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As a fellow Ausssie, I'm also sad about this. By the sounds of it, they've given this move a lot of careful consideration. But, rather than just be sad about i
by wluu 13y ago
As a fellow Ausssie, I'm also sad about this. By the sounds of it, they've given this move a lot of careful consideration.
But, rather than just be sad about it...
Might be a good opportunity to discuss what can be done to improve on the situation for future Australian companies? In what ways can navigating through the red tape be made simpler?
I know there's a lot of small startups springing up across at least Melbourne and Sydney. So it's natural to assume Atlassian aren't the only ones faced with this dilemma of moving overseas to further their business.
- jacques_chester 13y agoIt's probably not about red tape. It's that companies listed on US exchanges have higher valuations than companies listed on the ASX. There's just not that much red tape in Australia. Starting and running a company costs a few hundred bucks per year. If you keep up your books, reporting takes a few minutes per quarter. Bam, you've successfully navigated all the red tape needed to run a software business.
- ig1 13y agoYou don't have to be in the US to be listed in the US, Atlassian are actually moving to the UK but listing in the US.
- nikcub 13y agoExactly. This is all about corporate tax rates, capital gains, transfer pricing, etc.
- jacques_chester 13y agoCould you elaborate? It'd be interesting to know more.
- rayiner 13y agoI don't know about Australia's system, but the U.K. has been a popular target for reincorporation of American companies, along with Ireland and Switzerland: http://online.wsj.com/news/articles/SB10000872396390444230504577615232602107536 http://online.wsj.com/news/articles/SB1000087239639044423050.... Bermuda, a popular domicile in the past, apparently made certain changes to its tax code that caused companies to move to European countries. For corporations, tax rates lead to domicile-shopping because finance analysts use Earnings per Share (EPS), which is computed after taxes, as a key measure of company performance. Relocating from somewhere in the U.S. to the U.K. might substantially increase the total taxes paid by employees and executives (almost every developed country has a higher individual tax burden than the U.S.), but it can goose that all-important EPS number.
- jacques_chester 13y agoWell part of the confusion is that one reason for our headline rate, as I understand it, is because we have franking for company/income tax. So Australian companies tend to pay dividends much more freely than US companies, but the headline corporate tax rate is higher.
- rayiner 13y agoThat's actually an interesting illustration of the dynamic. The management at publicly-listed companies are very preoccupied with what finance analysts have to say about the stock. When someone at Morgan Stanley compares two companies on an EPS basis, what's relevant is the rate paid by the company. It comes down to $0.28 per share versus $0.35 per share, even if other features of the tax code mitigate that difference when a dividend is actually paid out.
- jacques_chester 13y agoRight. I'm going on the article's assertion that relocating to the UK will make it easier to launch an IPO in a US market. Tax would be a big part of that. I expect that American familiarity and comfort with UK companies would be another.
- Joe8Bit 13y agoI also suspect the relative ease of relocating a large number Australian's to the UK would have a big impact (ease of getting visa's etc).
- jacques_chester 13y agoI think it's easier to get Australians into the USA on the E3 visa.
- goatforce5 13y agoE3s are temporary and must be renewed every 2 years. Can't be transferred to another employer. Can't be used to qualify for permanent residency. They are quite useful if your married (straight) partner wants to join you (and somewhat useful if you have a defacto non-US citizen gay partner due to a bizarre quirk in the law. Tough luck if you have a defacto straight partner though.) Lots of Australians would qualify for permanent residency in the UK under an Ancestory Visa, or an equivalent in another EU country. Emigrating AU<->UK is a very well worn path that's easy to naviagte. The US isn't quite so welcoming. (Source: i'm an Australian who live in the UK for 10 years, the US for 2 and now Canada for 5.)
- mahyarm 13y agoHow would you compare the 4 countries, and why did you choose Canada as your current place?
- jacques_chester 13y agoI don't see any of those drawbacks as drawbacks, though. For me the key to the E3 is that I don't have to play H1B lotto.
- frabcus 13y agoYou could make it easier to buy shares from abroad. I tried to buy NZ stock exchange shares in the UK, and my broker didn't cover it. Not sure what the situation with Australian ones is. But basically, the more brokers abroad that can get them, the less the advantage of being on NASDAQ.
- jacques_chester 13y agoI don't think that's to do with our regulations; it's just that Australia's share market is miniscule compared to those in the global capitals of capital. NZ even more so. There's not enough retail investor interest to cover the costs.
- yapcguy 13y agoAfter growing organically - and very successfully too - they accepted $60m from Acccel Partners, a private equity firm, in 2010. This move abroad has probably been driven by the money-men seeking their return, rather than any business imperative.