Commonwealth: Industry Research and Development Act 1986 (Cth)

Industry Research and Development Act 1986 No. 89, 1986 Compilation No. 34 Compilation date: 21 February 2025 Includes amendments: Act No. 14, 2025 About this compilation This compilation This is a compilation of the Industry Research and Development Act 1986 that shows the text of the law as amended and in force on 21 February 2025 (the compilation date). The notes at the end of this compilation (the endnotes) include information about amending laws and the amendment history of provisions of the compiled law. Uncommenced amendments The effect of uncommenced amendments is not shown in the text of the compiled law. Any uncommenced amendments affecting the law are accessible on the Register (www.legislation.gov.au). The details of amendments made up to, but not commenced at, the compilation date are underlined in the endnotes. For more information on any uncommenced amendments, see the Register for the compiled law. Application, saving and transitional provisions for provisions and amendments If the operation of a provision or amendment of the compiled law is affected by an application, saving or transitional provision that is not included in this compilation, details are included in the endnotes. Editorial changes For more information about any editorial changes made in this compilation, see the endnotes. Modifications If the compiled law is modified by another law, the compiled law operates as modified but the modification does not amend the text of the law. Accordingly, this compilation does not show the text of the compiled law as modified. For more information on any modifications, see the Register for the compiled law. Self‑repealing provisions If a provision of the compiled law has been repealed in accordance with a provision of the law, details are included in the endnotes. Contents Part I—Preliminary 1 Short title 2 Commencement 3 Object of Act 4 Interpretation 5 Application Part II—Administration 6 Establishment of Industry Innovation and Science Australia 7 Functions of Board 8 Powers of Board 9 Constitution of Board 10 Period of appointment of members 11 Duties of Chairperson 12 Remuneration and allowances 13 Leave of absence 14 Resignation 15 Termination of appointment 16 Disclosure of interests by members of Board 17 Acting appointments 18 Meetings of Board 19 Minister may give directions to the Board 20A Minister may give advice to Board or committee 21 Delegation by Board 22 Committees 22A Delegation by committee 23 Directions of Board to committees 24 Disclosure of interests by members of committees 25 Staff, consultants etc. Part III—Functions relating to the R&D tax offset Division 1—Introduction 26 Objects 26A Simplified outline Division 2—Registering for the R&D tax offset Subdivision A—Introduction 27 Simplified outline Subdivision B—Registering R&D entities for R&D activities 27A Registering R&D entities for R&D activities 27B Findings about applications for registration 27C Notice of decision about registration Subdivision C—Applying to register R&D activities 27D Applying to register R&D activities 27E Board may request further information Subdivision D—Examining registrations 27F Examining a registration 27G Applying for findings 27H Board may request information during an examination 27J Findings about a registration 27K Notice of findings or of decisions refusing to make findings 27L Automatic variations so registration is consistent with findings 27M Varying registrations on application 27N Revoking registrations Division 3—Other findings Subdivision A—Introduction 28 Simplified outline Subdivision B—Advance findings about the nature of activities 28A Advance findings about the nature of activities 28B Applications made on behalf of R&D entities Subdivision C—Findings about activities to be conducted outside Australia 28C Findings about activities to be conducted outside Australia 28D Conditions for a finding that an overseas activity cannot be conducted in Australia etc. Subdivision D—Findings about whether technology is core technology 28E Findings about whether technology is core technology Subdivision E—Matters relevant to findings under this Division 28F Notice of decision about findings 28G Applying for findings 28H Board may request further information Division 4—Research service providers Subdivision A—Introduction 29 Simplified outline Subdivision B—Registering research service providers 29A Registering research service providers Subdivision C—Applying for registration 29B Applying for registration 29C Board may request further information about an application 29D Board may need to make inquiries about an application Subdivision D—Varying or revoking registrations 29E Duration of registrations 29F Varying registrations—on application 29G Varying registrations—otherwise than on application 29H Revoking registrations Subdivision E—Register of research service providers 29J Register of research service providers Division 5—Review 30 Simplified outline 30A Reviewable decisions 30B Notice of reviewable decision and internal review rights 30C Applications for internal review of reviewable decisions 30D Internal review of reviewable decisions 30E External review by Administrative Review Tribunal of internal review decisions Division 6—Consolidated groups and MEC groups 31 Registrations and findings not effective for subsidiary members for group R&D activities 31A What happens to findings if R&D entity joins a group 31B What happens to findings if R&D entity leaves a group Division 6A—Determinations about Board's powers, functions and duties under this Part 31C Simplified outline 31D Board may make a determination about its powers, functions and duties 31E When Board must amend or revoke a determination Division 7—Other matters 32 Approved forms 32A Decision‑making principles 32B General rules about findings under this Part 32C Alternative constitutional basis Part IV—Programs relating to industry, innovation, science and research 33 Industry, innovation, science and research programs 34 Arrangements relating to industry, innovation, science and research programs 35 Terms and conditions relating to industry, innovation, science and research program arrangements 36 Minister or accountable authority may delegate powers in relation to arrangements 37 Relationship of this Part with the Public Governance, Performance and Accountability Act 2013 38 Executive power of the Commonwealth Part V—Miscellaneous 44 Offences 45 Time for prosecutions 46 Annual report 47 Confidentiality 48 Regulations 48A Fees for making applications Endnotes Endnote 1—About the endnotes Endnote 2—Abbreviation key Endnote 3—Legislation history Endnote 4—Amendment history An Act relating to industry, innovation, science and research, and for related purposes Part I—Preliminary 1 Short title This Act may be cited as the Industry Research and Development Act 1986. 2 Commencement This Act shall come into operation on 1 July 1986. 3 Object of Act The object of this Act is to position Australia as a leading innovation nation by: (a) facilitating the provision of independent strategic advice about investment in industry, innovation, science and research; and (b) supporting and encouraging collaboration in the development and delivery of programs relating to industry, innovation, science and research; and (c) authorising spending on programs relating to industry, innovation, science and research; and (d) promoting the development, and improving the efficiency and international competitiveness, of Australian industry by encouraging R&D activities, innovation and science activities and venture capital activities. 