By 2050, Australia hopes to achieve net zero emissions through their long-term Emissions Reduction Plan. A big part of this plan is promoting the manufacture and use of batteries, thereby supporting our transition to renewable energy.
So, the government recently introduced the National Battery Strategy – but what exactly is it, and how does it affect your business?
In this article, we’ll dig through the details of this major plan and what your business may need to do as a result.
What Should I Know About The Australian Battery Industry?
Currently, a lot of battery manufacturing takes place overseas. As such, Australia is implementing this plan to accelerate our production and manufacture of raw battery materials, and supporting our battery industry generally.
As batteries are key to Australia’s transition to renewable energy, it’s important that businesses are aware of their obligations when it comes to ensuring the smooth running of a battery business.
After all, if your legals are sorted, it’s more likely that your business will perform well and experience minimal hiccups along the way.
Register Your Sustainable Battery Company
It’s important that Australian businesses work together to build a strong and healthy battery industry. However, a business’ performance in any industry depends heavily on the strength of their legal foundations.
For any business, it’s essential that legal documents and other regulatory compliance requirements are handled well from the outset, so there is little room for errors.
Let’s take a look at the legal obligations businesses should tackle in the early stages.
Register Your Business
Like any business, a battery business or company should register their business. However, the process isn’t so simple – your registration process will differ depending on the business structure you choose to adopt.
The three most common business structures are as follows:
If you want to keep your battery business local and simple, then a sole trader or partnership is right for you. This is because it’s relatively cheaper and less complex to set up. However, it also has unlimited liability, meaning that a business’ liabilities become your personal ones as the business owner.
Our lawyers at Sprintlaw can help you with the required legal documentation for sole trader or partnership structures. Learn more about our Partnership Agreement packages.
Make sure you register your business with the Business Registration Service. You’ll also need to apply for an Australian Business Number (ABN), which is what identifies your business for tax purposes.
If you’re setting up a company, then a company structure attracts a slightly different registration process. You’ll need to register your company with ASIC and pay the relevant fees. Once this is done, they’ll issue you an Australian Company Number (ACN) in addition to your ABN.
Protect Your Business Name
Next, you’ll also need to register your business name. However, it’s important to note that registering your business name does not legally protect it from others using it.
If you want enforceable legal protection for your business name, and to ensure no other business can use it, you’ll need to register a trade mark.
Like we mentioned earlier, the process for registering a company is slightly different to that of other structures. Well, it’s a similar concept for documentation!
All incorporated companies in Australia are required to have a Company Constitution, as set out in the Corporations Act 2001. Otherwise, the Act also has a set of replaceable rules that companies can adopt as their governing document, instead of a Constitution.
A Company Constitution is the document that sets out the rules of a company and how it will run, as well as the roles and responsibilities of key personnel.
In addition to this, many companies have a Shareholders Agreement which sets out the key responsibilities of shareholders and the process to follow in certain situations, such as resolving shareholder disputes.
Working With A Battery Company: What Do Businesses Need To Know?
Like any other company, a battery company needs to have legal documents in place to protect their interests and their business from key risks.
Even if you’re not a battery company yourself, you may find yourself working with one, whether it be for a project or for long-term business. For example, you might be supplying a battery business with certain equipment or battery-related products. In other cases, you might be developing an app to assist battery companies in delivering their services.
And yep – you guessed it – you’ll need to have all of this in writing, too!
Let’s have a look at some of the foundational legal documents to help you hit the ground running.
In many cases, businesses hire other people or organisations to complete tasks for them from outside of the company. These are common arrangements for short-term projects or one-off tasks.
Businesses usually hire contractors for these kinds of projects, but they can often be confused with employees. It’s important to note that employees and contractors are different (under employment laws), and as such, your agreements with them should reflect this. For example, your agreement should include the fact that contractors are responsible for their own insurance and superannuation.
A Contractor Agreement will set out the key details of your arrangements, from the responsibilities of each party to the scope of service and payment arrangements. This way, if an issue or dispute were to arise, parties can refer to the Contractor Agreement to settle the matter smoothly.
We’ve written more about the differences between employees and contractors – make sure you’re familiar with these differences before entering into agreements to avoid sham contracting!
