Policy Measures of Shanghai Municipality for Further Supporting the Enhancement of Capabilities of Foreign-funded Research and Development Centers

In order to thoroughly implement the requirements set forth in the Several Measures on Further Encouraging the Foreign Investors to Set up Research and Development Centers, further advance the upgrading initiative for the foreign-funded research and development (R&D) centers, attract the clustering and capability enhancement of such centers in Shanghai, and better support the development of Shanghai as an international science and technology innovation center, the following measures are hereby formulated.

I. Supporting the Foreign-funded R&D Centers in Increasing R&D Investment

1. The foreign-funded R&D centers shall be encouraged to establish public-interest basic research science funds. For the eligible basic research projects undertaken by universities and research institutes and supported by such funds, subsidies shall be granted at a prescribed proportion in accordance with the relevant provisions. (Responsible authorities: the Municipal Commission of Science and Technology, and the Municipal Bureau of Finance)

2. The scientific research infrastructure, common technology R&D platforms, and public scientific and technological information shall be made accessible to the foreign-funded R&D centers and services shall be provided for them in accordance with the laws and regulations. For the foreign-funded R&D centers that utilize the large-scale scientific instruments and facilities, as well as the national major science and technology infrastructure and the related services, to conduct high-level basic researches, subsidies shall be granted to them in accordance with the relevant provisions. (Responsible authorities: the Municipal Commission of Science and Technology, the Municipal Bureau of Finance, the Lin-gang Special Area Administration, and Pudong New Area People's Government)

II. Encouraging the Foreign-funded R&D Centers to Strengthen Open Innovation

3. The Foreign-funded R&D centers shall be supported to set up open innovation platforms, develop proof-of-concept centers and common technology service platforms, and provide cross-border incubation services. Such centers may, in accordance with the relevant provisions, enjoy policy support related to the cultivation of science and technology innovation and entrepreneurship carriers in Shanghai. (Responsible authorities: the Municipal Commission of Commerce, the Municipal Commission of Science and Technology, and the Municipal Bureau of Finance)

4. The high and new technology achievements generated by the foreign-funded R&D centers shall be supported to be included in the high and new technology achievement commercialization projects in accordance with the laws and regulations, and subsidies may be granted to them in accordance with the relevant provisions. Applications may be made for the industrialized innovative products to be listed in the Shanghai Catalogue of Recommended Innovative Products. The foreign-funded R&D centers are supported to participate in the establishment of various science and technology innovation bases and platforms, such as the Shanghai manufacturing innovation center, etc. Through the use of Science and Technology Innovation Vouchers, such centers may access the large-scale scientific instruments and equipment on the public R&D service platforms and enjoy the related R&D experimental services. (Responsible authorities: the Municipal Commission of Science and Technology, and the Municipal Commission of Economy and Informatization)

5. The foreign-funded R&D centers shall be supported in collaborating, in response to the market demands, technological innovation, and industrial development needs, with various innovation entities in Shanghai, such as universities, research institutes, and enterprises, to jointly undertake research on core technologies within the industrial value chains and to participate in postgraduate education and training, as well as to jointly establish practice bases, industrial colleges, industry–academia–research joint laboratories, data-sharing platforms, and other collaborative platforms. The foreign-funded R&D centers with strong R&D capabilities and significant achievements in industry–academia–research integration may establish enterprise postdoctoral research workstations or may be admitted to the district-level postdoctoral innovation practice bases to recruit and train postdoctoral researchers. The foreign-funded R&D centers that have established their postdoctoral research platforms shall be supported to apply for the support programs such as the Shanghai "Super Postdoctoral" Incentive Program and the Shanghai Postdoctoral International Exchange Program. (Responsible authorities: the Municipal Commission of Science and Technology, the Municipal Commission of Education, and the Municipal Bureau of Talent)

