines.
Slots at Sydney Airport are limited to 80 take-offs and landings per hour.
The laws will allow for the number of flights per hour at Sydney Airport to be increased if there is bad weather.
If flight landings or take-offs were affected by weather, the cap would be lifted to 85 flights per hour for two hours.
But the number of flights in total would not increase and would still be subject to the airport curfew.
The laws come after an independent audit of slots at Sydney Airport was handed down on Wednesday.
The audit confirmed more oversight was needed to make sure flights out of Sydney Airport were being managed effectively.
Major airlines Qantas and Virgin had faced allegations of deliberately cancelling flights in order to keep their slots.
At a Senate inquiry earlier in November, Qantas executives denied the airline had acted improperly.
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