Cutting Through the Red Tape

Holding your hand and leveraging off our strong local network

When you set up a business in any new country, the path is made so much easier with trusted local ‘friends’ to hold your hand and guide the way!  While the local law, regulations and business customs may seem strange and sometimes confusing or even frustrating to you, they are second-nature to the locals.

When Ecovis Clark Jacobs provides resident director services to our clients, not only do we tick a critical box in terms of the law, we also offer the ability to establish your business in an efficient and streamlined manner, minimising your exposure to the many time-consuming pitfalls and road-blocks that often arise for the uninitiated.

However, it is not only in the initial establishment of a company that this is true, but in the subsequent ‘bedding down’ and even ongoing activities, that further issues may arise.

Indeed, once a company has been registered with the Australian Securities and Investment Commission (ASIC) and then for various tax and related requirements of the Australian Taxation Office (ATO) and the Office of State Revenue (OSR), there are typically several other needs that must be met to enable the business to actually commence operations.

Our local knowledge, experience and, crucially, our network, all enable us to quickly find the best fit for your specific needs.
The most common of these include:

Establishing relationships with lawyers, immigration agents and other consultants, with specific language skills if needed

Establishing a banking relationship (and a bank account)

Liaising with recruiters, HR advisers, real-estate agents, etc.

In this context, we provide the following case study as an example of how Ecovis Clark Jacobs will work to your advantage.
<var>01</var> <var>challenge</var>

01 challenge

In November last year we were contacted by our colleagues at Ecovis Wingrave Yeats (EWY) in London.  They had a UK client that had recently won a contract for the supply of services in Australia and needed to get their footprint established before Christmas!

<var>02</var> <var>solution</var>

02 solution

Based on further consultation via email, phone and Skype with EWY, the client and their lawyers, we were able to quickly determine the most appropriate structure in which to combine asset protection, tax efficiency (in terms of their UK/Australia interaction), and manage their new Australian business.

This would include a main trading company, an additional company in which to hold a primary production property, and a further company in which to hold the Intellectual Property (IP) that they expected to develop in Australia.

Within a few days we had:

  • Established all three companies with ASIC (with our Director, David Conley, as resident director for each), and had each of them registered for all necessary taxes with the ATO and OSR
  • Through a referral to a local commercial lawyer, we ensured any necessary agreements between the three entities and the UK parent were being considered, to satisfy Australian/UK laws, as well as potential transfer pricing issues
  • Through a referral to a local immigration agent, we ensured that the client was being advised on options for seconding UK employees to Australia to assist in the local operations
  • Through referral to several banks, we enabled the client to quickly determine the best fit for their needs.

The banking relationship was particularly critical in this case as not only were bank accounts required, but debt funding was being sought for the property purchase.

However, while Australia’s AAA rated banks are great for our international reputation, they present higher hurdles for businesses starting up in Australia with no trading or credit history.  So, even if a business is well established overseas, its lack of trading and credit history in Australia means that there are significant additional information and compliance requirements, far tighter covenants and far lower loan to value ratios (LVRs), to name just a few of the issues.

In this context our strong relationship with a key business banker, and our presence as the resident director, all contributed significantly to cutting through as much ‘red tape’ as possible and expediting the credit assessment process.  Ultimately a process that could have taken many weeks was made faster, and a property was purchased with borrowed funds just before Christmas!

<var>03</var> <var>Results</var>

03 Results

Ultimately the client was able to establish a structure of three related companies, buy a commercial property and commence operations within a period only slightly longer than if they were locals, all by virtue of Ecovis Clark Jacobs holding their hand and our foresight in clearing the path of potential obstacles.