Issue 64

Shanghai Weekly Bulletin

No.1, October 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. CPC Leadership Meeting Analyzes and Discusses Current Economic Situation

【Keywords: Economic Situation】

The Political Bureau of Communist Party of China (CPC) Central Committee held a meeting on September 26 to analyze and discuss the current economic situation and make plans for future economic work. The meeting stresses the need to increase the intensity of countercyclical adjustments in fiscal and monetary policies, lower the reserve requirement ratio, and implement impactful interest rate cuts. It notes that efforts should be made to stabilize the real estate market and reverse its downturn. It also calls for supporting mergers and restructuring of listed companies, steadily advancing reform of publicly-offered funds, further regulating the ways laws are enforced and supervision conducted over enterprises, formulating private sector promotion law, intensifying efforts to attract and secure investment, and speeding up refining the policies for foreign investment access to the manufacturing sector. 

Source:Website of the Chinese Government

2. SPC Issues Interpretations on the Application of the Tort Liability Part of the Civil Code

【Keywords: Civil Code; Tort Liability】

The Supreme People's Court (SPC) issued on September 25 the Interpretations (I) on the Application of the Tort Liability Part of the Civil Code of the People's Republic of China. Taking effect on September 27, 2024 and consisting of 26 articles, the document clarifies the tort liability for illegally causing a ward to get out of the guardianship, the scope of application of the employer's liability, the form of tort liability in labor dispatch relations, and the applicable rules for motor vehicle traffic accident liability.

Source:SPC

3. China Extends Visa-free Policy to Portugal and Other Three Countries

【Keywords: Visa-free】

China has decided to extend the visa-free policy for citizens of Portugal, Greece, Cyprus and Slovenia to promote personnel exchanges between Chinese and foreign countries. Starting from October 15, 2024 to December 31, 2025, ordinary passport holders from these countries will be allowed to enter and stay in China visa-free for up to 15 days for business, tourism, visiting relatives and friends, and transit purposes, while people from these countries who do not meet the visa exemption requirements still need to obtain a visa before entering China. 

Source:International Services Shanghai

4. China Issues Revised Measures for the Administration of Financial Leasing Companies

【Keywords: Financial Leasing Companies】

The National Financial Regulatory Administration (NFRA) recently released the revised Measures for the Administration of Financial Leasing Companies. The revisions aim to improve the principal investor system, enhance category-based business supervision, strengthen corporate governance and scrutiny, step up risk management, regulate foreign-related financial leasing business, and refine business operating rules. The document adds state-owned capital investment and operating companies, state-owned financial capital investment and operating companies, and overseas manufacturing enterprises as eligible principal investors for financial leasing companies. It will take effect on November 1, 2024. 

Source: NFRA

【Shanghai】

1. Shanghai Vows to Strengthen Integration of Investment Promotion and Services

【Keyword:Investment; Investment Promotion and Services】

The Standing Committee of the CPC Shanghai Municipal Committee recently held a meeting to review and adopt the Implementation Plan on Optimizing the Investment Promotion Mechanism and Strengthening the Integration of Investment Promotion and Services. The meeting pointed out that it is necessary to take investment promotion and enterprise services as an important means to stabilize growth and promote development. It also makes overall plans, calling for paying more attention to optimizing industrial ecosystem and business environment, and accelerating the establishment of a whole lifecycle management system for investment promotion and services.

Source:  Shanghai Release

2. Pudong Issues Rules for the Implementation of Provisions on CCC Exemption

【Keywords: Compulsory Product Certification】

The Administration for Market Regulation of Pudong New Area recently issued the Rules for the Implementation of Certain Provisions on Exemption from Compulsory Product Certification (CCC) in Pudong New Area. The document specifies the channels and conditions for CCC exemption application, as well as the certification process, CCC exemption application process, and the identification of CCC product catalog. It will remain effective until June 30, 2026.

Source: Shanghai Municipal People's Government

One Week in Shanghai

【Latest News】

1. Shanghai Releases City Promotion Video for 7th CIIE 

【Keywords:CIIE】

The 7th China International Import Expo (CIIE) will take place in Shanghai from November 5 to 10, 2024. In anticipation of this event, the Information Office of the Shanghai Municipal People's Government released a promotion video titled Shanghai: We Are the Future. 

