Export Market Development Grants Act 1997

The Act primarily affects Australian small and medium enterprises that wish to develop export markets, together with organisations that represent them. Section 15 lists the eligible kinds of persons provided they also meet the conditions in section 16: (a) individuals who are Australian within the meaning of the rules; (b) bodies incorporated under the Corporations Act 2001; (c) associations or cooperatives incorporated under an Australian law; (d) partnerships that are Australian within the meaning of the rules; (e) trusts that are Australian within the meaning of the rules; (f) bodies corporate established for a public purpose by or under an Australian law; or (g) any other kind prescribed by the rules. The notes to section 15 direct readers to the special treatment of partnerships and trusts in sections 105A and 105B.

Applicants must satisfy the core export-readiness condition in section 16(2) unless the rules exclude them, in which case the rules must impose a connection to marketing eligible products in a foreign country. "Ready to export" is itself defined by the rules. Grantees – persons who become party to a grant agreement other than the CEO – are subject to ongoing obligations throughout the agreement term. They must continue to be eligible, incur (or have incurred) eligible expenses on eligible products of substantially Australian origin, spend the grant plus matching own funds on permitted activities, comply with reporting and information demands, and meet any repayment triggers.

The Act also affects the CEO of Austrade (defined by reference to the Australian Trade and Investment Commission Act 1985). The CEO is given power to issue invitations (section 7), decide on applications and enter agreements (section 9), determine payments (section 11), exercise the Commonwealth's contractual rights (section 12), require information and statements (sections 101 and 102), and reconsider reviewable decisions (section 98). The CEO's decisions not to enter an agreement or certain decisions about eligibility or payment are reviewable (section 97).

Third parties can be affected indirectly. Partners and trustees face personal exposure for obligations and offences (sections 105A(2)–(3) and 105B(2)–(3)). Suppliers of promotional or training services to grantees may find their invoices scrutinised for eligibility. Other Commonwealth or State agencies whose financial assistance schemes overlap with grant-funded activities are relevant to the exclusion in section 19. Exporters of products that would contravene Australian law are barred from using grants for related promotional expenses (section 20). The broader Australian community benefits from increased exports but also bears the cost through appropriated funds, subject to the administration cap in section 105.

Because so many substantive criteria are left to the rules, the precise class of affected persons can expand or contract by legislative instrument without amending the Act itself. The periodic review obligation in section 106A ensures that the Minister, Parliament and the public can periodically assess whether the scheme continues to reach the intended recipients.

Grantees' key duties are set out in the grant agreement and section 10. They must comply with the Act, the rules and all agreement terms (section 10(1)). They must expend both the grant and at least matching own funds on eligible expenses for eligible products (section 10(2)(a)). They must repay amounts in circumstances specified in the agreement (section 10(2)(b)(i)). They must respond to information or document requests within the time specified (at least 14 days) and provide any required statements about relevant matters (section 102). Failure to do so halts payment (section 102(3) and (6)). They must not use grant money for excluded expenses (sections 19 and 20) and must maintain eligibility throughout the relevant period (section 11(1)(b)).

Applicants have a right to apply in response to an invitation (section 8) but no right to a grant. The CEO has discretion whether to enter an agreement even if eligibility thresholds appear met (section 9(1)). Once a grant agreement is executed, the grantee has a contractual right to payment of instalments when the agreement and statutory conditions are satisfied (section 11), subject to the CEO's ongoing satisfaction about eligibility and expenses.

Review rights are central. Any person affected by a reviewable decision listed in section 97 – refusal to enter an agreement, adverse eligibility or expense findings, failure to meet rule-prescribed payment conditions, or any other decision prescribed by the rules – may request the CEO to reconsider it within 30 days (or longer if allowed) and must give reasons (section 98). If the CEO confirms or varies the decision, the affected person may apply to the Administrative Review Tribunal (section 99). Section 98(4) notes that section 266 of the Administrative Review Tribunal Act 2024 requires notification of review rights.

The CEO has statutory powers corresponding to these duties: the power to invite applications, enter agreements, require information, withhold payment for non-compliance, demand repayment as a debt, and institute proceedings (sections 7, 9, 101, 102, 11(3), 12). The CEO also possesses all rights, responsibilities, duties and powers of the Commonwealth as grantor (section 12(1)) and may exercise any power conferred by the agreement itself (section 13). Section 14 preserves the executive power of the Commonwealth beyond the Part 2 mechanism.

Partners and trustees have specific duties. For partnerships, every partner is personally subject to obligations that would otherwise fall on the partnership, although any partner may discharge them (section 105A(2)). Criminal Code offences are attributed to those partners who did the act, aided it, or were knowingly concerned (section 105A(3)). A change in partnership composition does not affect continuity (section 105A(4)). Similar rules apply to trusts, with obligations falling on the trustee or trustees and offences attributed accordingly (section 105B).

