Issue 29

Shanghai Weekly Bulletin

No. 4, January 2024

Shanghai Weekly Bulletin is an information service presented by the Foreign Affairs Office of Shanghai Municipal People's Government in collaboration with Wolters Kluwer to foreign-funded enterprises, foreign-related institutions as well as people from overseas living in Shanghai. Covering major national and Shanghai foreign-related news, event information, policy Q&A and interpretations in the past week, it keeps you up-to-date with the latest foreign-related policies and developments in Shanghai.

Laws and Regulations

【National】

1. China Issues Plan to Advance Pilot Reform of Pudong New Area

【Keywords：Pudong New Area; Pilot Reform】

 

The General Office of the CPC Central Committee and the General Office of the State Council recently issued the Implementation Plan for the Pilot Comprehensive Reform of the Pudong New Area (2023-2027). The Plan has 23 articles in seven aspects, proposing to strengthen the opening up of rules and standards to create a window of institutional opening; improve the sci-tech innovation system and build an open innovation ecosystem; deepen the reform of talent development systems and mechanisms, and accelerate the construction of high-standard talent pools; deepen the transformation of government functions and stimulate the vitality of business entities; promote the practice of developing cities for people and explore new ways to govern mega cities. 

 

Source: Website of the Chinese Government

https://www.gov.cn/zhengce/202401/content_6927503.htm

 

2.STA Updates the Guidelines on Tax Policies for Stabilizing Foreign Trade and Foreign Investment

【Keyword:Foreign Trade and Foreign Investment】

 

The State Taxation Administration (STA) released on January 15, 2024 a new version of the Guidelines on Tax Polices for Stabilizing Foreign Trade and Foreign Investment after the authorities combed through and updated the existing tax policies and tax collection measures. The Guidelines outline 51 tax policies aimed at stabilizing foreign trade and foreign investment.

 

Source:STA

 

3. China To Further Regulate Cross-Border Tax and Fee Payment into and Refund from the Treasury 

【Keywords:Cross-border Tax and Fee; Payment into and Refund from the Treasury】

 

The People's Bank of China, the Ministry of Finance, and the State Taxation Administration recently issued the Circular on Matters Relating to the Management of Cross-Border Tax and Fee Payment into and Refund from the Treasury, which clarifies that cross-border tax payment into the treasury is divided into cross-border tax payment into the treasury in foreign currency, and cross-border tax payment into the treasury in Renminbi.

 

Source: PBC

http://www.pbc.gov.cn/zhengwugongkai/4081330/4406346/4693545/5211635/index.html

 

【Shanghai】

1. Three-year Action Plan for Major Construction Projects in the Yangtze River Delta Integrated Development Demonstration Zone Released

【Keywords:Yangtze River Delta; Major Construction Projects】

 

The Executive Committee of the Yangtze River Delta Integrated Development Demonstration Zone, the development and reform commissions of Shanghai, Jiangsu and Zhejiang, and the municipal governments of Suzhou and Jiaxing jointly released the Three-Year Action Plan for Major Construction Projects in the Yangtze River Delta Integrated Development Demonstration Zone (2024- 2026). The document proposes 16 actions and 124 projects in key regions and four areas of ecological protection, facility interconnection, industry innovation, and people's livelihood services. 

 

Source: Shanghai Release

 

2. Shanghai Releases Guidelines on Further Promoting the Development of a Learning City

【Keyword:Learning City】

 

The General Office of Shanghai Municipal People's Government recently issued the Guidelines on Further Promoting the Development of a Learning City. The document proposes ten major tasks, including improving community education, accelerating the expansion of vocational training, vigorously developing education for the elderly, and continuing to consolidate academic qualifications and continuing education.

 

Source: Shanghai Municipal People's Government

https://www.shanghai.gov.cn/nw12344/20240117/b67bddef7653476a9ea4785677b03a7c.html

 

3. Shanghai Issues Rules Governing Quality and Safety Management Personnel at Drug Producers and Distributors

【Keywords:Drug Producers and Distributors; Key Management Personnel】

 

Shanghai Municipal Medical Products Administration recently issued the Measures for the Management of Key Management Personnel of Quality and Safety at Drug Producers and Distributors in Shanghai (for Trial Implementation). With 20 articles in four chapters, the rules identify key management personnel of drug producers and distributors. The rules will come into effect on March 1, 2024, and remain effective until February 28, 2026.

