{"id":"F2011L02738","name":"Innovation Investment Fund Program Round Three, Direction No.1 of 2011","slug":"innovation-investment-fund-program-round-three-direction-no-1-of-2011","collection":"legislative_instrument","jurisdiction":"commonwealth","status":"in_force","isInForce":true,"actNumber":null,"makingDate":null,"administeringDepartment":null,"currentVersion":{"id":126073,"registerId":"commonwealth-F2011L02738-current","compilationNumber":null,"startDate":"2026-04-03","status":"InForce","reasons":null,"registeredAt":null},"sections":[{"sectionNumber":"(a) the proposed size of the fund;","sectionType":"part","heading":"(a) the proposed size of the fund;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":0},{"sectionNumber":"(b) the ratio of privately sourced capit","sectionType":"part","heading":"(b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":1},{"sectionNumber":"(c) the fund’s proposed investors and th","sectionType":"part","heading":"(c) the fund’s proposed investors and the amount of capital to be committed by each;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":2},{"sectionNumber":"(d) the amount of capital, if any, to be","sectionType":"part","heading":"(d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":3},{"sectionNumber":"The applicant’s proposed investment stra","sectionType":"part","heading":"The applicant’s proposed investment strategy","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":4},{"sectionNumber":"(e) the extent to which the fund’s propo","sectionType":"part","heading":"(e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":5},{"sectionNumber":"(f) the number and the size of investmen","sectionType":"part","heading":"(f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":6},{"sectionNumber":"(g) the level and structure of managemen","sectionType":"part","heading":"(g) the level and structure of management fees proposed;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":7},{"sectionNumber":"The experience of the applicant’s invest","sectionType":"part","heading":"The experience of the applicant’s investment team","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":8},{"sectionNumber":"(h) whether the applicant has a balanced","sectionType":"part","heading":"(h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":9},{"sectionNumber":"(i) the applicant’s capacity and experie","sectionType":"part","heading":"(i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":10},{"sectionNumber":"(j) whether the applicant has an underst","sectionType":"part","heading":"(j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;","content":"## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;","sortOrder":11},{"sectionNumber":"(k) whether the proposed applicant has e","sectionType":"part","heading":"(k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":12},{"sectionNumber":"Intent","sectionType":"part","heading":"Intent","content":"Commonwealth of Australia\n\nIndustry Research and Development Act 1986\n\nInnovation Investment Fund Program Round Three\n\nDirection No. 1 of 2011\n\nI, KIM JOHN CARR, Minister for Innovation, Industry, Science and Research, acting under sections 18A, 19 and 20(1) of the Industry Research and Development Act 1986, give the following direction to Innovation Australia (the Board).\n\nDated 20 October 2011\n\nKIM CARR\n\nMinister for Innovation, Industry, Science and Research\n\nPART 1—PRELIMINARY\n\nName of direction\n\n1.  This direction is the Innovation Investment Fund Program Round Three, Direction No.1 of 2011.\n\nCommencement\n\n2. This direction commences on the day on which particulars of the direction are published in the Gazette and registered on the Federal Register of Legislative Instruments.\n\nObject of these directions\n\n3. The object of this instrument is to give directions to the Board in relation to:\n\n(a) additional functions of the Board, namely the administration of the IIF program including the provision of competitive merit based assessments and ranking of eligible applications under the IIF program; and\n\n(b) the policies and practices to be followed by the Board in the performance of the function.\n\n  \nInterpretation\n\n4. In this direction:\n\n“applicant” means an entity that makes an eligible application.\n\n“Board” means the Innovation Australia Board and includes its successors.\n\n“Board may” is permissive and not mandatory.\n\n“Commonwealth program capital” means amounts invested in or provided to a licensed fund by the Commonwealth.\n\n“Department” means the Department of Innovation, Industry, Science and Research.\n\n“early stage companies” means companies at the seed, start-up and early expansion stages (as defined in the Innovation Investment Fund Round Three guidelines).\n\n“eligible application” means an application for a licence under the IIF program in a form required by the Program Delegate from time to time that is an application that the Program Delegate has determined is eligible for competitive merit based assessment and ranking by the Board in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“equity” includes any form of debt financing that is approved by the Program Delegate which does not compel the borrower or debtor to pay the interest, coupon or other charge in the nature of interest prior to the end of the term of the debt, except in the event of default.\n\n“governing documents” in relation to a licensed fund includes:\n\n(a) the licence with the Commonwealth;\n\n(b) a constitution or other documents establishing the fund; and\n\n(c) any documents between the fund, its manager and the investors (or any of them).