You may also find yourself in a situation where you’d like to subcontract out some work to another battery company. In this case, the main Contractor Agreement should contain specific clauses about the subcontractor’s obligations and how their employees are legally bound to the terms of that main Contractor Agreement.
Employees are different to employees as they are internal to the company and therefore have different entitlements. Their work would generally be considered a larger contribution to the company, so they have access to more benefits and entitlements.
For example, employees are entitled to minimum wage under the National Employment Standards, whereas these standards do not apply to contractors.
So, it’s important that your employees all sign an Employment Contract with you. An Employment Contract will usually cover the following:
- Nature of work to be completed
- Leave entitlements
- Confidentiality clauses
- Non-compete clauses
- IP ownership
Employment Contracts are also a great opportunity to protect your battery business’ trade secrets. Many businesses have highly valuable and confidential information which plays a key role in the quality of their work, so naturally, they want to make sure that their confidentiality clauses and non-compete clauses are prepared by an expert lawyer.
Getting Battery Business Contracts Reviewed By A Lawyer: Is It Essential?
As more and more businesses start collaborating in the local battery industry, your business may be asked to work on a project and you’ll be given a contract to sign before doing so.
However, some contracts contain clauses which could actually work against your business. In other cases, contracts may be missing key clauses or elements which would ideally protect your interests and place your business in the best position.
An expert lawyer can identify these key issues, review and re-draft your contract so that your business is well-protected. They can also identify suggested key changes to a contract to assist you in negotiating with the business you’re working with.
At Sprintlaw, our lawyers can review and re-draft your contracts so that they work for you, especially if things within your company are changing.
Reach out to our team to learn more about our Contract Review packages.
Now, let’s explore some other legal contracts that are key to the Australian battery industry.
Supply Agreements In The Battery Industry
If you’re supplying renewable energy batteries to customers, or battery-related equipment, it’s important to have these details in writing. This way, you can limit your liability for things that may go wrong in the supply chain.
It’s also a useful way to clarify the roles and responsibilities of each party, and to inform your customers of their rights when they engage with your business.
For example, a Supply Agreement can set out some of the following key terms:
- The goods that are being supplied
- The quantity of goods
- Delivery timeframe
- Risks involved in the delivery of those goods
- Any additional costs
- Liabilities for damaged or lost goods
- Force majeure clause
If your business also offers installation services for your batteries, it’s best to get a Supply and Install Agreement. When it comes to contracts, your safest bet is to cover all key grounds just in case!
Distribution Agreements For Battery Businesses
Where there are multiple parties involved, it’s wise to have everyone on the same page by having them sign an agreement setting out people’s key roles and responsibilities. This not only provides clarity around the scope of services, but also protects and limits liability where necessary.
A Distribution Agreement should cover key terms like payment, liability protections, defects rectification, standards performance and more – chat to our legal team today to get started.
If you’re a battery manufacturer or supplier and you’re providing the goods to a distributor, it’s important to have a Distribution Agreement.
Power Purchase Agreements for Renewable Energy Suppliers
A Power Purchase Agreement is a contract between a renewable energy supplier and their customer. It usually covers key matters like liability, termination or cancellation and payment terms.
Each agreement should be tailored to the requirements of the business to which it applies, but the main concept is that it should set out the ground rules for the business relationship they have with customers.
If you need help, our expert lawyers can help you draft an agreement that is specific to your business and can protect you moving forward.
Software Agreements In The Battery Industry
Technology plays an important role in almost every industry, including the renewable energy sector. If you’re providing software services in the battery industry, there are several key documents you may need to get started.
For example, if you’re a business that’s developing software for a battery business, you’ll need to have a Software Development Agreement in place with them. It should set out key terms like the scope of services being provided, pricing, payment, liability protections and IP ownership.
Alternatively, you may wish to draft SaaS Terms and Conditions, along with a EULA (End User Licence Agreement). SaaS T&Cs are more specific to those businesses who run a SaaS platform, so that they can monitor activity on their page and how users engage with their business online.
It’s even more helpful to draft a EULA in addition to these T&Cs as it informs the end-user of their rights and obligations when using the software. At Sprintlaw, we offer a SaaS T&Cs and EULA package – reach out to our team to learn more.
