REGULATIONS ON PREFERENTIAL TREATMENT OF FOREIGN
INVESTMENT IN THE MINHANG AND HONGQIAO ECONOMIC
AND TECHNOLOGICAL DEVELOPMENT ZONES OF SHANGHAI
MUNICIPALITY

(Promulgated 23 March 1987 by the
Shanghai Municipal People's Government)

 

 

SUBJECT: ENTERPRISES WITH FOREIGN INVESTMENT

ISSUING-DEPT: SHANGHAI MUNICIPALITY

ISSUE-DATE: 03/23/1987

IMPLEMENT-DATE: 04/01/1987

LENGTH: 600 words

TEXT:

[Article 1] These Regulations are formulated in accordance with the relevant State laws and statutory regulations to develop Shanghai's foreign economic and technological co-operation and exchange, establish new industries and enw technological co-operation and exchange, establish new industries and new technological co-operation and exchange, establish new industries and new technology, expand exports and increase foreign exchange income, and accelerate the construction of the Minhang and Hongqiao Economic and Technological Development Zones of Shanghai Municipality (hereinafter referred to as the Development Zones).

[Article 2] Foreign investment enterprises in the Development Zones may enjoy the preferential treatment as stipulated in these Regulations, in addition to the preferential treatment stipulated in the relevant State and Shanghai Municipality regulations.

[Article 3] Manufacturing foreign investment enterprises in the Development Zones shall be exempt from local income tax until the end of 1995.

[Article 4] New buildings that are built or purchased in the Development Zones by foreign investment enterprises shall be exempt from building property tax for five years, commencing from the month of the completion of the building's construction.

[Article 5] Foreign investment enterprises in the Development Zones which have difficulty paying taxes in accordance with regulations may apply to a reduction of or exemption from Consolidated Industrial and Commercial Tax.  The reduction or exemption shall be subject to approval by the tax authorities

[Article 6] The relevant units shall ensure the supply of water, electricity; and gas, and transport and communications facilities, etc., that are required by foreign investment enterprises in the Development Zones for production and operations, and charges shall be calculated and collected in accordance with the scale of charges for local State-run enterprises.

[Article 7] Loans for short-term working capital required by a foreign investment enterprise for production and business transactions shall be assured following verification and approval by the bank with which the enterprise has an account or another financial institution, and priority lending shall be given for any other required credit funds.

[Article 8] Foreign investors may invest in the development of sites, undertake the construction of infrastructure facilities and deal in building property in the Development Zones, provided these activities are in accordance with the overall plans of the Development Zones.

Foreign investment enterprises undertaking the construction of infrastructure facilities in the Development Zones may enjoy the preferential treatment given to production enterprises in the Development Zones.

[Article 9] Bonded warehouses may be established in the Development Zones to provide services to enterprises either within or outside the Development Zones.  Bonded warehouses for entrepot trade may also be established following approval by the State department in charge.

[Article 10] Enterprises in the Development Zones which are invested in or operated by companies, enterprises or other economic organisations or individuals from Hong Kong, Macao and Taiwan shall act with reference to these Regulations.

[Article 11] The Shanghai Municipal Commission of Foreign Economic Relations and Trade shall be responsible for the interpretation of these Regulations.

[Article 12] These Regulations shall take effect from 1 April 1987.