The idea of this competition was to describe something that could potentially be done in IF, but requires a foundation that does not exist in current IF systems to do fully / properly. The competition ran during March and April of 2007. The organizer was David Fisher.
There was a single entry from Victor Gijsbers; see the Results section below.
The suggested format is a transcript for a potential game, annotated with footnotes.
For example (see the original announcement on RAIF for discussion):
You find yourself in another  small clearing, surrounded by stout looking oak trees.
>break off a branch 
 The parser is aware of the number of similar locations that have been visited, and inserts "another" etc. in the description as appropriate (see Dynamic Text Generation for details). The player can also use words like "other" to refer to things, eg. "go back to the other clearing".
 There is no explicit "branch" object here, but the parser's world model tells it that branches are parts of trees (and can be broken off). The world model also just says there are "trees" here, but after a branch is broken off, a new tree object (with a broken branch) is created and placed in this location.
An alternative format to a transcript would be a small essay describing your innovations for IF; or if you are really feeling brave, a short IF game demonstrating your ideas. A combination of these formats is OK (eg. an essay along with a transcript).
There was a single entry from Victor Gijsbers, who is therefore the winner!
He is currently testing out these concepts in this RAIF thread.