China Regulatory Brief: New Preferential Policies for SMEs, Shanghai Foreign Residence Permit Rules

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China-Regulatory-Brief
SMEs to Enjoy New Preferential Tax Policies in China

On August 19, Chinese Premier Li Keqiang announced a new round of preferential tax policies for small and medium-sized enterprises (SMEs) during an executive meeting of the State Council. Small and medium-sized enterprises with a taxable income not exceeding RMB 300,000 are allowed to pay corporate income tax at the rate of 20 percent on only 50 percent of their taxable income. Further, SMEs with a monthly sales volume of RMB 20,000 to RMB 30,000 shall be exempt from value-added tax (VAT) and business tax. The policy will take effect on October 1 and last until December, 2017. In the past eight years, China has taken a series of measures to aid in the development of SMEs such as establishing special support funds, reducing corporate income tax (CIT) and value-added tax (VAT) rates, and clearing some administrative fees. 

Shanghai Implements Detailed Rules on Foreign Residence Permit

The Shanghai Municipal Human Resources and Social Security Bureau (HRSS) recently released the “Implementation Rules on Administrative Measures of Shanghai on Residence Permits for Foreign Talents.” The Rules stipulate that qualified overseas talent with special skills or who have a bachelor’s degree, and who legally work or have a business in Shanghai, may apply for the Type B residence permit. The relevant employers need to apply to the local HRSS bureau and local police station for the permit. The permit’s maximum period of validity is set at 10 years. The period will be determined by the Shanghai Municipal HRSS bureau on a case-by-case basis, according to the applicant’s age, academic qualifications, field of specialization, working experience, employment contract and other conditions. 

Related Link IconRELATED: Retaining Foreign Talent in China – Shanghai and Beijing Improve Foreign Residence Permit Rules

China Launches Record-Filing System for Foreign-invested Advertising Enterprises

China’s State Administration for Industry and Commerce (AIC) has recently announced its decision to launch the record-filing system for foreign-invested advertising enterprises. According to the decision, the examination and approval formalities for advertising projects and branch establishment by a foreign-invested advertising enterprise shall be replaced by the record-filing system. Previously, the establishment of a foreign-invested advertising enterprise was subject to certain restrictions such as main business, operational experience and annual advertising business turnover. First piloted in the Shanghai Free Trade Zone (FTZ) in 2013, the filing system is now further expanded nationwide. 

China Releases Draft of Online Food Trading Business Rules

On August 18, the State Food and Drug Administration (SFDA) issued the “Measures for Supervision & Administration of Online Food Trading,” which is currently seeking public opinions. The Measures clarifies that the online food traders shall obtain the food trading license or be filed with the SFDA before starting up their online food trading business. Further, online food traders are not allowed to entrust other entities or personnel to conduct online food trading business. A third party online trading platform needs to provide the real name, address and valid contact details of the trader to consumers if needed.


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