4 Interpretation (1) In this Act, unless the contrary intention appears: accountable authority has the meaning given by the Public Governance, Performance and Accountability Act 2013. appointed member means the Chairperson, the Deputy Chairperson or a member referred to in paragraph 9(1)(c). approved form has the meaning given by section 32. Australia has the same meaning as in the Income Tax Assessment Act 1997. Board means Industry Innovation and Science Australia, established by section 6. Chairperson means the Chairperson of the Board. Commissioner has the same meaning as in the Income Tax Assessment Act 1997. committee means a committee appointed under section 22. consolidated group has the same meaning as in the Income Tax Assessment Act 1997. constitutional corporation has the same meaning as in the Income Tax Assessment Act 1997. core R&D activities has the same meaning as in the Income Tax Assessment Act 1997. core technology has the meaning given by subsection 28E(2). decision‑making principles has the meaning given by section 32A. Deputy Chairperson means the Deputy Chairperson of the Board. entity has the same meaning as in the Income Tax Assessment Act 1997. head company has the same meaning as in the Income Tax Assessment Act 1997. income year has the same meaning as in the Income Tax Assessment Act 1997. internal review decision has the meaning given by section 30D. MEC group has the same meaning as in the Income Tax Assessment Act 1997. member means the Chairperson, the Deputy Chairperson or another member of the Board. non‑corporate Commonwealth entity has the meaning given by the Public Governance, Performance and Accountability Act 2013. official has the meaning given by the Public Governance, Performance and Accountability Act 2013. PDF has the same meaning as in the Pooled Development Funds Act 1992. R&D activities has the same meaning as in the Income Tax Assessment Act 1997. R&D entity has the same meaning as in the Income Tax Assessment Act 1997. research field means a research field specified in regulations made for the purposes of this definition. research service provider means an entity registered under section 29A. reviewable decision has the meaning given by section 30A. significant scientific link has the meaning given by subsection 28D(3). subsidiary member has the same meaning as in the Income Tax Assessment Act 1997. supporting R&D activities has the same meaning as in the Income Tax Assessment Act 1997. (8) For the purposes of this Act, the Pooled Development Funds Act 1992, the Venture Capital Act 2002 and any other Act, a person gives information, or produces a document, to the Board if the person gives the information, or produces the document, to: (a) the Board; or (b) a member of the Board; or (c) a committee; or (d) a member of a committee; or (e) a member of the staff assisting the Board or a committee (see section 25); or (f) a consultant assisting the Board or a committee (see section 25). (9) A reference in this Act to research is a reference to research in any field. 5 Application This Act extends to every external Territory referred to in the definition of Australia. Part II—Administration 6 Establishment of Industry Innovation and Science Australia The body known immediately before the commencement of the Industry Research and Development Amendment (Industry Innovation and Science Australia) Act 2021 as Innovation and Science Australia is continued in existence with the new name Industry Innovation and Science Australia. Note: Subsection 25B(1) of the Acts Interpretation Act 1901 provides that a body whose name is altered by an Act continues in existence under the new name so that its identity is not affected. 7 Functions of Board The functions of the Board are: (aa) to provide independent strategic advice to the Secretary, the Minister and other Ministers in relation to industry, innovation, science and research matters; and (ab) to undertake audits of, and prepare, review and amend plans in relation to, industry, innovation, science and research matters; and (ac) to promote investment in industry, innovation, science and research; and (ad) to commission and publish research in relation to industry, innovation, science and research matters; and (a) such functions as are conferred on it by a provision of this Act (other than this section); and (b) to evaluate, and to advise the Minister about, the operation of this Act, the Pooled Development Funds Act 1992 and the Venture Capital Act 2002, and the Commonwealth's income tax laws as they operate in relation to those Acts; and (c) such functions as are conferred on it by the Pooled Development Funds Act 1992, the Venture Capital Act 2002 or any other Act; and (ca) to give information it obtains under Part 2, 3 or 4 of the Venture Capital Act 2002 to the Commissioner for the purposes of implementing and administering the taxation law (within the meaning of the Taxation Administration Act 1953); and (d) to do anything incidental or conducive to the performance of any of the above functions. 8 Powers of Board The Board has power to do all things necessary or convenient to be done for or in connection with the performance of its functions. 9 Constitution of Board (1) The Board shall consist of: (a) a Chairperson; and (aa) a Deputy Chairperson; and (b) where the Minister considers it appropriate—the person who, at any time, is performing the duties of an office or position in the Australian Public Service that is designated by the Minister, by notifiable instrument, for the purposes of this paragraph; and (c) not less than 3, or more than 12, other members. (2) The appointed members shall be appointed by the Minister in writing. (3) The appointed members shall be appointed as part‑time members. (4) A member holds office on such terms and conditions (in respect of matters not provided for by this Act) as are determined by the Minister in writing. (5) The performance of the functions or the exercise of the powers of the Board is not affected by a vacancy in the office of Chairperson or Deputy Chairperson, or because the number of members referred to in paragraph (1)(c) falls below 3 for not longer than 6 months. 10 Period of appointment of members (1) Subject to this Act, an appointed member holds office for such period, not exceeding 3 years, as is specified in the instrument of the member's appointment, but he or she is eligible for re‑appointment. (2) A person must not be appointed as an appointed member if the person has, at any time before that appointment, served 2 consecutive terms as a member of the Board (whether or not either or both of those terms commenced or ended before the commencement of this subsection). (3) Before the Minister appoints a person as an appointed member for a particular period, the Minister must be satisfied that appointing the member for that period would be appropriate, having regard to the desirability of ensuring, if practicable, that the periods for which the appointed members are appointed do not all end at the same time. 11 Duties of Chairperson It is the duty of the Chairperson to ensure the efficient and orderly conduct of the business of the Board, and for that purpose, the Chairperson: (a) must make, or cause to be made, such inquiries as the Chairperson thinks necessary into: (i) applications made under this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002; or (ii) any other matter relevant to the operation of this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002; and (b) may make, or cause to be made, to the Board such reports in relation to those applications as the Chairperson thinks fit; and (c) may determine the form of the records to be kept by the Board. 12 Remuneration and allowances (1) The appointed members shall be paid: (a) such remuneration as is determined by the Remuneration Tribunal; and (b) such allowances as are prescribed. (2) This section has effect subject to the Remuneration Tribunal Act 1973. 