Consulting Agreements For Battery Businesses
Battery businesses are not limited to supply and software. There are also many businesses who engage with renewable energy businesses to provide consultation services. If this sounds like your business, make sure you have the right legal documents in place to secure your business dealings.
Firstly, a Consulting Agreement is always worth having when providing consultancy services. Not only does it protect your business’ rights, but it also limits your liability, sets your clients’ expectations and ensures a smooth process around the management of disputes.
Similarly, a Service Agreement can serve to protect your business’ interests and limit your liability for business activities. However, it can also clarify ownership of intellectual property and act as a general reference point for the nature of services being provided.
Many of these documents sound like they’re identical in nature, but in reality, each of them must be drafted according to your business’ unique requirements. So, it’s best to chat to a lawyer who can work closely with you to protect your business in the best way possible.
Does My Battery Company Need Any Legal Policies?
Now that we’ve covered legal agreements and contracts, what about policies?
All businesses need to be aware of their obligations under the relevant laws, but another important step is making sure that all staff are on the same page and are actively complying with these processes.
The best way to do this is to draft and implement key policies in your workplace, and train your staff so that they understand how to comply with them. This could include a range of policies from wearing protective equipment, to maintaining IT security and needing to take unexpected time off that could otherwise affect the flow of work in the business.
It’s recommended that you keep these policies in a Staff Handbook that is easily accessible, so staff can easily refer to the relevant policies when required.
It’s also a good idea to incorporate these policies into your onboarding process, so new employees understand your dedication to remaining legally compliant from the outset. As a bonus, you’ll also be perceived as a business with a strong and healthy workplace culture!
So, what kind of policies would you need as a battery company?
Personnel Security Policies For Battery And Renewable Energy Businesses
A Personnel Security Policy can apply to any business, including battery businesses and renewable energy businesses.
Like we mentioned above, many businesses develop software that can help or assist in the provision of renewable energy. Where online data and systems are involved, it’s wise to have a Personnel Security Policy in place to mitigate the risk of unauthorised access to these systems.
After all, these systems often contain highly valuable and confidential information. The last thing you want is to have this data fall into the wrong hands (especially after the recent breaches at Optus and Medibank!).
There are many laws in Australia that regulate the collection, storage and distribution of personal data, such as the Privacy Act 1988. So, your safest bet is to be proactive and train your staff to follow a specific process to maintain a high level of security.
This may also require preparing a Data Breach Response Plan, which involves notifying OAIC of a notifiable data breach and notifying affected individuals.
Privacy Policies: Are They Needed In The Battery And Renewables Industry?
Information Security For Battery Businesses
As an extra safety measure, you may also wish to look into an Information Security Policy. Like we mentioned earlier, protecting your business goes further than just having legal documents in place. It’s highly advised that you take that extra step of training your staff and ensuring they have a solid understanding of what’s expected of them in the workplace.
An Information Security Policy can help minimise the risk of cyber security attacks on your business by outlining the relevant procedures to follow in case of a data breach. Additionally, it should set out rules around BYOD (Bring Your Own Device), social media use (for example, whether you can post about your boss online), and general IT security.
Put simply, it should set out some ground rules around employees’ access to systems and how they use them.
What Are Some Examples Of Sustainable Battery Companies?
With all this talk about the rise of battery companies, it often helps to see which companies are actually out there doing all of it.
A good example is Tesla. The materials used in their lithium-ion battery are recoverable and recyclable.
In Australia specifically, Lithium Australia is dedicated to ethically sourcing battery materials to contribute to a more sustainable future.
Need Legal Help With A Battery Or Renewable Business?
Battery companies, and renewable energy businesses in general, are expected to grow following this national strategy. As such, it’s important that these businesses are well-prepared for whatever comes their way, and a lot of this starts with strong legal foundations.
At Sprintlaw, we offer expert legal help with the following:
- Information Security Policy
- Employment Contracts
- Supply Agreements
- Software Development Agreements
- Consulting Agreements
- Power Purchase Agreement
- Distribution Agreement
If you would like a consultation on your options going forward, you can reach us at 1800 730 617 or firstname.lastname@example.org for a free chat about how we can help your business in the battery or renewables space.
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