Textile, Clothing and Footwear Strategic Investment Program Scheme 1999 (Cth)

Textile, Clothing and Footwear Strategic Investment Program Scheme 1999

as amended

made under section 8 of the

Textile, Clothing and Footwear Strategic Investment

Program Act 1999

This compilation was prepared on 1 March 2005
taking into account amendments up to Textile, Clothing and Footwear
Strategic Investment Program Scheme Amendment 2005 (No. 1)

Prepared by the Office of Legislative Drafting and Publishing,
Attorney-General’s Department, Canberra

Contents

Part 1Introductory

1Name of Scheme [see Note 1]  9

2Commencement [see Note 1]  9

3Definitions  9

4Meaning of Australian-based  11

5Meaning of eligible TCF activity  11

6Meaning of pre-program year and program year  13

7Meaning of sample production  14

8Meaning of TCF-dependent community  14

9Meaning of total eligible revenue  14

10References to an entity  15

11References to a grant for a program year  16

12References to the cost or price of plant, equipment etc  16

Part 2Types of grant

Division 2.1            Introductory

13Types of grant  17

Division 2.2            Type 1 grants

14What is a Type 1 grant  17

15What is eligible expenditure for a Type 1 grant  18

Division 2.3            Type 2 grants

Subdivision 2.3.1     Activities for Type 2 grants

16What is a Type 2 grant  19

17Research and development activities  20

18Innovative product design  20

19Innovative process improvement  21

20Brand support  21

21Market research  21

22Obtaining industrial property rights  21

Subdivision 2.3.2     Eligible expenditure for Type 2 grants

23What is eligible expenditure for a Type 2 grant  22

24Expenditure on research and development activities  22

25Expenditure on product development activities  23

26Expenditure on travel not eligible  23

Division 2.4            Type 3 grants

27What is a Type 3 grant  23

28What is eligible TCF value added by an entity  23

Division 2.5            Type 4 and Type 5 grants

29What is a Type 4 or Type 5 grant  24

30What is eligible expenditure for a Type 4 or Type 5 grant                  25

30ATotal eligible revenue for restructuring initiatives  25

30BWhat is eligible TCF value added by a resultant entity  26

Part 3Registration of entities for Type 1, Type 2 and Type 3 grants

31Application for registration for Type 1, Type 2 and Type 3 grants         27

32Financial statements etc  28

33Description of activities and estimates of expenditure  28

34Strategic business intent  28

35Strategic business plan  28

36Election of pro rata and method of determination options for Type 1 grant 29

37Additional information  30

38Time limits for registration  30

39Registration of entity  30

40Effects of registration  30

41Application for renewal of registration  31

42Renewal of registration  31

43Extension of time for registration or renewal  32

44Notice of registration or refusal to register etc  32

45Effect of non-registration  33

46Register of entities  33

47Notice of likely change in eligible expenditure  33

Part 4Notice of intention to claim for Type 4 or Type 5 grant

48Notice of intention to claim for Type 4 or Type 5 grant  34

49Information to be given with notice of intent  34

50Additional information  35

51Consideration of notice of intention  35

Part 4ARegular advances of grants

Division 4A.1          Introductory

51AEffect of Part  36

51BWhat is a regular advance of a grant  36

51CEffect of non-registration  36

51DReferences to a regular advance of a grant for a program year            36

Division 4A.2          Regular advances of Type 1, Type 2 and Type 3 grants

Subdivision 4A.2.1   Requests for regular advances of Type 1, Type 2 and Type 3 grants

51ERequests for regular advances of Type 1, Type 2 and Type 3 grants     37

51FInformation in support of requests for regular advances of Type 1, Type 2 and Type 3 grants     38

51GWhen requests for regular advances of Type 1, Type 2 and Type 3 grants must be made — pre-program and early program years  38

51HWhen requests for regular advances of Type 1, Type 2 and Type 3 grants must be made — later program years  39

Subdivision 4A.2.2   Assessment of eligibility for regular advances of Type 1, Type 2 and Type 3 grants

51IAssessment of eligibility for regular advances of Type 1, Type 2 and Type 3 grants     39

51JEntity no longer carrying on eligible TCF activity  40

51KArms length expenditure — regular advances of Type 1, Type 2 and Type 3 grants      40

51LPro rata adjustment of eligible expenditure for regular advances of Type 1 grants        40

51MCap for regular advances of Type 1 grants  41

51NCap for regular advances of Type 2 grants  41

51OCap for regular advances of Type 3 grants  41

51QAlternative calculation of amount — regular advances of Type 1 grants   42

51RThreshold expenditure for pre-program years — regular advances of Type 1 grants      43

51SThreshold expenditure for regular advances of Type 1, Type 2 and Type 3 grants — program years  44

51TMinimum additional expenditure  44

Subdivision 4A.2.3   Notice of decisions and payment of regular advances of Type 1, Type 2 and Type 3 grants

51UNotice of decisions — regular advances of Type 1, Type 2 and Type 3 grants   45

51UAResolution of requests for regular advances of Type 1, Type 2 and Type 3 grants in modulation year  46

51VPayment of regular advances of Type 1, Type 2 and Type 3 grants       46

Division 4A.3          Regular advances of Type 4 and Type 5 grants

Subdivision 4A.3.1   Requests for regular advances of Type 4 and Type 5 grants

51WRequests for regular advances of Type 4 and Type 5 grants               46

51XInformation in support of requests for regular advances of Type 4 and Type 5 grants    47

51YWhen requests for regular advances of Type 4 and Type 5 grants must be made        47

Subdivision 4A.3.2   Assessment of eligibility for Type 4 and Type 5 grants

51ZAssessment of eligibility for regular advances of Type 4 and Type 5 grants 48

51ZAEntity no longer carrying on eligible TCF activity  49

51ZBState-of-the art TCF plant or equipment — regular advances of Type 4 grants   49

51ZCArms length expenditure — regular advances of Type 4 and Type 5 grants 49

51ZDCap for regular advances of Type 4 and Type 5 grants  49

Subdivision 4A.3.3   Notice of decisions and payment of regular advances of Type 4 and Type 5 grants

51ZFNotice of decisions — regular advances of Type 4 and Type 5 grants    50

51ZGPayment of regular advances of Type 4 and Type 5 grants                50

Part 5Claims for grants

Division 5.1            Making a claim

Subdivision 5.1.1     Claims for a Type 1, Type 2 or Type 3 grant

52Claim for Type 1, Type 2 or Type 3 grant  51

53Information in support of a claim for Type 1, Type 2 or Type 3 grant      53

54When claim for Type 1, Type 2 or Type 3 grant must be made           53

Subdivision 5.1.2     Claims for Type 4 or Type 5 grant

56Claim for Type 4 or Type 5 grant  54

57Information in support of claim for Type 4 or Type 5 grant                  54

58When claim for Type 4 or Type 5 grant must be made  55

Subdivision 5.1.3     Extension of time for making claim

59Extension of time for making claim  56

59AEffect of extension for modulation year  56

60Notice of decision about extending claim period  57

Division 5.2            Assessment of claims

Subdivision 5.2.1     Assessment of eligibility for Type 1, Type 2 and Type 3 grants

61Assessment of eligibility for Type 1, Type 2 and Type 3 grants           57

62Arms length expenditure — Type 1, Type 2 and Type 3 grants           59

63Pro rata adjustment of eligible expenditure for Type 1 grants              59

64Cap for Type 1 grants  59

65Cap for Type 2 grants  60

66Cap for Type 3 grants  60

67Period for assessment and notice of decisions — Type 1, Type 2 and Type 3 grants     60

67AResolution of claims — eligibility for Type 1, Type 2 and Type 3 grants for modulation year      61

68Effect of decision as to eligibility for Type 1, Type 2 and Type 3 grants   61

68ADeferred amount for modulation year  61

68BSpecial cap arrangements: section 14A entities  62

Subdivision 5.2.2     Assessment of eligibility for Type 4 and Type 5 grants

69Assessment of eligibility for Type 4 and Type 5 grants  63

70State-of-the art TCF plant or equipment — Type 4 grants                  64

71Arms length expenditure — Type 4 and Type 5 grants  64

72Cap for Type 4 and Type 5 grants  64

73Notice of decisions — Type 4 and Type 5 grants  65

74Effect of decision as to eligibility for Type 4 and Type 5 grants           65

Division 5.3            Determination and payment of claims

Subdivision 5.3.1     Determination and payment of claims — Type 1, Type 2 and Type 3 grants

74AMeaning of determination  65

75Request for determination and payment of Type 1, Type 2 and Type 3 grants    65

76Determination of entitlement — Type 1, Type 2 and Type 3 grants       67

77Alternative determination of entitlement — Type 1 grants                  67

78Threshold expenditure for pre-program years — Type 1 grants           69

79Threshold expenditure for Type 1, Type 2 and Type 3 grants              69

80Minimum additional expenditure  70

81Determination and payment of Type 1, Type 2 and Type 3 grants        70

81ARevocation and remaking of determinations etc  71

Subdivision 5.3.2     Determination of entitlement — Type 4 and Type 5 grants

82Request for determination of a Type 4 or Type 5 grant  72

83Determination of Type 4 and Type 5 grants  73

83ARevocation and remaking determinations etc  73

84Notice of determination — Type 4 and Type 5 grants  74

85Payment of Type 4 and Type 5 grants  74

Subdivision 5.3.3     Overall limits on grant entitlements

85ASales-based cap for grants  74

85BModulation of Type 1, Type 2, Type 4 and Type 5 grants                  75

85CReductions on account of special advances  76

85DReductions on account of regular advances  77

Subdivision 5.3.4     Limits on payments

85EAnnual limit on payments  77

86Expenditure limit on Scheme  78

Part 5ATransfer of registration

86AInterpretation for Part 5A  79

86BTransfer of registration generally  79

86CTransfer of registration on transfer of business  79

86DEffect of transfer of registration  80

86EStatus of activities and expenditure unchanged  81

86FTreatment of value added  82

86GTreatment of total eligible revenue and total eligible start-up investment amounts        82

Part 5BSpecial advances of grants

Division 5B.1          Introductory

86HEffect of Part  83

86IDefinition for this Part  83

86JWhat is a special advance of a grant  83

86KReferences to a special advance of a grant for a program year           83

Division 5B.2          Special advances of Type 1, Type 2 and Type 3 grants

Subdivision 5B.2.1   Requests for special advances of Type 1, Type 2 and Type 3 grants

86LRequests for special advances of Type 1, Type 2 and Type 3 grants     84

Subdivision 5B.2.2   Eligibility for special advances of Type 1, Type 2 and Type 3 grants

86MEligibility for special advances of Type 1, Type 2 and Type 3 grants      86

86NEntity no longer carrying on eligible TCF activity  87

86OArms length expenditure — special advances of Type 1, Type 2 and Type 3 grants     87

86PPro rata adjustment of eligible expenditure for special advances of Type 1 grants       87

86QCap for special advances of Type 1 grants  88

86RCap for special advances of Type 2 grants  88

86SCap for special advances of Type 3 grants  88

86TModulation  89

Subdivision 5B.2.3   Notice of decisions and payment of special advances of Type 1, Type 2 and Type 3 grants

86UNotice of decisions and payment of special advances of Type 1, Type 2 and Type 3 grants      89

Division 5B.3          Special advances of Type 4 and Type 5 grants

Subdivision 5B.3.1   Requests for special advances of Type 4 and Type 5 grants

86VRequests for special advances of Type 4 and Type 5 grants               90

Subdivision 5B.3.2   Eligibility for special advances of Type 4 and Type 5 grants

86WEligibility for special advances of Type 4 and Type 5 grants               91

86XEntity no longer carrying on eligible TCF activity  92

86YState-of-the-art TCF plant or equipment — special advances of Type 4 grants   92

86ZArms length expenditure — special advances of Type 4 and Type 5 grants 92

86ZACap for special advances of Type 4 and Type 5 grants  92

86ZBModulation  93

Subdivision 5B.3.3   Notice of decisions and payment of special advances of Type 4 and Type 5 grants

86ZCNotice of decisions and payment of special advances of Type 4 and Type 5 grants      93

Part 6Miscellaneous

87Request for reconsideration of decision by Secretary  94

88Reconsideration by Secretary  94

89Statement to accompany notification of decisions  95

90Statement to accompany notice of decision on reconsideration           95

91Disposal of plant and equipment — Type 1 grant  96

92Grants not transferable  96

93Giving of notices etc by Minister or Secretary  96

94Entity may send documents electronically  97

95Access to premises  97

96Statutory conditions  98

97Condition — document retention  98

98Post-payment compliance monitoring  98

Schedule 1Eligible TCF activities  99

Part ATextile Fibre, Yarn and Woven Fabric Manufacturing  99

Part BKnitting Mills Manufacturing  100

Part CClothing Manufacturing  101

Part DFootwear Manufacturing  103

Part ELeather and Leather Product Manufacturing  103

Part FEarly-stage Processing  103

Part GMade-up Textile and Leather Product Manufacturing  104

Schedule 2Method of working out total eligible TCF value added by an entity 106

Schedule 3Pro rata adjustment of eligible expenditure for Type 1 grants or regular advances of Type 1 grants  108

Schedule 5Method of working out total eligible TCF value added by an entity for special advances of grants for incomplete program years  110

Notes   112

Part 1  Introductory

1Name of Scheme [see Note 1]

This Scheme is the Textile, Clothing and Footwear Strategic Investment Program Scheme 1999, also known as the TCF (SIP) Scheme.

