Guide to the SME Export Marketing Fund

Introduction to the SME Export Marketing Fund

What is the SME Export Marketing Fund?

The SME Export Marketing Fund (EMF) aims to encourage small and medium enterprises (SMEs) to expand their markets outside Hong Kong by providing financial assistance to SMEs for participation in export promotion activities. This is a governmental scheme under the Trade and Industry Department (TID).

• General info here: https://www.smefund.tid.gov.hk/english/emf/emf_update.html
• Guide to Application (as of Jun 2022): https://www.smefund.tid.gov.hk/english/emf/files/EMF_Guide_Eng.pdf
• Link to the official FAQ page: https://www.smefund.tid.gov.hk/english/emf/emf_faq.html

Key Facts on the Funding Scheme

• Each application should cover expenses in relation to one promotion activity.
• Funding is on a 50:50 matching basis (EMF fund supports up to 50% of the budget, and no less than 50% should be contributed by the enterprise), or HKD 100,000, whichever is less.
• Applicants can submit a number of applications separately (there’s no limit), but the cumulative limit is HKD 800,000.
  • Maximum of 50% of the cumulative limit can be used for applications in relation to setting up/ enhancing the corporate website / mobile application.
• For each application, video/product shooting and editing services are capped at 50% of the total approved funding per application.
• Fund disbursement: You can opt-in for Initial Payment (75% of the approved funding, as of June 2022) or Reimbursement basis for the disbursement of funds.
  • Reimbursement: The application should be submitted within 60 calendar days after the completion date of the promotional activity
  • Initial Payment: The application should be submitted within 45 to 120 calendar days before the commencement date of the promotional activity. If your application is successful, the applicant must submit a corresponding application for the final payment within 60 calendar days after the completion date of the promotional activity.
• The initial processing of the application takes ~ 30 working days, where the result will be notified by ordinary post to your business address.

Contact Information

• Address of the SME Export Marketing Fund Branch Service Counter: Room 1301, 13/F, Trade and Industry Tower, 3 Concorde Road, Kowloon City, Hong Kong
• Service Counter operating hours for receiving applications:
  • Monday to Friday: 0845 to 1230 and 1330 to 1745 (Lunch break from 1230 to 1330)
  • Closed on Saturdays, Sundays, and public holidays.
• Contact: (Tel) 2398 5127 (Fax) 2391 2646/ 3525 0329 (email) emf_enquiry@tid.gov.hk

Eligibility and Funding Scope

Applicant’s Eligibility

• Applicant: Any non-listed enterprises registered in Hong Kong, those with documentary evidence proving their substantive business operations in Hong Kong at the time of application.
  • Non-profit-making or non-profit-distributing organizations are NOT eligible for this scheme.
  • If the applicant has previously received funding support under EMF, the cumulative amount of funding received so far must not exceed the prevailing cumulative funding ceiling (refer to the below section for more details on the ceiling)
  • If the applicant should not be the organizer/ co-organizer/ service provider of the promotional activity that the applicant is requesting funding for in this application.

Funding Scope

EMF funding is for SMEs to promote their own products and/or services outside of HK. The covered scope of such promotional activities includes the below. Note that #8-9 may be especially useful for businesses who are looking to promote their products and services online to overseas customers.

1. Trade exhibitions held outside Hong Kong, targeting markets outside Hong Kong.
2. Trade exhibitions held in Hong Kong, targeting markets outside Hong Kong (please refer to part (i) under this webpage for more detailed requirements).
3. Trade exhibitions held in Hong Kong, targeting the local market (please refer to part (ii) under this webpage for more detailed requirements).
4. Online trade exhibitions (please refer to part (iii) under this webpage for more detailed requirements).
5. Business missions outside Hong Kong (please refer to part (i) under this webpage for more detailed requirements).
6. Online business missions (please refer to part (ii) under this webpage for more detailed requirements).
7. Advertisements on trade publications that mainly target markets outside Hong Kong.
8. Export promotion activities (such as placing advertisements, keyword search, listing product information, setting up or enhancing online shops, etc.), conducted through electronic platforms/media and mainly targeting markets outside Hong Kong (please click here for more detailed requirements).
9. Setting up or enhancement of a corporate website/mobile application owned by the applicant enterprise which mainly targets markets outside Hong Kong (please click here for more detailed requirements).
10. Fee charged for video/ product shooting and editing services in relation to the promotion of the product and/or the services, for any of the above activities (not as a standalone video that is not related to the eligible promotional activities listed above)

Funding Conditions

1. Because this scheme intends to support the SMEs in HK to export their products and services overseas, applicants must participate in these promotional activities as an HK enterprise. This means that their full name, HK contact information, etc. should be publicly displayed on their websites, media, mobile applications, etc.
2. The activity covered in the application must be related to the business of the applicant itself. The applicant must promote only its own products and/or services in the activity.

