WORLD TRADE  
ORGANIZATION   
G/SCM/Q2/AUS/45 
10 April 2012 
 (12-1849) 
Committee on Subsidies 
and Countervailing Measures Original:   English 
 
 
SUBSIDIES 
 
Replies to Questions from the EUROPEAN UNION1 Regarding the  
New and Full Notification of AUSTRALIA2 
  
 The following communication, dated 23 March 2012, is being circulated at the request of the 
Delegation of Australia.    
_______________ 
 
 
A) FOREST INDUSTRIES DEVELOPMENT FUND 
 
Q.1 Please provide us details about the eligibility cri teria, the eligible costs and the percentage of 
the costs covered by the grant. 
 Reply 
  The scheme closed in June 2011.  The respon se below is based on the criteria on which the 
scheme operated up to the closure date.  
 Individual businesses and organizations i nvolved in the Tasmanian native timber industry 
were eligible to apply for the program.  Applicants must have:    
 secured long-term access to a sufficient qua ntity and quality of forest products to 
undertake the proposal;  or 
 been engaged in the harvest and/or haulag e of those products under contract;  or 
 purchased wood from a wood supply contract for native forest or hardwood plantation 
wood.   
 Applicants were required to show that:   
 
 their project was industry and market-f ocused and commercially viable;  and 
 their business was financially sound and cap able of providing or attracting the 
necessary funds to complete the proposed project.   
 Applicants who were not participating in the industry at the time of application were required 
to demonstrate:   
 
 the existence of a secure agreement for resource supply as evidence of sufficient 
resources to undertake the proposal and participate in the industry;   
                                                      
1 G/SCM/Q2/AUS/44.   
2 G/SCM/N/220/AUS.   G/SCM/Q2/AUS/45 
Page 2 
 
 
   that their business had capable management;  and 
 that they were contributing to the industry's competitiveness.   
 The program is intended to supplement investme nt by the applicants.  As a general rule, 
successful projects will be offered a maximum federal grant of 30 per cent of total project costs with a maximum contribution of 20 per cent of the total proj ect costs, by participating states and territories. 
 
 Further information can be found in Sections  5 and 6 in the applicant guidelines for each 
round of the Forest Industries Development Fund Application Fund: 
 
Round 1:  
 
http://www.daff.gov.au/forestry/national/fidf/forest _industries_developmen t_fund_applicant_guidelin
es_round_1_-_january_2009  
 
Round 2:  
http://www.daff.gov.au/forestry/national/fidf/forest _industries_developmen t_fund_applicant_guidelin
es_round_2_-_august_2009  
 
B) COMMERCIAL READY 
 
Q.2(a) Please define the eligible industry sectors. 
 
Reply 
 
 The scheme was closed to new applicants on 28 April 2008.  The response below is based on 
the criteria on which the scheme operated up to the closure date.  
 Commercial Ready was a competitive grants program that opened to applicants on 
1 October 2004, and closed to new applicati ons on 28 April 2008.  The program was open to 
applicants from all industry sectors. 
 
Q.2 (b) Please provide details about the eligible costs. 
 
Reply 
 
 Eligible expenditure is limited to the perform ance of research and development (R&D), proof 
of concept and early stage commercialisation activities of the agreed project.   
 Only expenditure incurred on eligible activ ities within the agreed project period (as 
highlighted in the grant agreement) is eligible e xpenditure.  Categories of eligible activities include: 
 
a) Labor expenditure 
b) Contract expenditure 
c) Plant expenditure 
d) Prototype expenditure 
e) Intellectual property expenditure 
f) Collaboration expenditure  
g) Other expenditure  G/SCM/Q2/AUS/45 
 Page 3 
 
 
  a. Travel costs 
b. Training costs 
c. Product liability insurance costs 
d. Audit costs 
 
 For further information about these heads of costs please see:  
 
http://www.ausindustry.gov.au/InnovationandRandD /CommercialReadyCR/Pages/CommercialReady
ProgramGuidelines-31August2005.aspx   
 
C) CLIMATE READY 
 
Q.3(a) Please provide eligibility and merit criteria 
 
Reply 
  The scheme closed on 25 June 2009.  The r esponse below is based on the criteria on which 
the scheme operated up to the closure date. 
 
 To be eligible for a large Climate Ready gr ant (A$500 001 to $5 million), applicants had to: 
 
 be a non-tax exempt company incorporated under the Corporations Act 2001 ; and 
 have a combined annual turnover (including each  related body corporate) of less than A$100 
million in each of the three financial years befo re the financial year in which the application 
was lodged.  
 To be eligible for a small Climate Ready gr ant (A$50 000 to $500 000), applicants had to:  
 
 either be a non-tax exempt company incorporated under the Corporations Act 2001  or an 
individual who warranted in the application to form such a company to sign a grant agreement 
and undertake the project if offered assistance;  and 
 have a combined turnover (including each relate d body corporate) of less than A$100 million 
in each of the three financial years pr ior to lodgement of the application: 
 
o except for companies controlled by an Australian university or public sector 
research organisation, in which case turnover (not including that of related bodies) 
had to be less than A$100 million for each of the three years prior to the lodgement of 
the application. 
 
 An eligible applicant also had to prove:   
 it owned, or had beneficial access to, all inte llectual property needed to undertake and/or 
commercialise the project; and 
 it could fund its share of project costs without relying on any other government grants.  
 
 Applications were then assessed by the Innovation Australia Board against the following 
equally weighted merit criteria:   
1. Management capability 
2. Project commercial potential G/SCM/Q2/AUS/45 
Page 4 
 
 
  3. Project technical strength (including technical capabilities) 
4. Project national benefits 
5. Impact of funding on project outcomes. 
 
 The merit criteria were deliberately broad, to enable support to be delivered to a broad base of 
industry with diverse needs.   
 
