FTZ reform benefits more businesses

The separation of business licenses and administrative approvals in the China (Shanghai) Pilot Free Trade Zone has benefited a growing number of businesses, such as fresh products delivery in new retail, vocational training, medicines from lab to shelf, cosmetics imports, registration of medical devices and the qualification of construction enterprises.

Amid the reform, the number of new taxpayers (business entities) in Pudong increased by 29 percent in 2017, compared to the end of 2015.

The registration process for the establishment of an enterprise in the free trade zone now takes two days at most.

The first-time import of non-special use cosmetics — defined as make-up, hair, skin and nail care products, and perfume — is now subject to record filing that replaces the previous registration and approval system with the time required shortened from three to six months to three to five business days.

The number of applications for construction enterprise qualification in 2017 and 2018 has increased by 144 percent and 111 percent respectively compared to 2016.

The State Council has decided to promote the reform nationwide.

At the same time, a new management approach, mainly the in-event control and subsequent monitoring, is being improved. A government comprehensive monitoring system has been established to ensure the sharing of information among registration, licensing, monitoring and law enforcement departments which involves 21 government agencies in the free trade zone and 108 business sectors.

The free trade zone also optimizes its services and is dedicated to building an all-in-one online platform to facilitate company applications and registration.

The platform, which went online in March, can cope with all 327 business-related matters in the free trade zone. About 53 percent of these can be approved online. The time taken on average has been shortened from 22 to 3.3 working days.

Institutional innovations have inspired entrepreneurship.

More than 57,000 new enterprises have registered in the free trade zone since it was established five years ago. Nearly a fifth of these new firms are foreign-invested involving US$25 billion of investment.

A new lease of life for transport

More airplanes and ships will be available in the city’s free trade zone for financial leasing after a one-stop service platform was established Thursday.

Ten companies, including China Eastern Airlines, China Southern Air Leasing and China Development Bank Leasing, signed cooperation agreements with the Shanghai Pilot Free Trade Zone and Lujiazui financial hub in the Pudong New Area.

The newly-established financial leasing industry development service center will integrate providers and government departments to offer a one-stop service to financial leasing companies.

The service will expand to the Yangtze River Delta.

Pudong also released a new set of policies yesterday. They include simplified procedures in leasing of imported planes and awarding money to financial leasing companies in fields of aviation and key equipment.

By the end of September, 1,804 financial leasing parent companies have registered in Pudong.

Brief Introduction To Shanghai Free Trade Zone,Set Up Business,Company Registration,Corporate Formation In Shanghai Free Trade Zone

Introduction

Shanghai Free Trade Zone

The establishment of Shanghai Free Trade Zone (SHFTZ) is major decision made by the Central Committee of the Communist Party of China in response to new challenges posed by the new situation. It is envisioned to explore new paths and accumulate good experience for all-round reform and opening-up.

Officially launched on Sept. 29th 2013, SHFTZ designed a four-pronged institutional innovation strategy targeted at investment management, trade facilitation, financial services and transformation of government functions.

SHFTZ covers an area of 28.78 km2, composed of four customs supervision areas: Waigaoqiao Free Trade Zone, Waigaoqiao Free Trade Logistics Park, Yangshan Free Trade Port Area and Pudong International Airport Free Trade Zone.

SHFTZ was the very first to act in many groundbreaking projects. It is writing a new chapter for China's opening-up and embarking on a new path for the China’s open economy.

Location

Shanghai Free Trade Zone
The State Council approved the establishment of China (Shanghai) Pilot Free Trade Zone on August 2013 and the FTZ was officially launched on September 29 of the same year by merging four bonded areas under the special administration of Shanghai Customs, namely Waigaoqiao Free Trade Zone, Waigaoqiao Free Trade Logistics Park, Yangshan Free Trade Port Area, and Pudong Airport Free Trade Zone. The 28.78-square-kilometer FTZ is China’s experiment field to test policies for government reform, financial reform, business innovation, foreign investment and tax reform. It also allows Shanghai to vigorously develop re-export trade and offshore businesses.