Rights to information are limited. The Act contains no general freedom-of-information style rights; instead it gives the CEO coercive information-gathering powers. Grantees have an implicit right to know the terms of their own grant agreement and the content of the rules that govern them.

The Act itself creates no criminal offences or civil penalties. Instead it relies on two enforcement streams: contractual and statutory consequences within the grant scheme, and the Criminal Code for false or misleading conduct.

The primary enforcement mechanism is contractual. The grant agreement must provide for repayment in specified circumstances (section 10(2)(b)(i)). Any such repayable amount becomes a debt due to the Commonwealth (note to section 10(2)). The CEO, acting on behalf of the Commonwealth, may institute action or proceedings to recover it (section 12(2)(b)). Payment of further grants or instalments can be refused if the grantee fails to provide required information or statements (sections 101(3), 102(3) and 102(6)). The CEO may also rely on any wider breach-of-contract remedies included in the agreement (section 10(3)).

Information-gathering non-compliance carries direct statutory consequences rather than fines. An applicant's failure to comply with a notice under section 101 means the CEO is not required to deal with the application. A grantee's failure under section 102 prevents payment of the relevant grant or instalment. The simplified outline in section 100 warns that provision of false or misleading information may constitute an offence against Chapter 7 of the Criminal Code (proper administration of government).

For partnerships and trusts the Act attributes liability. Under section 105A(3) a partnership offence under Chapter 7 of the Criminal Code is taken to have been committed by each partner who did the act, aided it or was knowingly concerned. The same attribution applies to trustees (section 105B(2)(b) and (3)(b)). Because the Act "applies to a partnership as if it were a person" (section 105A(1)) and likewise for trusts, any obligation or prohibition that would bind a corporate grantee binds the partners or trustees personally.

The CEO's power to require information or documents (Part 3) is backed by the practical sanction of withholding payment rather than a separate penalty. Section 103 makes clear that the Part does not limit additional information requirements that may be imposed by rules or the grant agreement, allowing further contractual sanctions.

Enforcement is therefore largely preventive and remedial: refusal to pay, requirement to repay, and potential debt recovery proceedings. The reviewable nature of many CEO decisions (section 97) provides a check against arbitrary enforcement, but the onus remains on the grantee to satisfy the CEO on eligibility and expenditure at the time of each payment.

The Act is not standalone. It expressly cross-references and interacts with several other Commonwealth statutes.

First, it is administered by the CEO of Austrade, defined by reference to section 7B of the Australian Trade and Investment Commission Act 1985 (section 5). Austrade's existence is continued by section 7 of that Act. The CEO exercises both statutory powers under this Act and contractual powers under grant agreements (sections 12 and 13).

Eligibility of corporate persons turns on the Corporations Act 2001 (section 15(b)). Changes to corporate law can therefore affect who can participate.

Review of decisions is now routed through the Administrative Review Tribunal under the Administrative Review Tribunal Act 2024. Section 99 expressly provides for ART review of decisions confirmed or varied on reconsideration. The note to section 98(4) refers to the notification obligation in section 266 of that Act. This replaced the former Administrative Appeals Tribunal pathway.

Criminal liability for false or misleading information or documents is governed by Chapter 7 of the Criminal Code (see sections 100, 105A(3) and 105B(3)). The Act does not create its own offences but triggers the general Code provisions on dishonesty, forgery and obstruction in the context of Commonwealth administration.

The rules made under section 106 are legislative instruments and therefore subject to the Legislation Act 2003 (though not expressly stated, this is the default Commonwealth position). The rules cannot do the things prohibited by section 106(3): create offences or civil penalties, authorise arrest, detention, entry, search or seizure, impose tax, appropriate money, or amend the text of the Act.

Interaction with other funding schemes is addressed in section 19. An expense is not eligible if the person has already received financial assistance for it under any other scheme administered by the Commonwealth, a State, a Territory or their authorities. The note to section 19 warns that later receipt of such assistance after a grant has been paid may trigger repayment under the rules or the grant agreement. This prevents double-dipping.

Section 20 excludes expenses related to products whose sale or export would contravene "an Australian law" – defined in section 5 as a law of the Commonwealth, a State or a Territory. This imports the whole statute book (customs, quarantine, sanctions, prohibited exports, intellectual property, etc.) as a negative eligibility criterion.

The executive power of the Commonwealth is preserved (section 14), so the Commonwealth could in theory make grants outside the Act using non-statutory executive power, although the detailed scheme and appropriation requirements would make that unusual.

Section 105 caps the proportion of appropriated money that can be spent on administration. Any excess must be met from other sources, creating an interaction with the annual appropriation Acts and the Public Governance, Performance and Accountability Act 2013.

