The AFL faces insurmountable barriers to establishing a second Sydney team, says a Senate committee formed to examine Tasmania's bid for a league licence.

The committee, which supports Tasmania's bid for an AFL team, says the weakness of the sport's market in Sydney only underlines the risks in the decision to prioritise that city over Tasmania.

The AFL will have a second Sydney team in 2012, after expanding to the Gold Coast in 2011.

AFL chief executive Andrew Demetriou has said Tasmania was next in line if the competition ever expanded beyond the planned 18-team format or a Victorian club relocated.

A Senate committee was formed earlier this year to examine matters relating to the establishment of an AFL team in Tasmania as the league declined the island's state bid for inclusion.

Its report, recognising Tasmania's strong support for Australian Rules football for more than 100 years, was tabled in federal parliament on Thursday.

"There appears to be a growing consensus that Tasmania would have the necessary supporter base to sustain a financially viable AFL club," the report said.

The committee has asked the AFL to outline the circumstances under which Tasmania could get a team if the sport withdrew financial support from an existing club in dire financial straits.

"The committee would encourage the AFL to be upfront about the trigger for a Tasmanian licence to come about under these circumstances," the report said.

The committee was also of the view that the AFL's plans for a western Sydney team were "very ambitious".

"There are cultural barriers facing a western Sydney-based AFL team that appear to be insurmountable," the report said.

Children participating in modified Australia Rules games via school programs will not necessarily translate into meaningful support for the code, it said.

Australian Rules football was barely played at club level in the area, it added.

The weakness of the Sydney competition was most forcefully demonstrated by the fact that the Sydney Swans could not find a suitable competition for its reserves team to play in greater Sydney.

They chose to send the team to play in the Canberra competition.

"The committee believes this fact highlights the weakness of the market for AFL in the Sydney basin, and underlines the risks being taken by the AFL in its decision to prioritise this market over Tasmania."

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