Shanghai FTZ had registered 23,243 companies by the end of 2014, 14,860 of them newly registered and 2,342 foreign-funded. They generated 16 trillion yuan (US$2.6 trillion) in business revenue in 2014, up 11 percent from the year before. Product sales rose 11.5 percent to 13.8 trillion yuan; earnings of shipping and logistics companies grew 15 percent to 118 billion yuan. Foreign trade totaled 762.3 billion yuan, an increase of 8.3 percent.

Regional advantage

The 10-square-kilometer Waigaoqiao Free Trade Zone, set up in June 1990, was the first free trade zone in China approved by the State Council. After more than 20 years of development, it has attracted tens of thousands of companies, making it the biggest special-administered area under Customs in terms of economic output and range of services. In September 2011, the zone was designated by the Ministry of Commerce as China's first National Model Area for the Promotion of Imports and Innovation. It has become an important trade center in Shanghai, dedicated to building professional trade platforms in 10 categories: liquor, watches, automobiles, engineering machinery, machine tools, medical devices, biomedicine, healthcare products, cosmetics and cultural products. The latter category was accredited by the Ministry of Culture as China's first National Center for Trade in Cultural Products, with trade volume of the products continuing to rise. In 2012, the zone accounted for 43 percent of the watches imported into China, 37 percent of liquor imports and 29 percent of cosmetics. Imports of pharmaceuticals jumped 40 percent to account for 24 percent of the national total, and imports of medical devices rose 29 percent, comprising 21 percent of the national total.

The 1.03-square-kilometer Waigaoqiao Free Trade Logistics Park, set up in December 2003, was the first of its kind approved by the State Council. It was also the first place in the country to run a pilot project of “interactive development,” which allows companies to benefit from the policies and resources of both the free trade zone and the Port of Shanghai. Based those policies and tax rebates, the logistics park and the Waigaoqiao Free Trade Zone create a major center where multinational companies can export and source products in northeastern Asia, and can import non-ferrous metals and information technology components.

The 14.16-square-kilometer Yangshan Free Trade Port, set up in June 2005, was the first free trade port approved by China's State Council. It comprises Little Yangshan Port and the Donghai Bridge connecting the island port to the mainland. The free trade port is a key cornerstone of Shanghai's goal to become a Comprehensive Experimental Zone for International Shipping. The port has attracted companies in industries such as information technology, electronics, automobiles and auto parts, food processing and name-brand clothing. The companies have sited distribution depots in the port and established links with major shipping companies. The port currently is the fastest growing and most profitable of China's 15 free trade ports.

The 3.59-square-kilometer Pudong Airport Free Trade Zone, set up in July 2009, is designed to take advantage of its status as an Asian-Pacific and function as an “experimental area for innovative air services.”

Multinational companies in electronics, medical devices and high-end consumer goods have established distribution centers in the zone and become involved in related financial leasing projects. UPS, DHL and FedEx, the world’s top three express companies, have set up branches in the zone and helped it developed a strong business chain of air freight distribution, financial leasing, express transit and exhibitions of Asia-Pacific trade.

Why register a company in the Shanghai Free Trade Zone?

Registering and locating a WFOE in the Shanghai FTZ offers several advantages. Many of these benefits change over time – one of the main purposes of the Free Trade Zones in China has been to test out new policies and relax regulation, often benefits are offered nationwide after a period of time. We list here some of the most important to consider:

Simpler duty payment and customs

The original incentive of FTZ locations was duty-free importing and warehousing within the zone (with duty paid at the time of onward sale). This is still a major advantage for many companies which can save significant time and money from this. Manufacturing and logistics companies benefit from this, as do importers of goods such as wine.

Reform testing for certain industries

As a testing ground for national policy reforms, new policies are often put in place in a FTZ. These can open up certain previously banned industries to foreign investment. Recent examples of this include the sale of video game consoles and participation in the e-commerce market, which were both initially offered in the Shanghai FTZ before expanding nationwide.

