Yes it will still be legal and the current sets will still work on the existing 40 channels. The new additional 40 channels are being "slotted" in between the existing frequencies.
From this useful site: UHF CB Australia - News - Repeater Locations - History - Sales & More
Frequently Asked Questions
Will my old UHF CB radio still work when the changes take place?
Yes, You existing UHF CB radio will still work after January 1st 2011
Will my old UHF CB radio interfere with other channels?
It is possible that old UHF CB will interfere with new channels but you would need to be very close to another radio to create a problem
Can I talk to someone on a new UHF CB radio with my old UHF CB radio?
Yes, You will be able to talk to another person using a new UHF CB radio provided they are on one of the current 40 channels, if the other UHF CB radio is on one of the newly allocated channels then you will not be able to talk to them
Will I notice any changes when talking on a new UHF CB radio with my old UHF CB radio?
Yes, You will notice that the sound will be distorted but you will be able to talk to each other


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