Far North Queensland Destination Management Company Pty Ltd and Australian Trade Commission
[2000] AATA 1001
•15 November 2000
CATCHWORDS – EXPORT MARKET DEVELOPMENT GRANT – applicant is an inbound incentive travel operator – whether applicant participated in trade fair – what is a trade fair – whether applicant's activities were an eligible tourism service – whether the applicant supplied tourism services – decision set aside and remitted to recalculate the applicant's grant entitlement.
Export Market Development Grants Act 1997- ss. 3, 4, 25(2), 25(4), 28(1), 28(2), 29, 33, 33(2), 36, 37, 89, 101(1), 101(2), 101(3), 107, 114
Export Market Development Grant Regulations 1997 – Reg. 9, Schedule 2, Part 3
Acts Interpretation Act 1901 - s. 15AB(1)(a), 15AB(1)(b)
Export Market Development Grants Act 1974
Australian Trade Commission v Film Funding and Management Pty Ltd (1989) 87 ALR 49; (1989) 24 FCR 595; (1989) 14 IPR 461
DECISION AND REASONS FOR DECISION [2000] AATA 1001
ADMINISTRATIVE APPEALS TRIBUNAL )
) Q1999/514
GENERAL ADMINISTRATIVE DIVISION )
Re:FAR NORTH QUEENSLAND DESTINATION
MANAGEMENT COMPANY PTY LTD
Applicant
And:AUSTRALIAN TRADE COMMISSION
Respondent
DECISION
Tribunal: Miss S A Forgie (Deputy President)
Date: 15 November, 2000
Place: Brisbane
Decision: The Tribunal:
1.sets aside the decision of the respondent dated 18 December, 1998; and
2.substitutes a decision that:
(1)the applicant has incurred claimable expenses in respect of an eligible promotional activity and so has incurred eligible expenses;
(2)the expenses of $37,557.99 are reasonable expenses in respect of the eligible promotional activity; and
3.remits the matter to the respondent to calculate the grant to which the applicant is entitled under the Export Market Development Grants Act 1997.
S A FORGIE
Deputy President
REASONS FOR DECISION
On 7 May, 1999, the applicant, Far North Queensland Destination Management Company Pty Ltd ("FNQD"), applied for review of a decision of a delegate of the respondent, the Australian Trade Commission ("the Commission"), dated 18 December, 1998 and confirmed by a later decision dated 6 April, 1999. That decision was to disallow FNQD's claim for a grant under the Export Market Development Grants Act 1997 ("Act") in respect of the costs of expenditure it had incurred in relation to a theme night that took place during a convention known as "Dreamtime '98".
At the hearing, FNQD was represented by its directors, Mr Byron Kurth and Mrs Kurth with the assistance of Ms Frusher and the Commission by Mr O'Brien of counsel. Regard was had to the documents lodged pursuant to s. 37 of the Administrative Appeals Tribunal Act 1975 ("T documents") together with a video relating to the work of FNQD and to material relating to the theme night.
THE ISSUES
The first issue in this case is whether FNQD participated in a trade fair, and so incurred expenses relating to an eligible promotional activity when it sponsored a dinner at Dreamtime '98. If it did not, the second issue is relevant. That is whether FNQD provided promotional literature or other advertising material. In either case, it is relevant to consider the extent to which any participation in the trade fair or provision of promotional literature or other advertising material is done for an approved promotional purpose. If FNQD is successful in relation to either or both of these issues, the final issue is whether FNQD has substantiated its claim.
BACKGROUND
Many of the facts in this case were not in dispute between the parties. In view of that and on the basis of the material submitted on behalf of FNQD and Austrade, I have made findings of fact that I will set out in the following paragraphs.
FNQD is an inbound incentive travel ground operator that organises ground arrangements on behalf of incentive houses. An incentive house enters arrangements with a company that wishes to provide incentives to its employees (be they employees, agents or the like). As part of those arrangements, the incentive house will record the output of the employees and will arrange the delivery of "rewards" when those employees meet certain standards pre-determined between the incentive house and the company. Where the "reward" includes a travel component, the incentive house approaches an incentive travel operator, such as FNQD, to compile an incentive programme. FNQD is constantly competing against people who are promoting other desirable locations to incentive houses.