Source: International Services Shanghai

2. Shanghai Opens Two More One-stop Service Stations for Foreign Nationals

【Keywords: One-stop Service Station for Foreign Nationals】

Shanghai opened on September 27 two more one-stop service stations for foreign nationals at Terminal 1 of the Shanghai Hongqiao International Airport and Terminal 1 of the Shanghai Pudong International Airport, respectively. They are designed to greet international travelers upon their arrival. One such station has been put in trial operation since June 29 at Terminal 2 of the Pudong International Airport. 

Source:Foreign Affairs Office of Shanghai Municipal People's Government

3. Shanghai Launches Bulk Commodity Warehouse Receipt Registration Center

【Keywords: Bulk Commodity Warehouse Receipt; Registration Center】

Shanghai Futures Exchange and Shanghai Bulk Commodity Warehouse Receipt Registration Co., Ltd. held a ceremony for the launch of the national bulk commodity warehouse receipt registration center and the signing of the business cooperation framework agreement. The center will offer copper, silver, natural rubber and bonded 380 fuel oil on a pilot basis. It aims to realize the transition from bonded commodities to duty-paid commodity registration while expanding the bonded commodity registration varieties.

Source:Pudong Release

4. Shanghai Bonded Area Administration and CBBC Ink MOU

【Keywords: Bonded Area; China-Britain Business Council】

The Management Bureau of the Bonded Area under the Administration of China (Shanghai) Pilot Free Trade Zone and the China-Britain Business Council (CBBC) signed a memorandum of understanding (MOU) on September 23, 2024, under which the two sides will cooperate to establish five mechanisms with respect to communication and exchange, enterprise services, talent services, pilot implementation of policies, and business cooperation. 

Source:Smart Free Trade Zone

【Competitive Event】 

1.Asia's First International Esports Tournament Unveiled in Shanghai

【Keywords: ACL】

The Esports Asian Champions League (ACL), Asia's first international comprehensive esports tournament organized by VSPO, a world-leading esports event operator, was launched on September 24, 2024 in Shanghai. The first ACL event will be operated by the Asian Champions League Foundation of VSPO. ACL will also serve as a partner of the Esports World Cup (EWC).

Source:Shanghai Huangpu

【Culture & Art】

1. 2025 Spring/Summer Shanghai Fashion Week to Kick off

【Keywords: Spring/Summer Shanghai Fashion Week】

The 2025 Spring/Summer Shanghai Fashion Week will kick off on October 9. With the theme "Knowing New Lifestyle", it will showcase new momentum for Chinese design and work with international heavyweight brands to promote cooperation and exchanges in the global fashion sector.

Source:International Services Shanghai

2. Exhibition of Italy, the Land of Creative Blossoms Opens 

【Keywords: Italy; the Land of Creative Blossoms】

Italy, the Land of Creative Blossoms, a life and art exhibition jointly organized by the Organizing Committee of the Italian Art of Life Exhibition and the International Creative Arts Alliance (ICAA), has opened at the former Italy Pavilion, Shanghai EXPO Culture Park. The exhibition, which will last for five months, includes five theme exhibitions, including the chapter of Italian life & art, genius and masterpiece, Giorgio Armani 90th Anniversary Documentary Exhibition and Milan Fashion Library Exhibition, Italian luxury clothing collection, and emerging Italian designers, as well as a special children's exhibition hall and Renaissance Square.

Source:Pudong Release 

3. Rindon Johnson's Solo Exhibition "Best Synthetic Answer" Opens in Shanghai

【Keywords: Best Synthetic Answer】

The Rockbund Art Museum in Shanghai opened on September 21, 2024 Rindon Johnson: Best Synthetic Answer, a solo exhibition of the American artist Rindon Johnson. The exhibition covers the third to seventh floors of the museum. It is the artist's largest solo exhibition to date and his first exhibition in Asia. More than half of the works on display are newly created for the exhibition, which stimulates a real-time journey of the artist swimming across the Pacific Ocean in seven months. On every day of the exhibition, the artist-turned-swimmer is set to arrive at different seas according to the predetermined route.

Source:International Services Shanghai

【Corporate Activities】

1. Yum China Opens Its Supply Chain Management Center in Jiading

【Keywords: Yum China】

Yum China opened on September 24, 2024 its largest and self-constructed supply chain management center in Jiading District, Shanghai. The 61,000-square-meter center was completed in two years and three months. The facility incorporates cutting-edge technologies such as automated logistics, ASRS equipment, and rooftop distributed photovoltaics, aiming to create an efficient, intelligent, and green flagship center of supply chain operations.