Other specific industries are offered relaxed restrictions too. For example, the legal, medical and insurance sectors are some of the most tightly controlled in China. Yet in the Shanghai FTZ foreign companies are allowed to operate in certain legal areas (albeit at this stage just in partnership with Chinese lawyers). WFOEs are permitted to operate in the medical industry, and are also able to offer insurance services in the marine industry.

Business approval using a “Negative List.”

One of the early changes made by the Chinese government to simplify WFOE setup was the introduction of a so-called “Negative List.” This is used by local government in approving WFOE registrations, with any business not operating in a restricted or banned industry generally being approved (provided other requirements are met of course). At the same time, the industries on the list are being gradually reduced – in 2015, for example, the total restricted industries fell from 190 to 120.

Prior to using this method, a more extensive individual evaluation of proposed business activity was carried out. The Shanghai Free Trade Zone negative list is now being implemented in many other regions of China as well.

Other incentives for faster WFOE registration and setup

When it first started in 2013 one of the key attractions of the Shanghai FTZ to foreign investors was the simpler WFOE setup procedure offered. Shanghai put in place a “5 in 1” single application for five key business licenses and also allowed setup with no prescribed minimum capital amount or injection schedule. These policies have now been applied nationwide. The government’s positive attitude to WFOE setup and commitment to improving the process means that further changes are more than likely in the near future, and these may well be implemented again first via the Shanghai FTZ.

Simpler foreign exchange policies

Companies located in Shanghai FTZ are also freer to convert Renminbi and foreign currency. Accounts are able to receive both Renminbi and foreign currency payments, without approval being needed each time through SAFE (State Administration for Foreign Exchange). Note that this policy is also being expanded nationwide.

Clusters of similar industries and a prestigious location

No matter what financial and regulatory changes come and go for FTZs, one benefit that remains is the specific focus on certain industries. There are advantages for many companies in being located in close proximity to others in their industry. There are also brand and reputation associations that go along with certain regions too – important considerations in Chinese business! Shanghai FTZ offers many different industry clusters. Whilst financial services have been a long time focus, there are also strong groupings in other industries – such as high tech companies, logistics, and medical companies.

Since Shanghai Pilot Free Trade Zone was established on September 29, 2013, Tommy China Business Consulting has been focusing on consulting services for our clients to set up business in Shanghai Pilot Free Trade Zone, we offer one stop services for Shanghai Free Trade Zone company formation include:

Business Registration in Shanghai FTZ

-- Virtual registered address in FTZ

-- Human Resources

-- China VISA Services

-- Accounting and Tax Compliance Services

-- FTA Bank Account Opening

Contact Tom Lee to incorporate business in Shanghai Pilot Free Trade Zone

Shanghai Makes it Easier for Foreigners to Set Up Business in FTZ

By That's Shanghai, January 9, 2018

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Shanghai has released an extensive series of new policies aimed at making it easier for foreigners to establish businesses in the the city's Free Trade Zone (FTZ).

Under 20 new rules announced by market authorities in the FTZ, located in Pudong, "top foreign talent" with permanent residence cards (otherwise known as "green cards") will be allowed to establish technology companies and start limited liability partnerships, an option which was previously only available to Chinese citizens.

According to Shine, "top foreign talent" are identified as "award winners, renowned scholars, and elites in their fields, among other categories." Similar to China's new "Certificate for Foreign High-End Talent" announced on January 1, expats who wish to receive "top foreign talent" status must be officially recognized by the governments of either Shanghai or Pudong.

READ MORE: Some Foreigners Can Now Get Work Permits Within Just a Few Days

The new rules will also "bring foreigners a status equal to that of ordinary Chinese citizens in areas such as market entry, financing and company listing in stocks," Xinhua reports. 

The rules will also simplify adminstrative processes for companies, such as allowing firms established by Chinese citizens and registered in the FTZ to create multiple branches under a single business license. 

The new policies are part of the new 'Master Urban Plan' released by the municipal government last week. Aimed at making the city more accessible to businesses and foreign tourists, the plan calls for Shanghai to become an "excellent global city" by 2035, when it hopes to attract 14 million foreign visitors annually.

