China Adopts Foreign Relations Law, Clarifying Foreign Relations System
Shanghai Weekly Bulletin is a weekly information roundup targeting international institutions and foreign nationals based in the city. Covering major national news, Shanghai news, various events, policy Q&A and interpretations, etc. of the previous week, it keeps readers up-to-date with the latest policies and social developments in the Shanghai region.
Laws and Regulations
■ NATIONAL
△1.China Adopts Foreign Relations Law, Clarifying Foreign Relations System
[Keyword: Foreign Relations Law]
The Standing Committee of the 14th National People's Congress adopted the Law on Foreign Relations of the People’s Republic of China at its third meeting on June 28, 2023, and the law will come into force on July 1, 2023. The Law, which consists of six chapters and 45 articles, shall apply to China’s conduct of diplomatic relations with other countries, its exchanges and cooperation with them in the economic, cultural and other areas, and its relations with the United Nations and other international organizations. The law sets forth the functions and powers for the conduct of foreign relations, the goals and mission of conducting foreign relations, the system of foreign relations, support for the conduct of foreign relations and others.
Source: National People’s Congress
(http://www.npc.gov.cn/npc/c30834/202306/d4a1d80fd2764a7ca3c57387cf17109d.shtml)
△2.China Ratifies Supplementary Protocols to Two International Treaties
[Keyword: International treaty]
The Standing Committee of the 14th National People's Congress passed the Decision to Approve the Ninth Protocol Supplementary to the Constitution of the Universal Postal Union, and the Decision to Approve the Protocol Supplementary to the Convention for the Suppression of Unlawful Seizure of Aircraft at its third plenary session on June 28, 2023.
Source: National People’s Congress 1 & 2
（http://www.npc.gov.cn/npc/c30834/202306/b70ea1ec8b8a41f9a0ba5312f5dc765b.shtml）
（http://www.npc.gov.cn/npc/c30834/202306/e28c181aa74c455593991768859a67bd.shtml）
△3.State Council Issues 33 Measures to Advance Institutional Opening-up in Eligible Free Trade Zones on a Pilot Basis
[Keyword: Eligible Free Trade Zones]
The State Council issued on June 29, 2023 the Circular of the State Council on Piloting International High Standards and Promoting Institutional Opening-up in Eligible Free Trade Zones and Free Trade Ports, rolling out 33 measures in six aspects. The document stressed promoting innovative development in goods trade, facilitating trade in services, streamlining temporary entry of business personnel, ensuring the healthy development of digital trade, optimizing the business environment, as well as establishing robust risk prevention and control mechanisms.
Source: Website of the Chinese Government
(https://www.gov.cn/zhengce/content/202306/content_6889026.htm)
△4.MOJ Approves Applications of Five Foreign Law Firms to Establish Representative Offices in China
[Keyword: Foreign law firms, representative offices in China]
The Ministry of Justice (“MOJ”) released on June 25, 2023 the Announcement of Approving Five Foreign Law Firms Including Allen & Gledhill LLP (Singapore) to Establish Representative Offices in China. According to the Announcement, Allen & Gledhill LLP Shanghai Representative Office (Singapore), Holman Fenwick Willan LLP Shenzhen Representative Office (UK), Morgan, Lewis & Bockius LLP Shenzhen Representative Office (USA), Ricky Tan & Co Haikou Representative Office (Malaysia), and Areti Charidemou & Associates LLC Chongqing Representative Office (Cyprus) have been approved to be established.
Source: Ministry of Justice
(http://www.moj.gov.cn/pub/sfbgw/zwxxgk/fdzdgknr/fdzdgknrtzwj/202306/t20230625_481234.html)
■ SHANGHAI
△1.Shanghai Releases Measures to Promote Economic and Cultural Exchange and Cooperation with Taiwan
[Keyword: Economic and cultural exchange]
The General Office of Shanghai Municipal People's Government forwarded on June 28, 2023 the Implementation Measures for Promoting Economic and Cultural Exchange and Cooperation Between Shanghai and Taiwan, which were drafted by the Shanghai Municipal Taiwan Affairs Office and the Shanghai Municipal Development and Reform Commission. The document stated that Taiwan enterprises investing and exploring economic cooperation in Shanghai will be equally treated like local enterprises, and residents from Taiwan will gradually receive the same benefits as residents from other mainland regions in terms of studying, starting new business, working and living in Shanghai.