 

Source:Shanghai Municipal Medical Products Administration

https://yjj.sh.gov.cn/zx-yp/20240116/26a470e2cbc84bde8baa376c054bd162.html

 

4. Shanghai Releases Second Batch of Typical Cases on Special Law Enforcement Against Unfair Competition in 2023

【Keyword:Against Unfair Competition】

 

Shanghai Municipal Administration for Market Regulation announced on January 17, 2024 the second batch of eight typical cases on special law enforcement against unfair competition in 2023. They include four trade secret infringement cases and four cases of faking reviews to boost reputation. 

 

Source:Shanghai Municipal Administration for Market Regulation

 

5. Qingpu District Proposes 24 Policy Measures to Stabilize Foreign Trade and Foreign Investment

【Keywords:Qingpu; Foreign Trade and Foreign Investment】

 

The Commerce Commission of Qingpu District released on January 15, 2024 the Implementation Opinions on Stabilizing Foreign Trade and Foreign Investment in Qingpu District. The document puts forward 24 policy measures in three aspects, including redoubling efforts to stabilize foreign trade volume and improve quality, strengthening the work to attract and utilize foreign investment, and making persistent efforts to improve business environment. The policy measures will take effect on February 16, 2024 and remain valid for three years.

 

Source: Qingpu District People's Government

https://www.shqp.gov.cn/sww/swwzwgk/zxgk/zcfg/20240117/1156157.html

 

One Week in Shanghai

【Latest News】

1. Shanghai Launches Database of Shanghai Laws, Regulations and Normative Documents 

【Keywords:Laws and Regulations; Database】

 

Shanghai officially launched its database of Shanghai laws, regulations and normative documents on January 10, 2024. It provides the public with free retrieval, query and download of all Shanghai laws, regulations and normative documents. The public can access the database through the Shanghai Municipal People's Congress website www.spcsc.sh.cn by clicking on the icon of the "Database of Shanghai Laws, Regulations and Normative Documents".

 

Source: Shanghai Municipal People's Congress

 

2. Biyun International Community at Pudong New Area Releases Shanghai's First Legal Guidelines for Foreigners' Life

【Keywords:Foreigners; Legal Guide】

 

The launch ceremony of the legal publicity brochure and promotional films entitled "Golden Bridge Over the Gap – Legal Guidelines for Foreigners' Life" was held on January 12, 2024. The brochure was jointly planned and produced by the Jinqiao Town People's Government and the Jinqiao Court. From the perspective of foreign residents, six high-frequency themes that are closely related to daily life, such as marriage, child adoption, employment, transportation, pets, and noise, are selected with pictures and texts. The guidebook is presented in a Q&A format with both Chinese and English languages.

 

Source: Rule of Law in Pudong 

 

【Competitive Event】

1. ISU Four Continents Figure Skating Championships to Be Held in Shanghai 

【Keyword: ISU Four Continents Figure Skating Championships】

 

The 2024 ISU Four Continents Figure Skating Championships will be held at the Sea Crown Stadium, Shanghai Oriental Sports Center between January 30 and February 4, 2024. A total of 112 athletes from 15 countries and regions will participate in the championships. 

 

Source: Shanghai Sports 

 

【Forum & Exhibition】

1. First Shanghai Forum on Innovation and Development of ICVs Opens in Lin'gang 

【Keywords:Intelligent Connected; Vehicles】

 

The First Shanghai Forum on Innovation and Development of Intelligent Connected Vehicles (ICVs) opened at Lin-gang Center on January 17, 2024. The organizers invited China IMT2020 (5G) Promotion Group, German Automobile Industry Association, Shanghai Internet of Vehicles Association, and representatives from intelligent connected vehicle makers and parts suppliers, as well as tech experts in such fields as autonomous driving, Internet of Vehicles and smart transportation to attend the forum.

 

Source:Shanghai Lin'gang 

 

【Culture & Art】

1. "Permanent Love" - 19th Century European Classic Art Exhibition Opens in Shanghai

【Keywords:19th Century; European Art Exhibition】

 

Shanghai Haipai Art Museum recently opened a new exhibition "Permanent Love", a 19th-century European classic art exhibition. This exhibition focuses on the works of dozens of European art masters in the 19th century, including Auguste Rodin. The exhibition will last till April 7, 2024.

 

Source: Minhang Today

 

2. China Art Museum Stages Six Exhibitions 

【Keyword:China Art Museum】

 

Six exhibitions are currently being staged at the China Art Museum, including "Shanghai Through Artistic Eyes", "Starlights in the History", "12th Shanghai Fine Arts Exhibition", "East and West 2023", "City and Figure", and "The Journey of Aesthetics". 