Under the plan, Shanghai also hopes to increase the city's foreign population from its current number of 170,000 to 800,000 by 2035.

[Image via Ministry of Commerce of the People's Republic of China]

Shanghai's Free Trade Zone: an experiment in success

Editor’s note:

The upcoming 19th National Congress of the Communist Party of China is expected to lay out the map for the country’s growth in the next five years.

As a pioneer in reform, Shanghai has accomplished great progress in the economy, urban construction and technology as well as art and culture in the past five years. In this series, we take stock what has been achieved and outline the city’s vision for the future.

In four years, the China (Shanghai) Pilot Free Trade Zone has become a hub for foreign innovators, such as Adobe, which established its Shanghai branch in the area dubbed as a test ground for China’s key economic and financial reforms.

The American software giant, headquartered in San Jose, California, has moved its Shanghai office to the free trade zone as a stronghold of its east China business.

The zone, which covers about 121 square kilometers, comprises the Lujiazui financial hub, the Jianqiao manufacturing zone, the Zhangjiang high-tech base and the three bonded areas of Waigaoqiao, Yangshan and Pudong International Airport.

Adobe’s senior managing director for China Yew Hwee Ng said the zone was an ideal base for Adobe to bring the latest technology and digital experience to Chinese users as soon as possible.

The establishment of Adobe Shanghai marks another step in the company’s China strategy. Based in Shanghai and East China, Adobe says it will follow China’s national strategy and flexibly respond to the needs of the mainland market through the policies of the free trade zone as well as its first-mover advantage to provide customers with the best products and solutions to optimize their digital experience.

The Shanghai pilot free trade zone, indeed, offers multinationals easier access to the vast mainland market.

About 90 percent of total foreign investment of US$4 billion that Pudong attracted in the first half of this year has gone to the area, while altogether 8,781 foreign-funded companies have been set up there.

Officials of the Shanghai free trade zone say measures are being studied to further open accounting, construction and credit rating services to foreign capital.

As China’s first pilot free trade zone, the Shanghai FTZ was opened in 2013 as the test bed of new economic and financial policies, such as the negative list for foreign capital management, which defines sectors in which foreign entities can not invest, and the wider convertibility of the yuan and its cross border payment. 

China expects Shanghai to make the zone world class, with liberalized trade and investment, no hidden or opaque rules, fair and efficient supervision, as well as welcoming business environment by 2020.

The FTZ is expected to set up a mechanism in line with the international investment and trade rules by 2020, according to a plan released by the State Council.

The next phase in the FTZ development will further relax regulations on commercial transactions and foreign investment, including a shortening of the negative list for foreign investment and the implementation of best international practice for finance, foreign exchange, investment, and entry and exit processes.

Now in its fourth year, the Shanghai FTZ is moving from its initial experimental phase into more nitty-gritty areas of economic and financial reforms.

Faster reform

Beijing has given the green light to the zone to pioneer wider convertibility of the yuan and its cross broader payment. Since the beginning of the year, cross border payment within the FTZ has reached 673.58 billion yuan (US$102.21 billion) to further promote the international use of the yuan, according to the Shanghai Development and Reform Commission.

Nearly 700 enterprises have used two-way cross border yuan capital pool service since China launched the cross border yuan payment in the zone three years ago. The total revenue and expenditure involved have reached 849.77 billion yuan which effectively saved cross border transaction costs.

The next phase in the FTZ development will also include offshore tax arrangements and allocating resources to serve the Belt and Road strategy.

Chinese President Xi Jinping urged Shanghai to turn the FTZ into a zone of openness and innovation to serve the Belt and Road Initiative and help the country’s businesses to expand overseas.

“Shanghai officials should free their minds, seek new horizons, and be an example to the nation,” said Xi, who is also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission.

Xi urged Shanghai, a pioneer in reform and opening up, to do more on free trade zone reforms.

The Shanghai FTZ is striving to become an investment and financing hub as well as a bridgehead for the country’s Belt and Road Initiative to help domestic companies channel investment overseas.