\n\n“Government sourced capital” means amounts invested in a licensed fund by:\n\n(a) a person or persons funded directly or indirectly by the Commonwealth; or\n\n  \n\n(b) any person whom the Program Delegate considers is directly or indirectly in receipt of funding from a source or sources which is or are funded directly or indirectly by the Commonwealth to such an extent that, in the opinion of the Program Delegate, it is appropriate to treat any amount invested in or provided to the fund by that person as Government sourced capital,\n\nbut excludes any amount of that funding that, the Program Delegate considers would be inappropriate to treat as Government sourced capital.\n\n“IIF program” means round three of the Commonwealth’s Innovation Investment Fund Program.\n\n“include” “includes” and “including” do not limit the generality of the words which precede them or to which they refer.\n\n“innovation” means the process whereby ideas are transformed, through economic activity, into sustainable, value-creating outcomes. It can generate changes in output such as new products, processes and services.\n\n“Innovation Investment Fund Round Three guidelines” means the guidelines that are made by the Minister to the Department, as in force from time to time for the delivery of the IIF program.\n\n“key personnel” in relation to a fund manager, means those individuals determined by the Program Delegate to be key personnel because of their level of technical and managerial expertise, time commitment and their day to day involvement in the management of the relevant licensed fund. This includes any additions or replacements to that team approved by the Program Delegate and the Supervisory Board.\n\n“licence” means the licence to be granted to a successful applicant in accordance with the Innovation Investment Fund Round Three guidelines.\n\n“licensed fund” means a fund whose manager has been granted a licence in respect of the IIF program.\n\n“Minister” means the Minister for Innovation, Industry, Science and Research.\n\n“private capital” means amounts invested in or provided to a licensed fund that are not Commonwealth program capital.\n\n“privately sourced capital” means amounts invested in or provided to a licensed fund that are not, in the opinion of the Program Delegate, Government sourced capital.\n\n“Program Delegate” means an employee of the Department who has been empowered by the Minister, or otherwise duly authorised, to carry out the relevant function in respect of the IIF program.\n\n  “R&D activities” has the same meaning as in the Income Tax Assessment Act 1997\n\nA reference in this direction to “the IIF guidelines, licensing agreement or other contractual documents” or similar words is a reference to any one or more or all of them.\n\nA reference in these directions to the singular includes the plural and vice versa.\n\n\"Supervisory Board\" means the body whose function is described in clause 17 of these directions.\n\n  \nPART 2 - CONSIDERATION OF APPLICATIONS TO PARTICIPATE IN PROGRAM\n\nBoard to have regard to certain policy objectives\n\n5. The Board must have regard to the following policy objectives in giving effect to these directions:\n\n(a) to develop fund managers with experience in the early stage venture capital industry;\n\n(b) by addressing capital and management constraints, to encourage the development of new companies which are commercialising research and development;\n\n(c) to establish in the medium term a “revolving” or self funding scheme; and\n\n(d) to develop a self-sustaining Australian early stage, venture capital market.\n\nProcedure\n\n6.\n\n(a) Subject to clause 7, the Board will assess eligible applications and provide a technical merit ranking of those applications to the Program Delegate.\n\n(b) The Board must consider eligible applications as soon as practicable after those applications have been provided to the Board.\n\n(c) The Board may interview any applicant as part of the merit ranking process for applications.\n\n(d) The Board and Program Delegate may request additional information from applicants after the lodgement of an application in order to assist in ranking and assessing eligible applications.\n\nBoard may decline to provide merit ranking\n\n7. The Board may decide to refuse to provide a merit ranking in respect of a particular eligible application if it is not satisfied with the level of merit of an eligible application in relation to one or more of the merit criteria.\n\n  \nPART 3 – ASSESSMENT AND MERIT RANKING OF APPLICATIONS\n\nAssessment of applications\n\n8. Subject to clause 7, the Board must assess each eligible application on its merit according to the extent to which the application meets the merit criteria (as set out in clause 9 below).