Finally, the periodic review in section 106A requires public submissions and may involve public hearings, engaging administrative law principles of procedural fairness even though the review is not a decision affecting legal rights in the usual sense.

The compilation text reveals several layers of amendment. The administration cost cap in section 105 was tightened over time: 7.5% for the year ending 30 June 2021, 7% for 2022, and 5% for all subsequent years. This change, reflected in subsection 105(3), appears designed to ensure that a greater proportion of appropriated funds reaches actual grantees rather than overheads.

The most significant structural addition is section 106A, inserted by the Export Market Development Grants Legislation Amendment Act 2020. It mandates independent reviews of the entire assistance scheme. The first review had to be completed no later than the fifth anniversary of the commencement of Schedule 1 to that 2020 Act. Subsequent reviews must occur at least every five years. Each review must call for public submissions and may hold public hearings; the report must be tabled in both Houses within 15 sitting days. The evident purpose is to force periodic evaluation of effectiveness, efficiency and continued relevance – a response to the scheme's longevity since 1997 and the need for evidence-based policy adjustment.

Review mechanisms were updated to refer to the Administrative Review Tribunal and the Administrative Review Tribunal Act 2024 (sections 97–99 and the note to section 98(4)). This simply aligns the Act with the replacement of the former Administrative Appeals Tribunal.

The rule-making power in section 106 was expanded in its practical reach. The Act now repeatedly defers almost every substantive criterion – eligible persons, ready-to-export test, eligible products and their Australian-origin test, eligible expenses, grant calculation methods, additional application and payment conditions – to the rules. Subsection 21(3) expressly allows rules to alter grant amounts even for existing agreements, giving the Minister flexibility to respond to budgetary or policy shifts without new primary legislation. The prohibitions in section 106(3) were added to maintain constitutional and legislative propriety.

The simplified outlines in sections 4 and 6 were refreshed to reflect the rules-based model and the ART review pathway. Definitions in section 5 were updated to include "reviewable decision", "relevant matter" and "Administrative Review Tribunal" terminology.

These changes collectively shift the Act from a relatively prescriptive 1997 statute to a modern framework statute that can be adjusted quickly by ministerial rules while subjecting the overall scheme to regular independent scrutiny. The reduction in the administration cap and the review obligation suggest a policy emphasis on value for money and accountability.

The Act does not record specific court decisions, but its structure generates several predictable areas of contention that have been addressed through the review mechanisms in Division 7 of Part 2.

The most obvious reviewable decisions are listed in section 97: refusal to enter a grant agreement (section 9(1)), a finding that a person is not eligible or has not had or will not have eligible expenses (section 11(1)(b)), a finding that a rule-prescribed payment condition is not met (section 11(1)(c)), or any other decision prescribed by the rules. An affected person may seek internal reconsideration within 30 days (section 98). The CEO must then confirm or vary the decision. Further ART review is available (section 99). The short time limit and requirement to state reasons in the reconsideration request (section 98(3)) have the practical effect of forcing prompt and focused challenges.

Controversies are likely to cluster around the meaning of terms left to the rules: what constitutes "substantially Australian origin" (section 17(3)), whether a particular expense is promotional or training-related (section 18(2)), whether an expense is excluded because another scheme has provided or later provides funding (section 19 and its note), or whether a product’s sale or export would contravene Australian law (section 20). Because these are largely rules-based, disputes may turn on the proper construction of the legislative instrument rather than the Act itself.

The attribution provisions in sections 105A and 105B can generate controversy where a partnership or trust is involved. Every partner or qualifying trustee can be personally liable for obligations and for Chapter 7 Criminal Code offences. A partner who was not involved in the day-to-day grant administration may still face liability if they aided, abetted or were knowingly concerned. The continuity rule in section 105A(4) means that changes in partnership composition do not reset obligations, which could surprise incoming partners.

The power to require information or statements at any time (section 102) and the automatic cessation of payment for non-compliance has been criticised in analogous grant schemes for being draconian. However, the 14-day minimum notice period and the ability to agree to a later date provide some procedural protection.

The broad discretion retained by the CEO even after eligibility thresholds are apparently met (the word "may" in section 9(1)) can lead to challenges on administrative law grounds such as unreasonableness or failure to take relevant considerations into account. Because a refusal to enter an agreement is expressly reviewable, the ART can examine whether the CEO's discretion was exercised consistently with the object in section 3 and the simplified outlines.

No provision in the text creates a cause of action in tort or contract against the CEO personally; the CEO acts on behalf of the Commonwealth (section 12). This limits exposure but funnels claims toward judicial review or debt recovery proceedings.