Enterprises registered in the Shanghai FTZ have invested in 108 projects related to Belt and Road Initiative member states by the end of last month, with an overall investment of US$4 billion.

At the same time, 52 “Belt and Road” countries have invested US$11.58 billion in 3,012 enterprises in Pudong where the FTZ locates, said Lu Fangzhou, deputy director of Pudong New Area and the administrative board of the FTZ.

The Shanghai government is banking on the zone’s success as a centerpiece of the city’s plans to turn itself into an international financial center and a global science and technology hub.

Nearly half of the 48,000 enterprises established in the zone have started paying taxes. They are likely to pay about 10 billion yuan in taxes this year.

Enterprises in the zone reported their total profit increased more than 30 percent so far this year compared with a year earlier. Around 76 percent of key enterprises are profitable.

Transportation services, terminal business, warehousing and freight forwarding all reported double digit growth while the total industrial output of process manufacturing increased 5 percent.

More companies are establishing their regional headquarters in the FTZ — three this year, bringing the total to 81.This accounts for 13 percent of regional headquarters in the city and almost a third of those based in Pudong New Area.

More than 320 regional headquarters, Asia-Pacific business centers and business operations centers within the zone reported an 18 percent of year-on-year increase in revenue in the first half.

Leasing industry in the FTZ also maintained rapid growth. One third among the total 1,945 leasers in the zone has launched operationa and leased 256 aircraft, 22 aircraft engines and 186 ships.

Source: SHINE   Editor: Wang Qingchu

China (Shanghai) Pilot Free Trade Zone,Incorporate Business,Company Registration,Corporate Formation In Shanghai Free Trade Zone

The China (Shanghai) Pilot Free Trade Zone (SHFTZ or Shanghai FTZ) was approved by the State Council on 17 August 2013 as the first pilot free trade zone in China. It covers the four special customs supervision areas of the Waigaoqiao Bonded Area, Waigaoqiao Bonded Logistics Park, Yangshan Bonded Port Area and Pudong Airport Comprehensive Bonded Area. On 28 December 2014, the National People's Congress authorised the State Council to expand the SHFTZ by incorporating the Lujiazui Financial Area, Jinqiao Development Zone and Zhangjiang High-Tech Park. The expanded FTZ has a total area of 120.72 sq km.

Development Goals

According to the Plan for Further Deepening the Reform and Opening up of the China (Shanghai) Pilot Free Trade Zone (seeChinese version) approved by the State Council, the SHFTZ should deepen and improve investment management systems with the negative- list approach as the core, the trade regulation system focusing on trade facilitation, the financial innovation system aimed at capital account convertibility and liberalisation of the financial services, and the system of on-going and ex post supervision with the transformation of government functions as the core. The goal is to build an institutional innovation system that is in line with the common international rules of investment and trade, give full leverage to the radiating and exemplary role of key functional areas of finance and trade, advanced manufacturing and technological innovation, and strive to build a FTZ with the highest degree of openness, investment and trade facilitation, currency conversion freedom, convenient and efficient regulation, and a sound legal environment.

Foreign Investment Management

The Special Administrative Measures (Negative List) on Foreign Investment Access (see Chinese version) promulgated by the State Council set out special management measures for businesses and industries in which foreign investment does not qualify for national treatment, to be implemented in all 11 FTZs in China. For sectors falling outside the scope of the negative list, the system of advance approval for foreign-invested projects and the system of examining and approving the contracts and articles of association of foreign-invested enterprises will be replaced by filing requirements on the principle of same treatment for foreign and domestic investors.

Special administrative measures relating to national security, public order, public culture, financial prudence, government procurement, subsidies, special procedures and tax-related matters not on the negative list are subject to existing provisions. Foreign investment concerning national security is subject to review in accordance with the Tentative Measures for the National Security Review of Foreign Investment in Free Trade Zones (see Chinese version). 

Positioning of Sub-zones

FTZ Bonded Area

The FTZ Bonded Area, with an area of 28.78 sq km, was the first designated pilot area of the SHFTZ before its expansion. The FTZ Bonded Area comprises Waigaoqiao Bonded Area, Waigaoqiao Bonded Logistics Park, Yangshan Bonded Port Area and Pudong Airport Comprehensive Bonded Area.