FNQD promotes Far North Queensland ("FNQ") and, in doing so, its own creativity. It promotes its product by creatively drawing together those aspects of FNQ that will make people want to visit them. So, for example, a reef tour may be linked with trips on the Skyrail and to other destinations and the tour and trips may be linked with special events. Special events are designed to capture people's imagination and to take them beyond what they have previously experienced. FNQD takes account of the environment, venue, food and theme to create the experience. A special event may take place in conjunction with, for example, a tour to the Great Barrier Reef. The reef tour, the boat, the food and the event are then integrated into the one experience. FNQD operates an events management department to arrange such special events.
The Australian Tourist Commission ("ATC") managed Dreamtime '98, which was held at the Convention Centre at Cairns from 29 March to 2 April, 1998. It was a five day event incorporating a four day workshop and a number of themed events. Dreamtime '98 was a trade show designed specifically for the incentive and meeting markets and its object was to familiarise international buyers with a variety of Australian incentive products and to provide sellers with the opportunity to have their product included in incentive travel programmes.
On the basis of a document entitled "Sellers Prospectus", I find that overseas delegations to Dreamtime '98 were selected after 500 questionnaires had been distributed to Austrade's overseas' offices. Following a "qualifying process … verified by … host international carriers", a short list containing 150 names was prepared. Invitees were drawn from that list of names and represented those markets "… which provide Australia with the most potential for the incentive market. They are: North America, Canada, Asia, Japan, Europe, South Africa, South America and New Zealand." (page 8) Approximately 100 invited delegates were expected to attend together with 20 leading travel writers representing the targeted market areas. Arrangements were made for delegates to nominate those sellers whom they wished to meet. After being notified of those who wished to meet them, the sellers were then asked to nominate the 30 delegates whom they wished to meet. Arrangements were made for 30 scheduled meetings during the workshop period of Dreamtime '98. Another 10 unscheduled appointments were built into that period. Private appointments could also be arranged.
Incentive suppliers were invited to apply to participate in one of the 90 booths available at Dreamtime '98. The ATC set a number of criteria that it applied in selecting the successful applicants. Those criteria included the suitability of incentive product in overseas markets consistent with its marketing strategies, participation in the earlier Dreamtime '94 or '96, demonstrated marketing activities in overseas regions (including advertising and/or trade promotions), availability of product in the overseas market and a major emphasis on Australian products.
Incentive suppliers could choose to pay $5,500.00 to have a booth to themselves or $3,500.00 to share a booth with one other. Both fees included one set of scheduled appointments. A sole booth participant could have two delegates attend the booth and a share booth participant only one delegate. The payment of the fee entitled each participant to receive certain material and to participate in certain workshops as well as to attend the lunches, morning tea and afternoon tea and evening functions as specified in the programme. The programme provided for cocktails and dinner on three of the four evenings of Dreamtime '98.
In addition to becoming a booth participant, incentive suppliers were also invited to apply to become sponsors of certain events. The ATC sought sponsors "… to produce a number of events that showcase their products and the suppliers they use. Sponsors gain significant exposure to the international buyers invited to Dreamtime and are able to use the event to support bids for ongoing business. Detailed costing sheets are distributed to international buyers that list all co-sponsors involved with any sponsored event." (letter dated 4 January, 1999) In its briefing notes for themed events, the ATC advised that buyers were looking for creative, innovative and affordable themed events. The ATC also advised:
" Each event to be fully costed (including commission) – a 'What today cost' sheet is left as a daily pillow gift so that each delegate has an understanding of the event composition and costs. It is important that we do not go overboard with any of the functions, because if we do then the buyers will not be interested in buying it."
It also advised that all sponsors would be acknowledged in the menu and, if appropriate in the Tradeshow manual.
On 18 January, 1998, FNQD entered an agreement with the ATC to supply an event called "Underwater World" at a themed gala dinner on 1 April, 1998. FNQD were co-sponsors. The programme of events refers to the event as "Underwater World" but did not refer to FNQD as a sponsor. At the same time, it did not name any sponsors of events. FNQD was not listed as a major sponsor in the Tradeshow manual given to delegates to Dreamtime '98 but it was listed as the event organiser in the section of the Tradeshow Manual headed "Tropical North Queensland Sponsors & Event Managers". Red Ochre Grill was listed as the caterer, The Tanks Art Centre was shown as the host venue and six groups were listed as providing musical and other entertainment during the evening. FNQD was not shown in the section of the Tradeshow Manual listing gift and merchandise suppliers. That list showed, for example, those who had constructed the rainforest entry to the trade show, who had supplied the Dreamtime '98 staff shirts and who had provided the tea mini packs and anzac cookies in the invitation package.
