Export Market Development Grants Examined 

Export grants

The Export Market Development Grants (EMDG) scheme is a key Australian Government financial assistance program for aspiring and current exporters. Administered by Austrade, the scheme supports a wide range of industry sectors and products, including inbound tourism and the export of intellectual property and know-how outside Australia.
The scheme:
  • encourages small and medium sized Australian businesses to develop export markets
  • reimburses up to 50% of eligible export promotion expenses above $5,000 provided that the total expenses are at least $15,000
  • provides up to eight (8) grants to each eligible applicant.
Applications
Applications for the 2014-15 grant year are now closed. However applications for the 2015-16 grant year open on 1 July 2016.
Who can apply?
Any Australian individual, partnership, company, association, co-operative, statutory corporation or trust that has carried on export promotion activities during the year for which they wish to apply for an export grant.
To be eligible, the business must have:
  • income of not more than $50 million in the grant year
  • incurred at least $15,000 of eligible export expenses under the scheme (first-time applicants can combine two years expenses)
  • principal status for the export business (some exceptions apply, eg. non-profit export focused industry bodies)
The business also must have promoted one of the following:
  • the export of goods and most services
  • inbound tourism
  • the export of intellectual property and know-how
  • conferences and events held in Australia
 
What is an eligible product?
To qualify for an  grant, your business must have:
  • promoted your product for export
and your product must be one of the following:
  • a good made in Australia
  • a good made outside Australia where Australia will derive a significant net benefit from its sale overseas
  • all services except those specified as ineligible in the EMDG Regulations
  • a tourism service (including accommodation, passenger transport or tours)
  • a conference or event held in Australia
  • an intellectual property right that mainly resulted from work done in Australia
  • a trademark that was owned, assigned or first used in Australia
  • know-how that mainly resulted from work done in Australia
What can you claim?
Nine categories of promotional activities can be claimed
You may claim for expenditure on specific export promotional activities undertaken during the financial year before the application period. For your first grant you may claim expenses incurred over the last two financial years.
1. Overseas representatives
You can claim:
  • all reasonable costs that you pay to have an overseas representative act on your behalf on a long-term basis to market/promote your product
  • the portion of the fee or expense paid to your overseas representative that relates to promotion of your Australian products. You cannot claim the costs of non-promotional activities your representative carries out for you such as supplying after-sales service, post-contractual training, sourcing of products, arranging clearance, warehousing or collection of goods, importing or promoting products from other countries
  • a maximum of $200,000 per application is claimable under this category. However you should include all eligible expenses that you wish to claim in your application to ensure your grant is maximised
Note: Austrade conducts detailed checks on overseas representative claims and may contact your representative by phone or in person as part of these checks. If you are claiming expenses for overseas representatives, you may be asked to provide additional supporting documentation with your application form.
2. Marketing consultants
You can claim:
  • the cost of engaging an arms length consultant to undertake export market research or marketing activities
  • a maximum of $50,000 per application is claimable under this category. However you should include all eligible expenses that you wish to claim in your application to ensure your grant is maximised
3. Marketing visits
You can claim:
  • the cost of travel during the marketing visit eg. airfares, taxi fares, departure taxes, etc. (only 65 per cent of first class airfares may be claimed)
  • an allowance of $300 per day is claimable for overseas marketing visits to help defray accommodation, entertainment and living expenses
4. Communications
You can claim:
  • the costs of communications to promote your product eg fax, emails, phone
Note: if you do not claim your actual communication expenses, you will receive an automatic 3 per cent addition to your grant
5. Free samples
You can claim:
  • the cost of providing free samples of the product you are promoting for export
6. Trade fairs, seminars, in-store promotions
You can claim:
  • the cost of participating in an international trade fair, seminar, in-store promotion, international forum, private exhibition, or similar activity
  • the money it costs to participate, eg. entry fees, stand rental charges and the cost to freight your promotional materials to the trade fair
7. Promotional literature & advertising
You can claim:
  • external costs of promotional material, such as brochures, videos, DVDs, advertising and website development
8. Overseas buyers
You can claim:
  • the cost of bringing potential buyers who are non-residents to Australia for an approved export promotion purpose
  • up to a maximum of $7,500 per buyer per visit
  • up to a maximum of $45,000 per application
9. Registration and/or insurance of eligible intellectual property
You may claim:
  • a cap of $50,000 cap per application
  • payments made to third parties, eg. patent and trademark attorneys, for the grant, registration or extension of the period of registration of intellectual property for countries other than Australia or New Zealand
  • the cost of insurance premiums paid for protection against possible infringement, in countries outside Australia, of eligible intellectual property.
To be able to claim EMDG for any of the above activities:
  • you must have spent the funds to seek out, create demand for or develop an export market for your product
  • you must be the intended principal in export transactions (exemptions apply for manufacturers, Approved Body applicants, events promoters, suppliers to inbound tour operators or in situations where a company closely related to the applicant owns the product intended for export)
  • the expense must have been paid by you during the financial year (ie. it must be taken up as an expense in your books of account, not just in consolidated accounts or in the accounts of a related entity)
  • the item paid for must have been provided to you
  • you must have evidence of the expense and of what it was incurred for (ie. invoices, bank statements, etc.)
  • if you are claiming expenses under the overseas representatives or marketing consultants categories, you must have documentary evidence that shows the role and function of the representative or consultant
  • if you are claiming expenses under the marketing visits category you must have trip reports, boarding passes, diary notes and/or other evidence which substantiate the details of the trip

 

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