Issue 61

Shanghai Weekly Bulletin

No.2, September 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 Unveils New Negative List for Foreign Investment Acces

【Keywords: Foreign Investment Access; Negative List】

The National Development and Reform Commission (NDRC) and the Ministry of Commerce (MOFCOM) issued on September 8 the full text of the Special Administrative Measures for Foreign Investment Access (Negative List) (2024 Edition), to be effective on November 1. In the new edition of negative list, the number of restrictive items has been reduced from 31 to 29, with the remaining two measures in the manufacturing sector deleted. 

Source: NDRC

2. SAMR Unveils 40 Measures to Improve Business Environment

【Keywords: Business Environment】

The State Administration for Market Regulation (SAMR) recently released the Key Measures for Market Regulators to Improve Business Environment (2024 Edition). The document highlights 40 measures in ten aspects, including moving faster to improve the systems and rules in the field of market regulation, creating an environment that makes it more convenient for business entities to get access to and exit the market, safeguarding a fair and orderly market competition, regulating the order of the market, and strengthening quality assurance and standard orientation. 

Source: SAMR

3. MIIT Vows to Promote the Development of Sino-foreign SME Cooperation Zones

【Keywords: SME; Cooperation Zone】

The Ministry of Industry and Information Technology (MIIT) issued on September 3, 2024 the Interim Measures for the Administration of Sino-foreign Small and Medium-sized Enterprise (SME) Cooperation Zones, which took effect in September. The document consists of 19 articles in five chapters, which include general provisions, application and recognition, dynamic management, promotion of development, and supplementary provisions. It is also attached with the Criteria for the Recognition of Sino-foreign Small and Medium-sized Enterprise Cooperation Zones (2024 Edition).  

Source: MIIT

【Shanghai】

1.  Shanghai Plans for the High-quality Development of Livestreaming Economy

【Keyword:Livestreaming Economy】

Shanghai Municipal Commission of Commerce and other five departments in the city jointly released on September 2, 2024 the Three-year Action Plan for the High-quality Development of the Livestreaming Economy (2024-2026). The document sets goals to be achieved by 2026, including generating 600 billion yuan in retail revenue from livestreaming e-commerce, establishing ten leading livestreaming platforms with international competitiveness, developing a series of influential multichannel network (MCN) agencies to manage livestreamers, creating domestically well-known livestreaming event IP brands across various categories, and introducing 100 distinctive livestreaming scenarios.  

Source:  International Services Shanghai

2. Lingang Issues Environmental Compliance Guidelines for Enterprises

【Keywords: Ecological Environment; Production and Operation】

Three departments including the Administration of Lingang Special Area recently released the Guidelines for the Environmental Compliance of Business Entities in the Lingang Special Area in Production and Operation (Stationary Pollution Sources). Adopting a corporate perspective and following a step-by-step approach, the document clarifies the legal obligations, work priorities, compliance criteria, and common problems of enterprises at various stages of a project, including preparation, construction, completion, and operation phases. It covers environmental impact assessment, construction, acceptance, pollutant discharge permits, water, air, noise, solid waste, soil and other aspects of environmental protection.

Source: Shanghai Lingang

One Week in Shanghai

【Latest News】 

1. Shanghai Opens Special Windows for ODI Policy Consulting 

【Keywords:ODI Consulting】

In an effort to further facilitate enterprises to consult nearby and expand the coverage of special window services, the Shanghai Municipal Development and Reform Commission, together with the Administration of Lingang Special Area, the Management Bureau of the Bonded Area under the Administration of China (Shanghai) Pilot Free Trade Zone, and the Pudong Development and Reform Commission, has opened three more service windows for licensing consulting on overseas direct investment (ODI) projects in Pudong Lingang area, Pudong Bonded area, and other areas of Pudong. Appointments can be made through the "Silk Road e-Start" mini-program.

Source:Shanghai Municipal Development and Reform Commission

2. Manual for the Application of Protection for Foreign GIs in China Released

【Keywords:  Foreign GIs; Protection】

The Administration of Lingang Special Area of China (Shanghai) Pilot Free Trade Zone and the Shanghai Intellectual Property Office recently released the Manual for the Application of Protection for Foreign Geographical Indications (GIs) in China, the first of such document across the country. It systematically and comprehensively combs through the legal basis for the application of protection for foreign GIs, as well as the application process, technical review and approval, dispute handling, and the supervision and administration, providing a convenient channel for right holders to have a panoramic understanding of the GI protection rules.

Source: Lingang Administration for Market Regulation

【Forum & Exhibition】

1. 2024 CIIF to Be Held Soon

【Keywords: CIIF】

The 24th China International Industry Fair (2024 CIIF) will be held at the National Exhibition and Convention Center (Shanghai) from September 24 to 28, 2024. This year's fair targets core technologies and key areas of high-quality development of China's new industries, and provides a good model for industrial transformation and upgrading. The exhibition will attract 2,800 companies from 28 countries and regions around the world.

Source: China International Industry Fair

【Competitive Event】

1. 2024 FISE World Series Shanghai to Be Held in October 

【Keywords: FISE World Series】

The 2024 FISE World Series Shanghai will be held in the West Bund from October 16 to 20. The event features six international top-tier disciplines, including the UCI BMX Freestyle Park World Cup, UCI BMX Flatland World Cup, WORLD SKATE Roller Freestyle Park World Cup, WORLD SKATE Scootering Pro Tour - Street, FISE World Series Skateboard Street, and Breaking, as well as an around-the-clock carnival for participants of all ages.

