Australia’s string of successful stable governments and steady stream of foreign investment have allowed their economy to show a continuous incline over the last 20 years. These advantages have helped investors look past Australia’s rigid and strict corporate compliance system at the bigger picture – opportunity in the diverse corporate landscape that Australia offers. Nevertheless, that is not to say that newcomers to the market shouldn’t be aware of the regulation.
Outlined is a brief glance at a range of corporate compliance regulations that especially incoming foreign investors to Australia should be wary of.
Maintain corporate compliance in Australia with ordered business registrations
One of the first tasks to take care of when incorporating a business in Australia is compliantly registering the business with the relevant authorities. The first registration task is obtaining a business name. The best way to do this is directly through the Australia Securities and Investment Commission’s (ASIC) online business name registration portal. This is quick, convenient and direct. This business name must be renewed every 1-3 years. Following that, every operational business must get an Australian Business Number (ABN) and a Tax File Number (TFN). If the company is seeking to trade in goods and services, it must be registered for Goods and Services Tax (GST). All of these tax registrations are available to obtain online through the same Australian Business Register website. Following this, the company is formally recognized. Depending on the activities of the company, there may be certain other licenses and permits required before operations can be underway.
There are a number of other optional registrations that companies often seek including trademarks and website domains. These are also available through the Australian Business Register website. By registering a company correctly, businesses can rest assured that they have a firm compliant base to launch from.
Business Fair Trading & Compliance
Being located deep in the South Pacific, Australia is a long way from the major consumer markets of North America, Europe, and Asia. This makes Australia largely reliant on its trading industry. Thanks to their 6 current Free Trade Agreements (FTAs) and 2 awaiting ratification, Australia will continue its strong trading prowess. Nevertheless, businesses operating in Australia seeking to take advantage of its trading expertise must be aware of the corporate compliance regulations helping to ensure businesses and their customers practice fair trade. Fair trading laws consist of a mixture of federal and state laws so it is important to be aware of the differences, especially when trading across multiple states. The fair-trading laws broadly cover the obligations surrounding market practices, industry codes, product safety, product labeling, price monitoring, and trading regulation. The specificities of the federal laws are all comprehensively outlined in The Competition and Consumer Act 2010. While the federal laws demonstrate a firm grounding of the system, it is definitely worth checking the state laws as well. To be fully compliant, both of sets of these laws are important to adhere to.
Australia’s Intellectual property corporate compliance
Australia has thorough and strict laws on intellectual property (IP) in order to protect their businesses. Australia are also a signatory to many international agreements that protect intellectual property in other countries. Patents, trademarks, designs, formulae and secret processes are all available to be protected under Australian law through official IP offices located all around Australia. Without formal IP protection in place, companies are at risk of having products or services copied without permission or infringing on other people’s IP without knowing it. Both of these can result in major losses with the latter even incurring large penalties. By undertaking an IP check, businesses can ensure they remain in-line with corporate compliance regulation.
Environmental compliance in Australia
Australia is home to one of the most biodiverse range of habitats on the planet from dense rainforests and arid deserts on land to mangrove forests and coral reefs off the coast. It is no surprise then that Australia has strict environmental compliance regulations to administer sustainable business practices. As well as encouraging all businesses to voluntarily practice environmental management (reducing energy consumption, water use, and waste), the Australian government also has a legal compliance system in play for businesses that could present a severe threat to the environment. These laws are typically enforced through obtaining a permit or license relating to the activities of the business. These licenses can be administered by the federal government as well as the state as getting an environmental license depends on the threat it poses. If the activity is likely to affect national environments such as the ocean, rainforests or mangroves, the license must come from the federal body, Department of Environment and Energy. If the activity is threatening to the local environment such as parks, heritage sites or air and water, the permits come from the state government. Non-compliance with either of these licensing boards results in severe penalties. It is also worth noting that as well as penalties, there are also federal awards and grants for good environmental protection practices in order to incentivize sustainable business.
Corporate compliance regulations in marketing
Marketing, specifically digital marketing, is an industry that is substantially growing in value. It has the capability to increase customer bases, promote products and hence increase revenues. However, Australia, like many countries now, has corporate compliance regulation in place to ensure customers are not misled and the public’s privacy is not inhibited. These include laws on advertising, signage, spam email and pricing. Australia also has strict laws on hosting competitions, promotions and lotteries as a method of advertising to discourage gambling. There are also strict privacy laws on direct marketing as well as a comprehensive telemarketing ‘do not call register’ for protected phone numbers. If marketing to the Australian population at all, it is important to brush up on these laws to ensure corporate compliance.
Employment Law in Australia
Australia’s skilled workforce is one of the key reasons that businesses invest there. The population is well-educated and businesses in a wide variety of sectors are able to find talented staff. However, it is important to understand the regulations regarding employment; how staff are hired, how they’re paid, how they’re dismissed and how their working conditions need to be. The system is fair, it serves employers and protects employees. The minimum wage in Australia is set at AUS$19.49 per hour however there are guidelines for offering the correct rate dependent on age, industry, qualifications and work responsibilities. This rate can be calculated by the Australian Fair Pay Calculator. When paying employees, companies are required to withhold tax form their pay, known as ‘pay as you go’ (PAYG) tax. Other taxes such as Payroll Tax and Fringe Benefits Tax also should be made aware to new businesses. Payroll Tax is a tax only paid by employers if they pay a certain amount of Australian wages per month. This amount threshold is set in the state the company is situated. Fringe Benefits Tax (FBT) is a tax that employers pay when they provide certain benefits to their employees. If employees receive yearly bonuses, for example, this amount must be declared and taxed.
Australia has a system of 10 minimum employment entitlements which are outlined in the National Employment Standards (NES):
- maximum weekly hours
- requests for flexible working arrangements
- parental leave and related entitlements
- annual leave
- personal/carer’s leave, compassionate leave, and unpaid family and domestic violence leave
- community service leave
- long service leave
- public holidays
- notice of termination and redundancy pay
- provision of Fair Work Information Statement
Ensure you maintain corporate compliance by using a local expert in Australia
Investing in Australia has large upside potential. The nation is famed for its primary sector industries of mining and agriculture, there are large manufacturing hubs on both the east and west coast, and the services sector is growing increasingly. As one of the most advanced maritime trading countries in the world, the export possibilities are extensive. Australia’s downside is its rigid corporate compliance system which can be enough to deter foreign investors. However, by partnering with a local legal and accounting team learn how they can mitigate the risk of corporate compliance issues.
Biz Latin Hub has teams of legal and accounting experts at hand to help your foreign business with a full range of business services including corporate compliance checks for countries all across Latin America and Australia. Our corporate health checking services delves into your compliance paperwork to find discrepancies. By partnering with us, you can rest assured that your business is up to date on compliance regulation. If you’re looking for an Australian partner, get in touch today at [email protected] and we can take care of your compliance needs.
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