2021 – 2022 Export Market Development Grant (2021 – 2022 EMDG)

If you still want to apply for the 2021 – 2022 Export Market Development Grant (2021 – 2022 EMDG), you now will need to apply via a Austrade approved consultant (what Austrade call a QIP Consultant) – you have till 28 February 2022 to do this.

About the 2021 – 2022 Export Market Development Grant (EMDG).

Historically the Export Market Development Grant (EMDG) has functioned as a re-imbursement scheme for businesses spending money to develop export markets. As a result, you used to apply after you have spent the money.

From 1 July 2021, the EMDG has been redesigned into true grants program with businesses applying up-front for multiple year programs.

Because of the transition between the old and the new program, Austrade, who manage the EMDG have applications for the 2020 – 2021 and the 2021 – 2022 years EMDG open.

Note this grant is not a competitive grant. You don’t need to “beat” other applicants, you just need to meet all the eligibility rules and spend the money for eligible purposes.

This article is about the rules that apply to the new 2021 – 2022 and beyond EMDG program.

2021 – 2022 EMDG Program itself

If you are an eligible SME exporter, you will be able to apply for grants up to $770,000 per applicant over 8 financial years for promotional activities to market eligible products in foreign countries, or training activities to develop skills in such marketing. These grants under a number of different programs or tiers being:

Business Eligibility for the 2021 – 2022 EMGG

The key eligibility requirements is that the business has:

an ABN,
revenue or turnover of less than $20 million for the year ended 30 June 2021
a plan to market eligible products to overseas countries other than North Korea or New Zealand.

Your business must also be one of:

ready to export eligible products (Tier 1)
exporting eligible products and seeking to expand your export promotion activity (Tier 2), or
exporting eligible products, seeking to expand your export promotion activity and make a strategic shift in your export promotion activity (Tier 3).

What are Eligible Products under the 2021 – 2022 EMDG

Eligible Products can be goods, services, events, intellectual property, know-how and software.

In respect of goods these need to be substantially Australian.

Services include tourism services within Australia provided to foreign persons. Non tourism services can include services provided in Australia as long as certain conditions are met and the services are not specifically excluded.

Events can include online events if held by an Australian business.

For software the work to develop the software needs to be substantially done in Australia.

Remember, getting a foreign person or business to spend money in Australia may qualify as an eligible product.

What Eligible Expenses can you get funding for under the 2021 – 2022 EMDG

Eligible Expenses are those expenses incurred in respect of a promotional activity undertaken for the purposes of marketing an eligible product in a foreign country (other than North Korea or NZ), and the business has a designated connection to the eligible product. Designated connection effectively means you own or have a licence to the goods. Or you provide the service.

Eligible promotional activities include:

Maintaining representative in foreign country.
Short trips to foreign countries (maximum claim of 21 days per trip).
Payments to consultants to research into the market in the foreign country for the eligible product; or undertake promotional activities to market the eligible product in the foreign country.
Short trips in Australia in order to undertake activities that relate to marketing the eligible product to potential foreign buyers of the eligible product (maximum claim of 21 days per trip).
Foreign Buyer Visits.
Promotional and advertising material.

Excluded Expenses includes:

Capital expenses
Staff remuneration in respect of someone ordinarily employed in Australia by the business.

The 2021 – 2022 EMDG Process

The process for receiving a grant will be as follows:

You apply for a grant up front generally before you spend money on promotional activities. This year is unusual as it is the first year of the new program so you are applying during the first part of the 2021 – 2022 year so you may have actually spent money before your grant is approved. Note this grant is not a competitive grant. You don’t need to “beat” other applicants, you just need to meet all the eligibility rules and spend the money for eligible purposes.
Grant applications close 5 pm AEDT on 30 November 2021.
Once all applications have been assessed (expected late December 2021), Austrade offers a grant agreement to each eligible applicant.
You enter into a grant agreement with Austrade. You then undertake your promotional activities as agreed in the grant agreement.
You request milestone payments in accordance with your grant agreement. This will involve you providing proof that the money was spend on eligible expenses.
Your grant agreement will set out when your milestone payments should be made and what you need to do in order to receive these payments.

How much can you receive under the 2021 – 2022 EMDG?

Firstly, there is only so much funds approved the Federal Government’s budget for the 2021 – 2022 EMDG Grant.

This means that if the 2021 – 2022 EMDG grant is over subscribed. For example, there was $100m funding approved for the 2021 – 2022 EMDG and eligible grants are asking for $200m, your grant application will get scaled back by 50% of the funds you originally asked for.

The grant itself is effectively matched funding. For every dollar grant, you need to match this with another dollar of spending. For example:

if your grant is $10,000 and you spend $20,000, you will get $10,000 in grant funds.
If your grant is $10,000 and you spend $12,000, you will get $6,000 in grant funds (being 50% of what you spent).
If your grant is $10,000 and you spend $24,000, you will only get $10,000 in grant funds.

How to Apply for the 2021 – 2022 EMDG

Click here to go to Austrade’s checklist to apply

If you want some help, contact me below.

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