 Climate Ready consisted of four funding Rounds , each with a closing date for applications. 
Eligible applicants completed an application form  describing the planned outcomes of the project and 
addressing the merit criteria.  
  Applications were assessed by the Board of I nnovation Australia or its delegates (the Climate 
Ready Committee) on a competitive basis.  
  Recommendations regarding successful projects we re approved by the Program Delegate, an 
employee of the Department of Innovation, Industry, Science and Research authorised by the Minister 
of Innovation, Industry, Science and Research, (or ot herwise authorised) to carry out that function.   
 
 The Industry Research and Development Act 1986  (which underpins the Climate Ready 
Program) prevented the Minister, or his advisers, from being involved in the consideration of funding 
assistance for applications under this program.    Q.3(b) Please provide information about eligible costs.  
Reply 
 
 Eligible expenditure is limited to the perform ance of research and development (R&D), proof 
of concept and early stage commercialisation activities of the agreed project.   
 Only expenditure incurred on eligible activ ities within the agreed project period (as 
highlighted in the grant agreement) is eligible e xpenditure.  Categories of eligible activities include: 
 
a) Labor expenditure 
b) Contract expenditure 
c) Plant expenditure 
d) Prototype expenditure 
e) Intellectual property expenditure 
f) Collaboration expenditure  
g) Other expenditure 
a. Travel costs 
b. Training costs 
c. Product liability insurance costs 
d. Audit costs 
 
 For further information about these heads of costs please see:   
http://www.ausindustry.gov.au/Inno vationandRandD/ClimateReadyProgram/Documents/Climate%20
Ready%20Eligible%20Expenditure%20Guidelines.pdf    G/SCM/Q2/AUS/45 
 Page 5 
 
 
  D) RENEWABLE ENERGY DEVELOPMENT INITIATIVE 
 
Q.4(a) Please provide eligibility and merit criteria 
 Reply 
  The scheme was closed to new applicants on 28 April 2008.  The response below is based on 
the criteria on which the scheme operated up to the closure date.  
Expenditure on the following activities was  eligible, subject to salary and other limits:  
 
• research and development  
• proof-of-concept activities  
• early-stage commercialisation activities.  
 
 The complete Eligible Expenditure Guide lines for this program are available at:  
 
http://www.ausindustry.gov.au/InnovationandRandD /RenewableEnergyDevelopmentInitiativeREDI/
Documents/REDI_eligible_expenditure_gui delines_27_September_200720070928100207.pdf   
 
 Proposals were evaluated against several sets of merit criteria.  Highest priority was given to 
national productivity and economic growth criteria b ased on the potential of the project and/or the 
commercialisation of its outcomes, including to: 
 
• contribute to the development of strategic industry clusters;  
• improve the efficiency, competitiveness and productivity of Australian industry (for 
example, through the development or adoption of new technologies or processes);  and 
• lead to the establishment of new Australian industries, or generate significant new value 
adding operations, with associated significant new employment opportunities.  
  A more extensive list of merit criteria is available at:   
 
http://www.ausindustry.gov.au/InnovationandRandD /RenewableEnergyDevelopmentInitiativeREDI/
Documents/REDI%20national%20benefits%20policy%20Oct%2007.pdf   
 
Q.4(b) Please provide information about the eligible costs 
 
Reply 
 
 Eligible expenditure is limited to the perform ance of research and development (R&D), proof 
of concept and early stage commercialisation activities of the agreed project.   
 Only expenditure incurred on eligible activ ities within the agreed project period (as 
highlighted in the grant agreement) is eligible e xpenditure.  Categories of eligible activities include: 
 
a) Labor expenditure 
b) Contract expenditure 
c) Plant expenditure 
d) Prototype expenditure 
e) Intellectual property expenditure G/SCM/Q2/AUS/45 
Page 6 
 
 
  f) Collaboration expenditure  
g) Other expenditure 
a. Travel costs 
b. Training costs 
c. Product liability insurance costs 
d. Audit costs 
 
 For further information about these heads of costs please see:   
http://www.ausindustry.gov.au/InnovationandRa ndD/CommercialReadyCR/Documents/CR%20eligib
le%20expenditure%20guidelines%2027%20September%202007%20IA%20update.pdf   
 
Q.4(c) Please give details of the extent (units  and values) to which the products developed under 
this scheme are or have been exported.   
 No relevant statistical information has been  collected.  Details of all funded projects are 
available at:    
http://www.ausindustry.gov.au/innovationandrandd/r enewableenergydevel opmentinitiativeredi/pages/
home.aspx   
 
E) COMMERCIALISATION AUSTRALIA 
 
Q.5(a) Please provide eligibility and merit criteria.  
 
Reply 
 Eligibility Criteria 
 
 Skills and Knowledge Under the Skills and Knowledge component of Commercialisation 
Australia, funding is provided for obt aining expert advice and services to assist in the 
commercialisation process.  
 Experienced Executives 
  The employment of an experienced chief ex ecutive officer or other executive is supported 
under the Experienced Executives component. The executive is expected to bring complementary 
skills and experience that assist existing manage ment to drive the business towards a successful 
launch of its new product, process or service in the marketplace.  
 
Proof of Concept 
  Funding for activities associated with the step s necessary to establish the commercial viability 
of a new product, process or service is provided under the Proof of Concept component. 
 
Early Stage Commercialisation 
  Commercialisation Australia  provides funding for the steps necessary to bring a new product, 
process or service to market under the Early Stage Commercialisation component.   G/SCM/Q2/AUS/45 
 Page 7 
 
 
  Merit criteria  
 
 Eligible Commercialisation Australia applications are assessed against the program merit 
criteria as outlined below.  
 