Waigaoqiao Bonded Area (10 sq km) is China's first bonded area and first state-level import-export trade promotion and innovation demonstration area. Its diverse economic functions include free trade, export processing, logistics warehousing and bonded goods display and trading.

Waigaoqiao Bonded Logistics Park (1.03 sq km) is China's first integrated FTZ-port pilot logistics park as well as an important base for modern international logistics development.

Yangshan Bonded Port Area (14.16 sq km) is under "integrated FTZ-port" supervision. It is the core carrier of Shanghai's comprehensive pilot area for international shipping service development.

Pudong Airport Comprehensive Bonded Area (3.59 sq km) integrates the airport's bonded logistics area and the west freight area. It has the advantage of being the composite aviation hub of the Asia-Pacific region and is the pilot zone for the development of Shanghai's airport-based service industry.

For investment enquiries and related services, contact:

1. Waigaoqiao Public Service Center
Address: Comprehensive Service Hall, 9 Jilong Road, Pudong New Area, Shanghai
Tel: 86-21-58695566

2. Comprehensive Service Hall, Yangshan Bonded Port Area
Address: 1/F, Block D, Deep Water Port Business Plaza, 5 Shuntong Road, Pudong New Area, Shanghai
Tel: 86-21-68281620

3. Comprehensive Service Hall, Pudong Airport Comprehensive Bonded Area
Address: 7/F, A1 Zone, Pudong Airport Comprehensive Bonded Area Public Service Center (Phase 1), 1333 Wenju Road, Pudong New Area, Shanghai
Tel: 86-21-20285113

Lujiazui Financial Area

With an area of 34.26 sq km, Lujiazui Financial Area covers the Lujiazui financial district, the World Expo site and Qiantan. It forms the core of Shanghai's international financial centre, the high-end services cluster of Shanghai's international shipping centre as well as the modern commercial hub of Shanghai's international trading centre. Finance, insurance, securities and commerce are its dominant sectors. Headquarters of multinational companies, shipping agencies, emerging financial institutions, and futures markets are forming clusters here.

For investment enquiries and related services, contact:

1. Shanghai Citizen Service Center
Address: 1/F, 2 Hehuan Road, Pudong New Area, Shanghai
Tel: 86-21-68546904, 86-21-68546704, 86-21-68542222 ext 81523-81528

2. Expo Park Public Service Center
Address: 161 Zouping Road, Pudong New Area, Shanghai
Tel: 86-21-68586628, 86-21-68588919

3. Lujiazui Public Service Center
Address: 1/F, Block 3, 87 Tangqiao New Road, Pudong New Area, Shanghai
Tel: 86-21-60893775

Jinqiao Development Zone

With a planned area of 20.48 sq km, Jinqiao Development Zone is Shanghai's important core functional area for advanced manufacturing, hub for producer services, pilot area for strategic emerging industries, and demonstration area for ecological industries. Electronic information, automobile manufacturing and parts, modern home appliances and biomedicine are dominant industries in this zone.

For investment enquiries and related services, contact:

Jinqiao Public Service Center
Address: 1/F, Block 14, 27 Xinjinqiao Road, Pudong New Area, Shanghai
Tel: 86-21-68800000 ext 199

Zhangjiang High-Tech Park

With a planned area of 37.2 sq km, Zhangjiang High-Tech Park is Shanghai's core base for the innovation-oriented national strategy. Integrated circuit, software and biomedicine are the three dominant industries in this park, which boasts nine state-level bases, including the National Shanghai Biomedical Science and Technology Industry Base and the National Information Industry Base, as well as incubators of diverse models and types.

For investment enquiries and related services, contact:

Zhangjiang Public Service Center
Address: 3/F, Block 3, 1158 Zhangdong East Road, Pudong New Area, Shanghai
Tel: 86-21-50797963

Latest Policies and Regulations

Please see China (Shanghai) Pilot Free Trade Zone official website.

