Early Stage Venture Capital Limited Partnerships provides fund managers and investors with support to help stimulate early stage venture capital investments. Benefits include tax exemptions on an investor's share of a fund's income and tax gains.

The Early Stage Venture Capital Limited Partnership (ESVCLP) program aims to stimulate the early stage venture capital sector in Australia. The program:

• helps fund managers attract pooled capital, so they can raise new venture capital funds of between $10 million and $200 million to invest in innovative early stage businesses
• offers tax benefits to fund managers and investors 
• connects investors with early stage businesses
• helps Australian businesses grow by receiving financial support and guidance from expert advisers

Fund managers can apply to Innovation and Science Australia to register a partnership as an ESVCLP.

The Department of Industry, Science, Energy and Resources and the Australian Taxation Office (ATO) jointly administer the program on behalf of the Australian Government.

What are the eligibility criteria?

You can apply to register if you are:

• a new venture capital fund
• a limited partnership or an incorporated limited partnership
• established in Australia or a country that has a double tax agreement with Australia

You must have:

• a general partner (often also the fund manager) who is a resident of either Australia or a country that has a double tax agreement with Australia
• between $10 million and $200 million in committed capital (although a partnership that doesn't satisfy this requirement may be eligible for conditional registration)

To contribute more than 30% of the committed capital, an investor must be a:

• bank
• life insurance entity
• widely held super fund
• widely held foreign venture capital fund of funds

All other investors are not able to contribute more than 30% of the committed capital, without the approval of the Committee.

In addition, you must have a qualifying partnership agreement that:

• ensures the partnership remains in existence for between 5 and 15 years
• requires partners to contribute capital when required
• prohibits adding new partners except as provided for in the agreement
• prohibits increasing committed capital except as provided for in the agreement
• confers on the general partner the right to require partners to contribute their committed capital to the partnership

The partnership agreement must also include a plan that:

• sets out the partnership's intended investment activities
• shows that the investment activities focus on making eligible venture capital investments in early stage venture capital businesses

Your partnership must also have access to the skills and resources needed to implement its approved investment plan. 

• Phone: 13 28 46
• Email: venturecapital@industry.gov.au