III. Supporting the Foreign-funded R&D Centers in Conducting Integrated R&D and Manufacturing

6. The foreign-funded R&D centers shall be supported to enhance their technological R&D and commercialization capabilities and accelerate the industrial application of their basic research outcomes. Support shall be provided for the foreign-funded R&D centers to meet their needs for carrying out pilot-scale and intermediate-scale testing activities (excluding those involving hazardous chemicals) on the R&D-designated land, and the corresponding environmental impact assessment procedures shall be optimized for them. The foreign-funded R&D centers and their parent enterprises shall be encouraged to establish technology commercialization funds and venture capital funds and may, in accordance with law, enjoy applicable tax incentives and the other relevant policy support. The foreign-funded R&D centers shall also be supported to apply for recognition as National High and New Technology Enterprises and Technologically Advanced Service Enterprises and may, in accordance with law, enjoy the corresponding corporate income tax incentives and the other relevant policy support. (Responsible authorities: the Municipal Commission of Science and Technology, the Municipal Commission of Commerce, the Municipal Bureau of Planning and Natural Resources, the Municipal Bureau of Ecology and Environment, the Municipal Financial Regulatory Bureau, and the Municipal Tax Service)

7. The foreign-funded R&D centers shall be supported to apply for inclusion in Shanghai's key technological transformation projects and may, in accordance with the relevant provisions, enjoy corresponding policy support. Focusing on this Municipality's ten key industrial chains and on the Municipality–district coordinated leading industries, the foreign-funded manufacturing enterprises shall be guided to establish high-level R&D platforms and to increase their R&D investment in such high-growth sectors as intelligent terminals, embodied intelligence, high-end instruments and meters, the aerospace economy, bio-manufacturing, new energy, and green and low-carbon technologies, thereby promoting the industrialization of the R&D outcomes. (Responsible authorities: the Municipal Commission of Economy and Informatization)

8. The foreign-funded R&D centers shall be supported to utilize the Marketing Authorization Holder (MAH) system for pharmaceuticals to separate marketing authorization from manufacturing authorization. The foreign-funded R&D centers shall be encouraged, as registration applicants, to transfer the imported medical device products, registered by import medical device registrants under the same ultimate controlling entity, into Shanghai for R&D and production. The consultation services relating to product testing, application procedures, review requirements, and system verification for the transferred production items shall be optimized, and the review and approval efficiency for Class II transferred-production medical devices shall be enhanced. For those meeting the requirements set forth in the Provisions on Handling the Matters Related to the Transfer of Production to Shanghai of the Products That Have Obtained the Medical Device Registration Certificates, the on-site inspections related to their product registration and manufacturing licensing may be streamlined and consolidated. The matters relating to manufacturing licensing for the imported innovative medical devices shall be handled on an expedited basis. (Responsible authorities: the Municipal Commission of Science and Technology, and the Municipal Medical Products Administration)

IV. Optimizing Customs Clearance and Regulatory Procedures for Scientific Research Materials of the Foreign-funded R&D Centers

9. The foreign-funded R&D centers may, through the Integrated Science and Technology Innovation Information Management and Service Platform, enjoy customs clearance facilitation measures for the imported R&D materials. The air-freighted imported R&D materials may receive efficient, one-stop customs clearance services at the Zhangjiang Cross-Border Science and Technology Innovation Regulatory Service Center. When going through customs clearance procedures for the imported samples of food and cosmetics intended for testing and R&D purposes, the foreign-funded R&D centers may, in accordance with applicable laws and regulations, enjoy the facilitation measures such as simplified import procedures. The foreign-funded R&D centers shall be supported to apply, in accordance with the relevant provisions, to extend the re-export time limits for temporarily imported R&D-dedicated products, key equipment, and testing vehicles. For the goods temporarily entering and exiting the Chinese mainland in connection with the enterprises participating in national key projects or national scientific research programs, the maximum extension period may exceed two years. (Responsible authority: Shanghai Customs)

10. The high-quality and trustworthy foreign-funded R&D centers with high-quality, integrity, excellent biosafety control capabilities shall be recommended to be included in the pilot programs of the joint regulatory mechanism for the special items entering and exiting the Chinese mainland. Based on comprehensive assessment opinions under the joint regulatory mechanism, approval procedures shall be optimized and customs clearance processing shall be accelerated. Foreign-funded R&D centers in the biopharmaceutical sector are supported in benefiting from customs clearance facilitation for imported R&D materials in accordance with the Pilot Program for the Import of Items for Biopharmaceutical R&D and Testing in Shanghai. For imported biological materials introduced by foreign-funded R&D centers for national-level or municipal-level scientific research projects, biosafety risk assessments shall be conducted. Where the materials meet assessment requirements, quarantine approval time limits shall be shortened and entry and subsequent regulatory procedures shall be optimized. (Responsible authorities: Shanghai Customs, the Municipal Commission of Commerce, and the Municipal Commission of Science and Technology)