Transfers to and from the event were incorporated in the programme and conference delegates were reminded that "in most cases the coach journey is part of the event. For this reason, it is essential that all guests travel by coach to each event." A document was circulated to each of the delegates giving details of those sponsoring various events throughout the course of Dreamtime '98. In relation to Underwater World, FNQD was named as event organiser.
FNQD catered for 300 delegates to attend the event. The event began on the evening before the event with an invitation in a bottle left floating in water in the hand basin in the hotel room of each delegate. Entertainment was provided to delegates during the coach transfers to the venue of the event. The event was held at the Tanks Art Centre. Appropriate lighting set the scene in the courtyard during cocktails. Lighting and decoration inside the Tanks, including anchor chain, sand, coral bommies and schools of tropical fish, set an underwater scene at the Tanks. Those waiting on delegates were dressed in dive related costumes. Each circular table had a plaster column decorated with shells and coral and "other marine paraphernalia" with a fish bowl and live reef fish. A place card with a delegate's name and with an inset of a shell, faux pearls and glitter was placed at each place at the tables. Inside each place card was an insert setting out the menu and naming the sponsors, including FNQD, for the event.
Of the delegates who attended the event, 12 were international journalists, 93 international buyers, 13 were ATC staff of whom 9 were based overseas and 100 were Australian sellers. On 6 April, 1998, FNQD sent the ATC an invoice for $26,115.00 for the event. The invoice was based on 350 participants and covered such items as the bottles, pontoon, costumes, lighting, tables and chairs, chair covers, centre pieces, napery, labour, theming and entertainment. Food provided by Red Ochre Grill was invoiced separately by the restaurant in the sum of $29,750.00.
On 21 October, 1998, FNQD lodged an application for a grant under the Act in relation to the grant year commencing on 1 July, 1997. Among the expenses in relation to which the claim was made were those amounting to $37,557.99 paid by FNQD towards the Underwater World dinner. Austrade refused FNQD's application in relation to those expenses.
THE LEGISLATIVE FRAMEWORK
The Act is intended to:
"bring benefits to Australia by encouraging the creation, development and expansion of foreign markets for Australian goods, services, intellectual property and know-how. It does so by providing for an assistance scheme under which small and medium Australian exporters committed to and capable of seeking out and developing export business are repaid part of their expenses incurred in promoting those products." (s. 3)
A person is entitled to a grant if he or she:
"(a) is eligible under Part 3 for a grant in respect of a grant year; and
(b)has incurred eligible expenses in that grant year in relation to eligible products; and
(c)has applied for a grant in accordance with Part 7; ..." (s. 4)
In this case, there is no dispute between the parties that FNQD fulfils the requirements of paragraphs 4(a) and (c). The issue turns instead on s. 4(b). The term "eligible expenses" referred to in that provision is defined in s. 107 to have the meaning given it by Division 1 of Part 5. Section 28(1) also provides that Part 5 defines those expenses that are eligible expenses. Section 28(2) provides that:
"The underlying principle is that the only expenses relating to specific promotional activities genuinely incurred by applicants for the purpose of marketing eligible products in foreign countries should qualify."
General provisions relating to eligible expenditure are found in s. 29. In so far as it is relevant to this case, that section provides:
"... expenses incurred by an applicant for a grant in respect of a grant year are eligible expenses if the following conditions are satisfied:
(a)the expenses are, under section 33, claimable expenses in respect of an eligible promotional activity;
(b)...
(c)the expenses were incurred (within the meaning of Division 3) by the applicant:
(i)...
(ii)... - during the grant year;
(d)the expenses, together with other expenses of the applicant that satisfy paragraphs (a) to (c), add up to $20,000 or more."