2Commencement [see Note 1]

The TCF (SIP) Scheme commences on gazettal.

3Definitions

In the TCF (SIP) Scheme:

ABN has the meaning given by section 41 of the A New Tax System (Australian Business Number) Act 1999.

acquisition includes acquisition by purchase or lease.

ACN has the meaning given by section 9 of the Corporations Act 2001.

Act means the Textile, Clothing and Footwear Strategic Investment Program Act 1999.

associate has the meaning given by section 318 of the ITAA 1936.

auditor means an independent auditor registered under Division 2 of Part 9.2 of the Corporations Act 2001.

Australian and New Zealand Standard Industrial Classification or ANZSIC means the 1993 edition of the Australian and New Zealand Standard Industrial Classification published by the Australian Bureau of Statistics in 1993.

Australian-based, for an activity, for expenditure and for innovation, has the meaning given by section 4.

eligible expenditure, for a type of grant, means:

(a)for a Type 1 grant — eligible expenditure within the meaning of section 15; or

(b)for a Type 2 grant — eligible expenditure within the meaning of sections 23 to 26; or

(c)for a Type 4 or Type 5 grant — eligible expenditure within the meaning of section 30.

eligible start-up investment amount has the meaning given by subsection 85A (5).

eligible start-up period has the meaning given by subsection 85A (5).

eligible TCF activity has the meaning given by section 5.

eligible TCF product means a product resulting directly and predominantly from an eligible TCF activity mentioned in paragraph 5 (1) (a) (other than an activity carried on in relation to a prescribed product within the meaning of section 5) or paragraph 5 (1) (e).

eligible TCF value added, for an entity, has the meaning given by section 28.

equipment means tools or apparatus of a capital nature used exclusively for the operation of plant.

financial owner, for plant, equipment or another asset, means the person who is financially responsible for, and has control of, the plant, equipment or other asset.

GST has the meaning given by section 195-1 of the A New Tax System (Goods and Services Tax) Act 1999.

incomplete program year:

(a)in relation to a special advance of a Type 1, Type 2 or Type 3 grant — has the meaning given by paragraph 86L (1) (a); and

(b)in relation to a special advance of a Type 4 or Type 5 grant — has the meaning given by paragraph 86V (1) (a).

industrial property rights has the meaning given by section 22.

innovative, for an eligible TCF product, means having an Australian-based innovation.

ITAA 1936 means the Income Tax Assessment Act 1936.

ITAA 1997 means the Income Tax Assessment Act 1997.

modulation year means a program year to which subsection 85B (2) applies, or the 2004/2005 program year, as the case requires.

pilot plant has the meaning given by subsection 73B (1) of the ITAA 1936.

plant does not include a building or structure.

pre-program year has the meaning given by section 6.

product development activity has the meaning given by section 16.

program period, for an entity, means the period commencing at the beginning of the 2000/2001 program year and ending at the end of the 2004/2005 program year.

program year has the meaning given by section 6.

registered Australian research agency means a research agency registered under section 39F of the Industry Research and Development Act 1986.

regular advance of a grant has the meaning given by section 51B.

relevant financial year, in relation to a program year, means:

(a)for the 2000/2001 program year — the 2001/2002 financial year; and

(b)for the 2001/2002 program year — the 2002/2003 financial year; and

(c)for the 2002/2003 program year — the 2003/2004 financial year; and

(d)for the 2003/2004 program year — the 2004/2005 financial year; and

(e)for the 2004/2005 program year — the 2005/2006 financial year.

relevant program year, in relation to a financial year, means:

(a)for the 2001/2002 financial year — the 2000/2001 program year; and

(b)for the 2002/2003 financial year — the 2001/2002 program year; and

(c)for the 2003/2004 financial year — the 2002/2003 program year; and

(d)for the 2004/2005 financial year — the 2003/2004 program year; and

(e)for the 2005/2006 financial year — the 2004/2005 program year.

research and development activity has the meaning given by section 73B of the ITAA 1936.

Note   Only certain kinds of research and development activity give rise to eligible expenditure under the Scheme — see s 17.

resultant entity has the meaning given by section 29.

sample production has the meaning given by section 7.

Scheme means the TCF (SIP) Scheme.

sent electronically has the meaning given by section 94.

special advance of a grant has the meaning given by section 86J. 

TCF-dependent community has the meaning given by section 8.

TCF plant or equipment means plant or equipment used in an eligible TCF activity.

total eligible revenue has the meaning given by section 9.

Note   The following terms used in the Scheme are defined in the Act:

·     Australia

·     claim

·     entity

·     grant

·     income year

·     manufacture

·     Regional Assistance Program supplementation payments

·     scheme debt

·     Secretary

·     strategic business plan.

4Meaning of Australian-based

For the Scheme:

(a)an activity is Australian-based only if it is carried on in Australia; and

(b)expenditure is Australian-based only if it is incurred in Australia; and

(c)innovation is Australian-based only if it occurs in Australia.

5Meaning of eligible TCF activity

(1)For the Scheme, each of the following activities is an eligible TCF activity:

(a)a manufacturing activity of a kind mentioned in Parts A to E of Schedule 1 carried on in Australia by an entity;

(b)an activity carried on in Australia by an entity in respect of the design in Australia for manufacture in Australia of eligible TCF products, some or all of which are intended to be sold in Australia;

(c)an ancillary activity carried on in Australia by an entity in respect of a manufacturing activity mentioned in paragraph (a) (the manufacturing activity) carried on in Australia by that entity or another entity if, and only to the extent that, operations in respect of the ancillary activity and the manufacturing activity are wholly and mutually interdependent;

(d)an ancillary activity carried on in Australia by an entity in respect of an activity mentioned in paragraph (b) (the design activity) carried on by the entity or another entity if, and only to the extent that, operations in respect of the ancillary activity and the design activity are wholly and mutually interdependent;

(e)an activity of a kind mentioned in Part G of Schedule 1 carried on in Australia by an entity using an eligible TCF product resulting from a manufacturing activity mentioned in paragraph (a) carried on in Australia by the entity.

(2)However, an activity mentioned in paragraph (1) (a), (b), (c), (d) or (e), that is carried on by an entity both in Australia and elsewhere, is an eligible TCF activity only to the extent that it is carried on in Australia.

(2A)Also, despite subsection (1), each of the following activities is not an eligible TCF activity:

(a)the manufacture of hides or leather used, or intended to be used, in motor vehicles;

(b)an activity carried on in connection with, or incidental to, the design for manufacture of hides or leather used, or intended to be used, in motor vehicles;

(c)an ancillary activity carried on in connection with, or incidental to, a manufacturing activity mentioned in paragraph (a);

(d)an ancillary activity carried on in connection with, or incidental to, a design activity mentioned in paragraph (b);

(e)the manufacture of a prescribed product;

(f)an activity that is carried on in respect of the design for manufacture of a prescribed product;

(g)an ancillary activity carried on in respect of a manufacturing activity to which paragraph (e) applies;

(h)an ancillary activity carried on in respect of a design activity to which paragraph (f) applies.

(2AB)Despite anything else in this section, a manufacturing activity of a kind referred to in Subdivision 21 or any of Subdivisions 23 to 29 of Division C of ANZSIC, and not mentioned in subsection 1, is not an eligible TCF activity.

(2B)For paragraph (1) (a), a manufacturing activity of a kind mentioned in item 4 of Part A, or in Part B or C, of Schedule 1 may be carried on by the entity on a fee or commission basis, using client-supplied materials or materials purchased or transferred in from other entities.

(3)In this section:

ancillary activity means:

(a)an early-stage processing activity of a kind mentioned in Part F of Schedule 1; or

(b)a warehousing and distribution activity.

prescribed product means any of the following:

(a)disposable baby napkins;

(b)sanitary napkins;

(c)panty liners;

(d)disposable bed protectors;

(e)disposable incontinence products.

6Meaning of pre-program year and program year

(1)Each of the following periods is, for an entity, a pre-program year:

(a)the period commencing on 1 July 1998 and ending at the end of 30 June 1999 (the 1998/1999 pre-program year);

(b)the period commencing on 1 July 1999 and ending at the end of 30 June 2000 (the 1999/2000 pre-program year).

(2)Each of the following periods is, for an entity, a program year:

(a)the period commencing on 1 July 2000 and ending at the end of 30 June 2001 (the 2000/2001 program year);

(b)the period commencing on 1 July 2001 and ending at the end of 30 June 2002 (the 2001/2002 program year);

(c)the period commencing on 1 July 2002 and ending at the end of 30 June 2003 (the 2002/2003 program year);

(d)the period commencing on 1 July 2003 and ending at the end of 30 June 2004 (the 2003/2004 program year);

(e)the period commencing on 1 July 2004 and ending at the end of 30  June 2005 (the 2004/2005 program year).

(3)However, if an entity adopts, under section 18 of the ITAA 1936, a 12 month accounting period ending on a date other than 30 June, a reference in the Scheme to a pre-program year or a program year, for that entity, is a reference to the equivalent 12 month accounting period for that entity.

Examples

1.   For an entity whose adopted accounting period ends on 31 October 2001, the 2000/2001 program year is the period commencing on 1 November 2000 and ending at the end of 31 October 2001.

2.   For an entity whose adopted accounting period ends on 31 March 2001, the 2000/2001 program year is the period commencing on 1 April 2000 and ending at the end of 31 March 2001.

(4)If, as a result of the operation of section 18 of the ITAA 1936, the program period for an entity would, apart from this subsection, exceed 5 years, the last program year of the program period is taken to end at the end of the period of 5 years commencing on the first day of the program period for the entity.

7Meaning of sample production

(1)For the Scheme, sample production, for an eligible TCF product, means production of the product other than in commercial quantities.

(2)The production of an eligible TCF product for stockpiling is taken to be production in commercial quantities.

8Meaning of TCF-dependent community

(1)For the Scheme, a TCF-dependent community is a community within an area in Australia (other than an Urban Centre of a capital city) where:

(a)employment in eligible TCF activities constitutes more than 10% of the total employment in manufacturing in the area; or

(b)employment in eligible TCF activities constitutes more than 5% of the total employment in manufacturing in the area, and the rate of unemployment is higher than the national average rate of unemployment.