11. The foreign-funded R&D centers located within the comprehensive bonded zones shall be supported to conduct bonded R&D activities. (Responsible authorities: the Municipal Commission of Commerce, Shanghai Customs, the Municipal Commission of Science and Technology, and the Municipal Bureau of Ecology and Environment)

V. Supporting the Lawful Cross-Border Flow of R&D Data of the Foreign-funded R&D Centers

12. Efforts shall be made to accelerate the establishment and improvement of the systems, standards, and regulatory frameworks governing the data resources trading and circulation. The foreign-funded R&D centers shall be supported to conduct cross-border data transfers in accordance with applicable laws and regulations, while ensuring the implementation of the data security protection requirements. (Responsible authorities: Cyberspace Administration of the CPC Shanghai Municipal Committee, and the Municipal Data Administration)

13. The foreign-funded R&D centers shall be encouraged to obtain the data security management certification to enhance their data security governance capacity and to develop the standards that meet the applicable data security requirements. Subject to compliance with laws and regulations and the assurance of data security, measures shall be taken to facilitate cross-border data flows. For data identified as "important data," a green channel shall be established for the cross-border data transfers, and dedicated personnel shall be assigned to provide guidance and services, and the formulation of negative lists for the relevant fields of the foreign-funded R&D centers shall be promoted. Under the national data classification and graded protection framework, a list of data subject to regulatory control shall be formulated. For the data not included in such list, outbound data transfers may be exempted from the requirements such as filing for data export security assessment, entering into standard contracts for export of personal information, and obtaining personal information protection certification. (Responsible authority: Cyberspace Administration of the CPC Shanghai Municipal Committee)

VI. Strengthening Financial Support for Scientific and Technological Innovation of the Foreign-funded R&D Centers

14. Platforms shall be established to facilitate the docking between the foreign-funded R&D centers and financial institutions. Banks shall be supported to provide the foreign-funded R&D centers with convertible cross-border financial services, including cross-border financing, technology trade settlement, franchising-related transactions, and centralized fund management by relying on Free Trade Accounts (FTAs). Cross-border financial service shall be provided to facilitate the domestic employees of the foreign-funded R&D centers to participate in the equity incentive plans of overseas listed companies, as well as the foreign employees to participate in the equity incentive plans of domestically listed companies. Facilitation shall also be provided for the overseas talents introduced by the foreign-funded R&D centers to access convertible cross-border financial services through personal free trade accounts. Banking financial institutions in Shanghai are encouraged to optimize their procedures for outward remittance under non-trade items for the foreign-funded R&D centers, strengthen tax advisory and the related services, and provide green channel services for contract filing and tax determination related to non-trade outward remittances. (Responsible authorities: Shanghai Head Office of the People's Bank of China, Shanghai Branch of the State Administration of Foreign Exchange, and Office of the CPC Shanghai Municipal Committee for Financial Affairs)

15. The financial institutions shall be encouraged, subject to controllable risk and commercial sustainability, to provide financial support for the foreign-funded R&D centers to conduct scientific and technological innovation activities and engage in basic and frontier research. For the foreign-funded R&D centers characterized by light-asset structures and high R&D investment intensity, where funds raised through domestic listing (excluding over-allotment proceeds) are primarily used for R&D investment related to their core business operations, the proportion of such funds permitted to be used for working capital supplementation and debt repayment may be appropriately relaxed. (Responsible authorities: the Municipal Financial Regulatory Bureau, Shanghai Office of the China Securities Regulatory Commission, and Office of the CPC Shanghai Municipal Committee for Financial Affairs)

VII. Enhancing the Level of Intellectual Property Protection for the Foreign-funded R&D Centers

16. The Foreign-funded R&D centers may, through the Shanghai Intellectual Property Protection Center, obtain such one-stop comprehensive services as expedited pre-examination, expedited rights confirmation, and expedited rights protection for intellectual property. Relying on the Intellectual Property Customs Protection Center for Science and Technology Innovation Enterprises, foreign-funded R&D centers are supported in applying for customs protection recordation of intellectual property rights, in order to protect their proprietary intellectual property during goods import and export processes. Enforcement against intellectual property infringement shall be strengthened. For repeated infringement, malicious infringement, and other serious infringement activities, punitive damages may be applied in accordance with laws and regulations, thereby enhancing the deterrence and enforcement effect against infringing conduct. Cross-regional intellectual property protection cooperation in the Yangtze River Delta region and the administrative intellectual property protection coordination mechanism among twelve provinces and municipalities shall be further improved. Through measures such as lead discovery, lead transfer, and joint case investigation, coordinated protection of intellectual property rights of the foreign-funded R&D centers shall be strengthened. (Responsible authorities: the Municipal Intellectual Property Administration, Shanghai Customs, the Municipal High People's Court, and the Municipal Administration for Market Regulation)