The only issue in contention in relation to s. 29 is paragraph (a). The activities which are regarded as coming within the description of an "eligible promotional activity" are specified in column 2 of the table which forms part of s. 33. Column 3 of that table specifies certain expenses and those expenses:
"... to the extent to which they are not excluded expenses under Subdivision 4, are claimable expenses of the applicant in respect of the activity specified in column 2 of that item." (s. 33(2))
Although it is only Item 5 of the table that is relevant in the context of this case, that item should be seen in the context of the table of which it is a part. That table provides:
"Claimable expenses in respect of eligible promotional activities
Column 1Column 2 Column 3
Item Activity Expenses
maintaining an overseas representative on a long term basis in a foreign country to the extent to which the representative is maintained for an approved promotional purposeso much of the expenses incurred by the applicant in a grant year in: (a) maintaining the representative; and (b) meeting the expenses incurred by the representative in soliciting business for the applicant; that, together with similar expenses (if any) incurred in respect of other representatives during the grant year does not exceed $200,000
any visit (marketing visit) made by the applicant or its agent to any place in or outside Australia to the extent to which the visit is made for an approved promotional purposeall expenses: (a)incurred by the applicant in payments to persons that, in Austrade's opinion, were not closely related to the applicant; and (b) that are allowable expenses under section 34
any communication by the applicant or its agent with a potential buyer or a distributor, representative or consultant to the extent to which the communication is made for an approved promotional purposeall reasonable expenses incurred by the applicant in payments to persons that, in Austrade's opinion, were not closely related to the applicant
the provision, primarily for an approved promotional purpose, of free samples to a person that is not a resident of Australia, as follows: (a) provision outside Australia of samples relating to any eligible product of the applicant; (b) provision in Australia of samples relating to eligible tourism services supplied by the applicantall reasonable expenses incurred by the applicant that are attributable to the actual cost of providing samples
participation by the applicant or its agent in a trade fair, or the provision by the applicant or its agent of promotional literature or other advertising material, to the extent to which this is done for an approved promotional purposeall reasonable expenses incurred by the applicant in payments to persons that, in Austrade's opinion, were not closely related to the applicant
engaging as a consultant on a short term basis (either in or outside Australia) a person that, in Austrade's opinion, is not closely related to the applicant, to the extent to which the person undertakes market research, or marketing activities, related to an approved promotional purposeall reasonable expenses incurred by the applicant
The expression "approved promotional purpose" as used in Item 5 has the meaning given by Subdivision 3 of Division 2 of Part 5 of the Act (s. 107 and see also s. 36). Section 37 provides that:
"For the purposes of section 33, an eligible promotional activity in relation to an applicant is for an approved promotional purpose if it is carried out for the purpose of creating, seeking or increasing demand or opportunity in a foreign country for …"
eligible goods, eligible services or eligible intellectual property or eligible know-how which were then specified in paragraphs 37(a)-(g). In this case, there is no evidence that FNQD is an "approved body" within the meaning of s. 107. Therefore, in the context of this case, it is relevant to consider only s. 37(d). It provides that an eligible promotional activity in relation to an applicant is for an approved promotional purpose if its is carried out for the purpose of creating, seeking or increasing demand or opportunity in a foreign country for:
"(d) if the applicant is not an approved body or an approved trading house – eligible services supplied by the applicant; …" (s. 37)
The term "eligible services" is defined in s. 107. Its meanings include "eligible tourism services" (s. 107(c)) and that expression is defined in turn to have the meaning given by s. 25(2):
"Subject to subsection (4), a tourism service is an eligible tourism service if:
(a)the service is supplied in Australia to a person that is not a resident of Australia; or
(b)the service is supplied in Australia:
(i)to a person that is a resident of Australia; but
(ii)for supply by that person, in the course of trade, to a person that is not a resident of Australia."
Section 25(4) qualifies s. 25(2) in that it provides that:
"Despite subsection … (2) …:
…(b)a particular tourism service;
…
that, apart from this subsection, would be an … eligible tourism service … is not such a service if Austrade determines, in writing, having regard to all the facts available to it, that the Australian input in the service is not sufficient to ensure that Australia will derive a significant net benefit from the supply of the service."