13 Leave of absence (1) The Minister may grant leave to the Chairperson to be absent from a meeting or meetings of the Board. (2) The Chairperson may grant leave to another member to be absent from a meeting or meetings of the Board. 14 Resignation The Chairperson, the Deputy Chairperson or another appointed member may resign the office of Chairperson, Deputy Chairperson or member, as the case may be, by writing signed by him or her and delivered to the Minister. 15 Termination of appointment (1) The Minister may terminate the appointment of an appointed member: (a) for misbehaviour; or (b) for physical or mental incapacity. (2) If an appointed member: (a) becomes bankrupt, applies to take the benefit of any law for the relief of bankrupt or insolvent debtors, compounds with his or her creditors or makes an assignment of his or her remuneration for their benefit; (b) fails, without reasonable excuse, to comply with the member's obligations under section 16; or (c) is absent from 3 consecutive meetings of the Board otherwise than: (i) on business of the Board undertaken with the approval of the Board or of a committee; or (ii) on leave of absence granted under section 13; the Minister shall remove the member from office. 16 Disclosure of interests by members of Board (1) A member who has a direct or indirect pecuniary interest in a matter being considered or about to be considered by the Board shall, as soon as possible after the relevant facts have come to the knowledge of the member, disclose the nature of that interest at a meeting of the Board. (2) A disclosure under subsection (1) shall be recorded in the minutes of the meeting of the Board and the member shall not, unless the Minister or the Board otherwise determines: (a) be present during any deliberation of the Board with respect to that matter; or (b) take part in any decision of the Board with respect to that matter. (3) For the purpose of the making of a determination by the Board under subsection (2) in relation to a member who has made a disclosure under subsection (1), a member who has a direct or indirect pecuniary interest in the matter to which the disclosure relates shall not: (a) be present during any deliberation of the Board for the purpose of making the determination; or (b) take part in the making by the Board of the determination. 17 Acting appointments (1) The Minister may appoint the Deputy Chairperson, a member or other person to act as Chairperson: (a) during a vacancy in the office of Chairperson, whether or not an appointment has previously been made to the office; or (b) during any period, or during all periods, when the Chairperson is absent from Australia or is, for any other reason, unable to perform the duties of the office of Chairperson; but a person so appointed shall not continue so to act for more than 12 months. Note: For rules that apply to acting appointments, see section 33A of the Acts Interpretation Act 1901. (1A) The Minister may appoint a member or other person to act as Deputy Chairperson: (a) during a vacancy in the office of Deputy Chairperson, whether or not an appointment has previously been made to the office; or (b) during any period, or during all periods, when the Deputy Chairperson is absent from Australia or is, for any other reason, unable to perform the duties of the office of Deputy Chairperson; but a person so appointed must not continue to act in that appointment for more than 12 months. Note: For rules that apply to acting appointments, see section 33A of the Acts Interpretation Act 1901. (2) Where the number of members referred to in paragraph 9(1)(c) is less than 10, the Minister may appoint a person who is not a member to act as a member, but a person so appointed shall not continue so to act: (a) if and after the number of those members ceases to be less than 10; or (b) for longer than 12 months. Note: For rules that apply to acting appointments, see section 33A of the Acts Interpretation Act 1901. (3) The Minister may appoint a person who is not a member to act in the place of a member referred to in paragraph 9(1)(c) during any period, or during all periods, when the member is acting as Chairperson, is absent from Australia or is, for any other reason, unable to perform the duties of the office of member, but a person so appointed shall not continue so to act for longer than 12 months. Note: For rules that apply to acting appointments, see section 33A of the Acts Interpretation Act 1901. 18 Meetings of Board (1) The Board shall hold such meetings as are necessary for the efficient performance of its functions. (2) The Chairperson: (a) may, at any time, convene a meeting of the Board; and (b) shall, if directed by the Minister to convene a meeting of the Board, convene a meeting of the Board. (3) The Chairperson shall preside at all meetings of the Board at which he or she is present. (4) If the Chairperson is not present at a meeting of the Board: (a) the Deputy Chairperson is to preside; or (b) if the Deputy Chairperson is not present—the members present must appoint one of their number to preside at the meeting. (5) At a meeting of the Board, 4 members constitute a quorum. (6) Questions arising at a meeting of the Board shall be determined by a majority of the votes of the members present and voting and: (a) if the Chairperson is present—the Chairperson has a deliberative vote and, in the case of an equality of votes, also has a casting vote; or (b) if the Chairperson is not present and a question arising at the meeting cannot be determined by a majority of the votes of the members present and voting—the question shall be deferred to a meeting at which the Chairperson is present. (7) The Board shall cause minutes of its meetings to be kept. 19 Minister may give directions to the Board Directions conferring additional functions (1) The Minister may, by notifiable instrument, give directions to the Board that a function specified in the direction (being a function relating to the object of this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002) is an additional function of the Board. Directions about the performance of functions and exercise of powers (2) The Minister may, by notifiable instrument, give written directions to the Board about the performance of its functions or the exercise of its powers. (3) Without limiting subsection (2), the Minister may give directions to the Board in relation to: (a) the provision of technical assessments to the Minister in relation to programs or activities, or proposals for programs or activities, under or in connection with this Act; or (b) the provision of a report or advice on a matter that relates to: (i) any of the Board's functions or powers; or (ii) the operation of this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002; or (iii) the operation of the Commonwealth's income tax laws as they operate in relation to this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002; or (c) policies and practices to be followed by the Board in the performance of its functions and the exercise of its powers. (4) Subsection (2) does not empower the Minister to direct that the Board perform any of its functions, or exercise any of its powers, in a particular way in a particular case. Limits and obligations relating to directions under this section (5) A direction under subsection (1) or (2) must not confer a function on the Board to commit or authorise the expenditure of Commonwealth money. (6) The Board must comply with a direction given under this section. 20A Minister may give advice to Board or committee (1) The Minister may give advice to the Board, or to a committee, on any matter that relates, directly or indirectly, to the performance of any of the Board's functions. (2) The advice is to be in writing, delivered to the Chairperson of the Board or of the committee, as the case may be, and is to be expressed to be given under this section. (3) The advice must not relate to a particular person. (4) The Board or committee must consider the advice at its first meeting after the advice is received, but the Board or committee is not required to act in accordance with the advice. 