Need for Funding 
 
• The applicant must be able to demonstrate that  they have insufficient funds to undertake the 
required commercialisation activities and that it would be unreasonable to expect the 
applicant to raise all of the necessary funding otherwise. 
• Only applications that have a genuine need  for funding will be assessed against the other 
criteria. 
 
Market Opportunity 
 
• The need for the new product, process or service is clearly defined.  
• The type of customer is clearly defined.  
• The size of the target market.  
• The strength of the intellectual property and how it will address the market opportunity.  
 
Value Proposition  
 
• A clear, concise and compelling value proposition , i.e. why the customer wants the product, 
process or service.  
 
Execution Plan  
 
• A sound execution plan to capture the opportuni ty and manage the risks, for example 
 
- a clear set of objectives  
- a clearly defined path to market  - an understanding of the key structural or market challenges to be resolved  
- a sound IP  strategy  
 
Management Capability  
 
• The applicant  demonstrates an appropriate level of expertise in:  
 
- commercialisation management  
- project management  - business management  
- the relevant sector/technology domain  
 
National Benefits , including 
 
• Significant spill-over benefits will accrue to Australia through the conduct of the project 
and/or commercialisation of its results, including:  
 
- diffusion of knowledge and skills;  
- diffusion of new products, processes or services; and/or  
- increased collaboration between businesses and/ or businesses and research institutions.  G/SCM/Q2/AUS/45 
Page 8 
 
 
  Q.5(b) How many projects have been approved during each of the mentioned periods? What 
was the average grant amount respectively?  
Reply 
  In 2009-10, 32 projects were approved worth $11.9 million with average grant support per 
participant being approximately $372,000.  In 2010-11, 98 projects were approved worth 
$39.6 million with average grant support pe r participant of approximately $404,000. 
 
 As of 3/2/2012 the Minister had announ ced Commercialisation Australia support for 
205 participants with total f unding in excess of $82million. 
 F) INDUSTRY COOPERATIVE INNOVATION PROGRAM 
 
Q.6(a)  Please provide details about eligible business assistance.  
 Reply 
  The scheme closed on 30 June 2011.  The r esponse below is based on the criteria on which 
the scheme operated up to the closure date.  
 The Industry Cooperative Innovation Program (ICIP) offered two streams of funding 
assistance:   
 Stream A:  for small scale cooperative projects aimed at identifying the strategic planning of 
future innovation in an industry, such as project scoping or innovation mapping.  
 Stream B:  for more extensive cooperative projects aimed at progressing strategic innovation 
and achieving significant benefits for an indust ry, such as research and development (R&D), 
proof of concept, implementation activit ies and demonstration and adaptation. 
 
 The ICIP only supported cooperative industry pr ojects involving eligible activities.  Stream A 
and Stream B projects had distinct eligible activities.   The ICIP did not fund projects involving a mix 
of Stream A and Stream B eligible activities.   
 
 Stream A eligible activities included:  
 Project scoping activities:  Activities aimed at effectively assessing the cost, skills, risks, 
outcomes, stakeholders, commercial opportunities,  feasibility and/or any other parameters of 
a potential Stream B project. 
 Innovation mapping activities:  The steps requi red to determine the collective capability, 
gaps, goals, and long term stra tegy for an industry in terms of innovation.  These activities 
might seek to develop a collective industry understanding in areas such as: 
 
o broad technological sophistication and future direction for that industry; 
o appropriate mechanisms for cooperation within the industry on innovation projects 
(including industry clusters);  or 
o emerging technologies. 
 
 Stream B eligible activities included: 
  G/SCM/Q2/AUS/45 
 Page 9 
 
 
  o Research and development activities:  The sy stematic, investigative and experimental 
activities that involve innovation that w ill enable development of new products, 
processes and services in an industry context.   
o Proof of concept activities:  The steps n ecessary to establish the viability, including 
technical and commercial viability of a prod uct, process or service, in an industry 
context.  
o Innovation demonstration and adaptation activities:  The st eps necessary to 
demonstrate how new products, processes or services that have been proven in one 
context can be implemented into a new Aust ralian industry context for the benefit of 
that industry. 
o Innovation implementation activities:  The systematic work necessary for installing 
and establishing tools, processes, systems a nd services to implement innovation in an 
industry. 
 
Q.6 (b) Please provide details about eligible co sts and percentage of costs covered by funding. 
 Reply 
  ICIP offered two streams of funding assistance:   
 
Stream A provided funding of up to $150,000 (e xcluding GST) for eligible projects taking up 
to 18 months to complete. Government funding was limited to 50 per cent of eligible project 
costs.  Stream B provided funding of up to $3 million (excluding GST) for eligible projects taking up 
to three years to complete. Government funding  was limited to 50 per cent of eligible project 
costs.  
 
There was a minimum grant size of $50,000 for both streams. 
 
 Only expenditure incurred on eligible activ ities within the agreed project period (as 
highlighted in the grant agreement) was consider ed eligible expenditure. Categories of eligible 
activities included:  
Salaries:  expenditure considered under this cat egory related to people directly employed on 
the core elements of the agreed ICIP project. 
 
Project administration: expenditure included a set amount calculated as 35 per cent of project 
salary costs. On-costs could also be claimed for the project to cover expenditure on office 
space hire, lighting, heating, administrativ e consumables, computing and communication 
facilities, stationery, accounting and bank charges, communication activities, subscriptions, travel, accommodation, and living expenses, mee ting costs and any other costs associated 
with maintenance of the project consortium, including legal and financ ial advice relating to 
the project. 
 