A "tourism service" is a "… service prescribed for the purposes of this definition" (s. 107). Regulation 9 of the Export Market Development Grants Regulations 1997 ("Regulations") provides that, "For the definition of tourism service in section 107 of the Act, each service mentioned in Schedule 2 is tourism service." Schedule 2 of the Regulations provides that:
"1. The provision in Australia of the following amenities:
(a)passenger transport by land;
(b)passenger transport by water;
(c)passenger transport by air;
(d)accommodation for at least 1 night;
(e)a tour accompanied by an escort who is not a driver of the tour;
(f)admission to a place, for entry to which payment is required, of any of the following kinds:
(i)a place that has 1 or more outstanding natural features, or is of historical interest;
(ii)a park, nature reserve or botanical garden;
(iii)a wildlife sanctuary or zoological garden;
(iv)a museum, art gallery or craft centre;
(g)admission to:
(i)a place that is, or provides, an amenity appropriate to tourists; or
(ii)an exhibition, fair, festival or similar event;
that is declared by Austrade, by notice in the Gazette, to be a tourist attraction, and for entry to which payment is required;
(h)a service at a place, whether freestanding or part of another building, the principal purpose of which is to provide a venue and associated facilities for meetings, conventions and exhibitions;
(i)food and beverage by set-place table service in a place:
(i)that is designed primarily for the purpose of dining; and
(ii)for which a licence or permit authorising the sale of liquor for consumption on the premises has been given under Australian law;
(j)a service directly related to the act of gambling in a place licensed as a casino under an Australian law.
2.For item 1, a service is not an amenity if is a service:
(a)for a person visiting Australia solely or partly as a tourist; and
(b)that transports the person for a distance not more than 50 kilometres between:
(i)the person's point of arrival in Australia and a place of accommodation; or
(ii)a place of accommodation and the person's point of departure from Australia."
…"
The expression "resident of Australia" is defined to mean:
"(a) an individual;
(i)whose principal place of residence is in Australia; and
(ii)who intends to remain permanently in Australia;
(b)…" (ss. 107 and 114)
Pursuant to s. 101(1), the Minister must determine, in writing, guidelines with which Austrade must comply in exercising certain specified powers and functions under the Act. Those guidelines are not relevant in this case. Pursuant to s. 101(2), the Minister may determine, in writing, guidelines to be exercised by Austrade for the exercise of powers and functions not specified in s. 101(1). If he does so, Austrade must comply with those guidelines (s. 101(3)). The Minister has not made any guidelines that are relevant in this case. Austrade, however, has issued Administrative Guidelines that do not bind it.
CONSIDERATION
The first issue is whether Dreamtime '98 is a trade fair. That expression is not defined in the Act and I am not aware of any authorities in which it has been defined. Consequently, I have had regard to the ordinary meanings of the words "trade" and "fair". Taking first the word "fair" it is defined, in so far as it is relevant, to mean:
"… A periodical gathering of buyers and sellers, in a place and at a time ordained by charter or statute or by ancient custom. Often specialized, as cattle-, horse-, ram-, etc …" (Shorter Oxford English Dictionary, 3rd edition, 1973)
"… 1. an amusement show, originally accompanying a sale of livestock; now usu. travelling from place to place, having sideshows, merry-go-rounds, dodgems, etc. 2. a periodic gathering of buyers and sellers, as of livestock, books, antiques, etc., in an appointed place. 3. an exhibition, esp. an international one, for the display of national industrial and other achievements; World's Fair, International Trade Fair …" (The Macquarie Dictionary, 3rd edition, 1997)
Mr O'Brien relied upon the third meaning given in the Macquarie Dictionary definition to argue that, at the heart of the term "trade fair" is the exposition, through physical representations or displays of a business's products or services. In his submission, a dinner function could not amount to a display or exhibition of goods or services. In my view, this conclusion does not necessarily follow from that part of the definition for, apart from the "display of national industrial … achievements", the words "… display of national … achievements" is very wide indeed. It may well be possible to have physical representations or displays of a business's products or services if they involve, for example, manufactured goods, but much more difficult to have them if the national achievement being displayed is, for example, that of its musicians and film industry. The display may then have to take the form of a performance rather than some physical representation or display of them as might suffice in the case of more tangible goods or services leading to more tangible benefits for the purchaser.