\n\nMerit Criteria\n\n9. The technical merit of eligible applications must, amongst other things, be assessed against the following criteria:\n\nThe fund’s proposed committed capital\n\n## (a) the proposed size of the fund;\n\n## (b) the ratio of privately sourced capital to Commonwealth program capital (subject to the Commonwealth program capital not exceeding a 1:1 ratio to the privately sourced capital and the Commonwealth program capital being no more than $100 million);\n\n## (c) the fund’s proposed investors and the amount of capital to be committed by each;\n\n## (d) the amount of capital, if any, to be committed by the proposed key personnel of the fund manager;\n\n## The applicant’s proposed investment strategy\n\n## (e) the extent to which the fund’s proposed investment strategy is consistent with the objectives of the IIF program, including the establishment and management of a balanced portfolio of investments in early stage companies;\n\n## (f) the number and the size of investments the fund proposes to make and the proposed investment sector by activity;\n\n## (g) the level and structure of management fees proposed;\n\n## The experience of the applicant’s investment team\n\n## (h) whether the applicant has a balanced management team including relevantly qualified and skilled personnel;\n\n## (i) the applicant’s capacity and experience in early stage equity investing giving particular attention to realising returns from investments, sourcing investment opportunities and managing an investment portfolio;\n\n## (j) whether the applicant has an understanding of and experience in dealing with issues related to Australian and international investments, products, services and markets;\n\n## (k) whether the proposed applicant has effective strategies to contribute to training and developing of Australian based staff in all aspects of making venture capital investments in early stage companies;\n\n## Intent\n\n## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":13},{"sectionNumber":"(l) whether the applicant has a demonstr","sectionType":"part","heading":"(l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.","content":"## (l) whether the applicant has a demonstrated willingness to operate within the intent of the IIF program.\n\nOther Matters\n\n10. The Board may, in its absolute discretion, attribute a higher level of relative importance to one or more of the merit criteria.\n\n11. Applicants may, at the request of the Program Delegate, be required, at the time of lodgement of application, to demonstrate to the satisfaction of the Board their ability to access the required level of privately sourced capital.\n\n12. The Board may have regard to the accessibility of the program for industry around Australia.\n\n13. The Board may have regard to additional criteria and undertake other enquiries in order to consider the suitability of applicants.\n\n14. The Program Delegate may make policies of general application in relation to the administration of the IIF program. When making such policies the Program Delegate will seek the advice of the Board.\n\n15. The Program Delegate may make decisions and guidelines in relation to the administration of the IIF program. When making such decisions and guidelines the Program Delegate may seek the advice of the Board.\n\n16. The Program Delegate will seek the advice of the Board on the following matters:\n\n(a) new investments by a licensed fund beyond the fifth anniversary of the granting of a licence;\n\n(b) changes to the key personnel of a licensed fund;\n\n(c) changes in the structure of a licensed fund;\n\n(d) the application of sanctions against a manager or investor;\n\n(e) the suspension of funding in relation to a licensed fund;\n\n(f) the termination of a licence;\n\n(g) investee company eligibility; and\n\n(h) influence or control of manager by investor.\n\n17. The Supervisory Board for a licensed fund will be established and maintained by the manager and make decisions about matters in relation to the administration of that IIF3 fund as shall be set out in the governing documents. The decisions made by the Supervisory Board in relation to these matters shall be binding on the manager except where a matter is one for which the Program Delegate has responsibility under the licence. In such an event the decision of the Program Delegate, if contrary to that of the Supervisory Board, shall be final and binding upon the manager.\n\nPART 4 – ASSESSMENT OF PROPOSALS FOR VARIATION TO GOVERNING DOCUMENTS\n\n18. In making a decision on whether to vary any provision of the governing documents, the Program Delegate may seek the advice of the Board and may seek the advice of other third parties.\n\nPART 5 \\- BOARD TO HAVE ADMINISTRATIVE RESPONSIBILITY FOR THE PROGRAM\n\n19. The Board has administrative responsibility for the IIF program, subject to the restrictions imposed by the Industry Research and Development Act 1986, in particular section 19A, on the functions that may be conferred on the Board.\n\nWhere the Board provides advice to the Program Delegate in accordance with these directions, the Program Delegate must consider the advice of the Board and advise the Minister of any such advice where requested to do so by the Board.\n\n20. The Board may advise the Minister, or the Minister may request advice from the Board, on non-financial administration matters relating to the program, including the extent to which the program is meeting its objectives.\n\n21. The Board may collect and analyse data on the performance of the program, provide advice to the Minister on such performance, and will cooperate with any independent evaluation of the program.","sortOrder":14}],"analysis":{"flash_summary_failed":{"failed":true,"reason":"A positive credit balance is required for all requests, including BYOK, so fallback providers remain available. Add credits at https://vercel.com/d?to=%2F%5Bteam%5D%2F%7E%2Fai%3Fmodal%3Dtop-up to continue.","source":"analysis-cron"},"kimi_summary":{"_metrics":{"completionTokens":607},"content_quality":"ok","complexity_score":6,"scope_assessment":{"changed":false,"description":"The legislation remains focused on its original purpose: establishing Round Three of the IIF Program with merit-based selection of fund managers and matched public-private investment. The repeated full-text reproductions in the source material appear to be formatting artifacts rather than substantive additions."