(2)For subsection (1):

(a)employment in an area, and rates of unemployment, are to be determined by reference to data from the 1996 Census of Population and Housing published before the commencement of this Scheme by the Australian Bureau of Statistics; and

(b)the boundaries of an area are to be determined by reference to Statistical Geography: Volume 3, Australian Standard Geographical Classification Urban Centres/Localities, 1996 Edition, published by the Australian Bureau of Statistics.

(3)In subsection (1):

capital city means each of the following:

(a)Adelaide;

(b)Brisbane;

(c)Canberra-Queanbeyan (Canberra Part);

(d)Darwin;

(e)Hobart;

(f)Melbourne;

(g)Perth;

(h)Sydney.

9Meaning of total eligible revenue

(1)For the Scheme, total eligible revenue, for an entity (other than an entity mentioned in subsection (3)) and for a period, means the total revenue derived by the entity from sales, except sales to New Zealand, of the entity’s eligible TCF products during the period, excluding:

(a)any GST, excise or sales tax; and

(b)any subsidy given during the period by the Commonwealth, or a State or Territory.

(2)In subsection (1), a reference to the entity’s eligible TCF products is a reference:

(a)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a) — to eligible TCF products manufactured by the entity; or

(b)if the entity is not carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a), but is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (b) in accordance with paragraphs 52 (4) (a) and (b) — to eligible TCF products manufactured on behalf of the entity by another entity; or

(c)if the entity is not carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a), but is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (c) — to eligible TCF products manufactured by the entity that carries on the manufacturing activity mentioned in paragraph 5 (1) (c); or

(d)if the entity is not carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a), but is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (d) — to eligible TCF products manufactured, on behalf of the entity that carries on the design activity mentioned in paragraph 5 (1) (d), by another entity; or

(e)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (e) — to eligible TCF products produced by the entity as a result of that activity.

(3)If an entity is carrying on an eligible TCF activity of a kind mentioned in item 4 of Part A, or in Part B or C, of Schedule 1 on a fee or commission basis, the total eligible revenue for the entity and for a period is the total fees and commissions earned by the entity during the period for that activity, excluding:

(a)any GST; and

(b)any subsidy given during the period by the Commonwealth, or a State or Territory.

Note   For a resultant entity, the meaning of total eligible revenue is qualified by section 30A.

10References to an entity

In the Scheme, unless the contrary intention appears, a reference to an entity, in relation to the doing of anything by the entity for the purposes of the Scheme, does not include a reference to an agent of the entity, except where:

(a)the entity is a body corporate; and

(b)the agent is:

(i)a director or other officer of the body corporate, or an employee of the body corporate having management responsibility; or

(ii)if the entity is in receivership or under administration — the entity’s receiver or administrator.

11References to a grant for a program year

In the Scheme, a reference to a grant to an entity for a pre-program year or a program year is a reference to a grant to the entity relating to eligible expenditure incurred, or eligible TCF value added, by the entity in the pre-program year or program year.

12References to the cost or price of plant, equipment etc

In the Scheme, a reference to the cost or price of land, buildings, plant, equipment, materials or anything else is a reference to the cost or price excluding any GST, excise or sales tax.

Part 2  Types of grant

Division 2.1            Introductory

13Types of grant

There are to be 5 types of grant for the Scheme, as follows:

(a)grants in respect of new TCF plant/building expenditure (Type 1 grants);

(b)grants in respect of TCF research and development expenditure (Type 2 grants);

(c)grants in respect of TCF value-adding (Type 3 grants);

(d)special grants in respect of second-hand TCF plant expenditure (Type 4 grants);

(e)special miscellaneous grants in respect of TCF-dependent communities (Type 5 grants).

Division 2.2            Type 1 grants

14What is a Type 1 grant

(1)A Type 1 grant, for an entity, is a grant relating to eligible expenditure by the entity that is directly attributable to any of the following activities carried on by the entity in respect of an eligible TCF activity:

(a)the acquisition or construction of new TCF plant or equipment, of which the entity is the financial owner, for use exclusively in Australia;

(b)the acquisition or construction of a new building or structure, or alterations to an existing building or structure, of which the entity is the financial owner, to house and operate TCF plant or equipment, as a consequence of the acquisition or construction of new TCF plant and equipment mentioned in paragraph (a);

(c)the upgrade of existing TCF plant or equipment, of which the entity is the financial owner, in relation to environmental requirements of the Commonwealth, or a State or Territory;

(d)the acquisition of new computer hardware or software, or development of new computer software, that is:

(i)for carrying on the activity; and

(ii)capitalised in the entity’s accounts.

(2)A Type 1 grant may be made:

(a)in relation to more than 1 eligible TCF activity; and

(b)in addition to a grant of another type under the Scheme.

(3)A Type 1 grant is payable in relation to eligible expenditure in a pre-program year as well as in a program year.

15What is eligible expenditure for a Type 1 grant

(1)Expenditure is eligible expenditure for a Type 1 grant only if it is of a kind mentioned in this section and is incurred by the entity in accordance with this section.

(2)Expenditure must be on 1 or more of the activities mentioned in paragraphs 14 (1) (a) to (d).

(3)Expenditure on the purchase of new TCF plant or equipment:

(a)must represent the value of the plant or equipment capitalised in the entity’s accounts, less the amount, if any:

(i)recovered from any trade-in; or

(ii)received from the sale of any plant or equipment decommissioned as a result of the purchase; and

(b)is taken to have been incurred only at the time when the plant or equipment has been paid for and commissioned.

(4)Expenditure on the purchase of new TCF plant or equipment purchased under a hire purchase agreement or financed through a finance lease:

(a)is taken to be the value of the plant or equipment shown in the hire purchase agreement or finance lease and capitalised in the entity’s accounts, less the amount, if any:

(i)recovered from any trade-in; or

(ii)received from the sale of any plant or equipment decommissioned as a result of the purchase; and

(b)is taken to have been incurred only at the time when the first instalment under the agreement or lease has been paid and the plant or equipment has been commissioned.

(5)Expenditure on the construction of TCF plant or equipment:

(a)is limited to the sum of:

(i)the costs of materials; and

(ii)direct labour costs (including on-costs and administrative support costs); and

(iii)factory overhead (set at 110% of direct labour costs); and

(iv)establishment and commissioning costs; and

(b)must be capitalised in the entity’s accounts; and

(c)is taken to have been incurred only at the time when the plant or equipment is commissioned or, if commissioning is not required, is fully operational.

(6)Expenditure on a new building or structure, or on alterations to an existing building or structure:

(a)is limited to expenditure necessary for the efficient housing and operation of new TCF plant or equipment mentioned in paragraph 14 (1) (a); and

(b)is taken to have been incurred only at the time when:

(i)payment has been made; and

(ii)if a certificate of occupancy is required — the certificate has been issued.

(7)Expenditure on the purchase of a new building or structure purchased under a hire purchase agreement or financed through a finance lease:

(a)subject to paragraph (aa), is taken to be the value of the building or structure shown in the hire purchase agreement or finance lease and capitalised in the entity’s accounts; and

(aa)is limited to expenditure necessary for the efficient housing and operation of new TCF plant or equipment mentioned in paragraph 14 (1) (a); and

(b)is taken to have been incurred only at the time when:

(i)the first instalment under the agreement or lease has been paid; and

(ii)if a certificate of occupancy is required — the certificate has been issued.

(8)Expenditure on the upgrading of existing TCF plant or equipment is limited to the actual costs of the upgrade.

(9)Expenditure mentioned in this section must reflect costs based on normal commercial values and arms length transactions.

(10)For this section, an amount recovered from a trade-in, or received from the sale of decommissioned plant or equipment, must be based on normal commercial values and an arms length transaction.

Division 2.3            Type 2 grants

Subdivision 2.3.1       Activities for Type 2 grants

16What is a Type 2 grant

(1)A Type 2 grant, for an entity, is a grant relating to eligible expenditure by the entity that is directly attributable to any of the following activities carried on by, or on behalf of, the entity in respect of an eligible TCF activity:

(a)a research and development activity of a kind mentioned in section 17;

(b)a product development activity of a kind mentioned in subsections (2) and (3).

(2)For paragraph (1) (b), a product development activity must be:

(a)innovative product design within the meaning of section 18; or

(b)innovative process improvement within the meaning of section 19; or

(c)brand support within the meaning of section 20; or

(d)market research within the meaning of section 21; or

(e)obtaining industrial property rights within the meaning of section 22.

(3)For paragraph (1) (b), if a product development activity is carried on on behalf of the entity by another entity, the activity must be carried on under a written contract or in accordance with detailed and binding arrangements.

(4)A Type 2 grant may be made:

(a)in relation to more than 1 eligible TCF activity; and

(b)in addition to a grant of another type under the Scheme.

(5)A Type 2 grant is payable in relation to eligible expenditure in a program year.

Note The application of s 73C (Recouped expenditure on research and development activities) of the ITAA 1936, and Subdiv 20A (Insurance, indemnity or other recoupment for deductible expenses) of the ITAA 1997, is relevant to a Type 2 grant.

17Research and development activities

(1)For the Scheme, a research and development activity must be directed at a product or process.

(2)If the activity is not Australian-based, the activity must be necessary:

(a)to carry on an Australian-based research and development activity (for example, product testing at a facility that is not available in Australia); or

(b)to tailor an Australian-based research and development activity to the requirements of a particular market.

(3)If the activity is carried on on behalf of an entity by another entity:

(a)if the activity is Australian-based, the other entity must be a registered Australian research agency; and

(b)the activity must be carried on under a written contract or in accordance with detailed and binding arrangements.

18Innovative product design

(1)For the Scheme, an innovative product design activity must be:

(a)Australian-based; and

(b)an activity directly concerned with:

(i)the design, testing, trial and sample production of a particular innovative eligible TCF product; or

(ii)innovation in the design, testing, trial and sample production of particular eligible TCF products.

(2)However, an activity ceases to be an innovative product design activity if it is routinely undertaken or is directed solely at achieving visual product differentiation.

19Innovative process improvement

(1)For the Scheme, an innovative process improvement activity must be:

(a)Australian-based; and

(b)directed at innovative improvement of a production process for an eligible TCF product (for example, an improvement leading to a point of difference from, or a change of a technical nature to, the original production process).

(2)However, an activity ceases to be an innovative process improvement activity if it is routinely undertaken.

20Brand support

(1)For the Scheme, brand support comprises participation (other than as a retailer) by an entity in trade showings and in-store promotions of an innovative eligible TCF product:

(a)for which the entity has registered a trade mark, or has applied to register a trade mark, in Australia; and

(b)that is marketed, or is to be marketed, under that trade mark.

(2)However, brand support does not include media advertising, sponsorship or other media-related activities.

21Market research

(1)For the Scheme, market research comprises market testing, market development or sales promotion (including consumer surveys) that is not routine and that has as its main purpose the introduction of an innovative eligible TCF product.

(2)Market testing, market development or sales promotion for a purpose mentioned in subsection (1) must be carried on before production (other than sample production) of the product.

22Obtaining industrial property rights

(1)For the Scheme, obtaining industrial property rights in respect of an innovative eligible TCF product comprises:

(a)the preparation and lodging of applications and other documents that are required to be lodged, in Australia or elsewhere, for the initial grant or registration of the rights; and

(b)the initial grant or registration of the rights, in Australia or elsewhere.

(2)In subsection (1):

industrial property rights means:

(a)the rights (including equitable rights) possessed by a person under a law of Australia as:

(i)the patentee of a patent in force for an invention; or

(ii)the owner of a registered trade mark; or

(iii)the owner of a registered design; or

(b)rights possessed by a person under a law of a foreign country that are equivalent to the rights mentioned in paragraph (a).