Eligible Expenses

For the full list of the eligible expenses under EMF, please refer to the official website here. In this guide, we would like to highlight the expenses in relation to online promotional activities.

💡 The rule of thumb to remember is to make sure the expenses are non-recurrent in nature. Any expenses to cover daily operations, including salaries for sales, maintenance fees for the website, sales commission, etc. are not eligible

• Export promotion activities conducted through electronic platforms/ media
  • Fee for placing advertisements and keyword searching on online platforms/ media
  • E.g. Listing a product advertisement on Facebook, YouTube, Google, or any other platforms
  • Note that the expense should be non-recurrent and for the purpose of listing products/services for sales purposes.
  • Expenses in relation to the normal operation and sales activities are not covered.

• Setting up / enhancing the website/ mobile application
  • Non-recurrent fee for setting up or enhancing the applicant’s corporate website and/or mobile application.
  • Expenses in relation to the normal daily operation and maintenance of the website and/or the mobile application are not covered. Examples of such non-eligible expenses are:
    • Fees paid to external marketing agency fees for SEO, email marketing, etc.
    • Domain fees and server costs for daily operation and maintenance
    • Fees for translation and copywriting

• Video/ product shooting (in conjunction with the eligible promotional activities covered under EMF)
  • The video/ shooting should be created in conjunction with an EMF-eligible promotional activity (#1-9 of the “Funding Scope” above), not as a standalone video. Therefore, the video should bear the full company name of the applicant.
  • The amount of funding support for video/ product shooting for each application should be no more than 50% of the total approved funding per application.

Preparing for Application

Application & Vetting Process

• Application is open all year round, on a rolling basis.
• Link to the application form (as of Jun 2022): https://www.smefund.tid.gov.hk/english/emf/files/Appn_EMF.pdf
• Applications are submitted online, through the e-Form service. Please click here for the “Online Application Demo”.
• Once the applications are submitted, note that you also need to submit the “Declaration for Application / Application Record” – which can be done from the digital portal or by post.
• TID will conduct a preliminary check on your e-submission and send you a “Notification of Receipt of Application” containing the application number by email upon receipt of your complete and valid Application with the required supporting documents. Under normal circumstances, TID will complete the processing of a valid application within 30 clear working days from the date of receipt of the duly completed application accompanied by all necessary documentation.

💡 However, based on experience, do note that the back and forth process with TID to submit the “complete application” with all the necessary documentation proof can easily take 4-6 months.

Supplementary Documents

Below are the required supplementary documents to be submitted by all applicants.

General

• Business Registration (make sure that the BR includes the payment record)
• Latest Annual Return (NAR1)
• A copy of a valid Hong Kong Identity Card or Passport of the person signing the application form for and on behalf of the applicant enterprise

Proof of substantive business activity of the applicant in HK

• In addition to the above, because EMF is for HK SMEs to export overseas, the applicant must identify itself as an HK enterprise – this means that TID will likely request proof of display of your full company name and HK contact information (e.g. address, telephone number, fax number) on your advertisements, electronic platforms/media, and corporate website/mobile application.
  • Example: a snapshot of your Facebook profile or your website’s footer and/or contact page including such information

Proof of the promotional activity targeting outside of HK

• In considering whether a corporate website/mobile application mainly targets markets outside Hong Kong, TID will make reference to various factors, including how the corporate website/mobile application can facilitate the applicant enterprise’s export promotion, type of language used, content, function, and proof of the applicant enterprise’s export business, etc.
• In general, for an advertising campaign on Facebook and Google to be considered as mainly targeting markets outside Hong Kong, the number of local visitors/downloads of the advertising campaign should not exceed 30% of its total number of visitors/downloads. The operator of the platform/media concerned should provide statistics on the geographical distribution of visitors/downloads on the relevant electronic platform/media to prove the credibility of the platform/media concerned and that it is mainly targeting markets outside Hong Kong.
• See below example of a Facebook Geographical Report printout that was required by an applicant before, to prove the breakdown of the countries targeted in a Facebook Ads.