},"complexity_factors":["21 defined terms in the interpretation section, including recursive definitions ('Government sourced capital' refers to funding from sources funded by the Commonwealth)","Multiple overlapping capital categories: Commonwealth program capital, Government sourced capital, private capital, and privately sourced capital","Nested conditional logic in clause 9(b) with ratio caps and absolute dollar limits","Cross-references to external documents (Innovation Investment Fund Round Three guidelines) whose content can change over time","Dual decision-making structure with unclear hierarchy between Board advice and Program Delegate authority","Clause 17 creates a complex override mechanism where Supervisory Board decisions bind the manager unless the Program Delegate decides otherwise"],"plain_english_summary":"This ministerial direction establishes Round Three of the Innovation Investment Fund: it instructs Innovation Australia to run a competitive process to select fund managers who will receive Commonwealth co-investment (up to $100 million on a 1:1 matching basis) to back early-stage companies.  \n\nIt affects venture capital managers, early-stage firms, Innovation Australia and the Program Delegate, aiming to close a market gap by sharing risk with private investors while preserving private-sector investment discipline."},"flash_summary":{"complexity_score":7,"scope_assessment":{"changed":true,"description":"This direction expands the Board's operational role compared with a simple advisory or policy framework. It explicitly confers administrative responsibility for IIF Round Three on the Board (clause 19) and establishes a formal, merit‑based application, assessment and ranking process (clauses 6–9). At the same time it gives the Program Delegate broad discretionary powers: to determine eligibility, to treat particular investor funds as Government‑sourced capital, to set policies and guidelines, and to make final decisions on sanctions, suspension, licence termination and investee eligibility (clauses 4, 11, 14–16, 18). The result is a materially different scope from a generic enabling Act: the instrument both prescribes selection criteria and procedures for the Round Three program and reassigns significant practical decision‑making and interpretive authority to the Program Delegate and the Minister’s guidelines."},"complexity_factors":["Around 25 defined terms in the Interpretation section that feed into eligibility and discretionary decision‑making (clause 4).","Multiple cross‑references to external documents: the IIF Round Three guidelines, licences and governing documents (clauses 4, 9, 18).","Layered decision structure: Board assesses and ranks; Program Delegate determines eligibility and makes many final decisions (clauses 6, 7, 14–16).","Substantial discretionary language (\"may\", \"in the opinion of the Program Delegate\", \"absolute discretion\") across key provisions (clauses 4, 7, 10, 13, 14–16).","Nested exceptions: Supervisory Board decisions binding except where licence reserves matters to the Program Delegate, and Program Delegate decisions are final in those cases (clause 17).","Conditional financial limits: matching ratio capped at 1:1 and a $100 million Commonwealth cap per fund (clause 9(b)).","Broad and detailed merit criteria with many sub‑items (clauses 9(a)–(l)), allowing variable weighting and additional unspecified enquiries (clauses 10, 13).","Operationally significant but vague definitions (e.g. \"Government sourced capital\", \"key personnel\") which require factual judgement by the Program Delegate (clause 4).","Multiple operational processes (interviews, additional information requests, proof of private capital on request) that introduce procedural complexity (clauses 6(c), 6(d), 11)."],"plain_english_summary":"**What this direction does (short):**\n\n- The Minister directs Innovation Australia (the Board) on how to run Round Three of the Commonwealth's Innovation Investment Fund (IIF) Program.  It sets who does what, what to look for when choosing fund managers, and some hard limits on how much Commonwealth money may be matched.\n\n**Who it affects:**\n\n- Prospective fund managers and their managers/teams who apply for an IIF licence.\n- Investors (private and government‑linked) who would commit capital to those licensed funds.\n- Innovation Australia (the Board), the Department and the Program Delegate (a departmental officer empowered by the Minister) who administer and decide aspects of the program.\n\n**How it works, step by step (mechanics):**\n\n- The instrument adds functions to the Board so it will carry out competitive, merit‑based assessments and produce a technical ranking of eligible licence applications for IIF Round Three (clauses 3, 6–9).\n- \"Eligible application\" means an application for an IIF licence in the form required and declared eligible by the Program Delegate (definition and clause 4).  The Program Delegate controls eligibility at the entry gate.