Key Points

  • Grants to reimburse up to 50% of overseas intellectual property legal and registration fees are now available under the EMDG.
  • Applications made after 1 July 09 may claim expenses from the 08/09 year.

The EMDG

The EMDG scheme is an Australian Government financial assistance program targeting Australian exporters. The scheme is administered by Austrade and seeks to encourage small and medium sized businesses to develop export markets by reimbursing up to 50% of expenses incurred on a range of export promotion activities.

In 2008, changes were made to the EMDG scheme increasing the maximum level of reimbursement and making it easier to access. In addition, the scheme was expanded to include intellectual property (IP) in the range of claimable expenses.

Eligibility

Australian entities carrying on business in Australia may be eligible to claim under the EMDG scheme for expenses incurred in the promotion of products for export if they:

  • have an annual income of not more than $50 million during 2008-2009;
  • spend at least $10,000 on eligible export promotion activities during 2007-2009; and
  • are the principal exporter, rather than the agent, of the product being promoted.

Activities

Nine categories of promotional activities can be claimed. They include costs associated with:

  • overseas representation;
  • engagement of marketing consultants for foreign markets;
  • foreign marketing visits;
  • communication expenses;
  • promotional literature & advertising including free samples;
  • trade fairs, seminars, in-store promotions;
  • overseas buyer visits; and
  • most recently, registration and/or insurance of intellectual property

Intellectual Property

Eligible businesses can now claim up to 50% of Intellectual Property expenses that were incurred from 1 July 2008 (or, for first-time applicants, from 1 July 2007).

Intellectual property under the scheme is taken to include not only patents, designs and trade marks but also plant breeders rights, circuit layouts, copyright and even trade secrets.

The intellectual property must have resulted, to a substantial extent, from research or work performed in Australia. And for rights relating to trade marks, the trade mark must have been first used in Australia, or increased in significance or value because of its use in Australia.

What IP expenses can be claimed?

Claimable expenses include:

  • Payments made to lawyers and patent and trade mark attorneys, for the purpose of pursuing registration or the extension of the term of IP rights.
  • Expenses relating to insurance premiums paid for protection against possible infringement of eligible intellectual property.

It should be noted that as with all the other categories of expenses listed above, all claimable IP payments must be in relation to increasing export sales of the relevant product or service.

What IP expenses can't be claimed?

Expenses which cannot be claimed include:

  • Registering IP rights in Australia, New Zealand, and, as of 15 November 2008, Iran.
  • Registration of some business, company or domain names.
  • In-house IP expenses.
  • Registering IP rights not owned or held on exclusive assignment by the applicant or its related entities.
  • Costs associated with defending patent and other intellectual property infringement, including any preliminary litigation fees.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.