Contractor Expenditure:  expenditure covered th e cost of agreed activities to be performed by 
an organisation or individual other than the Funding Recipient/consortium members, under 
the terms of a separate contract between the Funding Recipient /consortium member and the 
third party.    
Plant and Equipment:  expenditure included: 
 
the cost of depreciation of newly constr ucted, purchased or pre-existing plant, 
equipment, tools or infrastructure used to pursue the agreed project G/SCM/Q2/AUS/45 
Page 10 
 
 
  the cost of hiring or leasing plant, equipmen t, tools or infrastructure used to pursue 
the agreed project 
the cost of consumables used in the conduc t of the project, other than administrative 
consumables 
 
New leading-edge Technology Acquisition and Adaptation: expenditure included new and 
leading edge technologies and soft infrastructure such as platform technology, software or 
intellectual property essential to the project.  Th is did not include off-the-shelf software 
programs or operating systems.   
 G) COMMERCIALISING EMERGING TECHNOLOGIES 
 
Q.7 Please provide details about eligible business assistance   
Reply 
 
 The scheme closed on 30 June 2011.  The r esponse below is based on the criteria on which 
the scheme operated up to the closure date. 
 
 A project was eligible if it aimed to prod uce, establish the commercial viability of, or 
commercialise a new, clearly identified product, process or service.  
 
Examples of eligible projects are projects that aim to:   
• Complete development of a new product, process or service, or 
• Prove commercial viability of a new product, process or service to a customer or strategic 
partner.  
 
Eligible Activities and Expenditure 
 
Skills and Knowledge   
 Under the Skills and Knowledge component of Commercialisation Australia, funding is 
provided for obtaining expert advice and services to assist in the commercialisation process. 
  Examples of expert advice and services include (but are not limited to):  
 
• Business planning  
- developing or reviewing a business plan  
- determining suitable corporate structures  - undertaking a risk analysis  
• Commercialisation  
- undertaking market research  - developing a market strategy  
- developing an export strategy  
• Intellectual property management  
- commissioning an IP landscape report  
- developing an IP protection strategy  
- preparing a patent application (but fees to a patent office such as registration and 
maintenance fees are ineligible)  
- developing or reviewing IP licensing agreements  
• Capital raising  
- developing an investment proposal and pitch   G/SCM/Q2/AUS/45 
 Page 11 
 
 
  - developing a capital plan to identify funding requirements  
• Linkages  
- developing a partnership or collaboration agre ement with another business or organisation.  
 Experienced Executives 
  The employment of an experienced chief ex ecutive officer or other executive is supported 
under the Experienced Executives component.  The executive is exp ected to bring complementary 
skills and experience that assist existing manage ment to drive the business towards a successful 
launch of its new product, process or service in the marketplace.  
  The maximum grant is $350,000 over two years (up to $175,000 per 12 month period).  
 
 Where the experienced execu tive to be employed by the applicant is not known at the time of 
application the applicant must select a person and seek the consent of the CEO of Commercialisation 
Australia within three months of notification that the application for an Experienced Executives grant 
was successful.   Proof of Concept  
 Funding for activities associated with the step s necessary to establish the commercial viability 
of a new product, process or service is provided under the Proof of Concept component.  
  Projects should be geared toward proving the value proposition , or a critical component of the 
value proposition , that is described by the applicant in Part C of the Stage 2 Application Form under 
Merit Criterion 3.  Expenditure must be incurred on e ligible project activities, and after an application 
has been accepted, to be considered eligible expenditure .  However, grant funding is only guaranteed 
when a funding agreement is executed, and, therefore, the applicant bears the risk of any expenditure 
incurred before then.   Early State Commercialisation  
 Commercialisation Australia provides funding for the steps necessary to bring a new product, 
process or service to market under the Early Stage Commercialisation component.  
 
 Only expenditure that is directly related to eligible project activities, and has been incurred on 
activities that occur after an application h as been accepted, can be deemed to be eligible expenditure .  
However, grant funding is only guaranteed when a funding agreement is executed, and, therefore, the 
applicant bears the risk of any expendi ture incurred before then.  
 
H) AUTOMOTIVE COMPETITIVENESS AND INVESTMENT SCHEME (ACIS) 
 
Q.8(a) Please provide details about eligible production. 
 Reply 
  The scheme closed on 31 December 2010.  Th e response below is based on the criteria on 
which the scheme operated up to the closure date.  
Eligible participants included motor vehicle producers;  automotive component producers;  
automotive machine tool and/or tooling pr oducers;  and automotive service providers. G/SCM/Q2/AUS/45 
Page 12 
 
 
   Eligible production relates only to motor ve hicle producers' production of motor vehicles, 
engines and engine components.  Motor vehicles a nd engine components are de fined in the relevant 
legislation.  
Engine components  are defined as  
 
(a) parts for engines classified to heading 8409; 
(b) balance shafts, camshafts, crankshafts, plain shaft bearings, flywheels and pulleys classified to heading 8483; 
(c) oil pumps, fuel pumps and water pumps classified to heading 8413; 
(d) starter motors, alternators and ignitio n equipment classified to heading 8511; 
(e) engine management systems classified to heading 8537 or 9032; 
(f) automatic voltage regulators classified to heading 9032; 
(g) ignition wiring sets clas sified to heading 8544. 
 
motor vehicle  means any vehicle (other than a used vehicle): 
 
(a) that has a gross vehicle weight of not more than 3.5 tonnes; and 
(b) that would be classified to:  (i) a subheading of heading 8702 or 8703 (other than 
8703.10.00) of Schedule 3 to the Tariff;  or (ii) subheading 8704.21, 8704.31 or 8704.90 of Schedule 3 to the Tariff. 
 
I) AUTOMOTIVE TRANSFORMATION SCHEME (ATS) 
 
Q. 9 Please provide details about eligible pr oduction, eligible investments in plant and 
equipment and eligible sales. 
 Reply 
 Please see response to Q.8 in regard to eligible production. 
 Eligible investment  is defined in the relevant legislation. 
 
