Written by Anamaria Correal, Trademark Attorney
Over the past few years, Australia has strengthened its start-up ecosystem, and now it is one of the fastest-growing destinations for start-ups globally. Australia is an attractive destination for investment due to its consistent economic growth, stability, world-class infrastructure, strong governance, and legal systems. However, when you start a business, you need to make sure that your business operates legally, fairly, and competitively. With this in mind, it is important to understand what structures, registrations, and laws may apply. In today’s post we will outline 5 essential factors that should be considered when starting a business in Australia.
- Business legal structures and registrations
It is essential to choose the business structure that will best meet your needs and reflect your business plans and goals. Your structure can vary depending on the size and type of business. Also, it can have significantly impact upon key areas such as Tax liabilities, responsibilities as a business owner, level of control, and legal liability. The four most common structures in Australia are: sole trader; partnership; company or; trust. In most cases, this will subsequently need to be registered with the Australian Securities & Investments Commission (ASIC).
In addition, you may need to register for an Australian business number (ABN), Goods and Services Tax (GST), Tax file number (TFN), Pay as you go (PAYG) withholding to comply with tax obligations.
- Business name
Moreover, a business name has been traditionally seen as a vital element of a company. Your business name identifies you from your competitors. Hence, if you want to trade under a particular name other than your own, you must apply for a business name registration with the Australian Securities & Investments Commission (ASIC).
The obligation to register a business name is separate from protecting any intellectual property rights in a name or brand. Your business name registration does not give you exclusive ownership of your business name. This means you also need to consider IP registrations such as trademarks to gain exclusivity over your name. We recommend discussing this with our legal team before starting your business.
- Intellectual Property
It is important to build an IP strategy in the early stages of your business. Each IP protects a different aspect of your products or services. Trademarks protect your name, logo, and symbols. Trade secrets and patents protect inventions or new technical solutions; copyright protects original works of authorship, and designs protect the visual appearance of your new and distinctive products.
In some cases, you should consider registering your IP and conducting a comprehensive search to find out if the proposed IP is available. Nevertheless, IP can be agreed with appropriate contractual arrangements in other cases. In addition, IP laws can impose penalties for unauthorised use of your IP.
Moreover, keep your idea confidential until it is protected or consider using a non-disclosure agreement. HGG can help you protect your IP and ensure your IP strategy is tailored to your specific business goals and needs.
- Domain names
Domain names are internet addresses that are commonly used to access websites and identify enterprises on the internet. As a result, they have become valuable for businesses to sell and promote their products and services.
The pandemic has accelerated the digitalisation of customer interactions; people have moved dramatically to online channels. Therefore, if you have plans of conducting your operations globally, it is crucial to establish a strong online presence for your business by registering your Domain name.
While every domain name is unique, carefully attention must be given since they are registered on a “first come, first served” basis subject to eligibility requirements.
- Fair trading
When buying and selling goods and services in Australia, you must comply with fair trading laws. These laws protect both businesses and consumers from unfair trading practices. The Competition and Consumer Act 2010 (CCA) stipulates how businesses must deal with their customers, competitors, wholesalers and suppliers.
The CCA also contains the Australian Consumer Law (ACL), which covers business behaviour when advertising and interacting with customers and consumer rights, including but not limited to:
- Guarantees: you must provide customers with a basic set of consumer guarantees when purchasing goods and services.
- Product safety: your products must comply with all the mandatory safety and information standards.
- Misleading or deceptive conduct: you are not allowed to make incorrect statements or are likely to create a false impression.
- Liability of manufacturers: in some circumstances, a supplier can take action against a manufacturer for reimbursement.
In conclusion, it is essential to know your rights, responsibilities and legal requirements when operating a business in Australia. HGG can assist you with all aspects of creating a startup, including choosing your business structure, business name and registering your IP. Moreover, our legal team can help you understand your obligations under the law.
Harris Gomez Group opened its doors in 1997 as an Australian legal and commercial firm. In 2001, we expanded our practice to the international market with the establishment of our office in Santiago, Chile. This international expansion meant we could provide an essential bridge for Australian companies with interests and activities in Latin America, and in so doing, became the first Australian law firm with an office in Latin America.
We provide innovative technology and resources businesses with legal and commercial expertise to realise their global potential. Our goal is to see innovative businesses establish and thrive in the global market. We are proud members of Austmine.
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