8 Regulatory Issues to Know Before Expanding Your Business to Australia
Australia has a GDP of more than 1 trillion US dollars, along with a sizeable middle and upper-middle-class citizenship. The country also has a thriving service sector forming 68 percent of its GDP.
Australia’s open economy has enabled it to become a major player in the global market. It was able to grow by 3.1% in the December quarter, despite the worldwide setback from COVID-19. If you are considering expanding your business operations to the country, here are some common regulatory issues that you need to know about:
In order to register your business in Australia, you will need an Australian Business Number (ABN), a Tax File Number (TFN), and the relevant licenses and permits.
You will also need to select a business structure to determine how your firm would operate and be taxed in the future. Common business structures include sole proprietorship, partnership, company, and trust.
In order to qualify for registration, you need to:
- Show a certified copy of the Certificate of Incorporation or Registration, along with a certified copy of the body’s constitution (not more than 3 months old)
- List of directors
- Appoint a power of attorney/local agent, that is, a company or a resident of Australia. They must be authorized to accept service of process and notices on behalf of the foreign entity
- Submit any other document requested
Appointing a Local Director
In order to set up a business in Australia, it is essential to have at least one resident Australian director. If that isn’t possible, you may appoint a nominee director to get over the barriers to entry and start operating in the country.
This rule is set in place to ensure that your business follows the rules of the Australian Securities and Investments Commission (ASIC), which is the regulatory body where all private companies in Australia are registered.
Australia has an advantage in a highly skilled and well-educated workforce. The employment system is organized and favors both employers and employees.
You can easily find people to work for your organization as either employees or contractors. Employment regulations exist for several categories including full-time, part-time, fixed-term, casual, probation, weekly or daily hire, shift workers, and contractors.
Knowing the prevailing employment standards can help you overcome regulatory issues before expanding your business to Australia. It lays down the terms for employees of all categories. Standards include entitlements, leave, termination and redundancy payments, and requests for flexibility in work arrangements.
Employers are also in charge of meeting occupational health and safety requirements set by the national or state government. Some of the important employment laws and regulations include those pertaining to contractors, children, obligations, dismissals, insurance, and anti-bullying laws.
Licenses and permits are required for certain businesses to legally begin their operations in Australia. Australian businesses are incorporations that are distinct legal entities. All companies in the country must be registered with the ASIC.
It is a good idea to collaborate with a local business specialist who can apply for licenses on your behalf and expedite the process and ensure it is carried out smoothly. For example, in the mining industry in Australia, you require special permits to prove that you possess the expertise to begin safe and compliant mining operations.
Foreign companies can expand to Australia by operating there as a foreign company. The ASIC has set clear criteria that define foreign companies and their rights in the country.
As a business owner, it is mandatory to register for all taxes applicable to your relevant operating industry. The taxes you may have to register for include Goods and Services Tax (GST), Capital Gains Tax (CGT), payroll tax, Tax File Number (TFN), and Pay-as-You-Go (PAYG) withholding.
In Australia, taxes are collected and administered by the Australian Taxation Office (ATO), and also by the state government revenue offices in some cases. You can save money by paying the correct amount on time and benefiting from the tax concessions.
Follow Fair Trading Laws
Your business needs to adhere to government regulations, such as fair-trading laws, in order to legally operate in Australia. These laws ensure fair trading practices, maintain competitiveness, and keep consumers informed.
Fair trading practice includes knowledge about Australian consumer law as applicable to your business, compliance with the competition and consumer act, Australian standards, and codes of practice.
Moreover, it is important to understand other details regarding sales of goods and services. You will need to know about pricing regulations, Australian trade measurement laws, laws about displaying prices, warranties and refunds laws, and product labeling.
This pertains to the way businesses are required to deal with the personal information of customers. The national privacy legislation of Australia is monitored by the Office of the Australian Information Commissioner (OAIC). It dictates how businesses can collect, access, and save personal information and communication.
Most companies gather and store their customers’ personal details. One of the regulatory issues in expanding to Australia includes strict legal guidelines businesses must follow in order to make sure the data is not leaked or misused. Additionally, states and territories usually have individual privacy regulations that influence business activity in each jurisdiction.
Environmental Protection Laws
In the 21st century, governments are enacting strict measures to make sure companies are aware of their obligations towards the environment. The environmental protection laws in Australia are jointly administered by the national and local governments.
Every business can do its part in protecting the environment. Environmental licenses and permits are put in place to make businesses mindful of their environmental duties. The environmental laws pertaining to your company largely depend on your business type.
Even though it may seem like you need to learn a myriad of regulatory issues in Australia, the key is to proceed in a step-by-step manner so that you do not miss out on any critical part. For more information about expanding your business to different markets around the globe, click here to explore our website.