A webinar which introduces the Australian gas market to British companies, passing on hints and tips about achieving business success in Australia.

1. Introduction to Australian Gas Market
Linda Miles, Trade Development Manager, UKTI Perth
Colleen Handy, Tax Manager, UHY Haines Norton
29 January 2014

2. 2
Australia – A Comparison in Geography

3. 3

4. 4
Why should you do business in Australia?
Strong and stable economy
 AAA credit rating
 Good current and future growth prospects
Anglo-Australian bonds
 Common language and customs
 High regard in Australia for UK products as “High Quality – Low Cost”
 Similar business, legal and regulatory framework
 Strong Australian Dollar making UK goods and services more affordable
 Strong IP protection
 Strong presence of British businesses in Australia already

5. 5
Why should you do business in Australia?
Gateway to Asia
 Easy access to a region with the greatest potential growth in the world
 Educated, multilingual, and skilled workforce
Quality of life
 Five Australasian cities listed in the world’s Top Ten most liveable cities (The Economist)
Strong, stable economy
 22 years without a recession
 GDP per capita in world’s top ten
 Average growth rate of 2.5%
Similar to UK
 More British people in Australia than any other foreign country
 Similar business culture, tax, legal regulations

6. 6

7. 7
America
 Apache#
 Chevron*
 ConocoPhillips*
 ExxonMobil*
 Hess*
Australia
 Arrow Energy
 Origin
 Santos
 Woodside
Asia
 Inpex* (Japan)
 PetroChina* (China)
 Sinopec* (China)
OPERATOR
Europe
 GDF Suez* (France)
 Maersk Oil* (Denmark)
 Total* (France)
*Companies with a UK office
#Company with presence in UK North Sea
UK
 BHP Billiton*
 BP*
 Shell*

8. Established market in Australia

9. 9
Northern Territory Projects
 Bonaparte LNG
 Caldita Barossa
 Cash Maple
 Evans Shoal
 Heron
 Ichthys

10. 10
Queensland Projects

11. 11
Queensland Projects
 CSG to LNG
 Unconventional
Gas

12. 12
Western Australia Projects














Browse
Crown
Crux
Equus
Gorgon
Laverda
Macedon
Olympus
Pluto
Poseidon
Prelude
Scarborough
Wheatstone
Zola

13. 13
Victoria
 Bass Strait

14. 14
Project Opportunities
State
Company
Project
Status
NT
ConocoPhillips
Caldita Barossa
Feasibility
NT
Eni
Heron
Feasibility
NT
GDF Suez
Bonaparte LNG
Pre-feed
NT
Inpex
Ichthys
Construction
NT
PTTEP
Cash Maple
Feasibility
NT
Shell
Evans Shoal
Feasibility
NT
Woodside
Sunrise
Feasibility
NT
ConocoPhillips
Darwin LNG
Operation
State
Company
Project
Status
VIC
ExxonMobil
Bass Strait
Operation

15. 15
State Company
Project
Status
WA
Apache
Olympus
Feasibility
WA
Apache
Zola
Feasibility
WA
BHP Billiton
Macedon
Operation
WA
Chevron
Gorgon
Construction
WA
Chevron
Wheatstone
Construction
WA
ConocoPhillips
Poseidon
Feasibility
WA
ExxonMobil
Scarborough
Feasibility
WA
Hess
Equus
Feed
WA
Santos
Crown
Feasibility
WA
Shell
Crux
Feasibility
WA
Shell
Prelude
Construction
WA
Woodside
Browse
Feasibility
WA
Woodside
Laverda
Feasibility
WA
Woodside
Pluto
Operation

16. 16
Process of Tender Approval
Even if you are supplying into
a Tier 5 provider, it is
probable that you will require
“Approved Supplier Status”
from Tiers 4, 3, and 2, as well
as the Operator. This is unless
you are only supplying
component parts.
Operator
Tier 2
Tier 3
Tier 4
Tier 5
More than
$1bn
$300mn
to $1bn
$50mn to
$300mn
Up to
$50mn

17. 17
*While an existing relationship or past experience with a company may assist in proving your
track record etc, do not expect it to enable side-stepping or skipping parts of the above process.

