What is Export Market Development Grants (EMDG)?
Austrade’s Export Market Development Grants (EMDG) program helps Australian businesses grow their exports in international markets. These grants encourage small to medium enterprises to market and promote their goods and services globally.
EMDG from 1 July 2021
The EMDG program now provides upfront funding certainty so you know how much you will receive during your grant agreement (2 or 3 years) so you can plan your promotional activities with confidence.
Types of grants for exporters
Small to medium enterprise (SME) exporters can apply for 3 different grants over 8 years (not necessarily consecutively) for eligible promotional activities.
Grants are available in 3 stages, called tiers. Each tier provides a different level of support for SMEs as they grow their export markets. The lengths of these grants reflect the different stages of an exporter’s journey.
Tier 1: Ready to export
- First time exporters
- 2 years and maximum $40,000 per financial year
Tier 2: Exporting and Expanding
- For businesses who are exporting and
- Expanding export promotion activities
- 3 years and maximum $80,000 per financial year
Tier 3: Exporting, expanding and strategic shift
- For businesses who are exporting and
- Expanding export promotion activities and making a strategic shift, for example targeting a new market or a new type of customer
- 3 years and maximum $150,000 per financial year
Grants for representative bodies
Assistance for industry bodies and alliances (representative bodies) extends to training members who are new to export to become export ready. Representative bodies will continue to have access to financial assistance for promotional activities on behalf of their members in international markets, with grants of up to 3 years and up to $150,000 per financial year.
Process for receiving a grant
From 1 July 2021 the EMDG program will become an eligibility-based grants program.
- You apply for a grant, for promotional activities you undertake from 1 July 2021.
- Once all applications have been assessed, Austrade offers a grant agreement to each eligible applicant, for the full grant period for that tier (unless that would exceed the 8 financial years cap or the $770,000 total grant cap).
- 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.
- Your grant agreement will set out when your milestone payments should be made and what you need to do to receive these payments.
Application period
You can apply for a grant under the EMDG program for eligible expenses incurred from 1 July 2021.
Grant applications open 9 am AEST on 16 August and close 5 pm AEDT on 30 November 2021.
In the first year, the application period is 3.5 months with a new, streamlined application process. This will allow applicants time to understand the new program. Austrade will review this process once complete and adjust it for future rounds if needed.
When are grant payments made?
The timing of payments is determined by your grant agreement. Your grant agreement will state:
When you should provide each milestone report. This will be a once a year requirement.
Austrade may make the first payment for tier 1 and representative body grantees this financial year (FY2021-22).
Tier 2 and Tier 3 grantees will receive their first payment early next financial year (FY2022-23),
In order to receive most payments you need to provide us with a milestone report as set out in your grant agreement. For further information about how we make this decision please see how we decide milestone payments
Once all applications have been received, Austrade will calculate the distribution of available funds for all eligible applications. Following assessment, if you are eligible, you will receive a grant agreement that will tell you how much your grant is for. Your obligation is to match, at a minimum, the dollar value of the grant monies you receive.
Eligibility
Eligibility
To be eligible for a grant under the EMDG program you will need to be an Australian person and have eligible products and expenses as defined in the EMDG Rules.
Who is eligible?
To be eligible
- you need to have a turnover of less than $20 million for financial year 2020–21
- you must be an Australian person within the meaning of the EMDG Rules,
- you must have an Australian Business Number.
Eligible products
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 Guidelines provide further guidance on what of substantially Australian origin means.
Eligible expenses
The EMDG grant is provided for expenses in one or more of the following categories, as detailed in the EMDG Guidelines:
- 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.
The EMDG Guidelines provide further guidance on ineligible expenses and designated connections.
Frequently Asked Questions
Frequently Asked Questions
Which Tier do I apply for?
It is up to the business to determine which grant Tier would work best and most strategically for it (within the requirements of the Rules) based on what it is currently doing and what it proposes to do, and whether they can meet the obligations of that tier.
Making strategic use of the Tiers
While the Tiers are designed to reflect a traditional growing export business, you can apply for any Tier level that suits your organisation if you meet the criteria.
