EXPLANATORY STATEMENT

 

Select Legislative Instrument 2008 No. 140

 

EXPORT MARKET DEVELOPMENT GRANTS ACT 1997

 

Export Market Development Grants Regulations 2008

 

 

The Export Market Development Grants Act 1997 (EMDG Act) provides for grants to specified Australian businesses which have incurred specified expenses promoting the export of their Australian goods, services, intellectual property rights and know-how. The grant is a partial reimbursement of the expenses incurred.

 

Among other changes, the Export Market Development Grants Amendment Act 2008 (EMDG Act 2008) amended the Export Market Development Grants (EMDG) scheme rules so that the Export Market Development Grant Regulations (EMDG Regulations) made pursuant to subsection 89(1) and section 107 of the EMDG Act require amendment. The Regulations are needed to give effect to these two amendments. The EMDG Regulations are repealed. Apart from these two amendments, all other rules in the repealed EMDG Regulations are contained in the Regulations and will operate in an unchanged manner.

 

Firstly, the EMDG Act 2008 amended the scheme rules, set out at paragraph 88(1)(c) of the EMDG Act, for defining the types of entities able to apply for approved body status under the EMDG Act. Organisations which promote on behalf of their members but which are not required to be principal or the intended principal in export sales are able to apply for approved body status under the EMDG Act.

 

Subsection 89(1) of the EMDG Act provides for the making of procedures in Regulations to be followed by Austrade in dealing with applications for approved body, approved joint venture and approved trading house status under the EMDG Act. The Regulations enable State/Territory or regional not-for-profit bodies representing an industry, industries or substantial parts of an industry, and which promote Australian exporters, to be granted approved body status under the EMDG Act.

 

Some approved body assessment rules formerly contained in the Ministerial determination Guidelines for the approval, variation of approval, and cancellation of approved bodies (1/1997 AB) are also included in the Regulations.

 

Secondly, the EMDG Act 2008 amended the scheme rules for determining the eligibility of services set out at sections 25 and 107 of the EMDG Act. Under these changes, the EMDG scheme’s former eligible internal and external service categories are replaced with a new non-tourism services category which provides for all services supplied to foreign residents whether delivered inside or outside of Australia to be eligible unless specified in the Regulations.

 

The Regulations contain two schedules listing service categories. These schedules replace the rules for defining eligible internal and external services formerly contained in the repealed EMDG Regulations.

 

Schedule 1 is made pursuant to the EMDG Act’s section 107 definition of tourism service and amends the former list of eligible tourism services found in the EMDG Regulations by simplifying the rules and making the following changes:

 

• vehicle hire services are to be eligible;
• events are to be eligible except those for which an event promoter has been engaged to promote the event;
• all restaurants broadly defined are eligible;
• accommodation relating to foreign residents studying and working in Australia will not be eligible;
• all transfer services regardless of distance from airport or port are to be ineligible.

 

Schedule 2 is a list of services that are ineligible non-tourism services and is made pursuant to paragraph (b) of the amended Act section 107 definition of non-tourism service. Services in this schedule are excluded on the basis that suppliers will generally compete with other Australian service providers for export business rather than with foreign suppliers. Accordingly, services in relation to the following activities will be excluded:

 

• Migration to Australia;
• Australian family law;
• Buying, selling, leasing assets in Australia;
• Protecting, operating or maintaining assets held in Australia;
• Complying with Australian laws;
• Prostitution;
• Supplying pornographic material;
• Illegal activities or illegal products;
• Gambling services provided by providers not licensed under an Australian law;
• Services not mentioned in Schedule 1 (referred to above) that are provided to foreign resident tourists in Australia;
• Accommodation for foreign residents studying and working in Australia;
• Recruiting employees to work in Australia.

 

The Regulations commence on 1 July 2008 and apply to applications made in the 2008-09 and following grant years.

 

Although this instrument is a machinery measure and does not substantially change the law, Austrade has consulted with the Department of Resources, Energy & Tourism during the course of its preparation. It has not consulted directly with industry because to do so would have provided undue commercial advantage to a limited number of individuals and organisations.

 

Austrade’s decisions under the Regulations are subject to review in the Administrative Appeals Tribunal.

 

This instrument is a legislative instrument for the purposes of the Legislative Instruments Act 2003 and is a disallowable instrument for the purposes of section 46A of the Acts Interpretation Act 1901.