Commonwealth Numbered Acts

INDUSTRIAL RESEARCH AND DEVELOPMENT INCENTIVES ACT 1976 No. 85 of 1976 - SECT 4

4. (1) In this Act, unless the contrary intention appears-

''acting Chairman'' means an acting Chairman of the Board appointed under
section 15;

''acting member'' means an acting member of the Board appointed under section
15, and includes an acting Chairman;

''Advisory Committee'' means the Australian Industrial Research and
Development Incentives Advisory Committee established by this Act;

''approved professional institute'' means a body that, at the relevant time,
is a recognized professional institute for the purposes of this Act by virtue
of a declaration under paragraph 6 (1) (b) ;

''approved research organization'' means a research organization that, at the
relevant time, is an approved research organization for the purposes of this
Act by virtue of a declaration under paragraph 6 (1) (a);

''Australia''-

   (a)  in relation to mining operations-includes such areas of the seabed
        adjacent to Australia as are prescribed; and

   (b)  in relation to the manufacture of goods-includes such areas of the sea
        adjacent to Australia as are prescribed;

''Board'' means the Australian Industrial Research and Development Incentives
Board established by this Act;

''Chairman'' means the Chairman of the Board, but does not include an acting
Chairman;

''commencement grant'' means a grant of financial assistance under Division 1
of Part III;

''company'' means a body or association of persons, whether corporate or
unincorporate;

''concentration'', in relation to a metal, means the separation of the metal
from its ore by any process;

''corporate membership'', in relation to an approved professional institute,
means membership of the institute that entitles the member concerned to full
voting and other rights under the rules or other document governing the
activities of the institute;

''eligible company'' means a company-

   (a)  which is incorporated under the law of a State or of an internal
        Territory or, in the case of an unincorporated body or association of
        persons, is prescribed by the regulations for the purposes of this
        paragraph; and

   (b)  which carries on, or proposes to carry on, the manufacture of goods or
        mining operations in Australia;

''eligible contract expenditure'', in relation to a company in respect of a
grant year, means so much of any amount paid or payable by the company to a
research organization for the carrying out by the research organization for
the company of industrial research and development at a time in that year when
the organization is an approved research organization as the Board is
satisfied is a reasonable charge by the research organization for or in
respect of-

   (a)  the salaries or wages of full-time employees of the research
        organization in respect of periods during which they were directly
        engaged in that industrial research and development;

   (b)  the use by the research organization of plant or equipment used in
        carrying out that industrial research and development; and

   (c)  technical information relating to that industrial research and
        development;

''eligible expenditure'', in relation to a company in respect of a grant year
in respect of which the company has eligible salary expenditure, means an
amount equal to the sum of that eligible salary expenditure and the following
expenditure of the company in respect of the year:-

   (a)  eligible plant expenditure;

   (b)  eligible expenditure on technical information;

   (c)  eligible prototype expenditure; and

   (d)  eligible contract expenditure;

''eligible expenditure on technical information'', in relation to a company in
respect of a grant year, means any amount paid or payable by the company for
obtaining technical information in that year, being technical information that
the Board is satisfied was or is required by the company for the purposes of
industrial research and development carried out, or to be carried out, by the
company;

''eligible plant expenditure'', in relation to a company in respect of a
grant year (in this definition referred to as the ''relevant grant year''),
means-

   (a)  one-third of expenditure incurred by the company-

        (i)    in the case of the grant year commencing on 1 July 1976-in that
               year;

        (ii)   in the case of the grant year commencing on 1 July 1977-in that
               year and the grant year commencing on 1 July 1976; and

        (iii)  in the case of the grant year commencing on 1 July 1978 or any
               subsequent grant year-in that year and the 2 grant years
               immediately preceding that year,

being expenditure of the company in purchasing or constructing, and
installing, research and development plant, less any consideration which has
been or will be received by the company in respect of the disposal, loss or
destruction of that plant except to the extent that that consideration has
been taken into account for the purposes of this definition in the application
of this Act to the company in respect of a grant year earlier than the
relevant grant year; or

   (b)  so much of any amount paid or payable by the company for the hire in
        the relevant grant year of research and development plant as, in the
        opinion of the Board, is a reasonable charge to the company for that
        hire;

