Export grants scheme increases expenses threshold

The Export Market Development Grants scheme will reimburse up to 50% of eligible export promotion expenses, after increasing the minimum expenses threshold from $10,000 to $20,000.

The EMDG is a government-funded program aimed at exporters. In addition to inbound tourism, it supports the export of intellectual property and know-how outside of Australia.

Administered by Austrade, it encourages SMEs to develop export markets by reimbursing up to 50% of eligible export promotion expenses.

Recent changes to the scheme include increasing the minimum expenses threshold from $10,000 to $20,000, while reducing the maximum grant from $200,000 to $150,000.

Other changes include:

• Extending the scheme so that it applies to all grant years from 2010-11 to 2015-16.
• Reducing the number of grants available for an individual recipient from eight to seven.
• Capping IP registration expenses at $50,000 per application.
• Increasing the income limit for members of approved joint ventures/consortia from $30 million to $50 million.

The deadline for 2010-11 is November 30. According to Austrade, recipients for this grant year – with an entitlement up to and including $50,000 – will be paid in full.

“Those with entitlements above this amount will receive a second tranche payment at the end of June 2012,” Austrade says.

“The size of the second tranche will be determined at that time to distribute the remaining available funding.”

For your first EMDG grants, Austrade will calculate your provisional grant entitlement based on a formula: 50% of total eligible expenses minus a $10,000 non-reimbursable threshold amount.

For example, if total eligible expenses are $55,000, the provisional grant entitlement will be $22,500. A minimum grant of $5,000 applies.

From your third grant onwards, you must satisfy the requirements of an EMDG performance measure in order to receive subsequent grants. In order to do this, you must choose from Option A and Option B.

Under Option A, applicants that have already received two or more grants will be subject to an export performance test.

Under this test, and subject to the maximum grant of $150,000, Austrade will calculate your provisional grant entitlement as the lesser of:

(a) 50% of total eligible expenses less $10,000.

(b) The relevant percentage of export earnings, depending on how many grants you have received.

Under Option B, applicants that have already received two or more grants must meet the Australian Net Benefit requirements in order to be able to continue to receive grants.

Applicants that meet these requirements will be entitled to receive a grant calculated according to its assessed eligible expenses, subject to the maximum grant amount and funds available in the scheme.