You do not have to progress through each Tier in any particular order.
You do not have to utilise the 8 years of funding available consecutively: you can take a break and come back when you need it.
Things to think about
The Tiers are designed so that you can access EMDG at critical times during your unique export journey. In deciding which Tier to apply for, you need to think strategically about when is the most appropriate time to apply for a particular Tier. Some helpful questions to ask yourself:
- Should I take a break from EMDG funding until my business is ready for the next stage in my export journey?
- Is now the best time to consolidate my current market? If yes, it might be advantageous for your business to wait until you are ready to expand or make a strategic shift.
- Am I ready to invest more into marketing to expand my market or diversify my markets (remembering that you are obliged to match the funding provided by Austrade dollar for dollar)?
- What promotional activities do I want to do differently or more of?
Who is an eligible person?
Most Australian businesses will be eligible persons.
To be eligible for a grant you must be an eligible kind of person within the meaning of the EMDG Rules, being one of the following:
- an individual whose principal place of residence is in Australia
- a body incorporated under the Corporations Act 2001
- an association, or cooperative, incorporated under an Australian law
- a partnership that is Australian, that is if the partnership was formed and operates under a law of a State or Territory, and at least half the partners are Australian persons
- a trust that is Australian within the meaning of the EMDG Rules, that is the trustee, or each trustee, of the trust is an Australian person
- a body corporate established for a public purpose by or under an Australian law
- a representative body.
How do you measure a turnover of less than $20 million?
If you are an SME exporter, at the time you apply for a grant you must also:
- have a turnover for the last financial year (2020–21) of less than $20 million (annual turnover is the total ordinary income that you derive in the income year in the course of running your business).
This is an explanation of the EMDG Rules at section 10 Eligibility conditions for applicants other than representative bodies, which requires the following condition to be satisfied by a person other than a representative body, at the time the person applies for a grant:
The person’s turnover for the financial year before the financial year in which the application is made is less than $20,000,000.
Do you have an example of a strategic shift?
Please see expanding and strategic shift for two examples of strategic shift.
What does exporting mean?
We will interpret exporting broadly.
A good indication that you are exporting is evidence of having exported recently (with 1 July 2020 a sound indicator of you having exported recently).
We will also consider other evidence including:
- Contracts in place with offshore buyers
- Agreement or memorandums of understanding with offshore buyers to sell or market your product
- Evidence of current negotiations with offshore buyers for the sale of your products
- Evidence (whether in your plan to market or otherwise) to show you are currently actively engaged in exporting, for example of active customer engagement with a realistic prospect of resulting sales (as demonstrated by evidence such as the capacity to produce and deliver your export product)
- Any other evidence
Each application will be judged on its merits and the individual circumstances of the applicant. This should not be taken as a guarantee that your application will be assessed as satisfying this requirement of the EMDG legislation. However, your explanation will be considered as part of the overall application assessment process.
What are the caps?
You can receive EMDG grants for 8 financial years.
You can only receive a total of $770,000 under the EMDG program. The cap of $770,000 refers to money received, NOT money applied for.
If I have already received 8 EMDG grants, can I still apply for this new program?
If you have received EMDG grants for 8 financial years since 1 July 1990 you have reached your cap of 8 years and are not eligible for the 2021-22 EMDG grant round.
How does matching funding work?
Your grant agreement will say how much you grant is for. You must match this funding.
(2) The grant agreement must include terms and conditions that:
(a) have the effect of requiring the grantee to spend the grant money, as well as at least a matching amount of the grantee’s own money, on eligible expenses of the grantee in relation to eligible products
Can I ask for my grant agreement to be varied to a higher amount if I spend more?
Austrade will not vary the amount of an agreement in a way that will result in a higher payment as the funding pool available for each Tier is fully allocated at the time of entering into grant agreements.
If I receive money from the reimbursement scheme in FY2021-22 how does that affect my grant agreement entered into in FY2021-22?
