Approval Process for Telecom Services in Shanghai FTZ Streamlined

April 24, 2014 Posted by China Briefing Reading Time: 2 minutes

SHANGHAI – Last week the Ministry of Industry and Information Technology (MIIT) announced revisions to the procedure for FIEs (foreign-invested enterprises) to register and operate value-added telecom services (VATS) in the Shanghai Free Trade Zone (FTZ).

For VATS enterprises applying to conduct business in the Zone, the approval process has been shortened from five to two months and the Shanghai Communications Administration (SCA) may now approve applications directly, rather than pre-approving applications for state-level approval as previous. In combination, the two revisions will speed up the approval process for VATS operators in the Shanghai FTZ , thus shortening market pre-entry time.

Despite these changes, there remain some bureaucratic hoops for FIEs to jump through, as the multi-tier system of authorities has not been completely eliminated: while the SCA is responsible for company annual inspections, the state-level MIIT is ultimately responsible for evaluating these reports and maintaining company records.

The approval process, largely unchanged, requires that FIEs comply with a list of conditions and submit various forms of documentation to the SCA. Once approved, VATS approval is valid for a period of 3 years; VATS enterprises are also required to submit to annual inspections conducted by the SCA and annually submit business reports in Q1 of the year following inspection.

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Guide to the Shanghai Free Trade Zone
In this issue of China Briefing, we introduce the simplified company establishment procedure unique to the zone and the loosening of capital requirements to be applied nation wide this March. Further, we cover the requirements for setting up a business in the medical, e-commerce, value-added telecommunications, shipping, and banking & finance industries in the zone. We hope this will help you better gauge opportunities in the zone for your particular business.