14 August, 2009

Export Market Development Grants Available for IP Costs

Export Market Development Grants Available for IP Costs

Intellectual Property (IP) is a valuable strategic and financial asset for every organisation. Like any other resource, IP should be carefully managed and opportunities should be sought to exploit and add value from that IP. The IP owned or controlled by an organisation represents a significant portion of its value. Particularly for small to medium sized organisations, realizing the value of its IP is critical in a monetization of that value.

A Government grant is one capital raising option open to an organisation involved in the development of technical innovations. Government grants are offered at a Federal and State level to organisations to facilitate research, development and commercialization of innovations.

One such grant is the Export Market Development Grant (EMDG) which is administered by Austrade (www.austrade.gov.au/exportgrants). “The EMDG Scheme:

  • encourages small and medium sized Australian businesses to develop export markets.
  • reimburses up to 50 percent of expenses incurred on eligible export promotion activities, above a $10,000 threshold.
  • provides up to eight grants to each eligible applicant.

To access the scheme for the first time, businesses need to have spent $10,000 over two years on eligible export marketing expenses”.

In respect of the IP assets of eligible businesses, Austrade advises that such businesses can claim:

  • Patent and Trademark Attorney fees and other payments made to third parties for the grant, registration or extension of the period of registration of IP in countries other than Australia, New Zealand and Iran (as at November 2008); and
  • the cost of insurance premiums paid for protection against possible infringement of eligible IP, in countries outside Australia.

As with all grants there are some exceptions. For example, costs related to defending infringements against the registration of your IP; In-house expenses and registering business, company or domain names. Remember that the grant is in relation to increasing export sales.

Austrade further indicates that to be eligible for the EMDG, the business must have:

  • income of not more than $50 million in the grant year.
  • incurred at least $10,000 of eligible export expenses under the scheme (first-time applicants can combine two years expenses).
  • principal status for the export business (some exceptions apply, e.g. event promoters).

Accordingly, there appears to be a good opportunity for eligible companies to obtain a substantial refund of IP costs which relate to exports of relevant products covered by the underlying IP.

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