Subdivision 2.3.2       Eligible expenditure for Type 2 grants

23What is eligible expenditure for a Type 2 grant

Expenditure is eligible expenditure for a Type 2 grant only if it:

(a)is of a kind mentioned in, and is incurred in accordance with, this Subdivision; and

(b)reflects costs based on normal commercial values and arms length transactions.

24Expenditure on research and development activities

(1)Expenditure on a research and development activity carried on by the entity must relate to 1 or more of the following:

(a)salaries;

(aa)the execution of a contract or other arrangement mentioned in subsection 16 (3) or 17 (3);

(b)the acquisition or construction of TCF plant or equipment that is pilot plant or a plant prototype;

(c)non-capitalised prototype expenditure;

(d)costs of materials for the activity.

(2)Expenditure relating to salaries is limited to the sum of:

(a)salary costs of employees of the entity engaged primarily and directly on core elements of the activity (but not exceeding $120,000 in respect of any 1 employee) comprising:

(i)regular salary costs (excluding fringe benefits); and

(ii)salary on-costs set at 30% of those regular salary costs; and

(b)if the entity has a dedicated section for research and development activities, with a separate cost centre and separate, identifiable overheads — overhead costs set at 50% of regular salary costs mentioned in subparagraph (a) (i); and

(c)general administrative overhead costs set at 30% of regular salary costs mentioned in subparagraph (a) (i).

(3)Expenditure on the acquisition or construction of pilot plant or plant prototypes must comply with, and be incurred in accordance with, subsections 15 (3), (4) and (5), as if the expenditure related to new TCF plant or equipment mentioned in section 14.

(4)Non-capitalised prototype expenditure:

(a)must relate to the making of an initial model, mock-up or similar thing for an innovative eligible TCF product, or an innovative process for an eligible TCF product, including expenditure on dies, jigs and testing materials, but not including expenditure on general sales samples; and

(b)is taken to be the net expenditure after deduction of the proceeds (if any) of the sale of materials acquired for the purpose of paragraph (a).

Note   Amounts and percentages mentioned in subs (2) may be reviewed during the period of the Scheme, and may be changed by amendment of the Scheme.

25Expenditure on product development activities

(1)If a product development activity mentioned in section 18, 19, 20 or 21 is carried on by the entity, the expenditure must relate to salaries and materials costs incurred in Australia in carrying on the activity.

(2)Expenditure on salaries is to be treated in the same manner as salaries relating to research and development activities, and subsection 24 (2) applies accordingly.

(3)Expenditure on a product development activity mentioned in section 22 is limited to costs and fees directly related to the matters mentioned in that section.

26Expenditure on travel not eligible

Expenditure is not eligible expenditure for this Subdivision if it relates to travel costs.

Division 2.4            Type 3 grants

27What is a Type 3 grant

(1)A Type 3 grant, for an entity, is a grant relating to eligible TCF value added by the entity in respect of eligible TCF activities carried on by the entity in a program year.

(2)A Type 3 grant may be made to an entity for a program year only if a Type 1 or Type 2 grant is also made to the entity for the program year.

(3)A Type 3 grant may be made in addition to a grant of another type under the Scheme.

28What is eligible TCF value added by an entity

For an entity, the total eligible TCF value added by the entity, in respect of eligible TCF activities carried on by the entity for a program year, is worked out in the way set out in Schedule 2.

Note   Eligible TCF value added for a resultant entity is described in section 30B.

Division 2.5            Type 4 and Type 5 grants

29What is a Type 4 or Type 5 grant

(1)A Type 4 grant is a grant relating to eligible expenditure:

(a)in relation to an eligible TCF activity; and

(b)on the acquisition of state-of-the-art second-hand TCF plant or equipment that complies with subsections (3) and (4); and

(c)as part of, or as a direct consequence of, a restructuring initiative that complies with subsection (5); and

(d)by the resultant entity mentioned in subsection (5).

(2)A Type 5 grant is a grant relating to eligible expenditure incurred by the resultant entity in relation to ancillary activities relating to a restructuring initiative that complies with subsection (5).

(3)For paragraph (1) (b), the state-of-the-art second-hand TCF plant or equipment must be acquired by the resultant entity from 1 or more of the entities taking part in the restructuring initiative.

(4)For paragraph (1) (b), the state-of-the-art second-hand TCF plant or equipment must not be plant or equipment:

(a)costing as much as, or more than, equivalent new TCF plant or equipment; or

(b)in respect of which a subsidy or similar benefit has been paid by the Commonwealth, or a State or Territory.

(5)For paragraph (1) (c), the restructuring initiative must:

(a)involve the restructuring (including by way of merger or takeover) or reconfiguration of 2 or more entities carrying on eligible TCF activities:

(i)at least 1 of which is carrying on eligible TCF activities in a TCF-dependent community; and

(ii)at least 1 of which is not financially viable, or is likely in the foreseeable future not to be financially viable; and

(iii)each of which is not an associate of another entity taking part in the restructuring initiative; and

(b)result in at least 1 entity (the resultant entity) that:

(i)is carrying on eligible TCF activities in a TCF-dependent community; and

(ii)is likely to be more financially viable than it would be if the restructuring initiative did not take place; and

(c)be directed at the expansion of existing markets, or at the establishment of new segmental markets, for eligible TCF products; and

(d)be likely to result in demonstrable economic benefits (including, but not limited to, sustained or increased employment) both nationally and for the TCF-dependent community in which the resultant entity is located.

(6)A Type 4 or Type 5 grant may be made in addition to a grant of another type under the Scheme.

(7)A Type 4 or Type 5 grant is payable in relation to eligible expenditure incurred in the 1999/2000 pre-program year as well as in a program year.

(8)In this section:

ancillary activities includes, but is not limited to, the decommissioning, dismantling, transportation, reinstallation and recommissioning of state-of-the art second-hand TCF plant or equipment mentioned in paragraph (1) (b).

30What is eligible expenditure for a Type 4 or Type 5 grant

(1)Expenditure is eligible expenditure for a Type 4 grant only if it is in respect of an eligible TCF activity carried on in a TCF-dependent community and is incurred in accordance with this section.

(2)Expenditure on the purchase of state-of-the-art second-hand TCF plant or equipment is taken to have been incurred only at the time when the plant or equipment has been paid for and commissioned.

(3)Expenditure on the purchase of state-of-the-art second-hand TCF plant or equipment purchased under a hire purchase agreement or financed through a finance lease is taken to have been incurred only at the time when the first instalment under the agreement or lease has been paid and the plant or equipment has been commissioned.

(4)Expenditure is eligible expenditure for a Type 5 grant only if it is in respect of ancillary activities mentioned in subsection 29 (2) and is incurred in accordance with this section.

(5)Expenditure must reflect costs based on normal commercial values and arms length transactions.

(6)For the Scheme, expenditure incurred by any of the entities taking part in the restructuring initiative in respect of ancillary activities mentioned in section 29 is taken to have been incurred by the resultant entity.

30ATotal eligible revenue for restructuring initiatives

For the Scheme, total eligible revenue, for a resultant entity for a period, includes revenue generated in relation to the period by any of the entities taking part in the restructuring initiative in respect of which the entity became a resultant entity.

Note   total eligible revenue is defined in section 9.

30BWhat is eligible TCF value added by a resultant entity

For a resultant entity claiming a Type 4 or Type 5 grant and also claiming a Type 3 grant, the total eligible TCF value added by the resultant entity in respect of eligible TCF activities carried on by it for a program year may include the total eligible TCF value added for that program year of an entity taking part in the restructuring initiative in respect of which the first-mentioned entity became a resultant entity.

Part 3  Registration of entities for Type 1, Type 2 and Type 3 grants

31Application for registration for Type 1, Type 2 and Type 3 grants

(1)An entity that intends to make a claim for a Type 1, Type 2 or Type 3 grant must apply to the Secretary to be registered for the Scheme.

(2)An entity is not eligible to apply for registration unless the entity carries on, or proposes to carry on, an eligible TCF activity.

(3)An application for registration must be in respect of:

(a)1 or both of the pre-program years and the 2000/2001 program year; or

(b)a program year.

(4)The application:

(a)must be in writing in a form approved by the Secretary; and

(b)must include the information mentioned in subsection (5); and

(c)must be signed in the manner indicated in the form.

Note   Applications and other documents under the Scheme may be sent electronically — see s 94.

(5)For subsection (4), the application must contain the following:

(a)the name of the applicant entity;

(b)the entity’s ABN or ACN, and date of formation or incorporation, if applicable;

(c)if the applicant entity is a trust — the type of trust and details of the beneficiaries;

(d)contact addresses (both street and postal);

(e)the names of directors and major shareholders (if applicable), and of key management personnel;

(f)details of the size of the entity (including current employment levels and the employment levels for the 2 income years of the entity before the income year in which the application is made), as well as annual turnover and a general description of the entity’s activities;

(g)details of any other entity whose operations are required, under the Corporations Act 2001, to be consolidated with those of the applicant entity, including the other entity’s ACN, the names of directors and major shareholders, and an organisation chart for the consolidated operations;

(h)if section 36 applies to the entity — the option in Schedule 3 that is to apply to the entity.

(6)The applicant entity must give to the Secretary, together with the application for registration, the documents and information mentioned in sections 32, 33 and 34.

32Financial statements etc

(1)For subsection 31 (6), the applicant entity must give the financial information required by this section.

(2)If the entity has carried on business operations in the 3 income years of the entity before the income year in which the application is made, the entity must give the financial information mentioned in subsection (4) for those 3 income years.

(3)If the entity (not being an entity mentioned in subsection (2)) has carried on business operations in 1 or more of the 3 income years of the entity before the income year in which the application is made, the entity must give the financial information mentioned in subsection (4) for those income years.

(4)For subsections (2) and (3), the financial information is:

(a)if the entity is required, under section 296 of the Corporations Act 2001, to prepare financial reports in accordance with accounting standards:

(i)financial reports prepared in accordance with those standards; and

(ii)if the entity is required, under section 301 of the Corporations Act 2001, to have an annual audit of the financial report — a copy of the auditor’s report; or

(b)in any other case — financial statements comprising a balance sheet and a profit and loss statement, together with notes to the statements and underlying assumptions made in their preparation.

33Description of activities and estimates of expenditure

For subsection 31 (6), the applicant entity must give:

(a)a detailed description of eligible TCF activities and eligible TCF products in relation to which claims are likely to be made under the Scheme; and

(b)the estimated total eligible expenditure in respect of which claims are likely to be made under the Scheme.

34Strategic business intent

For subsection 31 (6) the applicant entity must give a statement of strategic business intent that:

(a)is drawn from the strategic business plan mentioned in section 35; and

(b)includes the business, operational and financial strategies that will guide the entity to sustainable operations for eligible TCF activities beyond the end of the program period.

35Strategic business plan

(1)The applicant entity must have a strategic business plan for the entity that complies with this section.

Note A strategic business plan means a strategic business plan that incorporates a strategic investment plan — see s 4 of the Act.

(2)The strategic business plan must relate to:

(a)the program year (including any pre-program year) in respect of which the application for registration is made; and

(b)the remaining program years (if any) of the program period.

(3)However, if, for an entity, there are less than 2 remaining program years in the program period, the strategic business plan must relate, in addition to the program years mentioned in paragraphs (2) (a) and (b), to 1 or more income years of the entity after the end of the program period, so that the strategic business plan relates to at least 3 income years of the entity.

(4)The strategic business plan must indicate the entity’s strategic direction for the whole of the program period.

(5)The strategic business plan must:

(a)give details of the strategies (including financial plans) that will enable the entity to carry on sustainable operations for eligible TCF activities beyond the end of the program period; and

(b)include appropriate operational plans, details of financial commitment and controls, financial projections and assumptions on which forecasts are based.

(6)If the Secretary, in writing, requests the entity to make available a copy of the entity’s strategic business plan, the entity must comply with the request within a reasonable period specified by the Secretary in the request.