Source: Shanghai Sports

【Culture & Art】

1. 23rd China Shanghai International Arts Festival to Open in October

【Keywords: Shanghai International Arts Festival】

The 23rd China Shanghai International Arts Festival will be held from October 18 to November 17, 2024. This year's festival is expected to feature about 250 events and over 700 performances. Among them, 57 mainstage productions with 168 performances will spotlight nearly 5,000 artists from 36 countries and regions. Over 90 percent of the participating projects will be making their Shanghai debut, and about 85 percent of the 20 major exhibitions and fairs planned are premiering for the first time. 

Source:International Services Shanghai

2. Tate Modern Returns to Shanghai with Two New Exhibitions

【Keywords: Tate Modern】

Tate Modern will bring two new exhibitions - "Dialogues with Turner: Evoking the Sublime" and "El Anatsui: After the Red Moon" - to the Museum of Art Pudong.

Source:Pudong Release

【Corporate Activities】

1.Volkswagen Software Unit CARIAD Settled in Minhang

【Keywords: CARIAD】

CARIAD, a subsidiary of Volkswagen Group, settled in an office tower in the Hongqiao International Central Business District’s Minhang section on September 2, 2024. It aims to create a new hub connecting CARIAD's global software technology R&D efforts and become a new landmark for technological innovation.

Source:International Services Shanghai

Q&A

Q1: An official with the National Development and Reform Commission (NDRC) answered reporter's questions on the Special Administrative Measures for Foreign Investment Access (Negative List) (2024 Edition). What are the measures for opening-up in the new negative list?

A1: Compared to the 2021 version, the 2024 national negative list has eliminated the remaining two restrictive measures in the manufacturing sector: "printing of publications must be controlled by Chinese entities" and “foreign investment in the application of steaming, stir-frying, roasting, and calcining of Chinese herbal medicines and the production of Chinese medicine with confidential formulas shall.be prohibited." After this revision, the number of restrictive measures in the national negative list has been reduced from 31 to 29, and all foreign investment restrictions in the manufacturing sector have been completely lifted.

Manufacturing is the sector which China opened to the outside world at earliest. It is also the sector with the full market competition and the closest global industrial division of labor and cooperation. The removal of all the restrictions showcases China's determination to expand international cooperation and its commitment to supporting economic globalization. China will leverage the strengths of its enormous market to support exchanges and cooperation between Chinese and foreign enterprises and promote the high-end, intelligent, and green development of the manufacturing industry.

Source: NDRC

Q2：An Official with the Ministry of Commerce (MOFCOM) answered questions at a press conference on the Guidelines of the General Office of the CPC Central Committee and the General Office of the State Council on Improving the Market Access System held by the State Council Information Office. How to integrate the "two lists" of foreign investment access and market access has attracted attention from all parties. The policy paper has put forward clear requirements for strengthening the coordination and linkage of domestic and foreign investment access policies. What role will it play in integrating the two lists? Will there be special measures for the Hainan Free Trade Port and pilot free trade zones?

A2: Regarding the first question, the negative list for market access is part of national treatment and applies to all types of domestic and foreign business entities. The negative list for foreign investment access falls within the scope of foreign investment management and only applies to foreign investors. Previously, the two lists have been closely coordinated in the adjustment.

Firstly, in terms of system design, the negative list for foreign investment access has listed special management measures for foreign investment access, such as equity requirements and senior executive requirements; in other areas, management is implemented in accordance with the principle of consistency between domestic and foreign investment. Domestic and foreign investors are unanimously subject to relevant provisions of the negative list for market access.

Secondly, on specific matters, the "two lists" have made coordinated adjustments. For matters on which access restrictions for foreign investment have been relaxed, the restrictions for domestic investment are also removed. for matters on which entry thresholds have been set for domestic investment, in principle, such thresholds are also applicable to foreign investment, provided that such alignments shall not be against international agreements and commitments.

Third, during the policy implementation, without compromising the market access opportunities of existing business entities, we would adhere to the principle of national treatment, eliminate and remove various barriers that hinder fair market access, and ensure that all types of business entities have equal access to the market. The policy paper is an affirmation and consolidation of the existing practices, and it's also an important institutional achievement to strengthen the coordination between the "two lists".

Regarding the second question, as China's highlands for opening-up, pilot free trade zones and the Hainan Free Trade Port have a good foundation for reform and development, strong vitality for foreign investment, a shorter negative list for foreign investment access, and a higher degree of openness. In terms of market access, the Port has implemented special measures to relax market access. 

Next, we will guide relevant regions to promote the implementation of the "two lists", continue to improve services for foreign-invested enterprises, form replicable and scalable experience, and create a more efficient and convenient market access environment for all types of enterprises.

Source: State Council Information Office

Expert Perspective 

Impact of New Cross-border Data Regulations on Domestic and Overseas Investment Projects

By: Fu Peng, Yu Qin, Wei Longjie (Haiwen & Partners)

[Continuing from the Last Issue]

IV Impact of the new regulations on overseas investment projects of Chinese enterprises

(2) Cross-border flow of general data will be more convenient

In the past, when Chinese companies were investing overseas, they often found it difficult to clarify the definition of important data and determine whether it would trigger a security assessment due to the vague definition of important data and the lack of a specific catalogue on important data. After the new regulations were issued, according to Article 2, if the relevant data is not listed as important data by regulatory authorities, Chinese companies would not have to report the above data as important data for security assessment.

This provision will greatly promote the flow of general data and will also increase the certainty that Chinese companies do not need to be subject to data security assessments when making decisions during their overseas business expansion and investment.

However, Chinese companies also need to be aware of the fact that while regulatory boundaries and definitions of important data are clarified, the formulation of important data catalogue will become an important task for regulatory departments and industry authorities in the future. Therefore, Chinese companies should keep abreast of important data catalogue to be published by different departments, identify outbound data in a timely manner, and determine when security assessments will be required for their outbound data transfer.