Important changes to Export Market Developments Grant (EMDG) Scheme

Important changes to Export Market Developments Grant (EMDG) Scheme

Important changes to Export Market Developments Grant  (EMDG) Scheme

The Export Market Development Grants (EMDG) Scheme has been in existence since 1974 and has provided considerable assistance to Australian exporters of goods and services over the years. The Scheme encourages small to medium sized Australian businesses to develop export markets by making available the opportunity to obtain a reimbursement of up to 50% of certain expenditure above a $10,000.00 threshold.

To access the scheme for the first time, a business needs to have spent at least $10,000.00 over two years on eligible export marketing expenses. The recent amendment of interest to intellectual property owners is that a qualifying “product” for the purposes of the grant is now an intellectual property right (including know-how but other than a trade mark) that resulted substantially from research or work done in Australia. In the case of trade marks, the mark must have been first used in Australia or have had its significance or value increased because of its use in Australia. This opportunity could be of considerable benefit to eligible businesses which develop intellectual property rights in Australia and seek to commercialise the subject matter of those rights overseas; particularly in the light of the costs of registering intellectual property rights overseas, generally at a point in time when an income stream has yet to be realised.

The Scheme now allows a claim for reimbursement to be made in respect of up to 50% of the payments made to third parties (such as patent and trade mark attorneys) for the grant, registration or extension of intellectual property in countries other than Australia or New Zealand. It also provides for reimbursement of up to 50% of the cost of insurance premiums paid for the protection against possible infringement of eligible intellectual property in countries outside Australia. The maximum amount which can be received by an eligible business under the Scheme is $200k and an eligible business must have a turnover of less than $50m.

Whilst not all businesses will be able to comply with the rules of eligibility for grant, it is a scheme which all small to medium sized businesses incurring expenditure on prosecuting or maintaining intellectual property rights overseas (other than in New Zealand) should consider.