36Election of pro rata and method of determination options for Type 1 grant

(1)If the entity intends to make a claim for a Type 1 grant, or a request for a regular advance of such a grant, in 1 or both of the pre-program years as well as at least 1 program year, the entity must elect which of Option 1, Option 2 or Option 3 in Schedule 3 is to apply to the entity for the apportionment of eligible expenditure incurred by the entity.

(1A)If the entity elects that Option 1 is to apply to the entity, the entity may also elect that the method of determination of the entity’s entitlement to Type 1 grants set out in section 77 is to apply to the entity.

(1B)An election under subsection (1A) is also an election that section 51Q applies in relation to requests for regular advances of such grants.

(2)An election by an entity under subsection (1) or (1A) cannot be changed except:

(a)with the approval in writing of the Secretary; and

(b)before a claim is made by the entity.

(3)The entity must notify the Secretary in writing of an election under subsection (1A) before the entity makes a claim.

37Additional information

(1)If it appears to the Secretary that an application by an entity, or information submitted with the application, is incomplete or insufficient for the purpose of registration, the Secretary, in writing, may request the entity to do 1 or both of the following:

(a)make a further application in such form as is specified in the request;

(b)give further information specified in the request.

(2)The entity must comply with a request under subsection (1) within a reasonable period specified by the Secretary in the request.

38Time limits for registration

An entity wishing to make a claim for a grant for a program year must apply to be registered as follows:

(a)for the 2003/2004 program year — before 1 July 2003;

(b)for the 2004/2005 program year — before 1 July 2004.

Note 1   Section 38 of the Scheme, as amended and in force immediately before the commencement of this section, provided for time limits for registration for the 2000/2001, 2001/2002 and 2002/2003 program years.

Note 2   Section 43 provides for extension of time limits for registration.

39Registration of entity

(1)The Secretary must notify an entity of the receipt of the entity’s application for registration.

(2)The Secretary must register the entity if the Secretary is satisfied, on consideration of the application, that the entity:

(a)is eligible to apply for registration; and

(b)has complied with requirements of this Part for registration.

(3)If the Secretary is not satisfied as to a matter mentioned in paragraph (2) (a) or (b), the Secretary must refuse to register the entity.

(4)For subsections (2) and (3), the Secretary is not to be concerned with the eligibility of the entity for a grant under the Scheme.

40Effects of registration

(1)If the Secretary registers an entity, the registration is taken to have effect from the day on which the Secretary receives the initial application, whether or not a further application is made under section 37.

(2)Registration of an entity has effect for 1 or both of the pre-program years and the 2000/2001 program year, or for the program year, for which registration was sought.

(4)Registration of an entity does not, of itself, give rise to an entitlement to a grant.

Note   Part 5A deals with the transfer of registration.

41Application for renewal of registration

(1)Subject to this section, an entity that is registered, or has been registered, for a pre-program year and the 2000/2001 program year, or for a program year, may apply for a renewal of registration for a later program year (whether or not the entity intends to make a claim for that program year).

(2)An entity is not eligible to apply for a renewal of registration if it no longer carries on, or no longer proposes to carry on, an eligible TCF activity.

(3)An application for renewal must:

(a)be in a form approved by the Secretary; and

(b)include the information mentioned in subsection (4).

(4)For paragraph (3) (b), the information is as follows:

(a)details of any variation or updating of the information given to the Secretary under section 33, 34 or 37 in relation to an activity in respect of which the entity proposes to make a claim (including any change in the estimated total eligible expenditure in respect of which claims are likely to be made);

(b)if the entity has disposed of any assets in respect of which a grant has been made to the entity under the Scheme — details of the disposal.

(5)Sections 37 and 38 apply to an application for renewal of registration in the same way as they apply to an application for registration under section 31.

Note   Section 37 provides that the Secretary may request additional information. Section 38 imposes time limits for an application for registration.

42Renewal of registration

(1)The Secretary must notify an entity of the receipt of an entity’s application for renewal of registration.

(2)The Secretary must renew the registration if the Secretary is satisfied that the entity:

(a)is eligible to apply for a renewal of registration; and

(b)has complied with the requirements of section 41.

(3)If the Secretary is not satisfied as to any of the matters mentioned in paragraph (2) (a) or (b), the Secretary must refuse to renew the registration.

(4)For subsections (2) and (3), the Secretary is not to be concerned with the eligibility of the entity for a grant under the Scheme.

(5)Section 40 applies to an application for renewal and to the renewal of registration in the same way as it applies to an application for registration under section 31 and to registration.

Note   Section 40 deals with the effect and transferability of registration.

43Extension of time for registration or renewal

(1)The Secretary, on the written application of an entity, may extend the period within which the entity may apply for registration, or renewal of registration, for a program year.

(3)The Secretary must not extend the period unless the Secretary is satisfied that, because of exceptional circumstances affecting the entity, there is good reason to do so.

(4)   However, regardless of the circumstances, the Secretary may not extend the period for registration or renewal of registration beyond the end of the program year for which registration or renewal of registration is sought.

Examples

1.   If an entity applies to the Secretary for an extension of time to register for the 2003/2004 program year during the 2003/2004 program year, the Secretary may extend the period only until the end of the 2003/2004 program year.

2.   If an entity applies to the Secretary for an extension of time to register for the 2003/2004 program year on 1 July 2004 (the start of the 2004/2005 program year) the Secretary must not agree to the extension.

(5)To avoid doubt, a failure to apply for registration or renewal of registration on time due to oversight or ignorance is not to be regarded as an exceptional circumstance for subsection (3).

44Notice of registration or refusal to register etc

(1)The Secretary must give written notice to an entity of:

(a)the entity’s registration or renewal of registration; and

(b)if the period within which an application for registration or renewal is made is extended under section 43 — details of the extension.

(2)If the Secretary refuses an application for registration or renewal of registration, or for an extension of the period for registration or renewal, the Secretary must give written notice of:

(a)the refusal; and

(b)the reasons for the refusal.

Note   Section 89 requires the notice to be accompanied by a statement about the entity’s right to have the decision reconsidered or reviewed.

(3)If the Secretary has not decided the application within the decision period, the entity may, at any time, give the Secretary written notice that the entity wishes to treat the application as having been refused.

(4)For section 87, if the entity gives notice under subsection (3), the Secretary is taken to have refused the application, and to have notified the entity of the decision, on the day on which the entity gives notice.

(5)In subsection (3):

decision period, in relation to an application, means:

(a)if, within the period of 28 days commencing on the day when the application is received, the Secretary requests further information, or a further application, under section 37 — the period of 28 days commencing on the day when the further information or application is received; or

(b)in any other case — the period of 28 days commencing on the day when the application is received.

45Effect of non-registration

(1)An entity that is not registered for a pre-program year is not eligible for a Type 1 grant for that year.

(2)An entity that is not registered for a program year is not eligible for a Type 1, Type 2 or Type 3 grant for that year.

46Register of entities

(1)The Secretary must maintain a register of entities that are registered for the Scheme.

(2)In any proceedings relating to the Scheme, a document that appears to a court or tribunal to be a certificate by the Secretary, in accordance with subsection (3), certifying a statement to the effect mentioned in subsection (4):

(a)is evidence of the truth of the statement; and

(b)may be received in evidence without being proved.

(3)The certificate must be signed by the Secretary and be expressed to be in accordance with the register.

(4)The statement must be to the effect that, on a specified date, or during a specified period, a specified entity was, or was not, registered for a pre-program year or a program year.

47Notice of likely change in eligible expenditure

(1)An entity that is registered for a program year or a pre-program year must give written notice to the Secretary of:

(a)any likely significant change in eligible expenditure to be incurred by the entity in the program year or pre-program year in respect of which the entity proposes to make a claim; and

(b)any likely implications of the change on the estimated total eligible expenditure in respect of which claims are likely to be made by the entity under the Scheme.

(2)The entity must give the notice as soon as the entity becomes aware of the likely change.

Part 4  Notice of intention to claim for Type 4 or Type 5 grant

48Notice of intention to claim for Type 4 or Type 5 grant

(1)This section applies to an entity if the entity intends:

(a)to take part in a restructuring initiative of a kind mentioned in section 29; and

(b)that a claim will be made by the resultant entity for a Type 4 or Type 5 grant for the 1999/2000 pre-program year or a program year in relation to the restructuring initiative.

(2)The entity must give notice to the Secretary, acting on behalf of the Minister, of the intention to make a claim.

(3)The notice must:

(a)be given jointly by all the entities intending to take part in the restructuring initiative; and

(b)be in writing in a form approved by the Secretary; and

(c)be signed in the manner indicated in the form; and

(d)be accompanied by the information mentioned in section 49.

Note   Notices and other documents under the Scheme may be sent electronically — see s 94.

(4)Despite subsection (1), notice of intention may be given in respect of a restructuring initiative that:

(a)commenced in the 1999/2000 pre-program year, but before the commencement of the Scheme; and

(b)at the commencement of the Scheme had not yet been completed.

49Information to be given with notice of intent

(1)For paragraph 48 (3) (d), the information to accompany the notice of intention is the following:

(a)the information mentioned in subsection 31 (5) about each entity intending to take part in the restructuring initiative;

(b)details of the restructuring initiative, including:

(i)the principles underlying the restructuring initiative; and

(ii)the benefits and risks of the restructuring initiative; and

(iii)the expected outcomes of the restructuring initiative, addressing, in particular the matters mentioned in paragraphs 29 (5) (b) to (d); and

(iv)the corporate structure of the resultant entity;

(c)details of the likely costs and other likely implications of the restructuring initiative, including:

(i)the projected cost to each entity taking part in the restructuring initiative; and

(ii)the impact on employees of each entity at all locations; and

(iii)the funding arrangements for the restructuring initiative;

(d)the estimated total eligible expenditure in respect of which claims are likely to be made under the Scheme.

(2)The information must be in writing.

50Additional information

(1)If it appears to the Secretary that the notice of intention given by the entities mentioned in section 48, or information submitted with the notice, is incomplete, or is insufficient to enable the Minister to make a decision under section 51, the Secretary, in writing, may request the entity to do 1 or both of the following:

(a)give a further notice in such form as is specified in the request;

(b)give further information, in writing, specified in the request.

(2)The entity must comply with a request under subsection (1) within a reasonable period specified by the Secretary in the request.

51Consideration of notice of intention

(1)The Secretary must send to the Minister, as soon as practicable:

(a)the notice of intention given under section 48 or 50; and

(b)the documents and information accompanying the notice under section 49; and

(c)the further information, if any, given under section 50.

(2)If the Minister is satisfied, on consideration of the notice of intention and the information, that the proposed restructuring initiative would, if carried out in accordance with the notice and information, comply with subsection 29 (5), the Minister must confirm the notice.

(3)If the Minister is not satisfied as to the matter set out in subsection (2), the Minister must refuse to confirm the notice.

(4)Confirmation by the Minister of the notice of intention must be in writing to each of the entities intending to take part in the restructuring initiative.

(5)If the Minister refuses to confirm the notice of intention, the Minister must give notice to each of the entities of:

(a)the refusal; and

(b)the reasons for the refusal.

(6)Confirmation of a notice of intention does not, of itself, give rise to any entitlement to a grant.

Part 4A                   Regular advances of grants

Division 4A.1        Introductory

51AEffect of Part

This Part has effect despite anything else in the Scheme.

51BWhat is a regular advance of a grant

(1)A regular advance of a grant that may become payable to an entity is an amount that may become payable to the entity under this Part by way of an advance on account of the grant.

(2)A regular advance of a type of grant may be made to an entity in addition to a regular advance of another type of grant under the Scheme.

(3)A regular advance of a Type 1 grant or Type 2 grant may be made in relation to more than 1 eligible TCF activity.

(4)A regular advance of a Type 3 grant may be made to an entity for a program year only if a regular advance of a Type 1 or Type 2 grant is also made to the entity for the program year.