21 Delegation by Board (1) The Board may, by resolution, delegate any or all of its functions and powers to any of the following: (a) the Chairperson; (b) the Deputy Chairperson; (c) a member of the Board; (d) a committee; (e) a member of the staff assisting the Board. (3) A delegation of a function or power under this section: (a) may be revoked by a resolution of the Board (whether or not constituted by the persons constituting the Board at the time the function or power was delegated); and (c) continues in force notwithstanding a change in the membership of the Board. (4) Section 34A of the Acts Interpretation Act 1901 applies in relation to a delegation under this section as if the Board were a person. (5) A certificate signed by the Chairperson stating any matter with respect to a delegation of a function or power under this section is evidence of that matter unless evidence to the contrary is given. (6) A document purporting to be a certificate mentioned in subsection (5) shall, unless the contrary is established, be deemed to be such a certificate and to have been duly given. 22 Committees (1) The Minister may, by notifiable instrument, appoint such committees as the Minister considers necessary for providing advice to the Board on matters relating to the operation of this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002. (1A) In addition to providing advice to the Board as mentioned in subsection (1), a committee may exercise any functions or powers delegated to it by the Board under subsection 21(1). (2) A committee shall consist of not more than 7 members (who may include a member or members of the Board) who shall be appointed by the Minister in accordance with subsections (2A), (2B), (2BA) and (2C) and shall hold office, for the periods for which they are appointed, during the pleasure of the Minister. (2A) A member of a committee is to be appointed for a particular period, not exceeding 3 years, determined by the Minister. (2B) A person must not be appointed as a member of a committee if the person has, at any time before that appointment, served 2 consecutive terms as a member of the committee (whether or not either or both of those terms commenced or ended before the commencement of this subsection). (2BA) Despite subsection (2B), a person may be appointed as a member of a committee for no more than 2 further consecutive terms if: (a) during the previous 2 consecutive terms the person was not the Chairperson of the committee; and (b) the person will be the Chairperson of the committee in those further terms. (2C) Before the Minister appoints a person as a member of a committee for a particular period, the Minister must be satisfied that appointing the member for that period would be appropriate, having regard to the desirability of ensuring, if practicable, that the periods for which the committee members are appointed do not all end at the same time. (3) The Minister may appoint a member of a committee to be the Chairperson of the committee. (4) Where the Minister notifies a committee that he or she does not propose to appoint a Chairperson of the committee under subsection (3), the committee shall elect a member of the committee to be the Chairperson of the committee. (5) A member of a committee shall hold office on such terms and conditions (if any) in respect of matters not provided for by this Act as are determined by the Minister. (6) A member of a committee may resign by writing signed by the member and delivered to the Minister. (7) The Board may refer to a committee for advice any matter relating to the operation of this Act, the Pooled Development Funds Act 1992 or the Venture Capital Act 2002. (8) A committee shall cause minutes of its meetings to be kept. 22A Delegation by committee (1) A committee may, by resolution, delegate to a member of the committee or to a member of the staff assisting the committee all or any of its functions and powers (including a function or power delegated to the committee by the Board under subsection 21(1), despite paragraph 34AB(1)(b) of the Acts Interpretation Act 1901). (2) A delegation of a function or power under this section: (a) may be revoked by a resolution of the committee (whether or not constituted by the persons constituting the committee when the function or power was delegated); and (b) continues in force notwithstanding a change in the membership of the committee. (3) A certificate signed by the Chairperson of a committee stating any matter with respect to a delegation of a function or power under this section is evidence of that matter unless evidence to the contrary is given. (4) A document purporting to be a certificate mentioned in subsection (3) shall, unless the contrary is established, be taken to be such a certificate and to have been duly given. 23 Directions of Board to committees (1) The Board may, by notifiable instrument, give directions with respect to: (a) the matters to be taken into account by a committee in giving advice in relation to a matter or matters; or (b) the practices to be followed by the committee in the performance of its functions. (2) Directions under subsection (1) shall be in writing and shall be given to the Chairperson of the committee to which the directions are given. (3) The Board shall not give directions to a committee under subsection (1) unless and until the Board: (a) has given to the Chairperson of the committee: (i) particulars in writing of the proposed directions; and (ii) an invitation to the Committee in writing to give the Board, within a time specified in the invitation, any comments in writing which the committee wishes to give in relation to the proposed directions; and (b) has considered any comments given in response to the invitation. 24 Disclosure of interests by members of committees (1) A member of a committee who has a direct or indirect pecuniary interest in a matter being considered or about to be considered by the committee shall, as soon as possible after the relevant facts have come to the knowledge of the member, disclose the nature of that interest at a meeting of the committee. (2) A disclosure under subsection (1) shall be recorded in the minutes of the meeting of the committee and a member of a committee shall not, unless the Minister or the committee otherwise determines: (a) be present during any deliberation of the committee with respect to that matter; or (b) take part in any decision of the committee with respect to that matter. (3) For the purpose of the making of a determination by the committee under subsection (2) in relation to a member of a committee who has made a disclosure under subsection (1), a member of a committee who has a direct or indirect pecuniary interest in the matter to which the disclosure relates shall not: (a) be present during any deliberation of the committee for the purpose of making the determination; or (b) take part in the making by the committee of the determination. 25 Staff, consultants etc. (1) The staff required to assist the Board and committees in the performance of their functions shall be persons engaged under the Public Service Act 1999. (2) The Board and committees may also be assisted by consultants, or other persons, engaged by the Commonwealth. Part III—Functions relating to the R&D tax offset Division 1—Introduction 26 Objects The objects of this Part are: (a) to provide integrity for the working out of tax offsets under Division 355 (about R&D) of the Income Tax Assessment Act 1997; and (b) to increase certainty through findings about matters relevant to the working out of those tax offsets; and (c) to improve access for small and medium R&D entities to quality research services by maintaining a register of research service providers. Note: The integrity mentioned in paragraph (a) is provided, for example, by: (a) the Board registering entities seeking these tax offsets; and (b) the Board conducting compliance checks on those entities. 