9. (1) If the construction schedule does not provide for expeditious commencement of the construction of the eligible ship, commensurate with the shipbuilder’s building program, or if the construction schedule does not provide for completion of the eligible ship within a time that appears reasonable to the Minister, then, for the purposes of section 8, the application date shall be a date as determined by the Minister but the date so determined shall not be earlier than the application date.

(2) If the construction schedule of a subsidy agreement made pursuant to these Regulations in respect of an eligible ship is not followed by the shipbuilder and the ship is completed at a date later than that provided in the schedule, for causes not beyond the control of the shipbuilder and the shipowner, the Minister may, in his discretion, for the purposes of calculating the subsidy under section 8, declare the application to have been received at a date that is correspondingly later.

10. (1) A shipbuilder who applies for the grant of a contribution under these Regulations shall submit to the Minister, in a form acceptable to the Minister, a proposed strategic plan for the improvement of his shipyard including

• (a) market and product assumptions and strategies, and the specific projects that relate to them;

• (b) on-going improvements relating to safety and technological conditions;

• (c) a statement as to the expected improvements in capacity, productivity or safety relating to each project;

• (d) financial statements for the last three fiscal years of the shipbuilder; and

• (e) a projected balance sheet that reflects the implementation of individual elements of the plan.

(2) The projects and improvements referred to in paragraphs (1)(a) and (b) may be undertaken or made

• (a) by the shipbuilder; or

• (b) with the approval of the Minister, by a wholly-owned subsidiary of the shipbuilder or, if the shipbuilder itself is a wholly-owned subsidiary, by its parent company.

11. (1) Where an improvement plan is approved by the Minister, an improvement agreement shall be entered into between Her Majesty and the shipbuilder.

(2) Every improvement agreement shall

• (a) identify expenditures proposed and their relationship to the improvement plan;

• (b) include the terms and conditions in respect of the payment of any grant of a contribution pursuant to section 12;

• (c) provide that the shipbuilder shall repay that portion of the contribution payable pursuant to section 12 that is in respect of equipment obtained under the improvement agreement and

  • (i) diverted to uses other than those provided in the approved plan, or

  • (ii) disposed of by the shipbuilder

  within five years of its acquisition or such shorter period as may be determined by the Minister; and

• (d) provide for an audit to be made by the external auditors of the shipbuilder of the cost of the improvement project and for the cost of the improvement project to be verified, at the discretion of the Minister, by a person authorized by the Minister.