EXPLANATORY STATEMENT
Subject ACIS Administration Act 1999
ACIS Administration (Commonwealth Financial Assistance) Determination 2009 (No. 2)
The ACIS Administration Act 1999 (the Act) establishes the Automotive Competitiveness and Investment Scheme (ACIS) as a transitional assistance scheme to encourage competitive investment and innovation in the Australian automotive industry in order to achieve sustainable growth, both in the Australian market and internationally, in the context of trade liberalisation. ACIS rewards eligible activity by registered participants in the form of duty credits which can be used to acquit a Customs duty liability on eligible automotive imports, or can be sold.
Subsection 11(3) of the Act allows the Minister to determine, in writing, that a specified form of Commonwealth assistance is, or is not, financial assistance for the purpose of reducing an ACIS participant's ACIS assistance benefits.
The aim of the determination is to prevent ACIS participants from double-dipping by receiving assistance from both ACIS and another Commonwealth program for the same activity. The changes to the ACIS Administration (Commonwealth Financial Assistance) Determination 2005 incorporated in the ACIS Administration (Commonwealth Financial Assistance) Determination 2009 updated the determination to include a number of recently announced automotive and broader industry assistance programs. However, this determination omitted treatment of a specific form of investment under ACIS relating to capital investment by motor vehicle producers. Accordingly, a further amendment is necessary to ensure appropriate treatment of other Commonwealth financial assistance.
As there were only minor changes to the previous determination, it was not necessary to undertake consultations for the ACIS Determination Administration (Commonwealth Financial Assistance) Determination 2009 (No. 2).
For the purpose of this determination, other Commonwealth programs which are deemed to be financial assistance are those which provide assistance to industry on the basis of the production of motor vehicles, investment in automotive plant and equipment (P&E), or investment in research and development (R&D), and which would be open to ACIS participants. These programs are listed in Part 2 of the determination. The effect of the determination is to remove any element of assistance through ACIS that might arise from other assistance received by that participant for similar activity.
Programs that have not been deemed financial assistance for the purposes of this determination include, programs with their own clawback mechanisms, or programs that aim to improve the overall labour market. These programs are listed in Part 3 of the determination.