17. The foreign-funded R&D centers shall be supported to apply for the Shanghai Intellectual Property Innovation Award. Awards or other forms of support shall be granted to the recipients in accordance with the relevant provisions. Efforts shall be made to cultivate and develop international high-end intellectual property service institutions and to expand the open sharing of intellectual property data. Foreign-funded R&D centers are encouraged to engage in service outsourcing activities. Enterprises meeting the application requirements for Shanghai's special funds for high-quality development of commerce may, in accordance with relevant provisions, be granted subsidies. (Responsible authorities: the Municipal Intellectual Property Administration, and the Municipal Commission of Commerce)

VIII. Improving Talent Recruitment, Retention and Support Services for the Foreign-funded R&D Centers

18. Among the employees of the foreign-funded R&D centers, the high-level talents and urgently needed specialized talents who meet the relevant requirements of this Municipality may directly apply for household registration through the talent introduction programs. The overseas talents meeting the relevant requirements of this Municipality who apply for the Shanghai Overseas Talent Residence Permit may receive additional points under the relevant evaluation system and they may get a residence permit with a maximum validity period of up to ten years. The individuals returning to China after completing overseas studies may, in accordance with the relevant provisions, apply for permanent household registration in Shanghai. (Responsible authority: the Municipal Bureau of Talent)

19. The foreign-funded R&D centers shall be supported to apply for the Confirmation Letter for Foreign High-End Talent for the eligible high-level foreign professionals. The foreign-funded R&D centers shall be supported, in accordance with laws and regulations, to recruit outstanding foreign graduates holding a bachelor's degree or above from overseas universities to work in Shanghai. They may also recruit young foreign professionals to undertake internships in Shanghai pursuant to intergovernmental agreements and apply for the corresponding work permits. The foreign personnel employed by the foreign-funded R&D centers may, subject to compliance with the relevant municipal requirements, apply for work permits through the facilitation mechanisms such as the "notification plus commitment" and "waiver of formal requirements". Where there is a genuine need to recruit specialized foreign talents, and upon recommendation by the municipal commerce authorities, the requirements relating to age, educational qualifications, and work experience may be appropriately relaxed. (Responsible authorities: the Municipal Bureau of Talent, and the Municipal Commission of Commerce)

20. The overseas high-level talents employed by the foreign-funded R&D centers may, upon recognition by the municipal talent authorities, enjoy the corresponding benefits and support in accordance with the relevant provisions. The foreign talents working in the foreign-funded R&D centers shall be encouraged to apply for the Shanghai Foreign Talent Salary Foreign Exchange FAST PASS, and the banking institutions in Shanghai shall be supported to provide them with "one-stop" salary foreign exchange purchase and remittance services featuring installment processing, cross-bank processing, and zero-document pre-review requirements. The senior management personnel, core technical personnel, and the other employees of the global R&D centers may get housing support to ensure their residential needs in accordance with the relevant recognition procedures. (Responsible authorities: the Municipal Bureau of Talent, and Office of the CPC Shanghai Municipal Committee for Financial Affairs)

21. Application requirements may be appropriately relaxed for the technical backbone personnel of the foreign-funded R&D centers applying for inclusion in the Shanghai Science and Technology Expert Database. The professional and technical personnel employed by the foreign-funded R&D centers shall be supported to participate in the professional title evaluation. The eligible high-level overseas talents may participate in senior professional title evaluation without being subject to the minimum domestic tenure requirements; their overseas professional experiences, academic contributions, or professional technical achievements may serve as their evaluation criteria. The urgently-needed specialized talents may, where appropriate, be permitted to apply for the higher-level professional titles notwithstanding standard requirements relating to the academic qualifications or professional tenure. The foreign-funded R&D centers conducting employee training may, in accordance with the relevant provisions, receive corresponding vocational training subsidies for their employees. (Responsible authorities: the Municipal Commission of Science and Technology, and the Municipal Bureau of Human Resources and Social Security )

