Export Market Development Grants Act 1997 Determination (2/2022) Determination of the payout factor for grant year 2020-21

Overview

The Export Market Development Grants Act 1997, enacted by the Parliament of Australia, was introduced to provide financial support to Australian businesses aiming to develop new or expanded markets for their goods or services overseas. The legislation seeks to address the financial risks associated with international market entry and expansion by offering grants to offset some of the costs incurred in these endeavours. The Act, which facilitates the provision of export market development grants, plays a crucial role in enhancing Australia’s global trade competitiveness by enabling businesses to invest in market development activities that might otherwise be too financially risky without such support. This legislative framework supports the policy objective of fostering economic growth and job creation within Australia by encouraging businesses to explore and penetrate new export markets. The 2022 determination under this Act specifies the payout factor for the 2020-21 grant year, setting it at 37.3 cents in the dollar. This determination was made by Nerma Gunic, the Acting Head of Client Programs at the Australian Trade and Investment Commission, in accordance with the authority granted by section 69 of the Act. The payout factor essentially dictates the proportion of eligible expenses that the government will reimburse to businesses that have applied for and been approved for an export market development grant. This particular determination reflects the government’s ongoing commitment to supporting Australian businesses in their international ventures, ensuring they have the necessary financial backing to navigate and succeed in global markets.

Scope and Application

The Export Market Development Grants Act 1997 governs the administration and distribution of export market development grants in Australia, applying to entities and individuals engaged in export activities who are eligible for funding assistance under the Act. This legislation is a Commonwealth Act, thus it applies nationally and is enforced by the Australian Trade and Investment Commission (ATIC). The Act facilitates financial support to businesses to develop new export markets or expand existing ones, thereby enhancing Australia's trade and investment profile globally. The payout factor for the grant year 2020-21, as determined under section 69 of the Act, is set at 37.3 cents in the dollar, providing a specific financial cap for the grants issued during that period. The Act's application can be further refined or extended through subordinate instruments, such as regulations or guidelines, which may specify additional criteria or conditions for grant eligibility and distribution.

Key Provisions

The Export Market Development Grants Act 1997, specifically under section 69, empowers the determination of a payout factor for the grant year 2020-21, which has been set at 37.3 cents in the dollar. This determination is critical as it directly impacts the amount of grants available to eligible entities. This payout factor essentially dictates how much of the total eligible costs the government will reimburse to entities that are working to develop and expand their export markets. Entities governed by the Act must adhere to the provisions set out to be eligible for these grants. They must demonstrate that they are undertaking activities that are aligned with the objectives of the Act, which include the development and expansion of export markets. These activities might include market research, participation in trade missions, or other initiatives that facilitate and enhance the export capabilities of Australian businesses. Failure to comply with the requirements of the Act can result in significant consequences. While the Act does not explicitly outline specific offences, non-compliance could lead to the denial of grant applications or the repayment of already disbursed grants. Furthermore, the Australian Trade and Investment Commission retains the authority to audit and investigate the use of funds to ensure compliance. Should an entity be found to have misused grant funds, they may face legal actions, including civil penalties or criminal charges depending on the severity of the breach. In terms of penalties, while the Act does not specify maximum penalties, breaches of this nature are generally subject to the penalties outlined in the relevant administrative or public sector legislation, which can include fines up to a certain threshold or more severe penalties if prosecuted under criminal law. It is also worth noting that any financial losses incurred by the government due to non-compliance could be recovered through legal action. Therefore, entities must ensure they fully understand and adhere to the requirements set forth by the Act to avoid any potential legal repercussions.