Eligible investment  is investment by a participant in the Sc heme in allowable plant and equipment or 
allowable research and development.  Allowable plant and equipment is: 
 
(a) plant and equipment for the manufactur e, assembly, design, development or 
engineering of motor vehicles, engines, engine components, automotive components, 
automotive machine tools or automotive tooling; 
(b) plant and equipment directly supporting the manufacture, assembly, design, development or engineering of motor vehicl es, engines, engine components, automotive 
components, automotive machine tools or automotive tooling; 
(c) plant and equipment required to comply with a law of the Commonwealth, a State or 
a Territory relating directly to the manufacture,  assembly, design, development or engineering 
of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling; 
(d) plant and equipment for the activation of manufacturing processes for the production 
of motor vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling; 
(e) plant and equipment facilitating the provision of automotive services or allowable 
research and development;  G/SCM/Q2/AUS/45 
 Page 13 
 
 
  (f) plant and equipment indirectly supporting f unctions that are integral to the production 
of motor vehicles, engines, engine components, automotive components, automotive machine 
tools or automotive tooling. 
 
Allowable research and development  is research and development activities that are: 
 
(a) directly related to the design, develo pment, engineering or production of motor 
vehicles, engines, engine components, automotive components, automotive machine tools or automotive tooling; and 
(b) undertaken for the purpose of: (i) acquiring new knowledge; or (ii) creating new or 
improved materials, products, devices, production processes or services. 
 
and includes the following activities: 
 
(a) basic and strategic research; 
(b) industrial and engineering design; 
(c) production engineering; (d) development activities relating to the building and testing of prototypes; 
(e) re-engineering and modification of existing products and processes; 
(f) development and installation of purpose-d esigned systems for:  (i) quality assurance 
and process control; or (ii) materials or movement control; 
(g) testing and modification of new pr oduction systems (either purpose-built or 
interchangeable) to achieve repeatab ility within specified tolerances; 
(h) obtaining industrial property rights, including:  (i) the preparation and lodging of 
applications and other documents that are require d to be lodged, in Aust ralia or elsewhere, for 
the initial grant or registration of the rights;  and (ii) the initial grant or registration of the 
rights, in Australia or elsewhere; 
(i) activities conducted at the ATS participant' s own expense that are aimed at improving 
a product or process of an engine or component supplier to the ATS participant. 
 Eligible sales   
 A process of modulation applies to ensure that the ATS year cap for assistance is not 
exceeded.  No ATS participant is permitted to r eceive assistance exceeding five per cent of the sales 
value of the ATS participant's goods and services for the previous year or, if the ATS participant is in 
an eligible start-up period, no more than 15 per cent of its eligible start-up investment. 
 Sales value  is defined in the legislation and means: 
 
(a) for the sale of goods produced in Australia  by an ATS participant — the value of the 
goods sold reduced by the amount of sales tax payable on those goods;  and 
(b) for the sale of services provided in Austra lia by an ATS participant — the value of 
the services. G/SCM/Q2/AUS/45 
Page 14 
 
 
  J) GREEN CAR INNOVATION FUND (GCIF) 
 
Q.10(a) Please quote the eligible costs and provi de details on the exceptional basis referred. 
 
Reply 
 
 The Green Car Innovation Fund (GCIF) closed on 27 June 2011.  The responses below refer 
to the conditions of the scheme as they existed up to this date. 
 
 A small proportion of grants were made on th e exceptional basis referred to in Australia's 
notification (G/SCN/N/220/AUS).  Arrangements for these grants were commercial-in-confidence.  In 
making a decision on whether to agree to an excep tion to the total amount of financial assistance 
provided for a grant under the GCIF, the Government's aim of achieving investment in the ratio of one 
dollar of Government funding for every three dollars  contributed by grantees across the life of the 
program, and also the risk profile of the project a nd the value of in-kind contributions was taken into 
account.  Applications needed to rank highly agains t all the merit criteria with compelling reasons to 
be considered.    
 Generally, expenditure under the following head ings was eligible if it directly related to 
eligible project activities (R&D, proof-of-concept,  early-stage commercialisation and pre-production 
development): 
 
 labour (including salaries, special bonus for employing recent graduates); 
 contract expenditure; 
 plant and equipment; 
 acquisition and adaptation of new and leading-edge technology; 
 prototype; 
 IP protection; and 
 collaborative project expenditure.  
 
 Other miscellaneous expenditure items, if direc tly related to eligible project activities, may 
also have been eligible.  
 
 The GCIF eligible expenditure guidelines  explain the costs associated with the eligible 
activities that attracted grant funding.   
 The eligible expenditure guidelines  are available from the AusIndustry website 
www.ausindustry.gov.au . 
 
Q.10(b) Please provide details about eligibility and merit criteria.   
 
Reply  
 
The merit of eligible applications were assessed  by Innovation Australia against the following 
equally-weighted merit criteria. 
 
Criterion 1:  The extent of the reduction in pa ssenger motor vehicle fuel consumption and/or 
greenhouse gas emissions arising from the proposed project. 
Criterion 2: The technical merit and extent and calibre of innovation generated in Australia by the 
proposed project. 
Criterion 3: The capacity and capability of the applicant to undertake the project, including 
management capability.  G/SCM/Q2/AUS/45 
 Page 15 
 
 
  Criterion 4: The commercialisation potential of the proposed project to the benefit of Australia. 
Criterion 5: The contribution of the proposed project to a sustainable and internationally 
competitive Australian automotive industry, and th e benefits to the broader Australian economy. 
 
Q.10(c) Please provide details about Stream B.  
Reply  
 
 To be eligible to apply under  Stream B, applicants must: 
 
 be a non-tax exempt company incorporated under the Corporations Act 2001,  or an 
individual or other entity type that warrants to form a company, if offered assistance and 
prior to signing a grant agreement; 
 not be a Motor Vehicle Producer registered under ACIS  or ATS, or, an entity related to a 
Motor Vehicle Producer registered under ACIS  or ATS,  unless otherwise agreed by the 
Program Delegate  on an exceptions basis; and 
 be applying for a grant of $100,000 or more. 
  The cumulative total of grants allocated to a Stream B applicant must not exceed $100 
million. 
 