26A Simplified outline The following is a simplified outline of this Part: • The Board may, on application by an R&D entity, register the R&D entity for R&D activities. This registration is needed before the R&D entity can be entitled to a tax offset (an R&D tax offset) under Division 355 of the Income Tax Assessment Act 1997 for the R&D activities. • The R&D entity can seek an advance finding to get early notice about whether an activity is considered to be an R&D activity. • The R&D entity can seek a finding that an activity cannot be conducted in Australia. The finding is needed before expenditure incurred on the activity can count towards an R&D tax offset. • The Board may register entities as research service providers capable of providing research services to R&D entities. • Internal and external review can be sought for certain decisions under this Part. • The Board may make general determinations about how it will exercise its powers, and perform its functions and duties, under this Part. The Board must act in accordance with such a determination. Division 2—Registering for the R&D tax offset Subdivision A—Introduction 27 Simplified outline The following is a simplified outline of this Division: • The Board may register an R&D entity for R&D activities conducted during an income year. • The Board may make findings about the nature of an R&D entity's activities both before and after registration. This includes findings made on application by the R&D entity after registration. • These findings bind the Commissioner for the purposes of any entitlement of the R&D entity to a tax offset under Division 355 of the Income Tax Assessment Act 1997 for the activities. • The Board will register an R&D entity's activities consistently with any findings made about the entity's application. Any findings made about these activities after registration will, if necessary, automatically vary the entity's registration. • Registrations can also be varied and revoked. Subdivision B—Registering R&D entities for R&D activities 27A Registering R&D entities for R&D activities (1) The Board must, on application by an R&D entity, decide whether to register or refuse to register the entity for either or both of the following for an income year: (a) one or more specified activities as core R&D activities conducted during the income year; (b) one or more specified activities as supporting R&D activities conducted during the income year. Note 1: A decision under this subsection is reviewable (see Division 5). Note 2: For requirements of applications, see section 27D. (2) If the Board decides under subsection (1) to register the R&D entity, the Board must do so consistently with: (a) any findings already in force under subsection 27B(1) in relation to the application; and (b) any findings already in force under subsection 28A(1) (advance findings about the nature of activities) in relation to the R&D entity. (3) For each activity registered under subsection (1) as a supporting R&D activity for an R&D entity for an income year, the registration is to also specify: (a) one or more activities as the corresponding core R&D activities; and (b) if any of those activities specified as a core R&D activity is not registered under paragraph (1)(a) for the R&D entity for the income year—each income year for which that core R&D activity: (i) was registered under paragraph (1)(a) for the R&D entity; or (ii) is proposed to be registered under paragraph (1)(a) for the R&D entity. 27B Findings about applications for registration (1) The Board may make one or more findings to the following effect when considering an R&D entity's application for the purposes of subsection 27A(1): (a) that all or part of an activity mentioned in the application was a core R&D activity conducted during the income year; (b) that all or part of an activity mentioned in the application was not an activity of a kind covered by paragraph (a); (c) that all or part of an activity mentioned in the application was a supporting R&D activity conducted: (i) during the income year; and (ii) in relation to one or more specified core R&D activities for which the entity has been or could be registered under section 27A for an income year; (d) that all or part of an activity mentioned in the application was not an activity of a kind covered by paragraph (c). Note 1: A finding is reviewable (see Division 5). Note 2: The Board could make a finding under paragraph (b) if, for example, the Board has insufficient information to make a finding under paragraph (a). Similarly, the Board could make a finding under paragraph (d) if it has insufficient information to make a finding under paragraph (c). Note 3: The Board may also make findings after registration (see subsection 27J(1)). (2) If the Board makes a finding under subsection (1) in relation to the R&D entity's application, the Board may specify in the finding the times to which the finding relates. Example: A finding under paragraph (1)(a) could specify the times during the income year that an activity was a core R&D activity. (3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings). 27C Notice of decision about registration (1) The Board must notify an applicant in writing of the Board's decision under subsection 27A(1) about the application. (2) The notice must include a certificate for each finding (if any) made under subsection 27B(1) for the application. The certificate must set out: (a) a description of the finding; and (b) the Board's reasons for the finding; and (c) the activity affected by the finding; and (d) the matters (if any) specified in regulations made for the purposes of this paragraph. The notice and certificate may set out other matters. Note: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B). (3) The Board must give the Commissioner a copy of the notice if the notice includes one or more certificates. (4) A failure to comply with this section does not affect the validity of the decision or finding. Subdivision C—Applying to register R&D activities 27D Applying to register R&D activities An application to register activities under section 27A for an income year must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section; and (c) made within: (i) 10 months after the end of the income year; or (ii) a further period allowed by the Board in accordance with the decision‑making principles. Note 1: A refusal to allow a further period is reviewable (see Division 5). Note 2: Section 32 deals with approved forms. Note 3: Section 32A deals with the decision‑making principles. 