Overall, the Act channels controversy into the reconsideration–ART pathway rather than direct court litigation, consistent with the policy of efficient, low-cost merits review of grant decisions.

Most practitioners miss that eligibility is not static. Section 11(1)(b) requires the CEO to be satisfied at the time of each payment – or in relation to each period – that the person "is eligible for a grant" and "has had or will have eligible expenses". A grantee who becomes ineligible midway through an agreement (for example by ceasing to be "Australian" under the rules or no longer seeking to expand export activity) can lose the right to further instalments even though the agreement has not been terminated.

The matching-funds obligation in section 10(2)(a) is often misunderstood. The grantee must spend both the grant and at least an equal amount of its own money on eligible expenses. If the grantee spends less than the required own contribution, the entire grant (or a proportionate part) may become repayable under the agreement terms required by section 10(2)(b)(i).

The exclusion in section 19 operates at the moment the expense is assessed. However, the note warns that if financial assistance from another scheme is received after the grant has already been paid, the rules or the agreement may require repayment. Grantees who successfully obtain multiple sources of funding for the same promotional activity can therefore face retrospective claw-back.

Section 21(3) is a sleeper provision. Rules that change the method for calculating grant amounts can apply to grants or instalments payable after the rules commence, even under a grant agreement already in force. A business that negotiated its grant on the basis of one formula can find the formula altered mid-term.

The information-gathering power in section 102 is not limited to the grant period. A notice can be issued at any time and can require statements about past or future relevant matters. Failure to comply by the due date (or any agreed extension) automatically prevents payment of the relevant grant or instalment. There is no statutory right to seek review of the breadth or relevance of a notice before compliance; the only remedy is to comply or forfeit payment and then challenge the withholding decision under section 97.

Partnerships and trusts are treated as persons for eligibility but not for liability. Sections 105A and 105B impose obligations and potential criminal liability on every partner or trustee personally. A passive investor partner who signs the grant agreement can still be prosecuted if another partner provides false information and the investor was "knowingly concerned".

The definition of "export" in section 5 expressly excludes the temporary taking of goods out of Australia with the intention that they will later be brought back permanently. This can catch businesses that exhibit prototypes or samples overseas and then re-import them, potentially disqualifying related promotional expenses.

Finally, the Act contains no cap on the number of grants or total funding per grantee; those limits, if any, sit in the rules or the appropriation. Businesses sometimes assume there is a lifetime cap similar to older versions of the scheme, but that assumption is unsafe without checking the current rules.

Compliance begins before any application. A business must confirm it falls within an eligible kind of person under section 15 and meets the export-related conditions in section 16, or any substituted conditions imposed by the rules. It must identify products that will satisfy the Australian-origin test in the rules (section 17) and ensure that proposed promotional or training expenses fall within section 18(2) and are not excluded by sections 19 or 20.

When an invitation is issued under section 7, any application must be in writing and comply with all rule-prescribed formalities (section 8). The applicant should assemble evidence that it will have eligible expenses during the proposed agreement term and meet any other rule-prescribed criteria.

If a grant agreement is offered, it must be reviewed carefully. The agreement will contain the mandatory terms required by section 10(2) and any additional conditions permitted by section 10(3). The grantee must be satisfied it can meet the matching-funds obligation and the repayment triggers. Once executed, the grantee must maintain eligibility and incur only eligible expenses. Records should be kept in a form that allows prompt response to any notice under section 102, because non-compliance automatically stops payment.

Spending must be documented to demonstrate that both grant and matching funds were applied to eligible promotional or training activities for eligible products in foreign markets. If the grantee later receives funding from another scheme for the same expense, it must immediately consider whether repayment is required under the agreement or rules.

Any adverse decision by the CEO (refusal of agreement, adverse eligibility finding, refusal of payment) should be the subject of a reasoned reconsideration request within 30 days under section 98. If the CEO confirms the decision, ART review should be considered promptly.

Partnerships and trusts must ensure that all partners or trustees understand their personal exposure under sections 105A and 105B. Internal governance arrangements should allocate responsibility for compliance and information provision so that the "any partner may discharge" rule can be used effectively.

Because the rules contain most of the detail, compliance requires keeping the current version of the Export Market Development Grants Rules (or successor instrument) and any Austrade guidelines. The rules can change and can apply retrospectively to the calculation of grant amounts (section 21(3)), so existing grantees must monitor legislative instruments.

Finally, grantees should budget for the possibility that administration of the grant will require significant internal resources for reporting, record-keeping and responding to CEO notices. The administration cost cap in section 105 limits Austrade's overhead but does not reduce the compliance burden on recipients. Regular internal audits against the eligible-expense criteria and the terms of the specific grant agreement are the most reliable way to avoid repayment demands or payment suspension.