The breadth of meaning of a "trade fair" becomes apparent when regard is had to the meanings of the word "trade":
"4. The practice of some occupation, business, or profession habitually carried on, esp. when practised as a means of livelihood or gain. … II. … 2. Passage or resort for the purpose of commerce; hence, the buying and selling or exchange of commodities for profit; commerce, traffic, trading … " (Shorter Oxford English Dictionary, 3rd edition, 1973)
"… 1. the buying and selling, or exchanging, of commodities, either by wholesale or by retail, within a country or between countries: domestic or foreign trade. 2. a purchase, sale, or exchange. 3. a form of occupation pursued as a business or calling, as for a livelihood or profit. …" (The Macquarie Dictionary, 3rd edition, 1997)
When the ordinary meaning of the word "fair" is taken with that of "trade", it follows that the ordinary meaning of the expression "trade fair" is a periodic gathering of buyers and sellers for the purpose of buying and selling, or exchanging (or for the purpose of displaying for that purpose) the fruits of their occupations, businesses or callings for profit. This is consistent with the meaning adopted by Austrade in its Administrative Guidelines:
"'Trade fairs' means any organised activity involving multiple exhibitors promoting their products. It is not intended to include those expenses of an applicant who displays its own products in an in-store or show-room situation." (clause 5.8.3)
On the basis of the findings of fact that I have already made, I am also satisfied that Dreamtime '98 was a trade fair. I am satisfied that it brought together buyers of travel services and sellers of those services. At the same time, it gave those sellers the opportunity to promote their products and gave them that opportunity in a variety of ways.
Mr O'Brien submitted that Item 5 of s. 33 was not intended to cover the expenses of providing dinner for delegates and relied on the Minister's Second Reading Speech and the Explanatory Memorandum. In the Second Reading Speech, the Minister said:
"As a result of the fiscal legacy of the previous Labour government, the cost of the EMDG scheme has also had to be addressed. The government has, therefore, decided to place a cap on annual funding. This is inconsistent with the government's wider goal of fiscal restraint. Most importantly, the mechanism for effecting the cap will provide for full payment of smaller grants at the time of determination. Claimants eligible for larger grants will receive a partial advance at the time of determination and a pro-rated balance at the end of the year. … To minimise the potential reduction to individual grants, the government has introduced a number of policy changes which will simplify the scheme, address fraud and better target those SMEs in the early years of exporting. … The fundamental principles of this scheme have not been altered. The scheme will continue to provide assistance to small and medium exporters and potential exporters through the partial reimbursement of selected promotional costs. …" (Hansard, House of Representatives, pages 1521-1522)
In setting out the purpose and outline of the Export Market Development Grants Bill 1997, the Explanatory Memorandum stated:
"Division 2 describes the types of promotional activities and expenses claimable under the scheme. There are six general areas of eligible expenditure: overseas representation, overseas marketing visits, communications, free samples, trade fairs and advertising, and short term consultancy. Expenses in relation to overseas representatives is (sic) limited to $200,000 in any one year. Airfares may be claimed in respect of only the first two grants, the exception being expenses of overseas representatives. Accommodation, entertainment and sustenance expenses are not directly claimable. Two hundred dollars per day to a maximum of 21 working days per overseas trip may be added to eligible expenses. All expenses are subject to considerations of reasonableness. There are 17 expenses excluded from eligibility. …"
Looking first at the Explanatory Memorandum, it does not in itself exclude the expenses of arranging the Underwater World event. The reference to the exclusion of entertainment and sustenance is a reference to their not being "directly" claimable. That this is so is clear on the face of s. 33. The Explanatory Memorandum does not suggest that entertainment and sustenance may not be claimable indirectly. The Second Reading Speech does not take the matter any further. It is a general statement. In the absence of any ambiguity or obscurity or a manifestly or absurd result in the interpretation of s. 33 when the purpose and context of the Act are considered, I cannot have regard to extrinsic material pursuant to s. 15AB(1)(b) of the Acts Interpretation Act 1901. A general statement of the sort contained in the Second Reading Speech can be used to confirm the ordinary meaning of the section taking into account the purpose and context of the Act (Acts Interpretation Act 1901, s. 15AB(1)(a)). It cannot be used to give s. 33 a meaning that it does not have taking into account the purpose and context of the Act. Furthermore, the Minister's statements that grants would be capped does not lead to the conclusion that, as submitted by Mr O'Brien, a claim for "… large amounts of money for promotional events such as the Dinner which, under the old Act, could not have been claimed" is not claimable. The Act does not purport to be a re-enactment of its predecessor the Export Market Development Grants Act 1974 ("1974 Grants Act") but in, for example, plain English. As the Minister has stated, there have been policy changes. His reference to grants' being capped seems to be a reference to the reduction in the amounts to which a claimant is otherwise entitled rather than any attempt to read down the claimants' entitlements.