Source: Shanghai Municipal People’s Government
(https://www.shanghai.gov.cn/nw12344/20230628/67428f9284014790acfb45d2c962b777.html)
△2.Shanghai Issues Provisions to Improve the Ecological Environment Protection System in Pudong New Area
[Keywords: Business environment; intelligent declaration]
The Standing Committee of the Shanghai Municipal People's Congress issued on June 26, 2023 the Several Provisions of Shanghai Municipality on Improving the Ecological Environment Protection System in the Pudong New Area, which will come into force on August 15, 2023. Consisting of 15 articles, the Provisions specify that the ecological environment department in Pudong New Area shall strengthen the supervision and administration of environmental information disclosure by enterprises, while calling for the exploration of electronic evaluation of ecological and environmental damage appraisals in Pudong New Area for cases which have simple facts of ecological and environmental damage, no dispute over the determination of responsibilities, and relatively minor damage.
Source: Standing Committee of the Shanghai Municipal People's Congress
(http://www.spcsc.sh.cn/n8347/n8467/u1ai257403.html)
△3.Shanghai to Introduce Guidelines for Competition Compliance Evaluation of Internet Platform Enterprises
[Keywords: Internet Platform; Competition]
The Shanghai Municipal Administration for Market Regulation released on June 30, 2023 the Guidelines for the Competition Compliance Evaluation of Internet Platform Enterprises (Exposure Draft). The deadline for feedback is July 31, 2023. The Guidelines call upon Internet platform enterprises to strengthen building of their antitrust compliance management systems and enhance competition compliance risk management in light of the trends, characteristics and patterns of industry development, as well as to pay special attention to competition compliance risks in respect of big data, rules, technology, algorithms, traffic distribution, etc. In the process of executing "planning-implementation-inspection-improvement" for competition compliance management, enterprises should propose and carry out improvement measures based on the operation, monitoring and measurement situation of their competitive compliance systems, and form competition compliance operation reports.
Source: Shanghai Municipal Administration for Market Regulation
△4.China Releases Rules to Strengthen Management of Special Funds for National Science and Technology Projects
[Keywords: National Science and Technology Project, Funding Support]
The Shanghai Municipal Science and Technology Commission, the Shanghai Municipal Development & Reform Commission and the Shanghai Municipal Bureau of Finance released on June 30, 2023 the Detailed Rules for the Implementation of the Measures for the Management of Special Funds for National Science and Technology Major Projects, which will take effect on July 1, 2023 and remain valid until June 30, 2028. It is clarified that any unit in Shanghai that undertakes major national science and technology projects may apply for funds from the leading responsible department of the municipality for major national science and technology projects.
Source: Shanghai Municipal People’s Government
(https://www.shanghai.gov.cn/nw12344/20230630/182610ba4724451f99ac9ed7649b7461.html)
△5. Shanghai Adopts Wildlife Protection Rules
[Keywords: Wildlife]
The Standing Committee of Shanghai Municipal People's Congress released on its website on June 26, 2023 the Regulations of Shanghai Municipality on the Protection of Wildlife, which will take effect on October 1, 2023. Consisting of 37 articles in five chapters, the Regulations include provisions on the protection of wildlife and their habitats, management of wildlife, and legal responsibility.
Source: Standing Committee of Shanghai Municipal People's Congress
(http://www.spcsc.sh.cn/n8347/n8467/u1ai257402.html)
One week in Shanghai
■ GOVERNMENT ACTIVITIES
△1.2023 World Artificial Intelligence Conference to Be Held on July 6-8
[Keyword: Artificial intelligence]
The Shanghai Municipal Government Information Office held a press conference on the morning of June 29, 2023 to introduce the preparations for the World Artificial Intelligence Conference 2023. WAIC 2023 will be held from July 6 to 8 at the Shanghai World Expo Center and Shanghai World Expo Exhibition and Convention Center, with branch venues in Zhangjiang of Pudong and the West Bank of Xuhui. Related activities will also be held in industrial clusters such as Minhang. Themed on “intelligent connectivity, generating future”, the conference will include an opening ceremony, a closing ceremony, two plenary sessions on sci-tech innovation and industry development, 10 thematic forums as well as a number of ecosystem forums.