''eligible prototype expenditure'', in relation to a company in respect of a
grant year, means expenditure incurred by the company in that year (other than
expenditure that is eligible salary expenditure, eligible plant expenditure,
eligible expenditure on technical information or eligible contract expenditure
of the company in respect of that year) in making, or having made, in the
course of the carrying out by the company of industrial research and
development, a prototype, less any consideration which has been or will be
received by the company in respect of the disposal, loss or destruction of the
prototype except to the extent that that consideration has been taken into
account for the purposes of this definition in the application of this Act to
the company in respect of a previous grant year;

''eligible salary expenditure'', in relation to a company in respect of a
grant year, means expenditure incurred by the company in that grant year in
respect of-

   (a)  the salaries or wages of full-time employees who, throughout their
        employment by the company in that year, were, during their ordinary
        hours of duty, engaged primarily and principally in
        professional or technical research and development work and not
        engaged to any substantial extent in any other duties; and

   (b)  so much of the salary or wages of any other full-time employees as was
        paid in respect of the whole or any part of a continuous period of not
        less than 4 weeks during which the employees were, during their
        ordinary hours of duty, engaged primarily and principally in
        professional or technical research and development work and not
        engaged to any substantial extent in any other duties,

less so much of any amount that, in the opinion of the Board, has been or will
be received by the company for the performance by the company of
industrial research and development for another person in that year as is
reasonably attributable to the professional or technical research and
development work involved in the performance of that industrial research and
development, being professional or technical research and development work
engaged in by employees referred to in paragraph (a), or engaged in by
employees referred to in paragraph (b) during a period referred to in that
paragraph;

''grant'' means a commencement grant or a project grant;

''grant year'' means the year that commences on 1 July 1976 or any of the 4
next succeeding years;

''industrial research and development'', in relation to a company, means
systematic experimentation or analysis in a field of science or technology
carried on by the company, or procured
by it to be carried out, in Australia with the object of-

   (a)  acquiring knowledge that may be of use for the purpose of devising or
        developing new or substantially improved material products or new or
        substantially improved processes for or in connexion with the
        production or use of material products (including processes for
        disposing of, or rendering harmless, waste products or emissions
        resulting from the production or use of material products); or

   (b)  applying knowledge for the purpose referred to in paragraph (a);

''member'' means the Chairman or other member of the Board, but does not
include an acting member;

''metal'' includes a compound of a metal;

''minerals'' includes petroleum;

''mining operations'' includes operations for the recovery of naturally
occurring petroleum;

''new'', in relation to material products, means not previously produced by
the company concerned or by another company that, by virtue of section 5, is
deemed to be related to that company, and, in relation to processes, means not
previously used by the company concerned or by another company that is so
deemed to be related to that company;

''petroleum'' includes natural gas;

''previous Act'' means the Industrial Research and Development Grants Act 1967
or that Act as amended and in force from time to time;

''professional qualification'' means-

   (a)  the holding, in a branch of science or technology, of a degree,
        diploma or similar qualification that was granted by a university or
        by a college or other institution of tertiary or technical education
        and is approved by the Board for the purposes of this Act; or

   (b)  corporate membership of an approved professional institute or the
        holding of educational qualifications that are sufficient for
        admission to corporate membership of such an institute;

''professional or technical research and development work'', in relation to a
company, means-

   (a)  work by way of industrial research and development performed by a
        full-time employee of the company who-

        (i)    has a professional qualification; or

        (ii)   if the company is not an approved research organization-is, by
               virtue of an approval under section 7, an approved employee of
               the company for the purposes of this definition; or

   (b)  work by way of direct assistance in a technical capacity to the
        performance of work referred to in paragraph (a);

''project grant'' means a grant of financial assistance under an agreement
entered into under Division 2 of Part III;

''prototype'' includes model;

''research and development plant'', in relation to a company, means plant or
equipment used, or for use, by or on behalf of the company solely for the
purpose of industrial research and development carried out, or proposed to be
carried out, by or on behalf of the company;

''research organization'' means a person who, or a body or organization which,
enters into contracts to perform industrial research and development otherwise
than as an employee;

''salary or wages''does not include salary or wages of an employee in respect
of a period when the employee was absent from his employment on long-service
leave;

''technical information'' means technical or scientific information in books,
journals or other publications, or in some other form, and includes technical
or scientific information provided by an information service;

''year'' means a period of 12 months commencing on 1 July.