 Applicants under Stream B must also demonstrate: 
 
 an ability to fund the costs of the proposed project which are additional to the grant being 
sought;  and 
 access to, and sufficient rights in, all intellectual property necessary to carry out and 
commercialise the project, including any inte llectual property developed as a part of the 
project. 
 
K) AUTOMOTIVE INDUSTRY STRUCTURAL ADJUSTMENT PROGRAM  
Q.11(a) Please give details about the "discretion of  the Minister…" and the criteria on the basis 
of which the grants are awarded. 
 
Reply 
 
 The size of the grant is at the discretion of the Minister.  However, the amount of a grant made to an entity in respect of eligible expenditu re incurred by the entity must not exceed the amount 
of that eligible expenditure.   
  The Minister must not agree to a structural ad justment grant if the amount of all structural 
adjustment grants so agreed would exceed the program funding.  Total funding for the program 
between 2008/09 and 2011/12 is $78.016 million.  Further, the Minister will not agree to a grant if the 
amount of all grants for that year exceeds the amount available for that year.  
  The Minister has regard to the following policy objectives: 
 
 to facilitate structural adju stment within the automotive supply chain to achieve global 
scale and retain core capabilities, by provid ing assistance to firms to merge;  and  
 to strengthen the automotive components sector to enable it to continue providing secure 
employment to as many skilled workers as possible.  G/SCM/Q2/AUS/45 
Page 16 
 
 
   The AISAP Ministerial Guidelines can be found at 
http://www.innovation.gov.au/Industry/Automotive/ NewCarPlan/Pages/MinisterialGuidelines2010.as
px. 
 
 A structural adjustment grant  is a grant relating to eligible expenditure that is incurred by a 
resultant entity for an eligible activity relati ng to a structural adjustment initiative.   
 
A structural adjustment initiative  is an initiative that:  
 
 involves the restructuring by way of merger or acquisition of 2 or more participant entities 
each of which is not an associate of another entity taking part in the restructuring; and  
 results in a resultant entity that is likely to be more financially viable or competitive than 
would have been the case if the restructuring had not taken place; and  
 has the effect that only the resultant entity will be eligible to apply to be an ACIS or ATS 
participant after the completion of the restructuring; and  
 is the subject of a statement of strategic bus iness intent that includes the business, operational 
and financial strategies that will guide the resu ltant entity to sustainable operations beyond the 
completion of the restructuring; and  
 is likely to result in demonstrable economic a nd strategic benefits to the automotive industry 
(including, but not limited to, better employment outcomes than would have been the case in the absence of the initiative).  
 Q.11. (b) What are the eligible costs and to what  percentage are they covered by the grant?  
 
Reply 
 
 Expenditure on an eligible activity is:  
 
 expenditure incurred by any of the entities taking pa rt in the structural adjustment initiative in 
respect of the eligible activity is taken to have been incurred by the resultant entity;  
 only the expenditure necessary to complete the structural adjustment initiative is eligible 
expenditure; and  
 only expenditure regarded as being expenditure incurred before completion and set out in the 
audited statement referred to in paragraph 15(c) is to be consid ered in determining eligible 
expenditure.  
  Expenditure on second-hand plant and equipment that is purchased otherwise than under a 
hire purchase agreement or by finance through a finance lease is:  
 
 75% of the fair value of the plant and equipmen t is taken to be the value of the plant and 
equipment as capitalised in the resultant entity's accounts;  and  
 expenditure on the plant and equipment is take n to have been incurred only after full payment 
for the plant and equipment has been made.  
 
 Expenditure on second-hand plant and equipment that is purchased under a hire purchase agreement or by finance through a finance lease is:  
 
 75% of the fair value of the plant and equipmen t is taken to be the value of the plant and 
equipment as capitalised in the resultant entity's accounts; and  
 expenditure on the plant and equi pment is taken to have been  incurred only after the first 
instalment under the agreement or lease is paid.  
  G/SCM/Q2/AUS/45 
 Page 17 
 
 
   The expenditure must reflect costs based on fair value and arms length transactions.  
 
L) AUTOMOTIVE SUPPLY CHAIN DEVELOPMENT PROGRAM 
 
Q.13 To what percentage are the eligible costs covered by the grant?    
Reply 
 
One hundred per cent of those costs which are deemed to be eligible will be covered by the grant. 
 M) PHARMACEUTICALS PARTNERSHIPS PROGRAM 
 
Q.14(a) What are the scheme's merit criteria?   
Reply  
 
 The program closed on 30 June 2009.  The response below refers to the criteria on which the scheme operated up to the closure date. 
 
There are four eligibility criteria. All four eligibility criteria must be met in order for an 
application to be considered for funding and given a merit ranking under this Program. 
 
1. The applicant must be a company incorporated under the Corporations Act 2001 (Cth) 
and must be the only company from its group of related bodies corporate that is applying for a 
given round. 
2. The applicant must be part of the pharmaceuticals industry . 
3.  The applicant must have undertaken pharmaceutical R&D activities for at least three 
years prior to the start date of the round. 4.  The applicant must propose to incr ease above a base level its expenditure on eligible 
Australian pharmaceutical R&D activities for each year it applies to participate in the 
Program. 
 
Q.14(b) What are the eligible costs?   
 