Source:General Office of the Shanghai Municipal People's Government
△2.Pudong’s First Innovation and Entrepreneurship Competition to Be Held
[Keyword: Innovation, entrepreneurship]
In 2023, the Pudong New Area Human Resources and Social Security Bureau joined hands with the Pudong New Area Employment Promotion Center to combine three events and create an upgraded event - the First "Leading Pudong" Innovation and Entrepreneurship Competition.
Registration period: June 28 - July 5
Source: One-stop Corporate Policies in Pudong
■ CORPORATE ACTIVITIES
△1.Shanghai Sci-tech Innovation Source Project Commences Construction to Build Future Headquarters Community
[Keyword: Sci-tech innovation source project]
Shanghai Sci-tech Innovation Source Project, a new landmark located at Jiangwan historic & cultural zone, Yangpu District, commenced construction on June 27, 2023. It is also the former location of "China Engineering Institute’s Industrial Materials Testing Institute" in the "Great Shanghai Plan". The project is fully funded by Yangpu Sci-Tech Innovation Group and is planned to be completed in 2026. It aims to collaborate with industrial communities to create a harmonious "sci-tech innovation ecosystem", and build a culturally inheritable demonstration block of urban renewal and an innovative and sustainable headquarters community of digital industry.
Source:Invest Shanghai
■ SOCIAL ACTIVITIES
△1. 5th Zhuanqiao Drama Week Kicks Off
[Keyword: Drama]
The 5th Zhuanqiao Drama Week opened on June 27, 2023 and will continue until July 5, featuring a total of nine performances, including four small plays and four stage dramas. As a distinctive cultural brand of Zhuanqiao, the Zhuanqiao Drama Week is based on the "Lvliang Drama Studio" to establish a foundation for theatrical culture and transform theatrical culture into tangible happiness for local citizens. The Shanghai Theatre Academy's Social Practice Base for Traditional Opera was inaugurated on the same day, injecting new impetus to promote cultural and artistic undertakings and aesthetic education in Zhuanqiao.
Source: Minhang Today
△2. MWC Shanghai Opens, Digital Shanghai Exhibition Zone Makes Debut
[Keyword: Telecommunication connectivity]
The leading telecommunications and connectivity event in the Asia-Pacific region, Mobile World Congress Shanghai (MWC Shanghai), opened on June 28, 2023 at the Shanghai New International Expo Centre (SNIEC). The 2023 edition of MWC Shanghai coincides with its 10th anniversary, bringing together leaders from the global telecommunications ecosystem for a three-day exhibition to explore the key trends that will shape the future of connectivity development.
Source: Invest Shanghai
△3. IAAC 9 Calls for Worldwide Submissions
[Keyword: Awards for art criticism]
Organizers of the Ninth International Awards for Art Criticism (IAAC 9) issued an announcement on June 25, 2023 to call for worldwide submissions of art criticisms written in Chinese and English. IAAC is the most open and highest-funded award in the field of art criticism. It aims to promote independent critique of contemporary art and facilitate critical thinking, dialogue and research among art critics.
Source: Shanghai Huangpu
■ TRAINING
△1.IPBP Advanced Training on Senior Executives for Corporate IPR Affairs (Shanghai Station)
[Keyword: IPR, senior executives]
Time: July 22 & 23, 2023
Content: How to foster collaboration with the R&D department; How to conduct internal organizational management within the department; How to influence the management team and decision makers; How to manage external institutions.
Source: IPRdaily
Policy Q&A
△1. The State Taxation Administration recently issued a new document that clarifies the policy regarding additional deductions for prepayment declarations in July. Compared to previous regulations, what changes does this new announcement bring?
