ANNOUNCEMENT 01 Dec 2017

December 1, 2017 - China's southern Guangdong province announced 10 new policies intended to encourage the amount of FDI in the region.

NUMBER OF INTERVENTIONS

3

  • 0 harmful
  • 0 neutral
  • 3 liberalising

SOURCE

Guangdong provincial government, December 1, 2017. (粤府〔2017〕125号 广东省人民政府关于印发广东省进一步扩大对外开放积极利用外资若干政策措施的通知)
http://www.gdczt.gov.cn/zwgk/czxw/201712/t20171206_907831.htm

Inception date: 01 Dec 2017 | Removal date: open ended
Still in force

FDI: Entry and ownership rule

On the 1st of December 2017, the regional government in China's southern manufacturing heartland of Guangdong province released an announcement containing 10 measures designed to boost foreign investment in the region.

Firstly, the plan revealed mechanisms to relax ownership limits and/or operation scope in the following sectors:

  • Special vehicle manufacturing;
  • New energy vehicle manufacturing;
  • Ship design;
  • Regional aircraft and general aircraft maintenance;
  • Human resources service agencies;
  • International maritime transport companies;
  • Railway passenger transport companies;
  • Construction and operation of gas stations;
  • Internet service and call centers;
  • Performance brokerages;
  • Brokerage, banking, securities, futures, and life insurance companies;
  • Law firms jointly owned by Hong Kong/Macau investors and domestic investors; and
  • Hong Kong/Macau airlines will be treated as special domestic airlines.

Furthermore to the above, there were three policies released in the Guangdong government's December 2017 announcement that aimed to reduce various areas of controls applying to the actions of foreign investors in the region, namely:

Adjust the conditions for land distribution, particularly pushing favourable land use policies for international Fortune 500 companies;
Optimise the mechanisms surrounding foreign investment in flagship industrial parks;
Better the use of foreign investment guarantee mechanisms by increasing measures to promote foreign investment opportunities and ensuring that complaints regarding the FDI process from foreign firms are dealth with properly.

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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Inception date: 01 Dec 2017 | Removal date: open ended
Still in force

FDI: Financial incentive

In addition to the above, the Guangdong authorities also announced increased financial support for foreign-invested firms in the following ways:

  • Increase use of financial incentives over the 2017-2022 period, including:
    • For new projects worth more than US$50 million, replenishment projects worth more than US$30 million, and for multinational or regional headquarters worth at least US$10 million, the provincial government will give financial bonuses worth no less than two percent of the year’s actual investment amount, capped at RMB 100 million (US$15.1 million).
    • For Fortune 500 companies and leading global companies with actual investments (new projects or replenishment projects) in manufacturing worth over US$100 million in one year, and newly established IAB (new generation of information, automatic equipment, and bio-pharmaceuticals) and NEM (new energy, new material) projects with actual investments of no less than US$30 million in one year, the provincial government will provide financial support on a case-by-case basis.
    • For multinational or regional headquarters that contribute over RMB 10 million (US$1.5 million) to provincial revenue, 30 percent of the contributions will be awarded to the company in a lump sum payment, capped at RMB 10 million (US$1.5 million).
    • Local governments can provide other financial incentives based on provincial incentive standards.
  • Support R&D, including financial support for foreign R&D platforms;
  • More financial support for Fortune 500 companies as well as help with cross-border M&A.
 
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Inception date: 01 Jan 2017 | Removal date: open ended
Still in force

Labour market access

Finally, the Guangdong government announced in its 10-pronged policy release that it would be implementing a system called the 'Guangdong Priority Card' - a type of document given to certain high-talent foriegn nationals that will function as a proof of identity and right to settle in the province.

This makes access to public services, housing, healthcare etc. easier for both the card holders and their families - giving such individuals the 'equal treatment as compared to citizens of China'.

The individual cards are valid for five years apiece, subject to renewal approval.

 
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