27E Board may request further information (1) The Board may request the applicant in writing to give specified information, or specified kinds of information, to the Board about the application. (2) The request may be for the information or kinds of information to be given within: (a) 30 days after the request was made; or (b) a further period allowed by the Board in accordance with the decision‑making principles. Note 1: A refusal to allow a further period is reviewable (see Division 5). Note 2: Section 32A deals with the decision‑making principles. Note 3: A failure by the entity to give the information may result in a finding under paragraph 27B(1)(b) or (d). (3) The request may be for the information or kinds of information to be given in the approved form. Note: Section 32 deals with approved forms. (4) Subsections (2) and (3) do not limit subsection (1). Subdivision D—Examining registrations 27F Examining a registration (1) The Board may conduct one or more examinations of all or part of an R&D entity's registration under section 27A for an income year for the purposes of making one or more findings under subsection 27J(1). Note: A finding under subsection 27J(1) will support the entity's registration, or cause the variation of that registration. (2) The Board may examine an R&D entity's registration on its own initiative. (3) The Board must examine an R&D entity's registration if: (a) requested by the Commissioner; or (b) the R&D entity has applied for one or more findings under subsection 27J(1) about the registration. Note: A finding under subsection 27J(1) can only bind the Commissioner for the purposes of the R&D entity's income tax assessment for the income year if the finding is made within 4 years after the end of the income year (see subsection 355‑705(1) of the Income Tax Assessment Act 1997). (4) If the R&D entity applies for a finding under subsection 27J(1) about the registration, the Board must: (a) make one or more findings under subsection 27J(1) about the registration; or (b) if justified in accordance with the decision‑making principles—refuse to make a finding under subsection 27J(1) about the registration. Note 1: The Board may make a finding that differs from that sought by the R&D entity. Note 2: A finding, or a refusal to make a finding, is reviewable (see Division 5). Note 3: Section 32A deals with the decision‑making principles. 27G Applying for findings An application for one or more findings under subsection 27J(1) must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section. Note 1: An application can seek findings for several activities. Note 2: Section 32 deals with approved forms. 27H Board may request information during an examination (1) When examining an R&D entity's registration, the Board may request the entity in writing to give specified information, or specified kinds of information, to the Board about the entity's registration. (2) The request may be for the information or kinds of information to be given within: (a) 30 days after the request was made; or (b) a further period allowed by the Board in accordance with the decision‑making principles. Note 1: A refusal to allow a further period is reviewable (see Division 5). Note 2: Section 32A deals with the decision‑making principles. Note 3: A failure by the entity to give the information may result in a finding under paragraph 27J(1)(b) or (d). (3) The request may be for the information or kinds of information to be given in the approved form. Note: Section 32 deals with approved forms. (4) Subsections (2) and (3) do not limit subsection (1). 27J Findings about a registration (1) The Board may make one or more findings to the following effect about an R&D entity's registration under section 27A for an income year (the registration year): (a) that all or part of a registered activity was a core R&D activity conducted during the registration year; (b) that all or part of a registered activity was not an activity of a kind covered by paragraph (a); (c) that all or part of a registered activity was a supporting R&D activity conducted during the registration year and in relation to: (i) one or more specified registered core R&D activities; or (ii) one or more specified core R&D activities for which the entity has been registered in an earlier income year; or (iii) one or more specified core R&D activities yet to be conducted for which the entity could be registered in the registration year if those activities were conducted during the registration year; or (iv) several specified core R&D activities, each covered by subparagraph (i), (ii) or (iii); (d) that all or part of a registered activity was not an activity of a kind covered by paragraph (c). Note 1: A finding is reviewable (see Division 5). Note 2: The Board could make a finding under paragraph (b) if, for example, the Board has insufficient information to make a finding under paragraph (a). Similarly, the Board could make a finding under paragraph (d) if it has insufficient information to make a finding under paragraph (c). (2) If the Board makes a finding under subsection (1) in relation to the R&D entity's registration, the Board may specify in the finding the times to which the finding relates. Example: A finding under paragraph (1)(a) could specify the times during the registration year that a registered activity was a core R&D activity. (3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings). 27K Notice of findings or of decisions refusing to make findings (1) The Board must notify the R&D entity, and the Commissioner, in writing of any findings under subsection 27J(1) about the entity's registration under section 27A. (2) The notice must include a certificate for each finding. The certificate must set out: (a) a description of the finding; and (b) the Board's reasons for the finding; and (c) the registered activity affected by the finding; and (d) the effect of the finding on the entity's registration; and (e) the matters (if any) specified in regulations made for the purposes of this paragraph. The notice and certificate may set out other matters. Note 1: For the effect of the finding on the entity's registration, see section 27L (about automatic variations to registrations). Note 2: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B). (3) The Board must notify the R&D entity in writing of any decision under paragraph 27F(4)(b) refusing to make a finding under subsection 27J(1) in response to an application under section 27G by the R&D entity. (4) A failure to comply with this section does not affect the validity of a finding or decision. 27L Automatic variations so registration is consistent with findings (1) If an R&D entity is registered under section 27A for an income year, then while a finding is in force: (a) under subsection 27B(1) in relation to the application for the registration; or (b) under subsection 27J(1) in relation to the registration; the registration is taken always to have existed in a form consistent with the finding. Note 1: This subsection will cease to apply if the finding is set aside on review (see Division 5). Note 2: A finding has no effect to the extent of any inconsistency with a finding already in force under this Part in relation to the R&D entity (see section 32B). (2) If: (a) a finding under subsection 28A(1) (advance findings about the nature of activities) comes into force for an R&D entity about an activity conducted during an income year; and (b) the R&D entity is later registered under section 27A for the activity for the income year; then, after registration and while the finding is in force, the registration is taken to exist in a form consistent with the finding. Note 1: This subsection will cease to apply if the finding is set aside on review (see Division 5). Note 2: A finding has no effect to the extent of any inconsistency with a finding already in force under this Part in relation to the R&D entity (see section 32B). (3) This section has effect for the purposes of this Act and the Income Tax Assessment Act 1997. 27M Varying registrations on application (1) The Board may, by notice in writing given to an R&D entity, vary the entity's registration under section 27A for an income year if: (a) the entity applies for the variation; and (b) the variation is consistent with the Board's findings (if any) in force under this Part in relation to the R&D entity; and (c) making the variation is justified in accordance with the decision‑making principles. Note 1: A decision not to vary is reviewable (see Division 5). Note 2: Section 32A deals with the decision‑making principles. (2) An application for a variation must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section. Note: Section 32 deals with approved forms. (3) Section 27E applies to an application under this section in a way corresponding to the way that section applies to an application under section 27D. Note: This means the Board may request further information about the application for variation. (4) For the purposes of this Act and the Income Tax Assessment Act 1997, the effect of a variation is that the entity's registration under section 27A for the income year is taken always to have existed as varied. 