Robert Bosch (Australia) Pty Ltd v Secretary, Department of Innovation, Industry, Science and Research

Robert Bosch (Australia) Pty Ltd challenged a decision of the Administrative Appeals Tribunal (AAT) regarding its entitlement to duty credits under the Innovation and Science Australia (ISA) scheme. The dispute centred on the interpretation of the terms “conducted by” in ASIC Administration Regulations 2000 (Cth) and “inaccurate or incomplete” in s 94 ASIC Administration Act 1999 (Cth). Bosch argued that the AAT had erred in concluding that it was not entitled to duty credits for offshore research and development (R&D) conducted by its overseas subsidiaries. Bosch also argued that even if it was not entitled to duty credits for offshore R&D, the Secretary of the Department of Innovation, Industry, Science and Research could not recoup duty credits issued because of an erroneous view of legal entitlement to the credits.

The primary legal issues before the court were the interpretation of the phrase “conducted by” in ASIC Administration Regulations 2000 (Cth) and whether the Secretary could recoup duty credits issued due to an erroneous view of legal entitlement. The court was required to determine if Bosch was entitled to duty credits for offshore R&D and if the Secretary could recoup credits issued due to an erroneous view of entitlement.

The court found that the term “conducted by” should not be interpreted narrowly as Bosch contended. The court rejected Bosch’s interpretation that “conducted by” must exclude any element of “carrying out” or “undertaking” the R&D. Instead, the court found that the verb “to conduct” can be used interchangeably with “to carry out” or “undertake” and its meaning is not necessarily restricted to “directing”, “controlling” or “managing”. The court also found that the Secretary could recoup duty credits issued due to an erroneous view of legal entitlement. The court concluded that Bosch was not entitled to duty credits for offshore R&D and affirmed the AAT’s decision in that regard. The court dismissed Bosch’s appeal and ordered that if the question of costs is not agreed, the parties are to file short submissions by 11 October 2011.