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Lujiazui financial worker benefits from Shanghai FTZ opening up

Participants of PricewaterhouseCoopers You Plus Special Training program, the first foreign-funded business skill training course approved in China. [Photo/WeChat account: lujiazuijrc]

Zheng Ruyi, a 27 years old financial worker in Shanghai's Lujiazui Financial City, recently become a beneficiary of the opening up policy of Shanghai's free trade zone.

Zheng, who used to work on industrial investment and operation management at a financial group in Shanghai's Lujiazui Financial City, resigned in September and chose to become a full-time student to improve her expertise by joining PricewaterhouseCoopers (PwC) You Plus Special Training program.

During the one-year study period, Zheng and her classmates will attend business skill training courses given by top managers at Fortune 500 companies.

Moreover, they will have half-year practical training at leading companies such as General Motor China, Louis Vuitton Moet Hennessy, and Oriental DreamWorks, and will have opportunities to participate in their core projects.

The program, the first foreign-funded business skill training course approved in China, was launched by PwC Business Skill Training (Shanghai) Co, a foreign-funded vocational training institution that landed in Lujiazui last year.

The company's arrival in Lujiazui was attributed to Shanghai FTZ's opening up policy and simplified business registration procedures.

Shanghai FTZ announced 54 measures of further opening up in 2014, giving pre-establishment national treatment to foreign invested enterprises while using negative list management method.

In 2015, an amended negative list was released, excluding non-school-system vocational training and making the establishment of foreign-invested vocational training institutions in China possible.

Cai Xiaoying, general manager of PwC Business Skill Training (Shanghai) Co, said that the establishment of the company also benefited from simplified business registration procedures. It only took them six workdays to get the business license and then three months to start operation.

Lujiazui has made full use of its status as part of the Shanghai FTZ to promote opening up and encourage business innovation in foreign-funded companies. PwC subsidiary was one of such examples.

He Jianmu, a Lujiazui official, said that Lujiazui now has 93 multinational headquarters, accounting for 35 percent of Pudong's total. Eight of the world's top 10 asset management enterprises including BlackRock, Fidelity International, JP Morgan, Allianz, the Bank of New York Mellon, AXA, and Deutsche Bank have set up wholly-own subsidiaries in Lujiazui.

The China (Shanghai) Pilot Free Trade Zone, located in Shanghai's Pudong New Area, has been dedicated to pushing opening up and rolled out a large number of preferential policies for foreign-invested companies. [Photo/WeChat account: lujiazuijrc]

Shanghai’s free trade zone sets international standards

chinadaily.com.cnUpdated:2017-12-27

Shanghai Pilot Free Trade Zone will launch several measures to facilitate international collaboration and make policies in line with international standards according to a news report released on the Pudong's official website on Dec 25.

Universal Scientific Industrial (Shanghai) Company, located at Pudong New Area, is now dedicated to producing chips for the production of the Apple Watch. Owing to the measures launched by Shanghai's Pilot Free Trade Zone, the time spent in passing the customs has been greatly shortened, thus the company can deliver the products on time.

As a result, the amount of the company's exports during these three years has exceeded 1 billion dollars. Also, their operation revenue has increased by 138% compared to last year.

Moreover, the Zone endeavors to innovate its policies to bring more benefits to the companies' bases there.

Firstly, it has established an investment management system which matches international standards. Secondly, it has set up a high-standard regulatory   system to facilitate trade, thus it can closely monitor the operation of the port. Thirdly, it has created a financial innovation system which is suitable for a more open environment and better defends the companies against financial risk. Fourthly, it has formed an integral monitoring system to effectively regulate the whole market.

These innovative policies have invigorated the market, so much so in that the four years since its foundation, the free trade zone has witnessed an addition of nearly 50,000 enterprises.

