Australia is an increasingly attractive market for businesses looking to expand internationally. As with all expansions, proprietors must understand and comply with domestic laws regarding intellectual property, business structuring and consumer law. Below, we look how a French business can expand its efforts to Australia.
1. Business Structure
You will need to ensure you choose the structure that will further your growth plans and best protects your assets. Standard business structures include:
If you choose to operate in Australia as a company, you can either:
- Set up an Australian company;
- Register as a foreign company in Australia; or
- Purchase an existing Australian company.
Each of these alternatives requires you to undertake a different process. For example, the registration process for foreign companies is different to setting up an entirely new corporation. If you purchase an existing corporation, you may need the approval of the Foreign Investments and Takeovers Board.
Once you have chosen how to structure your business, you will need to familiarise yourself with Australia’s taxation laws and regulatory framework. All directors of Australian companies have particular directors’ duties. Failure to meet these can have serious repercussions, including personal liability. Depending on your company structure, one or more of your directors must be Australian residents.
Further, all Australian companies have taxation and compliance obligations. Australia has an income tax treaty with France. As such, any income earned from carrying on business in an Australian permanent establishment must pay income tax in Australia.
Your business will probably be required to pay Goods and Service Tax (GST) and withholding income tax for Australian resident employees. You will need:
- An Australian Business Number (ABN); and
- A Tax File Number (TFN).
If your business acquires and disposes of taxable Australian assets, it will also be liable for Capital Gains Tax (CGT).
Companies must register with ASIC. Again, according to your business structure, you must comply with any (and all) reporting and disclosure obligations. For example, public companies have certain requirements placed on them that do not apply to small proprietary companies.
Also, if you want to trade on the Australian Stock Exchange (ASX), you need to meet and maintain all the requirements prescribed by the stock exchange listing rules. These include rules about reporting and company disclosure.
2. Business Premises
Irrespective of your business structure, you will likely need a physical presence to operate in Australia. You must determine if you would prefer to purchase or lease your commercial premises. Either option will require you to enter into a contract and understand your obligations that arise under the contract.
Your enterprise will also need to obtain local government approval to carry on your French business at those premises. If you intend to make alterations to the building, it will have to apply for and receive building consent. Once construction is complete, the local council will have to certify it formally as meeting all relevant regulations and stipulations before you can use it.
Depending on your business, you might need a licence to carry out operations. For example, if you distribute liquor you will need a liquor licence. State and territory governments regulate these permits and which kind you will need depends on the location of your premises.
On this point, you will also need to comply with all regulations applicable to your business. For example, if you distribute food you must abide by the Australia New Zealand Food Standards. You will likely also need to meet all requirements concerning food labelling.
4. Consumer Law
Depending on your business, you might fall under the auspices of the Australian Consumer Law (ACL). That means your business must meet all consumer guarantees and be prepared to offer the appropriate remedies.
You must also comply with any applicable product safety standards. Your business practices also cannot breach the ACL. For example, no enterprise can engage in false and misleading conduct.
5. Intellectual Property
As a French business operating in Australia, you need to protect all of your intellectual property. Of course, this depends on your business’ offering. If you have a unique business name and logo, you should register a trade mark with IP Australia as well as a domain name to enforce your rights.
If you have any questions about expanding your business to Australia or need assistance setting up, get in touch with our commercial lawyers on 1300 544 755.