\n- The Board assesses and ranks eligible applications against an explicit set of merit criteria (clause 9). Those criteria cover:\n  - fund capital (size; who is investing; the amount key personnel invest; and the required ratio of private capital to Commonwealth capital),\n  - investment strategy (fit with program objectives, portfolio balance, number/size/sector of investments, management fees), and\n  - team experience and capacity (skills, track record in early‑stage equity, training strategies for Australian staff, international experience) and the applicant's willingness to operate within the program's intent.\n- Two specific financial constraints are imposed on Commonwealth program capital: it must not exceed a 1:1 ratio to privately sourced capital and the Commonwealth contribution for a licensed fund may be no more than $100 million (clause 9(b)).\n- The Board may interview applicants, ask for more information, and may refuse to give a merit ranking if an application fails the merit test (clauses 6(c), 6(d), 7).\n- The Program Delegate retains substantial operational control: they determine eligibility, may require applicants to prove access to private capital at lodgement, can make policies and guidelines for the program, and has decision authority on a long list of operational matters (clauses 4, 11, 14–16, 18).  The Program Delegate may also treat certain investor capital as \"Government sourced capital\" in their discretion (definition in clause 4).\n- Licensed funds must create and maintain a Supervisory Board (set out in governing documents).  The Supervisory Board's decisions are binding on the manager except where the licence reserves a matter to the Program Delegate — in that case the Program Delegate's decision prevails (clause 17).\n- The Board has administrative responsibility for the program (subject to statutory limits in the Industry Research and Development Act), may provide advice to the Minister and the Program Delegate, collect program performance data and cooperate with independent evaluations (clauses 19–21).\n\n**Why it matters (practical effects and incentives):**\n\n- Who pays: the Commonwealth provides program capital up to the specified match ratio and cap; private investors must provide matching privately sourced capital. Applicants must show they can access private capital when asked (clause 11).\n- Who decides: the Program Delegate controls eligibility and many final decisions; the Board assesses merit and advises/ranks applications but does not have final decision authority on all matters (clauses 6, 14–16, 19).\n- Behaviour the direction encourages:\n  - Fund managers must secure private capital and demonstrate private commitments and manager skin‑in‑the‑game to be competitive (clauses 9(a)–(d), 11).\n  - Applicants are incentivised to present balanced portfolios, clear early‑stage investment strategies, experienced teams and local staffing/training plans (clauses 9(e)–(k)).\n  - Managers must structure governing documents to accommodate a Supervisory Board and the Program Delegate's reserved powers (clauses 17, 18).\n- Compliance and implementation costs: preparing detailed applications, demonstrating access to private capital, committing manager capital, establishing Supervisory Boards, and responding to Program Delegate requests will create administrative burden for applicants and managers.\n- Policy levers and discretion: the instrument places several important discretionary powers with the Program Delegate (for example, deciding what counts as Government‑sourced capital, eligibility, sanctions and licence termination). Those discretionary steps shape which funds can participate and how funds are governed (clauses 4, 14–16, 18).\n\n**Trade‑offs and risks to note (mechanisms, not judgements):**\n\n- Concentrated benefits / diffuse costs: licensed fund managers and their investors who receive Commonwealth capital are the concentrated beneficiaries; the broader taxpayer bears the cost of program capital and any administrative overhead.\n- Matching rules and caps: the 1:1 matching limit and $100m cap per fund set a hard upper bound on Commonwealth exposure but also constrain the size and leverage profile of funds (clause 9(b)).\n- Discretion and uncertainty: broad discretion for the Program Delegate to classify \"Government sourced capital\" and to make policies/guidelines increases administrative flexibility but raises uncertainty for applicants about treatment of particular investors and about final decisions (definition of Government sourced capital; clauses 14–16).\n- Decision overlap: the Supervisory Board has binding internal governance powers but the Program Delegate can override in reserved areas — creating a layered decision environment managers must navigate (clause 17).\n\n**Primary source references (key clauses):** object and role (clause 3); definitions and Program Delegate powers (clause 4); assessment procedure (clauses 6–9); specific matching/cap limit (clause 9(b)); Program Delegate authorities and reserved decision list (clauses 14–16, 18); Supervisory Board override rule (clause 17); Board administrative responsibilities (clauses 19–21)."}},"importantCases":[],"_links":{"self":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011","history":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011/history","analysis":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011/analysis","conflicts":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011/conflicts","importantCases":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011/important-cases","documents":"/api/acts/innovation-investment-fund-program-round-three-direction-no-1-of-2011/documents"}}