The Australian Trade Commission's export market development grant (EMDG) program helps Australian enterprises increase exports in the international market. These grants encourage Small and medium-sized enterprise (SME) to market and promote their goods and services globally.
The reform of EMDG took effect on July 1, 2021, repositioning EMDG from reimbursement plan to grant plan. During the transition period of fiscal year 2021-22, the reimbursement plan and the grant plan will operate simultaneously. If you have eligible expenses for the fiscal year ending June 30, 2021, you can submit a claim from July 1 to November 30, 2021 (February 28, 2022 if you use a participating EMDG consultant).
EMDG from 1 July 2021
The EMDG program now provides up front funding certainty, so you know how much money you will receive during your grant agreement (2 or 3 years) so that you can confidently plan your promotions.
Types of grants for exporters
Small and medium-sized enterprise (SME) exporters can apply for three different grants for eligible promotional activities within 8 years (not necessarily continuously).
The grant is divided into three stages, called grades. Each level provides different levels of support for SMEs to develop export markets. The length of these grants reflects the different stages of the exporter's journey.
Tier 1: prepare for exit
- First time exporter
- 2 years, up to $40000 per fiscal year
Tier 2: expansion
- Expand export promotion activities
- 3 years, up to $80000 per fiscal year
- Expand export promotion activities and make strategic changes, such as targeting new markets or new customers
- 3 years, up to $150000 per fiscal year
Assistance to industry institutions and alliances (representative institutions) has been extended to train members who are just beginning to export to prepare for export. The representative office will continue to receive financial assistance for promotional activities on behalf of its members in the international market, with grants up to three years and up to US $150000 per financial year.
Who is eligible?
- You need a turnover of less than $20 million in fiscal year 2020-21
- You must be an Australian within the meaning of the EMDG rules,
- You must have an Australian business number.
EMDG grant funds must be used for promotional activities to market eligible products in foreign countries, or for training activities to develop skills in marketing for this purpose.
To be an eligible product, your product(s) must be of substantially Australian origin and be:
- goods
- services
- events
- intellectual property or know-how
- software.
The EMDG grant is provided for expenses in one or more of the following categories:
- maintaining a representative in a foreign country
- short trips to a foreign country
- engaging a consultant to undertake research or promotional activities
- short trips within Australia
- foreign buyer visits
- soliciting for business in a foreign country
- providing free samples
- producing and providing promotional and advertising material
- intellectual property rights
- if you are a Tier 1 applicant, obtaining export readiness training.
- Evidence that you are eligible for the EMDG grant and that you are Australian (please note that you must have an ABN)
- Evidence that your product meets the conditions, including that it is mainly from Australia
- Your marketing planning
- Your 2020-21 balance sheet and income statement to prove that your turnover is less than $20 million.
From July 1, 2021, the EMDG program will become an eligibility-based grant program.
- You apply for a grant for promotional activities starting from July 1, 2021.
- After all applications have been evaluated, the Australian Trade Commission will provide each eligible applicant with a grant agreement covering the entire grant period of that level (unless the ceiling of 8 financial years or the total grant ceiling of $770,000 is exceeded).
- You have signed a grant agreement with the Australian Trade Commission. Then, you carry out promotional activities as agreed in the grant agreement. You request milestone payments under your grant agreement.
- Your grant agreement will specify when milestone payments will be made and what you need to do to receive them.
For eligible expenses incurred from July 1, 2021, you can claim a grant under the EMDG program. The grant application is open at 9 a.m. EST on August 16 and ends at 5 p.m. EST on November 30, 2021. The application period in the first year is 3.5 months, and a new simplified application process is adopted. This will give applicants time to learn about the new plan. The Australian Trade Commission will review this process upon completion and make adjustments for future rounds as needed. The time of payment is determined by your grant agreement. Before we make milestone payment, you need to provide us with the milestone report specified in your grant agreement. Upon receipt of all applications, the Australian Trade Commission will calculate the allocation of funds available for all eligible applications. After the assessment, if you are eligible, you will receive a grant agreement that will tell you the amount of your grant. Your obligation is to match at least the dollar value of the grant you receive.
Chang Accounting Advisory Pty Ltd, we are CPA practice and EMGD consultant, we could help our clients to apply for EMDG. If you or your families or friends need our services, please feel free to contact our team for any assistance.
This article is for informational purposes only and does not form part of our advice. This article is based on NDIS guideline. Please contact our team if you need any assistance.
Claire Chang, 0497 131 419, claire.chang@changadvisory.com.au, wechat: clairechang26
Michelle Cui, 0433 539 870, michelle.cui@changadvisory.com.au, wechat: michellejc
Claire Chang