For an application for initial payment & final payment

• (For a first-time application for initial payment): you need to submit a signed funding agreement along with the “Declaration for Application/ Application Record” form over post, via drop-in box, or in person within one week of submission.
• Original receipts/certified true copy16 of each receipt of the deposit paid and the relevant booking confirmation/signed contracts/invoices/quotations (showing detailed contact information of the issuing organization) if payments for the declared expenditure items have not been made in full upon application for the initial payment. The name of the payer shown on the receipt(s)/documents must be the same as the name of the applicant enterprise. Original receipts/certified true copies of each receipt of payments specified in (vii)(a) should be submitted upon a corresponding application for final payment.

For an application for reimbursement

• Original receipts/certified true copy of each receipt in relation to payments made by the applicant enterprise for declared expenditure items, plus a copy of each of the relevant invoices/ quotations/ contracts (showing detailed contact information of the issuing organization). The name of the payer shown on the receipt(s)/documents must be the same as the name of the applicant enterprise.
• Credit card or bank statement to show the expense being credited out from your business account.

Additional Supplementary Documents You Should Prepare

If you are submitting an application for online promotional advertisements (e.g. Facebook, Google) and/or video and editing services for the advertisements, consider if you need to provide the additional supplementary documents listed below.

• Hiring a third-party vendor?
  • If you are hiring a third-party vendor to provide video/ editing services, or for setting up/ enhancing the corporate website or mobile application, this section is relevant to you.
  • Written quotations from vendors should be obtained prior to the award of the contract if the project price is over HKD 2,000**.** The lowest conforming quotation should have been chosen unless otherwise justified.
  • At least 2 quotations are required for project price from over HK$2,000 to HK$50,000; 3 quotations for project price from over HK$50,000 to HK$300,000; 5 quotations for project price from over HK$300,000 to HK$1,400,000; and public tender is required for project price over HK$1,400,000.
  • Contract with the vendor for the project arrangement, showing company information of the service provider with details of the services provided and breakdown of fees charged. The contract should include the full name of the applicant enterprise as well as the contact information and enterprise information of the service provider.

• Is your application for enhancing or creating corporate web pages and/or mobile applications?
  • A printout of the relevant corporate webpages or screen dumps of the relevant corporate mobile applications updated or created (with the date of printing)
  • The pages or the mobile application should show the applicant’s full company name, products/services provided, as well as Hong Kong contact information.
  • The registration details of the relevant website and the domain name
  • For mobile applications – the date of publication and areas/countries available for download on the app store(s) are required.

• Any video created or edited by a third-party vendor?
  • A colored copy of or a link to the final output is required. The full name of the applicant enterprise and information on the activity name should be shown on the final output where appropriate.

Tips & Best Practices

• Please make sure that you do read the Guide to Application thoroughly prior to making a submission. Given the time required for TID to review your application, let alone the time needed for any additional back and forth communication, we learned by heart that it is absolutely critical to submitting a good complete application from the beginning.
• Note that any original documents submitted from the applicant to TID over post can be returned, if requested by the applicant.
• Should you have any amendment or request to withdraw the application post submission, note that you need to do so in writing. If there are any material changes to the application, these should be consulted with TID as well.

💡 There are a lot of supplementary documents to prepare in advance – so we advise you to keep track of them in an organized manner. To save the administrative time, we recommend you prepare sufficient information in one go at the start, rather than waiting for TID to provide you feedback and advice on a piecemeal basis.

Post-approval process

If your application is approved by the government, you will receive a Notification Letter via ordinary post. For the applicants requesting an initial payment, the Funding Agreement should be signed and returned to the SME EMF Branch.

• TID will sign the Funding Agreement and return a copy, together with the cheque for the approved funding.
• Note that for initial payment cum final payment, the applicant needs to provide additional documents within 60 days of the activity completion date to show that the remaining budget was expensed as part of the promotional activity.

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