A: According to the Announcement of the State Taxation Administration on Matters Concerning the Preferential Policy of Additional Deductions for R&D Expenses in Prepayment Declarations by Enterprises (No. 10 of 2022) and the Announcement of the State Taxation Administration on the Release of the Revised Measures for Handling Matters Related to Preferential Policies for Enterprise Income Tax (No. 23 of 2018), enterprises can enjoy the additional deduction policy for R&D expenses during the prepayment declaration in October and the annual settlement and payment. The Announcement of the State Taxation Administration and the Ministry of Finance on Matters for Optimizing the Preferential Policy of Additional Deductions for R&D Expenses in Prepayment Declarations (No. 11 of 2023, the Announcement), adds an additional time point to the above two periods. For enterprises that can accurately calculate R&D expenses during the prepayment declaration of enterprise income tax for the second quarter (for quarterly prepayment) in July or in June (for monthly prepayment), they are allowed to enjoy the additional deduction policy for R&D expenses incurred in the first half of the year.
Check details at
https://mp.weixin.qq.com/s/gpRk1jON_NII_IyGXWLSRw
△2. Compared to the previous regulations, what are the changes in the management requirements for enterprises to enjoy the additional deduction policy for R&D expenses during prepayment declarations?
A: The Announcement specifies the management requirements for enterprises to enjoy the additional deduction policy for R&D expenses during prepayment declarations. These requirements remain consistent with those stated in the No. 10 announcement. The specific requirements are as follows: Real and self-determined: Enterprises must report and enjoy the additional deduction policy based on the actual R&D expenses incurred. They are responsible for determining the eligibility and calculating the amount of additional deduction. Declaration and documentation: Enterprises should report their eligibility for tax concessions by filling the "Corporate Income Tax Monthly/Quarterly Prepayment Tax Declaration Form (Type A)" and provide supporting documentations. They should also fill the "Detailed Statement of Additional Deductions for R&D Expenses" (A107012) based on the R&D expenses eligible for additional deduction (for the first half of the year or the previous three quarters).
Check details at
https://mp.weixin.qq.com/s/gpRk1jON_NII_IyGXWLSRw
Expert Perspective
△1. Which documents must be held by foreigners if they hope to work in China?
Foreigners working in China are required to hold valid legal documents, such as a work permit, a work-related residence permit, and Z visa.
According to Article 41 of the Exit and Entry Administration Law of the People's Republic of China, foreigners working in China should obtain the work permit and work-related residence permit in accordance with relevant rules.
According to Article 8 of the Regulations on the Administration of Employment of Foreigners in China (Revised in 2017), foreigners employed in China should enter the country with a work visa (Z visa) unless there is a visa exemption agreement in place. After entering China, they need to obtain the Foreigner's Work Permit and a residence permit for employment purposes before they can work in China. Foreigners who have not obtained a residence permit (F, L, C, G visa holders), as well as foreign students or interns in China, and accompanying family members of foreign nationals holding B visa are not allowed to work in China. In special cases, the employer should apply for a permit certificate through appropriate approval process specified in these regulations. The hired foreigner can change their status by presenting the permit certificate to the public security authority and then apply for the Foreigner's Work Permit and residence permit to be eligible for employment.
According to Article 16 of the Regulations on the Administration of Employment of Foreigners in China (Revised in 2017), foreign nationals who have obtained the Foreigner's Work Permit should apply for a residence permit at the public security authority within 30 days of entry. The validity period of the residence permit will be determined based on the validity period of the Foreigner's Work Permit.
Therefore, in judicial practice, when a company hires a foreigner, he/she should obtain the "Foreigner's Work Permit", and the employer should apply for an employment permit for the foreign employee. If the foreigner fails to obtain the work permit, it constitutes illegal employment. If the foreigner has already provided labor services, the employer should pay remuneration in accordance with the labor contract. In a civil ruling made in 2018, the Shanghai First Intermediate People's Court believed that when an employer recruits foreign personnel even though it’s aware that they have no Foreigner's Work Permit or other relevant documents, it constitutes illegal employment and should share some negligence.