Returning to the circumstances of this case, I must consider whether FNQD participated in the trade fair I have found took place and whether it was done for an approved promotional purpose. That leads me to look at the manner in which people participated in Dreamtime '98. Clearly, there were buyers and sellers and those persons were participants. Dreamtime '98 provided for sellers to have booths at which they could display products or advertise their services and at which they were to have 30 scheduled meetings with buyers and 10 unscheduled meetings. There were, however, others who showed their wares. Some were permitted to include samples of products as part of the invitation package, in the Dreamtime '98 registration kit, as part of a collation of gifts described as "Tropical North Queensland Gifts" and as part of the services (e.g. photographic and decorative) provided at the venue. Others created the atmosphere or provided services at the venue and they were acknowledged in the Tradeshow Manual. Whatever role they undertook, all of these persons undertook their activities in order to promote the sale of their services or products and were participants in the trade fair.
It is in this context that I must consider the Underwater World event, which was just one of the themed events provided for in the programme. That was an event that demonstrated the manner in which FNQD could develop a theme (in this case an underwater world) and could draw together the sellers of other services and their services. It could certainly be viewed as entertainment for, if Underwater World did not engage and delight the buyers at Dreamtime '98, FNQD could not expect to be approached to organise ground arrangements for any overseas incentive house. At the same time, I am satisfied that FNQD was promoting its skills by demonstrating what it could do. It was an "active" demonstration in which the atmosphere could be experienced rather than a pictorial promotion of the event in which the atmosphere was more difficult to reproduce. The event was just one of a whole gamut of activities that provided exposure for the sellers of their products and services to the buyers of those products and services.
Taking all of these matters into account, I am satisfied that FNQD was a participant in Dreamtime '98, which was a trade fair. It participated by arranging the event, which was a segment of that trade fair. I am also satisfied that FNQD's participation was carried out for the purpose of creating or increasing demand or opportunity in a foreign country for the supply of its service to draw events together and to link them with a theme to a person who is not a resident of Australia.
In order for that participation to be for an approved promotional purpose, it must also have been done for an eligible service, which in the context of this case means an eligible tourism service. I am satisfied that, in offering its service, FNQD is creating or increasing demand or opportunity in the buyers from foreign countries for the provision in Australia of its services and so of services such as passenger transport by land, water or air and accommodation for at least one night. Furthermore, it is creating or increasing that demand or opportunity for the provision of the other services described in Schedule 2 of the Regulations as tourism services.
The event that FNQD sponsored was a themed dinner. I am satisfied that its name was on the menu as the event organiser and was also named in the Tradeshow Manual of Dreamtime '98 as an event organiser. It was known as an events coordinator whose work involved not simply the presentation of a theme at a particular function such as a dinner but also as an incentive travel ground operator that organised ground arrangements on behalf of incentive houses. Against that background, I am not satisfied that FNQD was simply promoting its ability to organise a themed dinner whether at the Tanks Arts Centre or at a licensed place designed primarily for the purpose of dining with set-place table service but its services generally. Certainly, it was not promoting them in what might be considered to be a traditional sense of providing brochures or pamphlets or even a video presentation. It did so by letting those attending Dreamtime '98 to experience an example of FNQD's work. On the night, that work included drawing together the services of a caterer and of entertainers but it was work presented against a background of an exhibition of the work of tourist companies offering travel and accommodation services. As an incentive travel ground operator drawing together travel and accommodation services offered in FNQ, examples of those travel and accommodation services were on show in other segments of the Dreamtime '98 programme. Against that background, I am satisfied that it was in fact promoting itself and so its complete range of services.
As FNQD's complete range includes the coordination of ground arrangements and those ground arrangements include services (such as passenger transport by land or water and accommodation for at least one night) within the meaning of Schedule 2 of the Regulations, it was promoting services that are tourism services.
Is it relevant that FNQD is simply the coordinator and not the operator of the tourism services of the sort specified in Schedule 2. In order to be an eligible tourism service, a tourist service must be "supplied by the applicant" if it is to be "an approved promotional activity" within the meaning of s. 37(d) and so be an "eligible promotional activity" for the purposes of Item 5 in the table in s. 33. FNQD is not the operator of the tourism services, such as passenger transport, accommodation and food and beverage service with set-place table service at licensed premises. It coordinates them, packages them and sells the package to incentive houses.