 

Source: Shanghai Tourism

 

【Corporate Activities】

1. ABB Pledges to Expand Investment in China in the Next Three Years 

【Keyword:ABB】

 

At the 2024 ABB Electrical Innovation Week, Morten Wierod, President, Electrification at ABB, announced that ABB remains optimistic about China's future. In the next three years, the electrical business unit will invest US$100 million in China to enhance technology research and development for energy transition.

 

Source:Pudong Release

 

Q&A

Q1: Leaders of the Shanghai Municipal People's Government answered reporters' questions at the press conference of the Yangtze River Delta Green Integrated Development Demonstration Zone. In the next stage, what new plans and practices will be implemented in the Yangtze River Delta Integrated Demonstration Zone in the field of collaborative sci-tech innovation?

A1: We will implement the deployment of the Demonstration Zone work promotion conference, adhere to institutional innovation, regional integrated development, comprehensive functional reshaping, open collaborative innovation, and strive to build the Demonstration Zone into a large "innovation field" and incubator venue. Specifically, we need to do a good job in three aspects:

The first is to draft an implementation plan to build the Demonstration Zone into an "innovation field" and incubator venue, lead and guide a new round of innovative development, strengthen the layout of key areas, key fields, and important carriers in the Demonstration Zone, and introduce support policies. We hope to build a more dynamic innovation ecosystem, consolidate scientific innovation and industrial support for the integrated development of the Yangtze River Delta, and contribute experience and strength to drive high-quality development across the country.

The second is to focus on the construction of cross-province high-tech zones, formulate development plans for cross-province high-tech zones, establish a cross-province collaborative operation mechanism, and create a community of cross-sector sci-tech innovation and industrial innovation. We will strengthen collaborative innovation and open innovation, promote related regions and departments to integrate their innovation and industrial strength and advantageous resources, accelerate the cross-domain flow of innovation elements, and push for the efficient aggregation of advantageous resources.

The third is to further give full play to the enthusiastic roles of functional platforms such as the Demonstration Zone Developer Alliance and professional market forces, provide more innovative application scenarios, and vigorously cultivate innovative business formats; strengthen efforts to introduce high-quality enterprises and high-quality projects to the Demonstration Zone, lay out key industrial directions such as digital economy, green and low-carbon, and accelerate the transformation from formal development to functional development.

In the next step, the Demonstration Zone will strive to optimize and the layout of integrated innovation space, give full play to the leading advantages of integrated system innovation, building a cross-domain incubation and integrated transformation network, promote the harmonious coexistence of green development and technological innovation, and establish the integrated development of industrial innovation and technological innovation. We will try to provide successful examples for the Yangtze River Delta's regional innovation community, industrial development community, and regional development community, and become a critical link and important growth pole of the world-class innovative industry cluster in the Yangtze River Delta.

 

Source: Information Office of Shanghai Municipal People's Government 

https://www.shio.gov.cn/TrueCMS//shxwbgs/2024n_1y_wdsl/content/69572779-9ccf-443b-bf10-bc234bd2cc8c.htm

 

Expert Perspective

With the implementation of the new Company Law, what do foreign investors need to know? 

By: An Suiyi, Sol Zhang（Llinks Law Offices）

 

On December 29, 2023, the National People's Congress promulgated the long-awaited amendment to the Company Law of the People’s Republic of China (the "New Company Law"). After several rounds of public comments since 2021, the New Company Law contains certain significant changes that may alter many corporate activities.

Given that the Foreign Investment Law of the People's Republic of China requires foreign invested enterprises ("FIE") to adapt to the requirements under the Company Law within a transition period expiring at the end of 2024, the New Company Law, becoming effective from July 1, 2024, is remarkably meaningful and instructive to foreign investors, in particular in aspects as follows, whether they are considering the required changes to their investments in China, or planning and negotiating new joint venture or other deals.

First Highlight: Proportionate Capital Reduction

As to capital reduction of the company, the New Company Law now requires that, unless otherwise agreed by all the shareholders (for LLCs), they shall reduce their capital contributions in proportion to their shareholding. 

Llinks observation

Company redemption or the valuation adjustment mechanism, which are commonly seen in mergers and acquisitions, joint venture or fund investments, are mostly achieved be means of capital reduction. However, in such cases unproportionate capital reduction by one or a few shareholder(s) is needed, but not the proportionate capital reduction by all the shareholders mentioned above. Therefore, to ensure the enforceability of the foregoing mechanisms, agreement among all the shareholder is a "must-have" in the said deals.