4Overview of the Act

#### 4 Overview of the Act (1) This Act sets up ACIS for the purpose set out in section 3\. Under ACIS, participants receive duty credit which can be applied against customs duty payable, or paid, on certain eligible imports (item 41E of Schedule 4 to the Tariff and subsection 74A(1) of this Act). (1A) There are 2 stages in ACIS: (a) Stage 1—the period commencing on the scheme commencement date and ending 31 December 2005; and (b) Stage 2—the period commencing on 1 January 2006 and ending on 31 December 2010. (2) Each ACIS Stage has a cap on the value of certain duty credit that may be entered in the ACIS ledger in respect of that stage. The stage caps are as follows: (a) ACIS Stage 1—$2,000,000,000; (b) ACIS Stage 2—$2,000,000,000. There are also personal limits on each participant in respect of each ACIS year (see section 54). (2A) In ACIS Stage 2, the stage cap will be divided into separate funding pools—one for MVPs and the other for participants who are not MVPs (see section 55). (3) In ACIS Stage 2, the R&D scheme operates to provide to MVPs, within the funding pool for MVPs, duty credits that are unmodulated type J investment credits (see Part 5A). (3A) Participants can receive duty credits in respect of an ACIS Stage if the cap for that stage has not already been reached. Duty credits issued in respect of a particular ACIS Stage may be applied: (a) to the importation of eligible imports; or (b) against the customs duty a person has already paid if the duty was paid in respect of the importation, on or after 1 January 2001, of eligible imports. (3B) Duty credit issued in respect of a particular ACIS Stage expires if the duty credit has not been applied against customs duty: (a) during the particular stage; or (b) on or before 31 December of the calendar year next following the stage (see section 74A). (4) Under ACIS, certain persons may apply for registration under the scheme (Part 2). (5) Once registered, a participant has an obligation to make quarterly returns in accordance with Part 3. (6) On the basis of such returns, a participant is eligible to earn unmodulated credit (Part 4 and the R&D scheme for unmodulated type J investment credit) depending on: (a) the participant’s production of motor vehicles, engines or engine components (MVPs only); and (b) the participant’s investment in certain plant and equipment and research and development. (7) The scheme provides for a modulation process (Part 5) under which unmodulated credit (except unmodulated uncapped production credit and unmodulated type J investment credit), is converted into modulated credit. The modulation process has regard to the stage caps for ACIS. (8) Duty credit is modulated credit, unmodulated uncapped production credit or unmodulated type J investment credit that has been entered in the ACIS ledger. (9) The ACIS ledger is dealt with in Part 6. (10) Duty credit can be: (a) transferred to another person (Part 7); or (b) applied to the importation of certain eligible imports (the Secretary may restrict the uses to which certain kinds of modulated credit can be put (Part 7)); or (ba) applied against an earlier payment of duty on such eligible imports (Part 7); or (c) offset against an amount of unearned credit liability imposed on a person in respect of unearned duty credit (Part 9). (11) Under the scheme, there are powers of audit (Part 8). (12) Certain unearned duty credit can be recovered as provided for in Part 9. (13) Part 10 sets out document retention obligations (section 108) and obligations to update business plans on a regular basis (section 109). (14) Participants may be deregistered in the circumstances set out in Part 11. (15) Part 12 provides for administrative review of certain decisions. (16) Part 13 provides for delegation of powers and the making of regulations.