51CEffect of non-registration

(1)An entity that is not registered for a pre-program year is not eligible for a regular advance of a Type 1 grant for that year.

(2)An entity that is not registered for a program year is not eligible for a regular advance of a Type 1, Type 2 or Type 3 grant for that year.

51DReferences to a regular advance of a grant for a program year

In this Part, a reference to a regular advance of a grant to an entity for a pre-program year or a program year is a reference to a regular advance of a grant to the entity relating to eligible expenditure incurred, or eligible TCF value added, by the entity in the pre-program year or program year.

Division 4A.2        Regular advances of Type 1, Type 2 and Type 3 grants

Subdivision 4A.2.1     Requests for regular advances of Type 1, Type 2 and Type 3 grants

51ERequests for regular advances of Type 1, Type 2 and Type 3 grants

(1)If an entity intends to make a claim for:

(a)a Type 1 grant for a pre-program year as well as for the 2000/2001 program year; or

(b)a Type 1, Type 2 or Type 3 grant for a program year;

the entity may request the Secretary, in accordance with this Subdivision, for a regular advance of the grant or grants.

(2)An entity may not make a request for a regular advance of a Type 1, Type 2 or Type 3 grant if the entity has previously been paid a regular advance of a grant for a program year or a pre-program year but has not made a claim, under Part 5, for the grant or, if the entity has made a claim, the claim is not paid under that Part.

(3)An entity may make a request for a regular advance of a Type 1 grant for a pre-program year only if the entity also makes a request for a regular advance of a grant for the 2000/2001 program year.

(4)Subsections 52 (3), (3A), (4), (5), (6) and (7) apply in relation to a request for a regular advance of a Type 1, Type 2 or Type 3 grant in the same way as they apply to a claim for the grant.

(5)However, the Secretary, on written request by an entity, may exempt the entity from a provision referred to in subsection (4), other than subsection 52 (4), if the Secretary is satisfied that in the circumstances of the case there is good reason to do so.

(6)A request for a regular advance of a Type 2 grant relating to eligible expenditure by an entity (the contracting entity) in respect of a research and development activity or product development activity carried on, on behalf of the contracting entity, by another entity must be made by the contracting entity.

(7)A request must:

(a)be in a form approved by the Secretary; and

(b)be signed in the manner indicated in the form; and

(c)be accompanied by the documents and information mentioned in section 51F.

Note 1   A request may be made for 2 or more regular advances of grants of any type in the same form.

Note 2   Requests and other documents under the Scheme may be sent electronically — see section 94.

51FInformation in support of requests for regular advances of Type 1, Type 2 and Type 3 grants

For paragraph 51E (7) (c), the documents and information are the following:

(a)a detailed description of eligible TCF activities:

(i)carried on in the pre-program year or program year; and

(ii)in respect of which the request is made;

(b)if the request is for a regular advance of a Type 1 or Type 2 grant — a statement of eligible expenditure incurred by the entity in the pre-program year or program year in respect of which the request is made;

(c)if the request is for a regular advance of a Type 3 grant — the information required to work out, in accordance with Schedule 2, the total eligible TCF value added for the entity for the program year in respect of which the request is made;

(d)a written statement by the entity to the effect that, in the entity’s opinion, the total of regular advances of a Type 1, Type 2 or Type 3 grant for which the entity is applying would not represent an overpayment of the grant entitlements of the entity when section 85A is applied in determining those entitlements.

authorised person means an employee who is authorised under subsection (6).

96Statutory conditions

(1)The payment of a grant, or regular advance of a grant, to an entity is subject also to the condition that the entity complies, or has complied, with all relevant provisions of the Act and the Scheme.

(2)Each grant and regular advance of a grant under the Scheme is subject to the conditions set out in section 18A of the Act.

Note If a condition to which a grant (or regular advance of a grant) is subject is not fulfilled, the whole or part of the grant (or regular advance) may be recovered from the entity as a scheme debt under Part 5 of the Act.

97Condition — document retention

(1)The payment of a grant, or regular advance of a grant, to an entity is subject to the condition that the entity retain each of the documents mentioned in subsection (2) for not less than 5 years from the date on which the grant, or regular advance of a grant, is paid to the entity.

(2)For subsection (1), the documents are:

(a)each document that the entity is, under the Scheme, required to prepare or obtain in relation to the grant, or regular advance of a grant, including (but not limited to) each such document prepared or obtained in relation to:

(i)the registration of the entity under the Scheme; and

(ii)a claim for a grant or a request for a regular advance of a grant; and

(iii)a request for a determination and payment of a claim; and

(b)any record relied upon to prepare such a document.

Note If this condition is not fulfilled, the whole or part of the grant (or regular advance of a grant) may be recovered from the entity as a scheme debt under Part 5 of the Act.

98Post-payment compliance monitoring

If an entity receives a grant, the entity may be subject to post-grant payment compliance monitoring.

Note   Subsection 37P (4) of the Act provides that it is a condition of a grant that entry to certain premises be permitted to authorised officers and employees to monitor compliance with other conditions.

Subsections 37P (6) and (7) of the Act provide for the appointment of authorised officers and employees, and section 37U of the Act provides for identity cards to be carried and produced by authorised officers.

Schedule 1          Eligible TCF activities

(section 5)

Note   The activities listed in this Schedule are based on Div C, Subdiv 22 of the Australian and New Zealand Standard Industrial Classification (ANZSIC).

Part A           Textile Fibre, Yarn and Woven Fabric Manufacturing

1Man-Made Fibre Textile Manufacturing (including blends)

This category consists of manufacturing continuous fibre filament, fibre staple or yarns, tyre cord yarn or fabrics woven, non-woven, felted or tufted from those yarns, or mixed yarns, wholly or predominantly of man-made fibres.  Manufacturing of elastic or elastomeric yarns or threads or fabrics are also included.

·Fibres, manufacturing

·Filament, manufacturing

·Yarns, manufacturing

·Yarns, elastic or elastomeric, manufacturing

·Tyre cord yarns or fabrics, manufacturing

·Fabrics or other textiles, manufacturing

·Fabrics, elastic or elastomeric, manufacturing

·Lacing, woven, manufacturing

2Cotton Textile Manufacturing (including blends)

This category consists of manufacturing of yarns, fabrics woven, non-woven, felted or tufted, wholly or predominantly of cotton or similar fibres including flax, jute, hemp or kapok.

·Yarns, manufacturing

·Tyre cord yarns or fabrics, manufacturing

·Fabrics or other textiles, manufacturing

3Wool Textile Manufacturing (including blends)

This category consists of the manufacturing of yarns, fabrics woven, non-woven, felted or tufted, wholly or predominantly of wool or other animal fibre including mohair, angora, cashmere, alpaca or silk.

·Fellmongered, slipe or skin wool, manufacturing

·Yarns, woollen or other animal fibre, manufacturing

·Fabrics or other textiles, from woollen or worsted manufacturing processes, derived from animal fibres

4Textile Finishing

This category consists of any activities involved in the processes of dyeing, printing, and finishing, including any process of impregnation, coating or lamination for imparting particular end use properties to yarns, fabrics or other textiles except wool tops.

·Textile dyeing, including textile pigmentation

·Textile printing, including flock printing

·Label, printed cloth, manufacturing

·Impregnation, coating or lamination

5Textile Floor Covering Manufacturing

This category consists of manufacturing of carpets, rugs or other textile floor coverings and includes manufacturing of felt or felt products, mats or matting of jute or twisted rags.

·Felt, manufacturing

·Floor coverings, textile, manufacturing

·Floor rugs, textile, manufacturing

·Underfelt, manufacturing

The manufacturing of felt clothing, grass, sisal or coir mats or matting, rubber underlay and rubber floor coverings is excluded from this category.

6Textile Product Manufacturing n.e.c.

This category consists of textile product manufacturing n.e.c.

·Cleaning cloth, manufacturing

·Embroidered fabrics, manufacturing

·Fabrics, manufacturing n.e.c.

·Flock, manufacturing

·Hemp product, manufacturing n.e.c.

·Hessian goods, manufacturing n.e.c.

·Kapok, manufacturing

·Labels or badges, woven cloth, manufacturing

Part B          Knitting Mills Manufacturing

1Hosiery Manufacturing

This category consists of manufacturing of hosiery.

·Panty hose, manufacturing

·Socks, manufacturing

·Stockings, manufacturing

·Tights, manufacturing

2Cardigan and Pullover Manufacturing

This category consists of the manufacturing of knitted cardigans, pullovers or similar garments.

·Custom knitting, of pullovers or cardigans

·Jackets, knitted, manufacturing

·Sweaters, knitted, manufacturing

·Twin sets, knitted, manufacturing

·Waistcoats, knitted, manufacturing

3Knitting Mill Product Manufacturing n.e.c.

This category consists of the manufacturing of knitted or crocheted fabrics or knitted clothing n.e.c.

·Crocheted fabrics, manufacturing

·Knitted fabrics, manufacturing

·Outerwear, knitted, manufacturing (except hosiery, cardigans or pullovers)

·Sleepwear, knitted, manufacturing

·Swimwear, knitted, manufacturing

·Underwear, knitted, manufacturing (except hosiery)

Part C          Clothing Manufacturing

1Men’s and Boys’ Wear Manufacturing

This category consists of the manufacturing of men’s or boys’ outerwear from purchased or transferred in materials.

·Coats or jackets, men’s or boys’, manufacturing (except from fur or leather)

·Dust coats, manufacturing

·Jeans, men’s or boys’, manufacturing

·Overalls, manufacturing

·Shirts, men’s or boys’, manufacturing

·Shorts, men’s or boys’, manufacturing

·Suits, men’s or boys’, manufacturing (except from leather)

·Trousers, men’s or boys’, manufacturing

·Uniforms, men’s or boys’, manufacturing

The manufacturing of men’s or boys’ headwear, footwear, or garments made from leather or fur, is excluded from this category.

2Women’s and Girls’ Wear Manufacturing

This category consists of the manufacturing of women’s or girls’ outerwear from purchased or transferred in materials.

·Blouses, manufacturing

·Coats or jackets, manufacturing (except from fur, leather, plastic or rubber)

·Jeans, women’s or girls’, manufacturing

·Outerwear, women’s or girls’, manufacturing (except from fur, leather, plastic or rubber)

·Suits, women’s or girls’, manufacturing (except from leather or plastic)

·Tunics, women’s or girls’, manufacturing

·Uniforms, women’s or girls’, manufacturing

The manufacturing of women’s or girls’ waterproof clothing or clothing made from fur, leather, plastic or rubber, is excluded from this category.

3Sleepwear, Underwear and Infant Clothing Manufacturing

This category consists of the manufacturing of foundation garments, underwear, sleepwear or infants’ clothing from purchased or transferred in materials.

·Brassieres, manufacturing

·Corsets, manufacturing

·Foundation garments, manufacturing

·Girdles, manufacturing

·Infants’ clothing, manufacturing

·Sleepwear, manufacturing

·Underwear, manufacturing

4Clothing Manufacturing n.e.c.

This category consists of manufacturing of headwear, fur or leather clothing, clothing or clothing accessories n.e.c., and also includes the provision of clothing trade services such as hem stitching, basque knitting or buttonholing.

·Belts, manufacturing (for clothing)

·Clothing accessories, manufacturing n.e.c.

·Clothing, fur, manufacturing

·Clothing, leather or leather substitute, manufacturing n.e.c.

·Clothing manufacturing n.e.c., including clothing for protective or safety purposes

·Gloves, manufacturing (except rubber gloves)

·Handkerchiefs, manufacturing

·Hats* or headwear,* manufacturing

·Laces, manufacturing (for footwear)

·Leather or leather substitute suit, coat or uniforms, manufacturing

·Swimwear, manufacturing (except rubber bathing caps)

·Recreational clothing #

·Ties, manufacturing

·Waterproof clothing, manufacturing (except headwear, footwear or leather clothing)

Part D          Footwear Manufacturing

This category consists of the manufacturing of footwear, or footwear components.

