WORLD TRADE  
ORGANIZATION  G/SCM/Q2/AUS/43 
21 April 2010 
 (10-2060) 
Committee on Subsidies and 
Countervailing Measures Original:   English 
 
 
 
SUBSIDIES  
 
Replies to Questions Posed by the UNITED STATES1 Regarding the  
New and Full Notification of AUSTRALIA2 
 
  The following communication, dated 31 March 2010, is being circulated at the request of the Delegation of Australia.    
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FEDERAL PROGRAMMES 
 I. INNOVATION 
 
Climate Ready 
Renewable Energy Development Initiative 
 
Question 1 
 
 According to the notification, these programmes provide grants to eligible enterprises to 
encourage innovation in areas such as climate ch ange and renewable energy technologies.  Both 
programmes aim to increase the "internationa l competitiveness of Australian businesses".  
Funding is awarded on the basis of "eligibility and merit criteria".  What are the specific criteria for eligibility for receiving benefits under these programmes?   
 
Reply
 
 
Climate Ready 
 
To be eligible for a large Climate Ready grant (A$500 001 to $5 million), an applicant had to:   
 
• be a non-tax exempt company incorporated under the Corporations Act 2001 ; 
• have a combined annual turnover (including each  related body corporate) of less than 
A$100 million in each of the three financial year s before the financial year in which the 
application was lodged. 
 
To be eligible for a small Climate Ready gran t (A$50 000 to $500 000), an applicant had to:   
 
• either be a non-tax exempt company incorporated under the Corporations Act 2001  or an 
                                                      
1 G/SCM/Q2/AUS/39.   
2 G/SCM/N/186/AUS.   G/SCM/Q2/AUS/43 
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  individual who warranted in the application to form such a company to sign a grant agreement 
and undertake the project if offered assistance;   
• have a combined annual turnover (including each  related body corporate) of less than 
A$100 million in each of the three financial year s before the financial year in which the 
application was lodged.  For companies controlle d by an Australian university or public sector 
research organisation, turnover (not including th at of related bodies) had to be less than 
A$100 million for each of the three years prior to the lodgement of the application.   
 
In addition, to be eligible, an applicant had to:   
 
• be able to prove it owned, or had beneficial access to, all intellectual property  needed to 
undertake and/or commercialise the project; and 
• be able to prove it could fund its share of project costs as they fell due without relying on any 
other government grants. 
 
Applications were then assessed by the I nnovation Australia Board against the following 
equally weighted merit criteria:  
1. Management capability 
2. Project commercial potential 
3. Project technical strength (including technical capabilities of the applicant) 
4. Project national benefits 
5. Impact of funding on project outcomes. 
 
Funding for the program is now fully committed.  Applications for the final round closed on 
25 June 2009.   
 
Renewable Energy Development Initiative 
 
To be eligible for a Renewable Energy Developm ent Initiative grant, applicants had to be:   
 
• a non-tax exempt company incorporated under the Corporations Act 2001 ;  or 
• a wholly or majority-owned Commonwealth or State government body that either: 
(i) derived its income predominantly from commercial sources;  
(ii) did not receive significant recurrent government funding; or 
(iii) returned any part of a trading surplus to a gove rnment in the form of an annual dividend or 
similar payment; 
• able to demonstrate it could fund the costs of the project not met by the grant;  and 
• able to demonstrate access to, or the beneficial use of, any intellectual property necessary to carry 
out and/or commercialise the project. 
 
Applications were then assessed by the I nnovation Australia Board against the following 
equally weighted merit criteria: 
 
1. Management capability 
2. Project commercial potential 
3. Project technical strength (including technical capabilities) 
4. 
Project national benefits 
5. Impact of funding on project outcomes 
6. Potential for greenhouse gas abatement. 
 
The program closed to new applications on 29 April 2008.    G/SCM/Q2/AUS/43 
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  II. PASSENGER MOTOR VEHICLES 
 
Automotive Competitiveness and Investment Scheme (ACIS) 
 
Question 2 
 
 This programme provides duty credits to various types of automotive producers which 
can be used to pay customs duty on certain eligib le imports.  The duty credits are earned on the 
basis of a percentage of eligible production, and eligible investments in plant and equipment.  
What are the specific criteria for determining "eligib le production" and "eligible investments"?    
 
Reply  
  'Eligible production' is the production of 'motor  vehicles', 'engines' and 'engine components', 
which are defined as 'MVP production' in section 6 of the ACIS Administration Act 1999 , also 
available at www.comlaw.gov.au
. 
  'Eligible investments' are investments in a llowable plant and equipment and investments in 
allowable research and development. The criteria for what is considered 'allowable' is set out in regulation 13E and 13G of the ACIS Administration Regulations 2000 , available at 
www.comlaw.gov.au.   
 
 Australia would also draw attention to its r esponse to earlier similar questions contained in 
WTO document G/SCM/Q2/AUS20 of 13 August 2001.    
III. QUEENSLAND 
 
Business and Industry Transformation Incentives 
 Question 3 
 
 This programme provides grants for projects that will drive Queensland towards an 
"international competitive, sustainable and knowledge-intensive future through seeking 
projects that are transformational at a business le vel as well as at an industry level".  Please 
explain what is meant by an eligible applicant mu st "have been trading for at least the last two 
years".  Please further explain how it is determin ed that an applicant satisfies this eligibility 
criterion.   
 
Reply
 
  In this context, 'trading' means that the a pplicant has been conducting business operations.  It 
is not a reference to importing a nd/or exporting.  The fact that an  applicant has been trading for 
two years is proven by submission of 2 years of financial statements.  This provides sufficient 
information to undertake a due diligence including a financial assessment and to identify any risks in 
relation to the financial situation of the applicant.    
Additional Programme  
 
Question 4 
  Public sources indicate that Australia administers another programme that was not included in this notification.  For this progra mme, please explain whether this programme still G/SCM/Q2/AUS/43 
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  exists and, if so, why the programme is not no tifiable pursuant to Article 25 of the Subsidies 
Agreement.    Victorian Companies Venture into Collaborative Export Marketing  
 Under this "Collaborative Export Market ing" programme, the state government of 
Victoria seeks to encourage groups of compani es to explore and participate in international 
activities such as group marketing approaches and group technology marketing applications.  
This programme will support work on joint export initiatives and bidding for major 
international projects.  Financial support in the form of a 50 per cent subsidy of up to $30,000 
will be provided to applicants against expendi tures to develop and/or implement a group's 
export marketing strategy. 
 
Reply
 
 
 This program no longer exists.   
 
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