A senior official engaged in negotiations over the Aboriginal flag has described talks with the artist as complex and delicate.
The National Indigenous Australians Agency is locked in discussions with Harold Thomas and the flag's licensees.
NIAA chief executive Ray Griggs acknowledges use of the Aboriginal flag remains a divisive issue and has pledged to resolve the negotiations in a timely, fair and reasonable way.
"These discussions are complex and delicate, and based on goodwill and trust," he told a Senate estimates hearing in Canberra on Friday.
"Mr Thomas has asked for these discussions to remain confidential at this point and NIAA intends to respect this."
The government is negotiating to potentially buy the commercial rights from Mr Thomas and the flag's non-Indigenous licensees, in a move that would allow the design to be freely used.
A parliamentary inquiry has recommended the government establish an independent body with custodial oversight of its use, if the artist is willing to part with its copyright.
Australian Associated Press