To qualify for preferential policies, foreign-funded research and development centers must meet the following criteria:

1. R&D investment:

- For an independent legal entity, total investment must be no less than $8 million.

- For a non-independent legal entity operating as an internal department or branch of a company, total R&D investment must be no less than $8 million.

2. Personnel: The R&D center must employ at least 80 full-time research and experimental development personnel.

3. Equipment: The original value of equipment purchased since establishment must be no less than 20 million yuan ($2.94 million).

4. The following definitions apply to the terms used in items 1, 2, and 3 above:

(a) "Total investment" refers to the amount recorded in the Foreign Investment Information Report Receipt.

(b) "Total R&D investment" refers to the assets invested by the foreign-invested enterprise specifically for the establishment and construction of the R&D center, including assets to be invested for which purchase contracts have been signed. A list of purchased assets and a list of contracts for assets about to be purchased must be submitted.

(c) "Full-time research and experimental development personnel" refers to science and technology personnel who are fully engaged in basic research, applied research, and experimental development projects. These personnel include those directly participating in projects, full-time science and technology management staff, and those providing direct support such as information and documentation, materials supply, or equipment support. Personnel must hold employment contracts of at least one year with the foreign-funded R&D center or the foreign-invested enterprise to which it belongs. Headcount will be based on the number of personnel on the day before the foreign-funded R&D center submits its application.

(d) "Equipment" refers to experimental equipment, devices, and instruments for scientific research, teaching, and technology development. When calculating the cumulative original value of purchased equipment, include both imported equipment and domestically purchased equipment, including items with signed purchase contracts to be delivered within the current year. Imported equipment covered by these rules is limited to the goods listed in the duty-free list for scientific research, technology development, and teaching. A list of purchase contracts and delivery deadlines must be submitted.

Note: The English version is for reference only. In case of any discrepancy, the official Chinese document shall prevail.

Source: Shanghai Municipal Commission of Commerce