Contact mdp

  • T: +613 9620 9660
    contact

Categories

Are You Expanding Your Brand Internationally?

Michael McDonald | July 21st, 2014

If so, you may be eligible for an Export Market Development Grant (EMDG) from Austrade for registration of your intellectual property (IP) overseas.

This means that you may be entitled to be reimbursed 50% of your international IP costs of up to $50,000 per EMDG application, plus other significant promotional expenses.

What is an EMDG?

The EMDG scheme is an Australian Government financial assistance program which encourages small to medium sized Australian businesses to develop export markets.  If eligible, you may be reimbursed up to 50% of eligible export promotion expenses above $5,000 provided that your total expenses are a minimum of $15,000.

Is my business eligible for an EMDG?

To be eligible your business must:

  • have income of not more than $50 million in the grant year;
  • have incurred at least $15,000 of eligible export expenses, although first-time applicants can combine two years worth of expenses;
  • be the principal for the export business (rather than an agent); and
  • have promoted your product for export.

Some organisations that may not ordinarily meet the above criteria, may still qualify for Special Approval status such as Approved Bodies and Joint Ventures.

Are my products eligible for an EMDG?

An eligible product must be one of the following:

  1. Goods made in Australia;
  2. Goods made outside Australia where Australia will derive a significant net benefit from sales overseas;
  3. All services unless otherwise deemed ineligible in the EMDG regulations;
  4. Tourism services;
  5. Conferences or events held in Australia; or
  6. Intellectual property rights that mainly resulted from work undertaken in Australia.

What can I claim under an EMDG?

For a first grant, you may claim expenditure on specific export promotional activities undertaken during the two financial years beforethe application period.  For subsequent grants, you may only claim expenditure incurred in one financial year before the application period.

The eligible promotional activities are as follows:

  1. Costs paid to overseas representatives to market or promote your product up to a maximum of $200,000;
  2. Costs paid to a marketing consultant up to a maximum of $50,000;
  3. Expenses for marketing visits up to $300 per day;
  4. Communication expenses to promote your product;
  5. Costs of providing free samples for export;
  6. Costs of participating intrade fairs, seminars and in-store promotions;
  7. Costs of production of promotional literature and advertising materials;
  8. The costs of bringing potential overseas buyers to Australia for an approved export promotion purpose up to a maximum of $45,000 per EMDG application;
  9. Costs of registration and/or insurance ofeligible intellectual propertyup to a maximum of $50,000 per EMDG application.

How many times can I claim an EMDG?

Eligible applicants may obtain up to eight grants.  You may only obtain one grant per financial year. The grants do not need to be applied for in consecutive years.

Can I claim costs of Madrid Protocol or Patent Convention Treaty (PCT) Applications under an EMDG?

In short – yes.

The Madrid Protocol is an international treaty which allows Australian lawyers to file international trade mark applications through IP Australia (the government body which administers intellectual property).  The costs are in effect paid to Australian lawyers for undertaking international trade mark work.  Because the trade marks are international registrations, the costs incurred in making Madrid Protocol applications are covered by an EMDG.

PCT applications operate in a similar way to Madrid Protocol applications, except that they relate to patents instead of trade marks. Again, because the patents are international registrations, the costs incurred in making PCT applications are covered by an EMDG.

I have two entities – a trading entity which derives income from export and a passive entity which holds my IP. Does this structure preclude me from claiming an EMDG?

No, you still may be eligible to claim an EMDG.

You cannot claim expenses that were incurred by a related entity.  However, there is no requirement that the entity which claims the EMDG must hold the IP.

This means that a trading entity can claim an EMDG provided that the trading entity:

  • incurs the relevant expenses; and
  • is granted exclusive marketing rights to the IP by the passive entity which holds the IP.

It is therefore crucial to ensure that your licence agreement between your passive entity and trading entity is carefully drafted to ensure that you will still qualify for an EMDG.

Which expenses are ineligible for EMDG’s?

Some expenses which are ineligible are those that relate to business with New Zealand, North Korea and Iran.

Other ineligible expenses are outlined on Austrade’s website  http://www.austrade.gov.au/Export/Export-Grants/What-is-EMDG/What-can-you-claim

Is there any further information about EMDG’s?

We are planning to hold an upcoming information session about EMDG’s.  We will provide further information about this in the next few weeks.

For further information regarding EMDG’s please go to http://www.austrade.gov.au/Export/Export-Grants/What-is-EMDG

What next?

Please feel free to contact mdp if you have any queries regarding the following:

  • setting up corporate structures in anticipation of international expansion;
  • registering IP internationally; or
  • commercialisation of and/or international expansion of your brand or IP through licensing.

About Sarah Verstak

Sarah has 13 years’ experience in intellectual property (IP), litigation and commercial law.  She has significant experience in protecting, structuring and enforcing clients’ IP rights and assisting clients to expand their brand protection internationally.

About mdp

We provide the following services:

If you have any queries, please feel free to contact Sarah Verstak on 03 9620 9660 or sverstak@mdplaw.com.au.

Visit Our Online Store

Michael McDonald

Michael McDonald

Director, BA LL.B at mdp
Michael is a highly respected and pre-eminent lawyer, commercial advisor and businessman with a career spanning more than 35 years across corporate, commercial and intellectual property law. He has specialist expertise in, and passion for, commercialising and growing Australian businesses both in Australia and internationally.
Michael McDonald

Latest posts by Michael McDonald (see all)

News & Insights

Testimonials