Source:Shanghai Jiading

2. SCHUNK China Opens New Production Base in Minhang 

【Keywords: SCHUNK】

SCHUNK China opened on September 26, 2024 its new production base in Xinzhuang Industrial Zone. The base is dedicated to the production of depaneling equipment and automation products. It is a comprehensive manufacturing center integrating office, R&D, production and warehousing, and also SCHUNK's third overseas production base and the first in the Asia-Pacific region.

Source:Minhang Today

【Training】

1. Lecture on How to Expedite Patent Application to Be Held

【Keywords: Patent Application】

In order to help foreign-invested enterprises in Shanghai to get quicker protection for their inventions and creations, Shanghai Intellectual Property Protection Center and Shanghai Foreign Investment Association will jointly hold a lecture on the "Ways and Techniques to Expedite Patent Application" on October 11, and the lecturer will explain the "fast track" for patent grant. 

Source:Shanghai Foreign Investment Association

Q&A

Q1: Officials with the National Financial Regulatory Administration (NFRA) answered questions at a press conference held by the State Council Information Office about financial support for high-quality economic development - Large commercial banks play an important role in the financial system. What measures will the financial regulators take in the near future to promote the sound operations of large banks? In June, the State Council issued the Policy Measures to Promote High-quality Development of Venture Capital Investment, proposing to expand the scope of equity investment pilot projects for financial asset investment companies under large banks. Could you explain what implementation measures have been taken?

A1: Currently, large commercial banks have sound operations, with stable asset quality, and major regulatory indicators are in a "healthy range". As we know, capital is the core of financial institutions, and is the foundation for improving the ability to serve the real economy and a barrier to resist risks. In recent years, large commercial banks have retained profits to increase capital. However, as banks have continued to reduce fees and give concessions to customers, their net interest margins have narrowed and profit growth has gradually slowed. Banks have to resort to multiple channels, both internal and external, to replenish capital. In order to enhance the sound operations of large commercial banks and play a better role in serving the real economy, the central government plans to increase the core tier-one capital of six large commercial banks, and we will implement the plan in an orderly manner. We will also urge large commercial banks to improve refined management and strengthen their ability to explore high-quality development under capital constraints.

At present, indirect financing still accounts for a large proportion of China's total social financing, which means that we need to find a development path with Chinese characteristics, especially for investment in tech startups. In the early stage, financial asset investment companies under large commercial banks have carried out equity investment pilot projects in Shanghai. They explored viable paths, accumulated experience, and trained work teams, and conditions have been ripe to expand the pilot projects. According to the arrangements of the State Council, in order to effectively play the driving role of pilot projects and encourage the development of venture capital investment, we plan to take three measures to promote it: The first is to expand the scope of pilot cities. We will work with relevant departments to study the feasibility of expanding the scope of the pilot from Shanghai to 18 large and medium-sized cities with active sci-tech innovations, such as Beijing. The second is to relax restrictions. We plan to relax restrictions on the amount and proportion of equity investment, increase the upper limit on the proportion of on-balance sheet investment from 4% to 10%, and increase the upper limit on the proportion of investment in a single private equity fund from 20% to 30%. The third is to optimize assessment mechanism. We will guide relevant institutions to exercise due diligence and establish a sound long-term, differentiated performance assessment system. In the next stage, we will summarize experience and add more pilot cities; at the same time, we will continue to optimize supporting policies and implement more projects as soon as possible.

Source: State Council Information Office 

Expert Perspective

China FDI Review: Regulatory Updates of FDI in Modern Service

By: Zhao Yifan, Zhang Ziwei (ALLBright Law Offices)

[Continuing from the Last Issue]

III Opening-up policies for service sectors in the free trade zones

In addition to the aforementioned special provisions issued by the State Council, China's 21 free trade zones have also adopted special opening-up policies for certain modern service sectors. We single out Shenzhen Qianhai, Hainan Free Trade Port and Beijing Comprehensive Demonstration Zone to explain their opening-up policies for modern service sectors.

(1) Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone

Shenzhen Qianhai is a free trade zone and also the location of Shenzhen-Hong Kong modern service industry cooperation zone. It has adopted a series of opening-up policies for service activities such as modern finance, legal services, information services, trade & logistics, marine economy, and digital economy.