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Business / Policy Watch

Shanghai policies woo multinational headquarters

(Xinhua) Updated: 2012-10-12 16:33

SHANGHAI -- Shanghai has issued a package of new policies, including subsidies and duty exemptions, to encourage more multinational corporate headquarters and R&D centers to set up shop in the financial hub of China.

New regional multinational headquarters in Shanghai will be able to receive a launch subsidy of 8 million yuan ($1.27 million) in three years, while foreign R&D centers will enjoy duty-free imports of facilities and equipment for their own use, according to the new policies.

The new policies are intended to encourage foreign-funded companies to divert their management and innovation resources to China in order to transform the local economy amid global recession, said Wang Xinpei, deputy director of the city's commerce commission.

The regional headquarters of investment companies that have a turnover surpassing 1 billion yuan will get a one-off reward of 5 million yuan, according to the new policies.

The package also extends long-term residency to senior foreign executives and department managers at corporate firms that have a registration fund of no less than $3 million.

Previously, only foreign staff at the headquarters could enjoy long-term residency, which lasts for a maximum of five years.

The headquarters can also enjoy preferential financial policies, such as convenience in cross-border use of the yuan, with simplified procedures for businesses under the yuan current account.

The headquarters of multinationals are also encouraged to establish yuan settlement centers for overseas business in Shanghai.

By the end of September, Shanghai had 393 regional multinational headquarters and 349 foreign-funded R&D centers, the most of any city on the Chinese mainland.

The city attracted $15.68 billion in contractual foreign investment in the first eight months of the year, with $10.64 billion already in actual use, a rise of 13.8 percent and 20.2 percent, respectively, from a year earlier.

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