Market Development Grants - FAQ

Before you apply

• When can I apply?
• Do I need to be exporting already?
• What is co-funding?
• What am I expected to contribute?
• Can I get help to start a business?
• Do I need an NZTE client manager to be able to apply for funding?
• I have spent lots of money on export initiatives, can I claim this back?
• Are any markets, or product and services excluded?
• Can I get funding to buy equipment, machinery and stock?
• What do you mean by “business as usual”?
• What kind of information do I need to apply?
• Why does NZTE need my financial information?
• Is my information kept confidential?
• Is there special funding available for Pacific Island businesses?
• Is there special funding available for Maori enterprises?
• Can I send my application electronically?
• How do I get an application form?

After you apply

• What happens once I have applied?
• Why has my application been delayed?
• What if my application is unsuccessful?
• Can I apply more than once?

After your funding has been approved

• How do I make a claim?
• Does the funding include GST?
• Why do I charge NZTE GST?
• Do I have to account for the funding in my taxes?
• What period can I claim costs for?
• How long does a claim take?

Miscellaneous Questions

• How do groups of businesses working together apply?
• What other funding is available?
• Where do I get funding for research and development?
• Do you have a question that is not answered here?

Before you apply

When can I apply? 
At any time, subject to availability.

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What is co-funding?
Enterprise Development Grants for Market Development operate on a co-funding basis. That means NZTE contributes up to half the costs, while your business contributes the rest.

Your 50 percent contribution must be monetary. In-kind contributions, such as the use of facilities and resources, are excluded.

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What am I expected to contribute?
The EDG-MD works on a reimbursement basis

• That means your business must be able to fund all the approved costs in your market development plan up front.
• NZTE will reimburse up to half these costs on evidence that payment has been made.
• The total amount you must spend in any one year on approved activities is $40,000.
• Claims can be made at any time during the year, once you have a signed contract with NZTE.
• As soon as you have invoices totalling $20,000 or more for the approved expenses, you can submit your claim(s). Note that you must spend a minimum amount of $40,000 over 12 months, or risk having your grant terminated.

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What do you mean by “business as usual”?
“Business as usual” means anything done in the normal course of operations. Market Development Co-funding must be used for a change in your current business model.
Examples of business model changes are:

• geographical market
• client base
• product line
• competitors
• value proposition
• distribution/partner channels
• marketing strategy.

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What kind of information do I need to apply?
When submitting an application, the following information must be included on the application form:

• Background information about your business, its markets, and key parties involved in the business. This includes details of any parent, associate, sister or subsidiary companies, both domestic and offshore.
• A copy of your international market development plan or business plan. This needs to detail a clear strategy for what you are trying to achieve and how you will do it. Applications can be declined because they have no, or very vague, strategic plans. If you do not already have one, then preparing one will be valuable for your business.
• Information about the market development project or activities you will undertake, including costs and timeframes. These costs must be listed in: Section 3.4 Project Information on the application form.
• Information on how you will pay for your market development plan. Please remember, funding is provided on a reimbursement basis, so you will need sufficient cash flow to finance the total up-front costs of the proposed plan in addition to the normal operating expenses of the business.
• Ensure your application form has been signed and dated in the correct places by a director of the company, not a manager. Applications signed by managers will be returned.
• Ensure the form includes your registration number. This number was given to you when you registered online to access the application form. NZTE uses it to track applications and your form will be returned if you do not include the registration number.

The following information must also be attached to the application:

• An original pre-printed bank deposit slip in the name of the applicant company. In lieu of this please include a bank statement or signed letter from your bank showing the bank account number and the applicant company name.
• A set of the latest end-of-year financial reports. If these are not audited we require them as prepared for your tax return. This must include a Statement of Cash Flow and notes to the financial statements. If they are not finalised, draft reports will be sufficient. They need to show the last two years of financial information for the company (if applicable) and must include any subsidiaries, both domestic and offshore.
• If the applicant company is owned by a parent company, we will require full consolidated group financial accounts for the parent, in addition to company statements.
• A set of year-to-date management accounts. So if your latest end-of-year financial reports are for the year ending March 31, we need management accounts covering your financial performance from April to whenever you apply.

Please Note:
If information is missing, your application will be returned. Missing or incomplete information is the most common reason why applications are delayed. You will be able to resubmit it once all the required information is included.