Shanghai Pilot Free Trade Zone. [Photo/ Reuters.com]

Universal Scientific Industrial (Shanghai) Company, located at Pudong New Area, is now dedicated to producing chips for the production of the Apple Watch.[Photo/ jobui.com]

Thanks to a series of innovative policies, Shanghai Pilot Free Trade Zone has witnessed an addition of nearly 50,000 enterprises in the past four years.[Photo/ people.com.cn]

New policy to encourage foreign investment in FTZ

chinadaily.com.cnUpdated:2018-01-17

The State Council published a policy on Jan 9 to encourage investment from more foreign enterprises into Shanghai's Free Trade Zone (FTZ).

The new policy has made several changes on the previous ones including in aspects of aircraft industry, entertainment industry, financial industry, tourism, education and rail traffic.

One of the major changes is that the new policy has removed the restriction of investment from foreign enterprises, in areas such as the industry of shipping, aircraft manufacturing and rail traffic.

Sea transportation. [Photo provided to chinadaily.com.cn]

In sea transportation, wholly foreign-owned enterprises that are doing the business, such as shipping, ship management, cargo handling, marine container and storage, will be allowed to be established at FTZ. Foreign enterprises are allowed to do businesses as international shipping agency in the form of joint ventures and cooperation. In addition, the allowed shareholding ratio has been lifted to 51 percent.

Aviation. [Photo provided to chinadaily.com.cn]

In aviation, foreign enterprises are permitted to carry out work such as selling inflight meals, establishing parking lots, and storing goods in the form of sole proprietorship. The foreign enterprises are spared the obligation of having to maintain the airplanes at the global market if the enterprises invest in airplane maintenance.

Foreign enterprises are also permitted to design, manufacture and maintain the general-purpose planes which weigh six tons and hold no more than nine seats in the form of sole proprietorship. The investment restrictions of designing and manufacturing helicopters for civil use weighing more than three tons have been removed.

Rail Traffic. [Photo provided to chinadaily.com.cn]

In rail traffic, the requirement that over 70 percent of the foreign invested railway transportation project have to be domesticized has been removed.

Foreign enterprises have long been restricted to establish and manage the petrol station, while due to the launch of the new policy, foreign enterprises are permitted to build and manage petrol station operations.

FTZ shows a considerable growth in maintenance industry

chinadaily.com.cnUpdated:2018-01-31

The maintenance industry has been developing rapidly in Shanghai's Free Trade Zone as reported on Pudong's website on Jan 30.

The maintenance industry has been regarded as an important factor to take into consideration when evaluating the competitiveness of a country or a district. The industry also plays an important role in boosting economy.

According to formal statistics, Shanghai Entry-exit Inspection and Quarantine Bureau has repaired 27 thousand articles, and the revenue gained from the maintenance has reached a staggering 420 million dollars.

Maintenance services have helped companies save time, money and labor. In the past, Orbotech company, which specializes in producing semiconductors, had to transport its devices to its Israel-based headquarter for maintenance. As a result, the company had to pay the transportation fee and sometimes there would not be enough stock, which delayed processes even further.

In August, 2017, Orbotech founded a company in the Free Trade Zone, which is to provide maintenance services to companies around the globe. Since then, devices that require maintenance are able to be repaired in China. Furthermore, devices in other countries can now also be sent to Shanghai for repair, bringing great benefits to China’s economy.

At present, Orbotech has been planning to provide maintenance services in five main fields, namely on computers, circuit boards, motors, cameras and electrical components. It is estimated that annual revenue will reach 10 million dollars and it will hopefully become a global maintenance center in the near future.

The Shanghai Entry-exit Inspection and Quarantine Bureau has set a series of regulations and procedures, orientated towards worn-out mechanical and electrical products. In July, 2015, the bureau released and implemented an innovative monitoring policy for executing global maintenance. This practice will enhance the efficiency of the maintenance business and ensure the quality of the service. It has also proven to be beneficial for the environment.

Shanghai's Free Trade Zone has been developing global maintenance by continuously improving its technology and upgrading its systems. Now, six enterprises of the free trade zone possess the capability of providing qualified maintenance services. Targets have been set for the maintenance industry covering several areas such as in communication tools, computer networks, automobile electronics, semiconductors, industrial control equipment, aviation and electronic devices.

Workers are repairing components in a factory. [Photo provided to chinadaily.com.cn]