22. The foreign personnel invited or employed by the foreign-funded R&D centers without a visa to enter China may, in accordance with the relevant provisions, apply for a port visa upon entry. Shanghai Customs shall provide customs clearance facilitation services for the senior management personnel and scientific research personnel of the foreign-funded R&D centers entering China, including online declaration of accompanied baggage, priority on-site processing, and green channel services for health certificate processing. The foreign personnel invited by the foreign-funded R&D centers who need multiple entries and exits may apply to the public security exit-entry administration authorities for their multiple-entry visas. The foreign-funded R&D centers may apply for Asia-Pacific Economic Cooperation (APEC) Business Travel Cards on behalf of their Chinese employees. For the employees traveling to Hong Kong, Macao, Taiwan, or overseas for business purposes, the relevant authorities shall provide them with facilitation services. The foreign employees employed by the foreign-funded R&D centers may, in accordance with the relevant provisions, apply for residence permits for foreigners with a validity period of three to five years. The foreign high-level talents introduced by the foreign-funded R&D centers may, upon recommendation by the municipal commerce authorities, be given priority in applying for their permanent residence. (Responsible authorities: the Municipal Bureau of Public Security, Shanghai Customs, the Municipal Commission of Commerce, the Municipal Bureau of Talent, and Foreign Affairs Office of the Municipal People's Government)

IX. Implementing Fiscal and Taxation Policies for Scientific and Technological Innovation in Accordance with Law

23. The foreign-funded R&D centers that meet the requirements of the national import tax policies for scientific and technological innovation may, in accordance with the relevant provisions, be exempt from import customs duties, import value-added tax, and consumption tax when importing scientific research, technological development, and teaching equipment and supplies that are not domestically produced or whose performance does not meet their demands. Foreign-funded R&D centers that meet the eligibility requirements of the national policies for value-added tax refunds for the procurement of domestically manufactured equipment shall enjoy full refunds of the value-added tax on such procurement. (Responsible authorities: the Municipal Commission of Commerce, the Municipal Tax Service, Shanghai Customs, and the Municipal Bureau of Finance)

24. The foreign-funded R&D centers shall, in accordance with law, enjoy policy benefits including additional pre-tax deduction of R&D expenses and tax incentives for enterprise investment in their basic research. For the expenditures contributed by enterprises to non-profit scientific research institutions, higher education institutions, and government-established natural science funds for the purpose of supporting basic research, deductions may be made on a pre-tax basis according to the actual amount incurred when calculating taxable income, and such expenditures may additionally be qualified for a 100% super deduction on a pre-tax basis. (Responsible authorities: the Municipal Tax Service, and the Municipal Bureau of Finance)

X. Strengthening Service Support for the Foreign-funded R&D Centers

25. Support shall be provided to the R&D premises of foreign-funded open innovation platforms for their being recognized as the centralized registration addresses. In accordance with the Measures of Shanghai Municipality for the Registration and Administration of the Business Entity Domiciles, all district people's governments, the Lin-gang Special Area Administration, or their authorized entities may designate the eligible R&D premises of foreign-funded open innovation platforms as the centralized registration addresses. The market regulatory authorities shall provide registration services to the enterprises that are contractually admitted to such platforms and that engage in the business activities that do not disturb the residents and do not adversely affect the surrounding environments or public safety. (Responsible authorities: all District People's Governments, the Lin-gang Special Area Administration, and the Municipal Administration for Market Regulation)

26. The reasonable land-use needs of the foreign-funded R&D centers shall be protected in accordance with law. Planning control indicators, including floor area ratio and building height for R&D land use, shall be rationally determined, and the spatial layout for scientific research and innovation shall be optimized, so as to promote the integrated development of scientific and technological innovation functions and overall urban functions. (Responsible authorities: the Municipal Bureau of Planning and Natural Resources, and all District People's Governments)

These Measures shall be effective as of January 1, 2026 and shall remain valid until December 31, 2030. The Upgrading Plan of Shanghai Municipality for the Foreign-funded Research and Development Centers (SMPG GO D [2024] No. 3) shall be repealed concurrently.