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Is my information kept confidential?
NZTE holds all proposals and client information in the strictest confidence. However, we are subject to the Official Information Act (OIA). That means information we hold can be requested by third parties, and we must provide information as required to do so by law. This information may include:

• The name of businesses that receive our funding
• The amount of the funding
• Contact details for businesses that have received funding
• General information about the projects we are funding
• The outcome of an activity we helped fund.

The OIA allows for information to be withheld for several reasons, including if it is subject to an obligation of confidence or is commercially sensitive.  NZTE will not release any details beyond those listed above without first consulting the client involved.

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How do I get an application form?
To get an application form you need to complete the online registration form. Once you register, you can download the form and save it to your computer.
For more information, see Step-by-step guide to the application process.

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After you apply

What happens once I have applied?

• We will check that your application is complete. If significant information is missing, or if you are not eligible, we will return your application.
• Once your application is judged complete, we will begin processing it. We process applications as quickly as we can on a first come, first served basis.
• Once we've arrived at a decision, we'll notify you by mail about the outcome of your application.
• If you are successful, we will send you a letter offering you funding, and a contract.

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Why has my application been delayed?
The most common reasons why applications are delayed are:

• Some of the information we need is missing or is incomplete.
• The application hasn’t been signed, or has been signed by a manager who is not a director. Applications need to be signed by a director of the company.
  If this happens, your application will be returned. 

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Can I apply more than once?
You will be funded to undertake any eligible activities related to your market development plan for a twelve month period.  If you complete this twelve month period successfully, you may be eligible to apply for further funding in future years (to a limit of five years).

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After your funding has been approved

The total (minimum) amount you need to spend in any one year on your approved list of activities is $40,000.

You can start making claims against these costs once a contract has been signed. The grant is for 12 months and the dates are stated in your contract. Costs incurred before or after these dates cannot be claimed.

You can make claims at any time during this period. To make it easy for you, we will accept multiple claims during this time for expenditure totalling $20,000 or more, providing the total amount you spend over a 12 month period is $40,000 or more.

Once you have invoices for approved expenses totalling the minimum claim level or more, fill in the form and send it to us.

To process a claim we require the originals of receipts and invoices. You have up to three months after the contract period to settle all claims agreed in the contract.

Claims usually take about four to six weeks to process although this can take longer if we are dealing with a large volume of claims.

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The minimum and maximum amounts of funding available also include GST.

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Do I have to account for the funding in my taxes?
Yes, All Market Development funding is assessable for income tax purposes.

The funding amounts are also GST-inclusive, so your application and claims should be based on GST-inclusive amounts.

The GST portion of the funding will have to be accounted for as output tax in your GST return.

You should take advice from an accountant or tax specialist about the tax implications of funding, particularly the effect on costs and depreciation that can be claimed in your tax return.

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Claims can only be filed once a contract has been signed by both you and NZTE. All claims must be filed within three months of the end of the contract period.

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How long does a claim take?
Claims usually take about four to six weeks to process – but it can take longer if we are processing a high volume of claims or if the documentation you send us is incomplete. If you require reimbursement for a specific reason, get your claim in as soon as possible.

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How do groups of businesses working together apply?
Groups of businesses working together on a market development project can apply for funding.  They must meet the same eligibility criteria as individual busnesses.

In addition, they must meet the following criteria:

• For every business within the group that has turnover of $50 million or more, there must be at least two businesses with turnover of less than $50 million.
• The businesses must have a written legal agreement detailing the form and conditions of their collaborative group.  
• The businesses must be “unrelated”. That means there must be less than 20% shareholding between any businesses within the group, and no common directorship or other inappropriate financial or personal links.
• Each business must stay within the funding limits. For each business the minimum annual claim must be at least $20,000 including GST, and the maximum must be no more than $100,000 including GST a year, up to a lifetime limit for each business of $500,000 including GST.

To apply for funding, businesses involved in collaborative projects need to get one group member to register on the NZTE website, and indicate they are part of a collaborative group.

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Miscellaneous Questions

What other funding is available?
Enterprise Development Grants – Capability Building

The Capability Building component is available for entrepreneurs, start-ups and established businesses to;

• employ mentors,
• engage a small business advisory board,
• undertake advanced management or technology training,
• get specialist advice,
• undertake market development activities.

Growth Services Fund

The Growth Services Fund offers support for high growth potential firms to purchase external advice, expertise, and market development services. The fund is aimed at making a significant impact on the business leading to substantial, sustained growth.

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