27N Revoking registrations (1) The Board may, by notice in writing given to an entity, revoke the entity's registration under section 27A for an income year if the Board is satisfied that the entity was not an R&D entity at any time when an activity covered by the registration was conducted during the income year. Note: A decision to revoke under this subsection is reviewable (see Division 5). (2) The Board may, by notice in writing given to an R&D entity, revoke the entity's registration under section 27A for an income year if the entity requests the Board to do so. (3) A request for a revocation under subsection (2) must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section. Note: Section 32 deals with approved forms. (4) For the purposes of this Act and the Income Tax Assessment Act 1997, the effect of a revocation under this section is that the entity is taken never to have been registered under section 27A for the income year. Note: This subsection will cease to apply if a revocation under subsection (1) is set aside on review (see Division 5). (5) The Board must notify the Commissioner of a revocation under this section. Division 3—Other findings Subdivision A—Introduction 28 Simplified outline The following is a simplified outline of this Division: • An R&D entity can seek a finding (an advance finding) about whether an activity is an R&D activity. • An advance finding binds the Commissioner for the purpose of working out tax offsets (R&D tax offsets) under Division 355 of the Income Tax Assessment Act 1997. • An R&D entity can seek a finding that an activity cannot be conducted in Australia. • An R&D tax offset will only be available for expenditure incurred on an activity conducted outside Australia if a finding that the activity cannot be conducted in Australia has come into force. • The Board may also make a finding about whether particular technology is core technology for R&D activities. • An effect of a finding that the technology is core technology for the R&D activities is that an R&D tax offset will not be available for expenditure incurred in acquiring, or in acquiring the right to use, the technology for the R&D activities. Subdivision B—Advance findings about the nature of activities 28A Advance findings about the nature of activities (1) The Board must, on application by an R&D entity for a finding under this subsection about an activity, do one or more of the following: (a) find that all or part of the activity is a core R&D activity; (b) find that all or part of the activity is a supporting R&D activity in relation to one or more specified core R&D activities for which the entity has been or could be registered under section 27A for an income year; (c) make a finding to the effect that all or part of the activity is neither: (i) a core R&D activity; nor (ii) a supporting R&D activity of a kind covered by paragraph (b); (d) if justified in accordance with the decision‑making principles—refuse to make a finding about all or part of the activity. Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5). Note 2: For requirements of applications, see section 28G. Note 3: A finding binds the Commissioner for the purposes of income tax assessments for certain income years (see subsections 355‑705(2) and (3) of the Income Tax Assessment Act 1997). Note 4: Section 32A deals with the decision‑making principles. (2) The Board must not make a finding under subsection (1) about an activity unless the Board is satisfied that the activity: (a) is being conducted, or has been completed, during the income year in which the application is made; or (b) is yet to be conducted, but that it is reasonable to expect that the activity will be conducted in any or all of the following income years: (i) the income year in which the application is made; (ii) either of the next 2 income years. (3) If the Board makes a finding under subsection (1) about an activity that is being conducted, or has been completed, during the income year in which the application is made, the Board may specify in the finding the times to which the finding relates. (4) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings). 28B Applications made on behalf of R&D entities (1) An application for a finding under subsection 28A(1) may be made on behalf of an R&D entity by an entity who: (a) is specified in regulations made for the purposes of this subsection; and (b) is acting with the R&D entity's written consent. The application is taken to be made by the R&D entity. Note: For specification by class, see subsection 13(3) of the Legislation Act 2003. (2) If: (a) an entity could, under subsection (1), make an application on behalf of more than one R&D entity for the same finding for the same activity; and (b) the entity applies (the joint application) under subsection 28G(2) for the finding on behalf of those R&D entities; the joint application is taken to be a separate application under subsection 28G(1) for the finding by each of those R&D entities. Subdivision C—Findings about activities to be conducted outside Australia 28C Findings about activities to be conducted outside Australia (1) The Board must, on application by an R&D entity for a finding under this subsection about an activity, do one or more of the following: (a) find that all or part of the activity is an activity (the overseas activity) that meets the conditions in section 28D; (b) find that all or part of the activity is not an activity that meets the conditions in section 28D; (c) if justified in accordance with the decision‑making principles—refuse to make a finding about all or part of the activity. Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5). Note 2: For requirements of applications, see section 28G. Note 3: An effect of a finding under paragraph (a) is that a tax offset may be available for expenditure incurred on the overseas activity after the finding comes into force (see Division 355 of the Income Tax Assessment Act 1997, in particular paragraphs 355‑210(1)(d) and (e) of that Act). Note 4: Section 32A deals with the decision‑making principles. (2) For the purposes of this Act and the Income Tax Assessment Act 1997, a finding under subsection (1) comes into force at the start of the income year in which the application for the finding is made. (3) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings). 28D Conditions for a finding that an overseas activity cannot be conducted in Australia etc. Must be an R&D activity (1) The first condition is that the overseas activity is covered by a finding under paragraph 28A(1)(a) or (b) (findings that activities are R&D activities). Must have significant scientific link to Australian core activities (2) The second condition is that the overseas activity has a significant scientific link to one or more core R&D activities (the Australian core activities): (a) that are conducted or to be conducted solely within Australia; and (b) that: (i) are registered under section 27A for the R&D entity for an income year; or (ii) are reasonably likely to be conducted and be registered under section 27A for the R&D entity for an income year. (3) The overseas activity has a significant scientific link to the Australian core activities if: (a) the Australian core activities cannot be completed without the overseas activity being conducted; and (b) the conditions (if any) specified in regulations made for the purposes of this subsection are met. Must be unable to be conducted within Australia etc. (4) The third condition is that the overseas activity cannot be conducted solely