·Boots,* manufacturing

·Footwear component, manufacturing

·Footwear,* manufacturing

·Industrial footwear, including safety or protective footwear

·Sandals,* manufacturing

·Shoes,* manufacturing

·Slippers,* manufacturing

·Thongs, manufacturing

Part E           Leather and Leather Product Manufacturing

Leather Tanning and Fur Dressing

This category consists of post full substance activities including sammying, splitting, shaving, tanning, currying, dressing, dyeing, embossing or japanning leather, animal skins or fur.

·Fur dressing or dyeing

·Hide and skin tanning, currying, dressing, crusting, dyeing or finishing

·Leather manufacturing

·Leather tanning

Part F           Early-stage Processing

1Natural Fibre Processing

This category consists of natural fibre processing.

(a)Wool or other animal fibres — all processing activities up to and including top making, including:

·Scouring

·Tops, unspun, manufacturing

·Carding or combing

(b)Cotton — all processing activities up to and including sliver production, including the following:

·Ginning, cleaning, baling and classing of cotton

·Doubling and drawing of cotton

·Carding, slivering and combing of cotton

(c)Others, including flax, hemp, jute or silk — all processing activities up to and including:

·Tow, manufacturing

2Man-made Fibres

This category consists of man-made fibre processing.

Early-stage processing activities relating to man-made fibres — all processing activities up to and including man-made tows and tops, including:

·Synthetic fibre tops, unspun, manufacturing

·Tow, manufacturing

3Leather

This category consists of early-stage leather processing.

Early-stage leather processing — all processing activities up to and including wet blueing or equivalent stage, including:

·Fleshing, de-hairing, fellmongering, skin pickling, wet blueing and wet whiting of hides and skins

Part G          Made-up Textile and Leather Product Manufacturing

This category consists of manufacturing of made-up textile and leather products including household textile goods, blinds, tents, awnings, sails, or goods of canvas or related materials.

·Animal rugs, manufacturing

·Awnings, textile, manufacturing

·Bags or sacks, textile or canvas, manufacturing for packaging

·Bags, leather or leather substitute, manufacturing

·Binding, textile, (including plastic coated) manufacturing

·Blinds, textile, manufacturing (including plastic coated blinds and woven slats for fabric blinds)

·Canvas goods, manufacturing n.e.c.

·Curtains manufacturing

·Filters, manufacturing, if produced by a manufacturing process made predominantly from yarns, fabrics or other textiles of a kind listed in item 1, 2, 3, or 6 of Part A, or fabrics of a kind listed in item 3 of Part B

·Flags or banners, manufacturing

·Harness, manufacturing

·Helmet*, manufacturing

·Hose, canvas or other textile, manufacturing

·Household textile goods, manufacturing

·Leather or leather substitute goods, manufacturing n.e.c.

·Machine belting, leather or leather substitute, manufacturing

·Motor vehicle covers, textile, manufacturing

·Nets, including fish nets, manufacturing

·Parachutes, manufacturing

·Ropes, twine, cord or cordage, strings (except paper string), braids or cable, manufacturing (except wire rope or wire cable)

·Saddles, manufacturing

·Sails, manufacturing

·Seat covers, manufacturing

·Sleeping bags, manufacturing

·Soft furnishings

·Suitcases, textile, manufacturing

·Tents, manufacturing (except oxygen tents or toy tents)

·Waterbags, textile, manufacturing

Definitions

In this Schedule:

n.e.c. means not elsewhere classified.

man-made fibres include cellulosics and synthetics.

Symbols

#   If made predominantly from the products of activities listed in items 1, 2, 3 and 6 of Part A, or in item 3 of Part B.

*   If made predominantly from leather or the products of activities listed in items 1, 2, 3 and 6 of Part A or in item 3 of Part B.

Schedule 2          Method of working out total eligible TCF value added by an entity

(section 28)

1.Eligible TCF value added must be worked out on the basis of normal commercial values and arms length transactions.

1. Total eligible TCF value added by an entity in respect of the entity’s eligible TCF activities for a program year is worked out using the following formula:

   Total eligible TCF value added = turnover plus change in stock minus (purchases plus transfers-in plus selected expenses)

   where:

   turnover is the sum of:

   (a)     revenue (exclusive of any GST, excise and sales tax) from:

   (i)sales, except sales to New Zealand, of the entity’s eligible TCF products; or

   (ii)if the entity is carrying on an eligible TCF activity of a kind mentioned in item 4 of Part A, or in Part B or C, of Schedule 1 on a fee or commission basis — fees and commissions earned by the entity for that activity; and

   (b)revenue from transfers-out of the entity’s eligible TCF products to associates of the entity; and

   (c)all other operating income from outside the entity (for example, commission income, repair and service income, and rent, leasing and hiring income) from carrying on the entity’s eligible TCF activities,

   but does not include receipts from interest, royalties, licensing fees, dividends or the proceeds of sale of non-current assets.

   change in stock means the value of total closing stocks of the entity’s eligible TCF products less the value of total opening stocks of the entity’s eligible TCF products.

   stocks mean finished eligible TCF products, work-in-progress, raw materials, fuels, and containers and packaging for the entity’s eligible TCF products.

   purchases mean purchases of materials, components, containers, packaging, fuels, electricity, water, and eligible TCF products for further processing or assembling, for carrying on the entity’s eligible TCF activities.

   transfers-in means transfers-in of eligible TCF products from associates of the entity for further processing or assembling, for carrying on the entity’s eligible TCF activities.

   selected expenses means fees and commission expenses, repair and maintenance expenses, outward freight and cartage expenses, motor vehicle running expenses, and rent, leasing and hire expenses, incurred in carrying on the entity’s eligible TCF activities.

2. A reference in this Schedule to an entity’s eligible TCF products is a reference:

   (a)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a) — to eligible TCF products manufactured by the entity; or

   (b)if the entity is not carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a), but is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (b) in accordance with paragraphs 52 (4) (a) and (b) — to eligible TCF products manufactured on behalf of the entity by another entity; or

   (c)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (e) — to eligible TCF products resulting from that activity.

   
   

   Schedule 3          Pro rata adjustment of eligible expenditure for Type 1 grants or regular advances of Type 1 grants

   (sections 51L and 63)

   Note   Subsection 63 (2) provides that the purpose of pro rata adjustment of eligible expenditure is to ensure that the total amount of Type 1 grants payable to an entity in respect of eligible expenditure in both the pre-program and program years does not exceed the total amount of Type 1 grants that would have been payable to the entity in respect of eligible expenditure by the entity in the 5 year program period.  Subsection 63 (1) provides that the pro rata adjustment applies where an entity has eligible expenditure for either or both pre-program years as well as at least 1 program year.  Under s 31 and 36, entities must elect, in their application for registration, which of the following options is to apply in calculating eligible expenditure incurred.

   Option (1)Phase In-Phase Out

Pre-program/Program year	Proportion of Expenditure
1998/1999	1/3
1999/2000	2/3
2000/2001	1
2001/2002	1
2002/2003	1
2003/2004	2/3
2004/2005	1/3

Note   Under this option, full benefit for actual expenditure undertaken is received in respect of the first 3 years of the program period (that is, in 2000/01, 2001/02 and 2002/03).  One third of the actual expenditure undertaken in the first pre-program year (1998/99) and the last program year (2004/05), and two thirds of the actual expenditure undertaken in the second pre-program year (1999/2000) and the second last program year (2003/04) are included.  This results in eligible expenditure generating grants which are the equivalent of grants in the 5 year program period.

Option (2)Pro rata over 7 years

Pre-program/Program Year	Proportion of Expenditure
1998/1999	5/7
1999/2000	5/7
2000/2001	5/7
2001/2002	5/7
2002/2003	5/7
2003/2004	5/7
2004/2005	5/7

Note   This option treats all expenditure undertaken within the program and the pre-program years on an equal basis.  Actual expenditure each year is reduced by approximately 29% to ensure overall eligible expenditure generating grants over the 7 year period does not exceed that which would have been eligible expenditure generating grants in the 5 year program period.

Option (3)Pro rata in the pre-program years and pro rata in the program years

Pre-program/Program Year	Proportion of Expenditure
1998/1999	1/2
1999/2000	1/2
2000/2001	4/5
2001/2002	4/5
2002/2003	4/5
2003/2004	4/5
2004/2005	4/5

Note   This option, in effect, averages actual expenditure in the pre-program years by reducing the value of actual expenditure in each pre-program year by 50%.  The value of actual expenditure in each of the program years is reduced by 20% to accommodate the averaging in the pre-program years.  This results in eligible expenditure generating grants which are the equivalent of grants in the 5 year program period.

Schedule 5          Method of working out total eligible TCF value added by an entity for special advances of grants for incomplete program years

(subsection 86M (9))

1.Eligible TCF value added must be worked out on the basis of normal commercial values and arms length transactions.

2.Total eligible TCF value added by an entity in respect of the entity’s eligible TCF activities for an incomplete program year is worked out using the following formula:

Total eligible TCF value added = turnover plus change in stock minus (purchases plus transfers-in plus selected expenses)

where:

turnover is the sum of:

(a)revenue (exclusive of any GST, excise and sales tax) from:

(i)sales, except sales to New Zealand, of the entity’s eligible TCF products; or

(ii)if the entity is carrying on an eligible TCF activity of a kind mentioned in item 4 of Part A, or in Part B or C, of Schedule 1 on a fee or commission basis — fees and commissions earned by the entity for that activity; and

(b)revenue from transfers-out of the entity’s eligible TCF products to associates of the entity; and

(c)all other operating income from outside the entity (for example, commission income, repair and service income, and rent, leasing and hiring income) from carrying on the entity’s eligible TCF activities;

but does not include receipts from interest, royalties, licensing fees, dividends or the proceeds of sale of non-current assets.

change in stock means the value of total closing stocks of the entity’s eligible TCF products less the value of total opening stocks of the entity’s eligible TCF products.

stocks mean finished eligible TCF products, work-in-progress, raw materials, fuels, and containers and packaging for the entity’s eligible TCF products.

purchases mean purchases of materials, components, containers, packaging, fuels, electricity, water, and eligible TCF products for further processing or assembling, for carrying on the entity’s eligible TCF activities.

transfers-in means transfers-in of eligible TCF products from associates of the entity for further processing or assembling, for carrying on the entity’s eligible TCF activities.

selected expenses means fees and commission expenses, repair and maintenance expenses, outward freight and cartage expenses, motor vehicle running expenses, and rent, leasing and hire expenses, incurred in carrying on the entity’s eligible TCF activities.

3.A reference in this Schedule to an entity’s eligible TCF products is a reference:

(a)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a) — to eligible TCF products manufactured by the entity; or

(b)if the entity is not carrying on an eligible TCF activity mentioned in paragraph 5 (1) (a), but is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (b) in accordance with paragraphs 52 (4) (a) and (b) as applied by subsection 86L (3) — to eligible TCF products manufactured on behalf of the entity by another entity; or

(c)if the entity is carrying on an eligible TCF activity mentioned in paragraph 5 (1) (e) — to eligible TCF products resulting from that activity.

Notes to the Textile, Clothing and Footwear Strategic Investment Program Scheme 1999

Note 1

The Textile, Clothing and Footwear Strategic Investment Program Scheme 1999 (in force under section 8 of the Textile, Clothing and Footwear Strategic Investment
Program Act 1999) as shown in this compilation is amended as indicated in the Tables below.

For all relevant information pertaining to application, saving or transitional provisions see Table A.