Can it be said that the tourism services are "supplied" by FNQD when it is not the operator? In so far as they are relevant, the ordinary meanings of the word "supply" are "… To furnish, provide, afford …" (Shorter Oxford English Dictionary, 3rd edition, 1973 and see also The Macquarie Dictionary, 3rd edition, 1997). As Gummow J said in Australian Trade Commission v Film Funding and Management Pty Ltd (1989) 87 ALR 49 in considering the predecessor of the Act, the 1974 Grants Act:
"'Supply' in its ordinary and natural meaning means to furnish or provide. It most readily is understood when used in relation to goods or personal services. Certainly, in a particular context, the supply of goods or other property may not necessitate a change in ownership of that which is supplied: Commonwealth of Australia v Sterling Nicholas Duty Free Pty Ltd (1972) 46 ALJR 241 at 243, 245, 247, 249. …" (page 67)
Does the context in which the word "supply" appears in s. 37(d) of the Act suggest that the provision of the tourism services (in this case eligible tourism services) by the applicant for a grant must be accompanied by the applicant's owning those services (in this case tourism services)? I do not think that it does. Section 37(a), for example, expressly refers to ownership when it provides that an eligible promotional purpose is an approved promotional purpose if it is carried out for the purpose of creating, seeking or increasing demand or opportunity in a foreign country for "eligible goods owned by the applicant and that the applicant intends to sell for export or to export and sell" (emphasis added). Similarly, s. 37(e) refers to eligible intellectual property or eligible intellectual know-how owned by the applicant and s. 37(f) to that owned by another person.
Does the context in which the word "supply" appears in s. 37(d) of the Act suggest that the provision of the tourism services by the applicant for a grant must be accompanied by the applicant's being the original provider or source of those services? Section 37(g) refers to eligible services provided by another person if the applicant is an approved body. FNQD is not an approved body but those bodies approved under s. 89 of the Act and Part 3 of the Regulations are more in the nature of industry bodies promoting the interests of its members rather than profit making enterprises. In view of that, I do not think that s. 37(g) assists one way or the other and that the word "supply" should be given its ordinary meaning of furnish or provide.
When given that meaning, I am satisfied that FNQD does supply tourism services and so eligible tourism services. It furnishes or provides those services to overseas incentive houses when it packages them. It follows that I am satisfied that FNQD participated in a trade fair am also satisfied that it participated for an approved promotional purpose. Consequently, its claim for a grant can succeed for it has undertaken an eligible promotional activity and so the expenses it incurred in respect of the Underwater World dinner are claimable expenses. In view of that, the is no need to consider as an item separate from the dinner FNQD's claim in relation to any literature or advertising material that may come within Item 5 of s. 33.
It follows that FNQD has claimable expenses all reasonable expenses it incurred in payments to persons not closely related to it. Mr O'Brien submitted that only 48% of its costs should be permitted as only 48% of the participants at the dinner were overseas visitors. It seems to me that this is an artificial approach to what happened at Dreamtime '98. Section 33 provides that all reasonable expenses incurred are claimable expenses where they are incurred for participation in a trade fair to the extent that it is done for an approved promotional purpose. The event was certainly attended by Australian sellers as well as by buyers. In having both attend, FNQD was able to showcase not only its coordination but also promote the tourism services which it supplies but which are operated by others, including Australian sellers attending the dinner. Those Australian sellers are able to promote their services and not only enchanced the show case provided by FNQD but were a component of it.
Mr O'Brien submitted that FNQD had failed to put forward sufficient documentation to explain how the expenses were incurred in relation to the event. I do not accept that submission. FNQD has submitted invoices of the costs in which it has itemised those costs. On their face, they relate to the dinner and appear reasonable. In the absence of any material beyond their face value, I am satisfied that they are reasonable expenses.
For the reasons I have given, I:
1.set aside the decision of the respondent dated 18 December, 1998; and
2. substitute a decision that:
(1)the applicant has incurred claimable expenses in respect of an eligible promotional activity and so has incurred eligible expenses;
(2)the expenses of $37,557.99 are reasonable expenses in respect of the eligible promotional activity; and
3.remit the matter to the respondent to calculate the grant to which the applicant is entitled under the Export Market Development Grants Act 1997.
I certify that the forty eight preceding paragraphs are a true copy of the reasons for the decision herein of Miss S A Forgie (Deputy President)
Signed: .....................................….
M Martinez AssociateDates of Hearing 24, 25 February, 2000
Date of Decision 15 November, 2000
Representatives for the Applicant Mr B Kurth, Mrs Kurth, Ms Frusher
Counsel for the Respondent Mr D O'Brien
Solicitor for the Respondent Australian Government Solicitor
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