(2) A reference in this Act to expenditure incurred by a company in a year
shall be read as a reference to an amount that has become payable by the
company in the year, whether or not it is paid in that year.

(3) Without either extending or restricting, by implication, the scope of
the definition of ''industrial research and development'' in sub- section (1),
it is declared that the following do not constitute industrial research and
development for the purposes of this Act:-

   (a)  methods engineering;

   (b)  operational research;

   (c)  routine quality control;

   (d)  routine materials testing;

   (e)  exploration or prospecting for minerals;

   (f)  design work that-

        (i)    arises from a need to meet the special requirements of a
               customer; or

        (ii)   is primarily directed to style as distinct from the functional
               characteristics of a product; and

   (g)  such other operations as are prescribed, whether generally or in
        relation to a particular class of material products or processes.

(4) Regulations made for the purposes of paragraph (3) (g) do not apply in
relation to a grant year earlier than the grant year next commencing after the
notification of the regulations in the Gazette.

(5) A reference in this Act to industrial research and development, in
relation to an eligible company, shall be read as a reference to such, and
only to such, industrial research and development as is-

   (a)  performed by or for the company directly in relation to-

        (i)    the manufacture, or proposed manufacture, in Australia of goods
               by the company or by another company that, by virtue of section
               5, is deemed to be related to the company;

        (ii)   the manufacture, or proposed manufacture, in Australia of goods
               by another person, being goods that are directly related to the
               sale or manufacture of goods manufactured, or proposed to be
               manufactured, in Australia by the company or by another company
               that, by virtue of section 5, is deemed to be related to the
               company; or

        (iii)  mining operations, or proposed mining operations, in Australia
               of the company or of another company that, by virtue of section
               5, is deemed to be related to the company; or

   (b)  performed by the company, acting as a research organization, directly
        in relation to the manufacture, or proposed manufacture, in Australia
        of goods by another person, or to mining operations, or proposed
        mining operations, in Australia of another person.

(6) Where, at any time, a company commences to use research and development
plant or a prototype for a purpose other than industrial research and
development, the company shall, for the purposes of the definitions of
''eligible plant expenditure'' and ''eligible prototype expenditure'' in
sub-section (1), be deemed to have disposed of the plant or prototype at that
time.

(7) A reference in the definitions referred to in sub-section (6) to
consideration which has been or will be received in respect of the disposal,
loss or destruction of plant or a prototype shall be read as a reference to-

   (a)  in the case of the sale of the plant or prototype-such amount as, in
        the opinion of the Board, is the sale price less the expenses of the
        sale;

   (b)  in the case of the loss or destruction of the plant or prototype-such
        amount as, in the opinion of the Board, is the amount or value which
        has been or will be received under a policy of insurance or otherwise
        in respect of the loss or destruction;

   (c)  in the case of the sale of the plant or prototype with other assets
        where no separate value is allocated to the plant or prototype-such
        part of the sale price as is determined by the Board less such part of
        the expenses of the sale as is determined by the Board; and

   (d)  in the case of the disposal of the plant or prototype otherwise than
        by sale or in a case where the plant or prototype is deemed to have
        been disposed of-the amount determined by the Board to be the value
        (if any) of the plant or prototype at the time of the disposal.

(8) Without limiting the generality of the references in this Act to the
manufacture of goods, those references shall be deemed to include a reference
to the refining of petroleum and to the concentration of a metal or the
treatment or processing of a metal after its concentration, or, in the case of
a metal not requiring concentration, the application to the metal of a
treatment or process which, if the metal had required concentration, would not
have been applied until after the concentration.

(9) A company shall be deemed for the purposes of this Act to have carried on
the manufacture of goods in a year if, under a contract entered into between
the company and another person, that other person manufactured goods for the
company in that year.

(10) Where 2 periods of employment of an employee were separated by a period
during which the employee was absent from his employment with the consent of
his employer, the Board may, in its discretion, for the purpose of the
definition of ''eligible salary expenditure'' in sub-section (1), treat those
2 periods of employment as having been continuous.