Table of Instruments

Title	Date of notification in Gazette or FRLI registration	Date of commencement	Application, saving or transitional provisions
Textile, Clothing and Footwear Strategic Investment Program Scheme 1999	5 Jan 2000 (see Gazette 2000, No. S6)	5 Jan 2000
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2000 (No. 1)	29 Mar 2000 (see Gazette 2000, No. S153)	29 Mar 2000	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2000 (No. 2)	28 June 2000 (see Gazette 2000, No. S339)	1 July 2000	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2001 (No. 1)	28 Feb 2001 (see Gazette 2001, No. S72)	28 Feb 2001	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2001 (No. 2)	4 June 2001 (see Gazette 2001, No. S200)	4 June 2001	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2001 (No. 3)	20 July 2001 (see Gazette 2001, No. S296)	20 July 2001	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2002 (No. 1)	27 Aug 2002 (see Gazette 2002, No. S319)	27 Aug 2002	R. 4
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2002 (No. 2)	11 Dec 2002 (see Gazette 2002, No. GN49)	11 Dec 2002	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2003 (No. 1)	23 July 2003 (see Gazette 2003, No. S285)	23 July 2003	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2004 (No. 1)	28 May 2004 (see Gazette 2004, No. S181)	28 May 2004	—
Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2005 (No. 1)	28 Feb 2005 (see F2005L00416)	1 Mar 2005	—

Table of Amendments

ad. = added or inserted   am. = amended   rep. = repealed   rs. = repealed and substituted
Provision affected	How affected
Part 1
S. 3......................................	am. 2001 Nos. 1, 2 and 3; 2002 No. 1; 2003 No. 1
S. 5......................................	am. 2000 No. 2; 2001 Nos. 1 and 2; 2003 No. 1
S. 8......................................	am. 2000 No. 1
S. 9......................................	am. 2001 No. 1
Note to s. 9 (3)..................	ad. 2002 No. 1
S. 10...................................	rs. 2001 No. 1
am. 2001 No. 2
Part 2
Division 2.2
S. 14...................................	am. 2003 No. 1
S. 15...................................	am. 2001 No. 1
Division 2.3
S. 16...................................	am. 2003 No. 1
S. 19...................................	rs. 2002 No. 1
S. 24...................................	am. 2002 No. 1
Division 2.4
Note to s. 28......................	ad. 2002 No. 1
Division 2.5
S. 29...................................	am. 2003 No. 1
S. 30A.................................	ad. 2002 No. 1
S. 30B.................................	ad. 2002 No. 1
Part 3
S. 31...................................	am. 2003 No. 1
S. 32...................................	am. 2003 No. 1
Heading to s. 36...............	rs. 2001 No. 1
S. 36...................................	am. 2001 Nos. 1 and 3; 2002 No. 1
S. 38...................................	am. 2000 No. 1
rs. 2002 No. 1
S. 40...................................	am. 2001 No. 1
S. 42...................................	am. 2002 No. 1
Note to s. 42 (2)................	rep. 2002 No. 1
S. 43...................................	am. 2002 No. 1; 2005 No. 1
S. 44...................................	am. 2001 No. 1
Part 4A
Part 4A................................	ad. 2001 No. 3
Division 4A.1
S. 51A.................................	ad. 2001 No. 3
S. 51B.................................	ad. 2001 No. 3
S. 51C................................	ad. 2001 No. 3
S. 51D................................	ad. 2001 No. 3
Division 4A.2
S. 51E.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51F.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51G................................	ad. 2001 No. 3
am. 2002 Nos. 1 and 2
S. 51H................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51I..................................	ad. 2001 No. 3
rs. 2002 No. 1
S. 51J.................................	ad. 2001 No. 3
rs. 2002 No. 1
S. 51K................................. .........................................	ad. 2001 No. 3
rs. 2002 No. 1
S. 51L.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51M................................	ad. 2001 No. 3
S. 51N................................	ad. 2001 No. 3
S. 51O................................	ad. 2001 No. 3
S. 51P.................................	ad. 2001 No. 3
rep. 2002 No. 1
S. 51Q................................	ad. 2002 No. 1
am. 2002 No. 1
S. 51R................................	ad. 2001 No. 3
S. 51S.................................	ad. 2001 No. 3
am. 2003 No. 1; 2005 No. 1
S. 51T.................................	ad. 2001 No. 3
am. 2003 No. 1
S. 51U................................	ad. 2001 No. 3
am. 2002 No.1
S. 51UA..............................	ad. 2002 No. 1
S. 51V.................................	ad. 2001 No. 3
am. 2002 No. 1
Division 4A.3
S. 51W................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51X.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51Y.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51Z.................................	ad. 2001 No. 3
am. 2002 No. 1
S. 51ZA...............................	ad. 2001 No. 3
S. 51ZB..............................	ad. 2001 No. 3
S. 51ZC..............................	ad. 2001 No. 3
S. 51ZD..............................	ad. 2001 No. 3
S. 51ZE..............................	ad. 2001 No. 3
rep. 2002 No. 1
S. 51ZF...............................	ad. 2001 No. 3
S. 51ZG..............................	ad. 2001 No. 1
am. 2002 No. 3
Part 5
Division 5.1
S. 52...................................	am. 2001 Nos. 1 and 2
S. 53...................................	am. 2001 No. 3
Notes to s. 53 (1), (2)......	ad. 2002 No. 1
S. 54...................................	rs. 2002 No. 1
S. 55...................................	rep. 2002 No. 1
S. 57...................................	am. 2001 No. 3; 2002 No. 1
S. 58...................................	am. 2002 No. 1
S. 59...................................	am. 2002 No. 1; 2005 No. 1
S. 59A.................................	ad. 2002 No. 1
Division 5.2
S. 61...................................	rs. 2002 No. 1
S. 62...................................	rs. 2002 No. 1
S. 63...................................	am. 2001 No. 2; 2002 No. 1
S. 66...................................	am. 2003 No. 1; 2004 No. 1
S. 67...................................	am. 2001 No. 1; 2002 No. 1
S. 67A.................................	ad. 2002 No. 1
S. 68...................................	rs. 2002 No. 1
S. 68A.................................	ad. 2002 No. 1
S. 68B.................................	ad. 2004 No. 1
S. 69...................................	am. 2002 Nos. 1 and 2; 2003 No. 1
S. 72...................................	am. 2001 No. 3
S. 74...................................	am. 2002 No. 1
Subdiv. 5.2.3.....................	rep. 2002 No. 1
Division 5.3
Div. 5.3...............................	rs. 2002 No. 1
S. 74A.................................	ad. 2002 No. 1
S. 75...................................	am. 2001 No. 1
rs. 2002 No. 1
S. 76...................................	am. 2001 No. 1
rs. 2002 No. 1
S. 77...................................	am. 2001 Nos. 1, 2 and 3
rs. 2002 No. 1
S. 77A.................................	ad. 2001 No. 1
rep. 2002 No. 1
S. 78...................................	rs. 2002 No. 1
S. 79...................................	rs. 2002 No. 1
am. 2005 No. 1
S. 80...................................	rs. 2002 No. 1
S. 81...................................	rs. 2002 No. 1
am. 2005 No. 1
S. 81A.................................	ad. 2005 No. 1
S. 82...................................	rs. 2002 No. 1
am. 2005 No. 1
S. 83...................................	am. 2001 Nos. 2 and 3
rs. 2002 No. 1
S. 83A.................................	ad. 2005 No. 1
S. 84...................................	rs. 2002 No. 1
S. 85 ..................................	am. 2001 No. 2
rs. 2002 No. 1
Heading to s. 85A............	rs. 2001 No. 3
rs. 2002 No. 1
S. 85A.................................	ad. 2001 No. 2
rs. 2002 No. 1
S. 85B.................................	ad. 2001 No. 3
rs. 2002 No. 1
S. 85C................................	ad. 2002 No. 1
S. 85D................................	ad. 2002 No. 1
S. 85E.................................	ad. 2002 No. 1
S. 86...................................	am. 2001 No. 2
rs. 2002 No. 1
Part 5A
Part 5A................................	ad. 2001 No. 1
S. 86A.................................	ad. 2001 No. 1
S. 86B.................................	ad. 2001 No. 1
S. 87C................................	ad. 2001 No. 1
S. 86D................................	ad. 2001 No. 1
am. 2001 Nos. 2 and 3
S. 86E.................................	ad. 2001 No. 1
S. 86F.................................	ad. 2001 No. 1
S. 86G................................	ad. 2001 No. 1
am. 2002 No. 1
Part 5B
Part 5B...............................	ad. 2001 No. 2
Division 5B.1
S. 86H................................	ad. 2001 No. 2
S. 86I..................................	ad. 2001 No. 2
S. 86J.................................	ad. 2001 No. 2
S. 86K.................................	ad. 2001 No. 2
Division 5B.2
S. 86L.................................	ad. 2001 No. 2
am. 2001 No. 3; 2002 No. 1
S. 86M................................	ad. 2001 No. 2
S. 86N................................	ad. 2001 No. 2
S. 86O................................	ad. 2001 No. 2
am. 2001 No. 3
S. 86P.................................	ad. 2001 No. 2
am. 2002 No. 1
S. 86Q................................	ad. 2001 No. 2
S. 86R................................	ad. 2001 No. 2
S. 86S.................................	ad. 2001 No. 2
S. 86T.................................	ad. 2001 No. 2
S. 86U................................	ad 2001 No. 2
am. 2002 No. 1
Division 5B.3
S. 86V.................................	ad. 2001 No. 2
am. 2001 No. 3; 2002 No. 1
S. 86W................................	ad. 2001 No. 2
am. 2002 No. 1
S. 86X.................................	ad. 2001 No. 2
S. 86Y.................................	ad. 2001 No. 2
S. 86Z.................................	ad. 2001 No. 2
S. 86ZA...............................	ad. 2001 No. 2
S. 86ZB..............................	ad. 2001 No, 2
S. 86ZC..............................	ad. 2001 No. 2
am. 2002 No. 1
Part 6
S. 87...................................	am. 2001 No. 3; 2002 No. 1
S. 88...................................	am. 2002 No. 1
S. 91...................................	am. 2001 No. 2; 2003 No. 1
S. 96...................................	ad. 2005 No. 1
S. 97...................................	ad. 2005 No. 1
S. 98...................................	ad. 2005 No. 1
Schedule 1
Schedule 1........................	am. 2000 No. 1; 2001 Nos. 1, 2 and 3; 2003 No. 1
Schedule 2
Schedule 2........................	am. 2001 No. 1
Schedule 3
Heading to Schedule 3...	rs. 2001 No. 3
Schedule 4........................	am. 2001 Nos. 1 and 2
rep. 2002 No. 1
Schedule 5
Schedule 5........................	ad. 2001 No. 2

Table A  Application, saving or transitional provisions

Textile, Clothing and Footwear Strategic Investment Program Scheme Amendment 2002 (No. 1)

4            Application and saving

(1)In this section:

amended Scheme means the Textile, Clothing and Footwear Strategic Investment Program Scheme 1999 as amended by Schedule 1.

old Scheme means the Textile, Clothing and Footwear Strategic Investment Program Scheme 1999, as amended and in force before the commencement of this instrument.

(2)The old Scheme continues to apply in relation to requests, claims and grants made in relation to the 2000/2001 program year (including a pre-program year).

(3)The amended Scheme applies in relation to requests, claims and grants made in relation to the 2001/2002 program year and subsequent program years.

(4)However, in relation to the 2001/2002 and 2002/2003 program years, anything done under the old Scheme before the commencement of this instrument is taken to have been done under the amended Scheme as if any relevant time constraint under the amended Scheme were the longer of the time constraint applicable under the amended Scheme and the corresponding time constraint under the old Scheme.

(5)Further, the amendments of paragraph 87 (3) (c) and sections 63 and 88 of the old Scheme made by Schedule 1 apply in relation to a request under subsection 87 (1) for reconsideration of a decision of the Secretary for any program year (including a pre-program year).