in Australia because: (a) conducting it requires access to a facility, expertise or equipment not available in Australia; or (b) conducting it in Australia would contravene the Biosecurity Act 2015 or a law relating to quarantine; or (c) conducting it requires access to a population (of living things) not available in Australia; or (d) conducting it requires access to a geographical or geological feature not available in Australia; or (e) it meets a condition (if any) specified in regulations made for the purposes of this subsection. Expenditure must be less than that incurred on Australian core activities (5) The fourth condition is that the total actual and reasonably anticipated expenditure of any entity in all income years on: (a) the overseas activity; and (b) each other activity (if any) conducted wholly or partly outside Australia that has a significant scientific link to the Australian core activities; is less than the total actual and reasonably anticipated expenditure of any entity in all income years on: (c) the Australian core activities; and (d) activities conducted solely within Australia that are supporting R&D activities in relation to the Australian core activities. Subdivision D—Findings about whether technology is core technology 28E Findings about whether technology is core technology (1) If an R&D entity has acquired, or has acquired the right to use, particular technology wholly or partly for the purposes of one or more R&D activities conducted, or to be conducted, during one or more income years, the Board may: (a) find that the technology is core technology for the R&D activities; or (b) find that the technology is not core technology for the R&D activities; or (c) if justified in accordance with the decision‑making principles—refuse to make a finding about the technology and the R&D activities. Note 1: A finding, or a refusal to make a finding, is reviewable (see Division 5). Note 2: A finding under paragraph (a) means that a tax offset will not be available for expenditure incurred in acquiring, or in acquiring the right to use, the technology for the R&D activities (see subsection 355‑225(2) of the Income Tax Assessment Act 1997). Note 3: Section 32A deals with the decision‑making principles. (2) Particular technology is core technology for one or more R&D activities if: (a) a purpose of the R&D activities was or is: (i) to obtain new knowledge based on that technology; or (ii) to create new or improved materials, products, devices, processes, techniques or services to be based on that technology; or (b) the R&D activities were or are an extension, continuation, development or completion of the activities that produced that technology. (3) The Board must make a finding under paragraph (1)(a) or (b) if requested by the Commissioner to make a finding under this section. (4) In addition to subsection (3), the Board: (a) may make a finding under subsection (1) on its own initiative; and (b) must make a decision under subsection (1) if the R&D entity applies for a finding under this section. Note: For requirements of applications, see section 28G. (5) This section has effect subject to section 32B (findings cannot be inconsistent with any earlier findings). Subdivision E—Matters relevant to findings under this Division 28F Notice of decision about findings (1) The Board must notify an applicant in writing of each of the Board's decisions under subsection 28A(1) or 28C(1) about the application. (2) The Board must notify an R&D entity in writing of each of the Board's decisions under subsection 28E(1) that relates to the R&D entity. (3) A notice under subsection (1) or (2) must include a certificate for each finding (if any) to which the decision relates. The certificate must set out: (a) a description of the finding; and (b) the Board's reasons for the finding; and (c) a description of the activity affected by the finding; and (d) for a finding under subsection 28E(1)—a description of the technology affected by the finding; and (e) the matters (if any) specified in regulations made for the purposes of this paragraph. The notice and certificate may set out other matters. Note: The notice could also mention the applicant's right to have the finding reviewed under Division 5 (see section 30B). (4) The Board must give the Commissioner a copy of the notice if the notice includes one or more certificates. (5) A failure to comply with this section does not affect the validity of a decision or finding. 28G Applying for findings Applications for findings (1) An application for one or more findings under this Division must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this subsection. Note 1: An application can seek findings for several activities. Note 2: Section 32 deals with approved forms. Joint applications for identical advance findings (2) An application for identical findings under subsection 28A(1) on behalf of several R&D entities must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this subsection. Note: The application is taken to be a separate application under subsection (1) of this section for the finding by each of those R&D entities (see subsection 28B(2)). 28H Board may request further information (1) The Board may request in writing: (a) for an application taken to be made by an R&D entity because of section 28B—the entity that acted on behalf of the R&D entity in relation to the application; or (b) otherwise—the applicant; to give specified information, or specified kinds of information, to the Board about the application. (2) The request may be for the information or kinds of information to be given within: (a) 30 days after the request was made; or (b) a further period allowed by the Board in accordance with the decision‑making principles. Note 1: A refusal to allow a further period is reviewable (see Division 5). Note 2: Section 32A deals with the decision‑making principles. Note 3: A failure by the entity to give the information may result in a refusal to make the finding. (3) The request may be for the information or kinds of information to be given in the approved form. Note: Section 32 deals with approved forms. (4) Subsections (2) and (3) do not limit subsection (1). Division 4—Research service providers Subdivision A—Introduction 29 Simplified outline The following is a simplified outline of this Division: • The Board may register entities as research service providers capable of providing research services to R&D entities. • Near the end of each financial year, registered research service providers will be asked if they want their registrations to continue for the next financial year. • Registrations can be varied and revoked. • Details of registrations are set out in a register available on the internet. Subdivision B—Registering research service providers 29A Registering research service providers (1) The Board must, on application by an entity, decide whether to register or refuse to register the entity as a research service provider capable of providing services in one or more specified research fields to R&D entities registered under section 27A. Note: A decision under this subsection is reviewable (see Division 5). (2) The Board must not register the entity under subsection (1) unless the Board is satisfied that the entity meets the criteria specified in regulations made for the purposes of this subsection. (3) A registration under this section is subject to the conditions (if any) specified in regulations made for the purposes of this subsection. Subdivision C—Applying for registration 29B Applying for registration An application to be registered under section 29A must be: (a) in the approved form; and (b) accompanied by the fee (if any) specified in regulations made under section 48A for the purposes of this section. Note: Section 32 deals with approved forms. 29C Board may request further informa