Your payment will be reduced to the extent that you would exceed the overall caps. Your grant agreement will state:
For the avoidance of doubt, the Commonwealth may reduce a payment in accordance with Rule 48(3) in the circumstances where the Grantee is eligible for a final payment under the outgoing reimbursement program that would result in the Grantee receiving more than the cap on total grants payable.
Can I apply for a one year grant agreement?
No. Austrade will offer you the maximum term for your Tier unless:
- The maximum will mean you exceed your caps (8 years or $770,000)
What is the process and timeline for reviewing applications?
Section 7.2 of the 2021-22 Grant Guidelines states:
You must submit your application between the published opening and closing dates (16 August to 5pm AEDT 30 November 2021). We cannot accept late applications.
We will endeavour to assess your application and advise you of the outcome within 10 weeks of the closing date. At this time, we will provide you with a grant agreement for you to sign.
What is the profit and loss statement for?
| Applicant | Attachment | Why do we need it? |
| SME exporters – all tiers | 2020–21 Profit and Loss Statement | To substantiate that your turnover is less than $20 million. |
Are there limits to each expense category?
There will be upper spending limits for travel costs including accommodation, flights and daily allowances. This will be set out in your grant agreement and will be more reflective of the true cost to SMEs than previously.
There are no upper limits to other expense categories. Businesses can choose the best way to market their business.
Each grant agreement will state the upper limit for your overall grant in each financial year. If you spend more than matched funding for this limit you will not receive further grant money.
What has changed from the previous scheme?
The following information will be particularly relevant for those familiar with the previous EMDG reimbursement scheme.
EMDG is now a forward looking grant program. Many concepts necessary under the reimbursement scheme are no longer necessary and have not be incorporated into the grant program.
The most important starting point for you in understanding the new processes for the EMDG grant program is the 2021-22 Grant Guidelines . When filling out your application please refer to these guidelines to assist you.
Pre-Approval
There is no pre-approval process in the EMDG grants program.
Audit
Audit processes were relevant to the EMDG reimbursement scheme. The grant program will follow Commonwealth grant processes.
You will be asked for further information upon receipt of milestone reports if the assessor considers further information is needed. You will not receive a milestone payment until Austrade accepts the milestone report.
Will an applicant have to show how they will be able to match funding at application stage?
No. At the milestone reporting stage an applicant will demonstrate that they have provided matched funding.
Related Entities
The requirements concerning related entities that have been translated into the grant program concern:
A designated connection to goods
27 Designated connection to eligible product
Goods
(1) A person has a designated connection to an eligible product that is goods if:
(a) the person, or a related entity of the person, owns the goods; or
(b) the person, or a related entity of the person, owns, or holds an exclusive licence for, one or more intellectual property rights in relation to the goods; or
(c) the person is a representative body and members of the represented group have a designated connection to the goods within the meaning of paragraph (a) or (b).
And
The assessment of caps:
When assessing whether you have reached either the 8-year cap or the $770,000 cap on total grant funding available to you under EMDG, Austrade will include the grants of another grantee where Austrade considers organisational restructuring activity has occurred that means you are, in substance conducting the business the previous grantee conducted. This is done by assessing whether your business is similar in substance to a previous EMDG grantee (including a grantee that has ceased to exist)
These assessments of caps are reviewable decisions.
I am confused about how matched funding works now
The grant agreement will specify the maximum grant amount per financial year. You must, match at the minimum, the dollar value of the grant monies they receive.
If you spend more, you will not receive more grant money. If you spend less, you will only receive an amount equal to the amount you contributed.
For example, if your grant agreement states that you are able to access $60,000 in a given financial year, you must match that amount in order to receive the full amount in your grant agreement.
In other words, the total amount spent on marketing activities must be at least $120,000 in that financial year in order for you to receive a $60,000 milestone payment.
Please note this amount is the maximum you will receive for that financial year. If you spend $100,000 on eligible activities in that financial year, you will receive $50,000 through the milestone payment.
If you spend more than $120,000, for example $140,000, you can only receive up to the maximum $60,000 grant amount as per your grant agreement.
New Zealand
Expenses with respect to trade with New Zealand are not eligible expenses.