18. 18
Detailed engineering
and procurement

19. Establishing your business in
Australia – practical issues
Colleen Handy
January 2014
In partnership with:

20. In partnership with:
20
Setting up business – Practical issues
• Expanding your business to Australia is a big step!
• Planning your expansion is key !
• Speak to others who have made the move, local representatives,
accountants, lawyers, Business Development Networks etc
• Don’t assume the laws and regulations will be the same as the UK
• Implementing a tax efficient structure is key to ensuring the commercial
success of your expansion to Australia

21. In partnership with:
21
Registering as a foreign Company
•
A foreign company or similar entity is able to carry on a business on its own
account (branch or subsidiary) provided it has registered in Australia.
 Appointing and authorising at least one local agent or director to act on its
behalf
 Maintaining a registered office in Australia
 Lodging specific company documents and financial statements with ASIC
 Identifying the business as a foreign company in written contracts and
correspondence

22. In partnership with:
22
Setting up business – Branch vs Subsidiary
• Tax payable by a PE/branch or a subsidiary is the same
• Currently rate of tax is 30% on net profits
• Business assets owned by a non-resident and part of a PE/Branch operations in
Australia remain within scope of Capital Gains Tax (CGT)
• In contrast, the disposal of shares in a subsidiary company by a non-resident will
be outside the scope of CGT, unless that subsidiary’s value is more than 50%
attributable to real property
• Advantages of subsidiary company: limited liability, lower level of disclosure
compared to a branch, generally quicker to set up

23. In partnership with:
Setting up business – Subsidiary
• It can take 1-2 days to register a subsidiary in Australia
• Registering involves lodging an application with ASIC (equivalent of the UK’s
Companies House)
• Once registered the company is provided with an ACN (Australian Company
Number) which must be shown on letterheads and other business documents
• The company is also required to register with the Australian Taxation Office
(ATO) for its ABN (Australian Business Number), GST (similar to VAT), PAYG
(similar to PAYE)
23

24. In partnership with:
24
Setting up business – Branch
• It can take a long time to register a branch in Australia
• Registering involves lodging an application with ASIC (equivalent of the UK’s
Companies House) and original or certified copies of various documents are
required
• The branch is also required to register with the Australian Taxation Office (ATO)
for its ABN (Australian Business Number), GST (similar to VAT), PAYG (similar
to PAYE)

25. In partnership with:
25
Setting up business – ATO requirements
•
Subsidiaries and branches prepare accounts and file tax returns reporting
income and deductions to 30 June each year
•
With ATO approval a different accounting period ending on another date
may be adopted
•
Deductions are similar to those permitted in the UK and include R&D
incentives
•
Transfer pricing policies may be needed – even for SMEs

26. In partnership with:
26
Setting up business – Employer requirements
•
As an employer you must:
 Meet minimum wage regulations, EBAs, Union requirements, visa requirements
 Pay superannuation on Ordinary Times Earnings
 Pay a State Payroll Tax (the rate differs depending on the State the employees
are based in)
 Have adequate workers compensation insurance (compulsory)
 Research the working hours, holiday pay, long leave and other employment law
requirements
 Comply with Health and Safety Requirements

27. In partnership with:
Setting up business – Tax rates
•
Rates of tax in Australia for residents to 30 June 2014:
Threshold
Tax rate %
$0- $18,200
0
$18,201 - $37,000
19
$37,001 - $80,000
32.5
$80,001 - $180,000
37
$180,001 +
45
27

28. In partnership with:
28
Setting up business – Superannuation
•
Superannuation is a specially designed long term investment for retirement
savings
•
Employers are obliged to pay a minimum superannuation amount for each
employee into a recognised superannuation fund
•
Currently this is 9.25%, set to rise to 12% by 30 June 2020, of ordinary
times earnings

29. 29
What can UKTI Australia do for you?
Introduction services:
 Orchestration of meetings with prospective business partners, distributors, suppliers, and
Australian Government bodies
Local knowledge:
 Tailored, experienced, and impartial advice about how to maximise your chances of
success in Australia
Market reports:
 Provision of up-to-date information about the industry and market, relevant to your
business case
Market testing:
 Opportunities to reduce the cost, risk, and time of establishing your business in Australia,
by working in one of our business centres

30. 30
What can UKTI Australia do for you?
Online enlightenment:
 Provision of industry-specific web-seminars (“webinars”), accessible from your own
homes and businesses in the UK
Product launch:
 Access to one of our boardrooms, for use in marketing your business (available in most
Australian state capitals)
Promotion:
 PR services through local media, UKTI e-newsletters, e-marketing, and social media
campaigns

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What’s next?
 Feel free to ask questions after this
presentation
 Follow the conversation on LinkedIn
 Follow the UKTI twitter account:
@uktiaustralia
 Keep yourself updated on the latest
Australian business opportunities
 Attend UKTI’s industry-specific webinars
 Visit our website: gov.uk/world/australia

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Questions?
Linda Miles
Trade Development Manager
Email: linda.miles@fco.gov.uk
Chris Egan
Trade Development Officer
Email: chris.egan@fco.gov.uk
Colleen Handy
Tax Manager, UHY Haines Norton
Email: chandy@uhyhn.com.au
Information and images courtesy of: Arkay Career Services, Western Australian Department of State Development, Queensland
Government, Invest Queensland, The Economist Intelligence Unit’s Liveability Ranking and Overview, 2013 Francis Norman, Xodus
Group, PESA News, PESA News Resources Online, The Sydney Morning Herald, UK Trade & Investment, Vividus