Reply 
 
 Eligible Australian pharmaceutical R&D activities means pharmaceutical R&D activities that 
are carried out in Australia.  
Pharmaceutical :  For the purposes of this Program, a pharmaceutical is 
 
– a chemical or biological substance containing one or more active ingredients; 
– used, or intended for use, in the treatment  or prevention of disease in humans;  and 
– registered or intended to be registered under the Therapeutic Goods Act 1989 or under 
equivalent provisions in comparable countries (s uch as, in the United States, through the Food 
and Drug Administration, and in Europe, through the European Medicines Agency). 
 
Pharmaceutical R&D activities  include: 
 
1. Systematic, investigative and experimental ac tivities which have a direct link to, or are of 
direct relevance to, the development of a pharmaceutical or a device for the delivery of a 
pharmaceutical , and 
2. Activities that directly contribute to systemat ic, investigative and experimental activities.  G/SCM/Q2/AUS/45 
Page 18 
 
 
  Subject to the application of the definition of pharmaceutical research and development (R&D) 
activities , the following broad types of activity may be eligible: 
 
a. basic pharmaceutical research; 
b. drug discovery, including biological screening; 
c. the synthesis and/or extrac tion of therapeutic substances; 
d. drug formulation; 
e. bioequivalence studies; f. stability testing on a pharmaceutical; 
g. pre-clinical (including animal toxicology) work and phase I, II and III trials; 
h. clinical trials of a registered drug in a new indication, formulation, route of administration or dosage; 
i. pharmaceutical development activities re lating to the building and testing of 
prototypes; j. laboratory evaluation to determine likely commercial production processes; 
k. scale-up from laboratory to pilot plant; 
l. significant process improvements; m. obtaining industrial rights, including patents (but note expenditure limits); 
n. computer software activities integral to the R&D; and 
o. supporting activities that are directly re lated to the carrying on of the R&Dactivities 
referred to above, including pharmaceutical ser vices such as protocol development; the 
development, preparation and supply of active i ngredients for use in non-clinical testing and 
clinical trials; clinical trial management; bioi nformatics; and biostatistical analysis, activities 
associated with complying with st atutory requirements or standards needed for drug or device 
registration. 
 Q.14(c) How many projects have been approved through the overall period of the scheme?   
 
Reply 
 
Twenty-five offers have been made during the duration of the scheme.  Further details on the 
successful applicants and the amount offered can be found at  
 
http://www.ausindustry.gov.au/Inno vationandRandD/PharmaceuticalsPartnershipsProgramP3/Pages/h
ome.aspx 
 
N) GEELONG INVESTMENT AND INNOVATION FUND 
 
Q.16 Please define the eligible industry sectors   
The program closed on 31 October 2008.  The response below reflects the criteria on which 
the program operated up to the closure date.  
 
There are no 'eligible industry sectors'.  Eligible applicants are legal entities which can 
demonstrate the commitment of funding, exclusive of  in-kind contributions, to an investment proposal 
which is free of other government funding and whic h at least matches the funding which is being 
sought from the program.   G/SCM/Q2/AUS/45 
 Page 19 
 
 
  O) SOUTH AUSTRALIA INNOVATION AND INVESTMENT FUND  
 
Q.17 Please define the eligible industry sectors  
 
Reply 
 
The program closed on 10 September 2010.  The response below reflects the criteria on which 
the program operated up to the closure date.   
There are no 'eligible industry sectors'.  Eligible applicants are legal entities which can 
demonstrate the commitment of funding, exclusive of  in-kind contributions, to an investment proposal 
which is free of other government funding and whic h at least matches the funding which is being 
sought from the program.  
 
P) TEXTILE, CLOTHING AND FOOTWEAR POST-2005 STRATEGIC INVESTMENT 
PROGRAM SCHEME 2005 
 
Q. 18 To what extent did the eligible revenue  concern exports?  What was the respective 
overall revenue and volume of exports? 
 
Reply 
 
 The scheme closed on 30 June 2011.  The res ponse below reflects the criteria on which the 
scheme operated up to the closure date.  
 No relevant statistical information concerni ng exports has been collected as part of the 
scheme.   
  During the scheme's five-year lifetime, $487.5 million in grants was allocated to more than 
500 businesses as a return on capital investment and innovation investment activities. Details of all 
funded projects are available at:   
http://www.ausindustry.gov.au/Manufacturing/Textile sClothingandFootwearTCF/TextilesClothingan
dFootwearTCFPost-2005StrategicInvestment ProgramPost-2005SIPScheme/Pages/home.aspx  
 
Q) TEXTILE, CLOTHING AND FOOTWEAR RESTRUCTURING INITIATIVE 
GRANT SCHEME 
 
Q.19 What is the percentage of eligible expe nditure covered by the grant and the maximum 
grant per entity?  
Reply 
 
 The decision to award a grant and the amount of any grant is at the discretion of the Minister 
for Industry.  Eligible expenditure is capped at five per cent of a firm's annual sales.  
 
 Previous grants awarded under the scheme have provided participants with a similar rate of 
return in respect of their expenditure to that available under the TCF Post-2005 (SIP) scheme (40 per 
cent of eligible expenditure multiplied by the modula tion factor for that year of the TCF post-2005 
(SIP) scheme).  Four grants totalling $6.1 m illion were paid over the period June 2005 – 
February 2008.    G/SCM/Q2/AUS/45 
Page 20 
 
 
  R) TCF SMALL BUSINESS PROGRAM 
 
Q.20 Please provide information about the eligibility criteria, the eligible costs, and the 
percentage covered by the grant.  
 Reply 
 
To be eligible for a grant, the TCF small business should meet the following criteria: 
 
1. Have fewer than 20 employees. 
2. Have not received funding from the TCF (SIP), TCF Post-2005 (SIP) or the Clothing 
and Household Textile (BIC) Schemes, or be  entitled to receive funding under the (BIC) 
Scheme at the time the decision that the a pplicant is eligible for the grant is made. 
3. Have had a turnover of not less than $100,0 00 in the previous year, and must be 
solvent and not under any administrative arrangements. 
4. Must make a cash contribution to the project of no less than 25% of eligible project 
expenditure. This contribution should not have come from a Commonwealth, State or 
Territory Government subsidy. 
5. The project must be aimed at improving the business enterprise culture of the TCF 
small business. 
 
Applications that meet the eligibility criteria will compete on merit against all other 
applications, for that round, from across Australia.  
The merit criteria are: 
 
1. Whether the project's outcome will meet program objectives, assessed by how the 
project will:  
a. contribute to the TCF small business' willingness and ability to take 
risks  
b. contribute to the TCF small business becoming more creative  
c. improve the flexibility or adaptabilit y of the TCF small business, and  
d. contribute to the growth strategy of the TCF small business. 
2. Value for money and commitment. 
3. Whether the project is capable of being commenced and completed within a 12 month 
period commencing with the executi on of the funding agreement. 
 
A maximum of $50,000 is available for a par ticular project. The maximum applies to any 
project, regardless of its size or the cash contributio n made by the applicant (at least 25 per cent of 
eligible expenditure).  
Grants are only to be used for approved expend iture incurred during, not before, the project 
period. Routine business expenses, such as salaries of ongoing employees, a dvertising, or routine 
accounting are not eligible for grant support. 
  Grant funding is only to subsidise actual e xpenditure incurred on project costs for activities 
that occur following the execution of a funding agreem ent—that is, during the project period set out in 
the funding agreement.   
 If a project contains a mixture of eligible a nd ineligible expenditure , the level of funding 
provided to the project may be reduced by the amount  of expenditure assessed as ineligible.  The key 
is to demonstrate the types and amount of eligible (non-routine) expenditure expected to be incurred.  G/SCM/Q2/AUS/45 
 Page 21 
 
 
  S) PRODUCT DIVERSIFICATION SCHEME 
 
Q.21 Please provide more details about the terms of implementation of the scheme. 
 
Reply 
 
 The scheme closed on 30 June 2011.  The res ponse below reflects the criteria on which the 
scheme operated up to the closure date.  
 The Scheme commenced on 1 July 2006 and prov ided assistance in the form of Duty Credit 
to clothing and finished textile firms located in Au stralia to help them internationalise their sourcing 
arrangements and complement their existing pro duct range.  The scheme had an annual cap of 
$5 million. 
  A Producer's Nominated Product had to be an eligible TCF product of the Producer resulting 
directly and predominantly from an eligible clothing activity or an eligible finished textile activity as 
defined by the TCF Post-2005 (SIP) Scheme.  
 A Producer's Nominated Product had to be an eligible TCF product of the Producer resulting 
directly and predominantly from an eligible clothing activity or an eligible finished textile activity as 
defined by the TCF Post-2005 (SIP) Scheme.  T) TEXTILE, CLOTHING AND FOOTWEAR (TCF) STRATEGIC CAPABILITY 
PROGRAM (SCP) 
 
Q.22 Please provide details about the type of elig ible projects, the eligible costs and the merit 
criteria. 
 
Reply 
 
 To be eligible for a grant, the applicant or  lead applicant in the case of a consortium must 
meet the eligibility criteria.  These include (but are not limited to):  
 
(a) being an entity undertaking an eligib le TCF activity or being a prescribed 
entity under the guidelines  
(b) able to demonstrate they can pay their share of the proposed projects costs  
(c) able to demonstrate that the applicati on is for eligible project expenditure, 
and  
(d) able to demonstrate that it has acce ss to, or the beneficial use of, any 
intellectual property required to carry out and commercialise the project.  
 
Proposed projects need to be in the form of one or more of the following activities to be 
considered eligible, including:  
 
2. Innovation, research and design capability.  Supporting projects that will build 
innovative capability, increase the intensity of  research and technology development or 
contribute to market-leading design rele vant to manufacturing in Australia.  
3. New business models and strategic repositioning.  Enabling firms and 
organisations to reposition themselves in r esponse to changing market conditions and 
opportunities with innovative business models.  
4. High-performance work and management systems.  Developing an inclusive 
partnership approach to productivity-enhanci ng organisational change and improvement in 
the workplace.  G/SCM/Q2/AUS/45 
Page 22 
 
 
  5. Education and skills.  Funding educational and skills-development initiatives within 
firms, including in partnership with exte rnal education and training providers.  
6. Environmentally-sustainable and ethical practices.  Helping firms to pursue 
environmentally-sustainable practices and ensuring ethical supply chains.  
 
Types of expenditure that could be considered  as eligible expenditure, to the extent they 
directly support the project, would include:  
 
 wages and salaries;  
 contractors and consultants;  
 plant and equipment  
 prototyping;  
 IP protection and licencing costs (not including costs arising from disputes 
relating to IP);  
 research and development costs;  
 supply chain costs;  
 education and skill development costs; 
 change management costs;  
 collaboration costs;  
 acquisition (for adaption in the project) of new leading edge technologies 
costs; and  
 other expenditure, if directly related to eligible project activities, may be 
considered eligible.  
 
Applications that meet the eligibility criteria will be assessed on the following merit criteria:  
 
(a) How the proposed project will contribu te to building innovative capability in 
sustainable and internationally competitive TCF industries  
(b) The applicant's capacity and capability to undertake the project, including 
management capability  
(c) How the results will be publicised.  
 
Merit criterion 1 is weighted at 60%, cr iterion 2 at 30% and criterion 3 at 10%.  
 
There will be a number of grant payments during the life of the grant.  Payments will be 
milestone-based, as detailed in the funding agreement.   Part of the funding will be paid in advance 
once the funding agreement is signed. The final payment will be dependent on the receipt and 
acceptance of a final audited project report.    
 
 
__________