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Shanghai Weekly Bulletin (Issue 31, No.1, February 2024)

2024年02月07日 09:46

Issue 31

Shanghai Weekly Bulletin

No. 1,February 2024

Shanghai Weekly Bulletin is an information service presented by the Foreign Affairs Office of Shanghai Municipal People’s Government in collaboration with Wolters Kluwer to foreign-funded enterprises, foreign-related institutions as well as people from overseas living in Shanghai. Covering major national and Shanghai foreign-related news, event information, policy Q&A and interpretations in the past week, it keeps you up-to-date with the latest foreign-related policies and developments in Shanghai.

Shanghai Weekly Bulletin (Issue 31, No.1, February.png

 

Laws and Regulations

【National】

1. China Issues Interim Regulations Governing Carbon Emissions Trading

【Keyword:Carbon Emissions Trading】

 

The Interim Regulations Governing Carbon Emissions Trading have been adopted at the 23rd executive meeting of the State Council. The Regulations, which have 33 articles and are scheduled to take effect on May 1, 2024, specify the obligations of the key greenhouse gas (GHG) emitters that are included in the national carbon emissions trading market and the technical service agencies that are authorized to conduct testing related to GHG emissions, as well as the penalty rules. The Regulations also clarify that China will strengthen international cooperation and exchanges in the field of carbon emissions trading.

 

Source: Website of the Chinese Government

https://www.gov.cn/zhengce/content/202402/content_6930137.htm

 

2. China and Thailand Sign Mutual Visa Exemption Agreement 

【Keywords:Thailand; Mutual Visa Exemption】

 

China and Thailand signed on January 28, 2024 in Bangkok, Thailand the Mutual Visa Exemption Agreement Between the People’s Republic of China and the Kingdom of Thailand, which will come into force on March 1, 2024. According to the agreement, Chinese nationals holding passports for public affairs or ordinary passports, and Thai nationals holding ordinary passports are allowed to enter each other's country without a visa for a single stay of up to 30 days (no more than 90 days per 180 days), and those who enter each other's country for work, study, news reporting, residence and some other activities requiring prior approval and plan to stay in each other's country for more than 30 days shall obtain the corresponding visa before entering the country.

 

Source: Consular Express

 

3. China Issues Documents to Further Facilitate Real Estate Registration and Improve Business Environment

【Keywords:Business Environment; Real Estate Registration】

 

Four departments including the Ministry of Natural Resources recently issued the Circular on Further Facilitating Real Estate Registration to Promote Improvement of Business Environment. The document proposes to create an integrated "inter-provincial service" demonstration model in the Yangtze River Delta region with "full range of online services" as the mainstay and offline assistance as the supplement, and gradually expand the model to Beijing-Tianjin-Hebei, Chengdu-Chongqing and other regions.

 

Source: Ministry of Natural Resources

https://m.mnr.gov.cn/gk/tzgg/202402/t20240201_2836868.html

 

【Shanghai】

1. Shanghai to Build Producer Internet Service Platform Clusters in Five Key Areas

【Keywords:Internet Service Platform; Clusters】

 

Shanghai Municipal People's Government recently issued the Several Measures on Supporting Pudong New Area and Another Four Key Areas to Build Producer Internet Service Platform Clusters. The document proposes several measures to support the creation of producer Internet service platform clusters in five key areas including Pudong New Area, Baoshan District, Putuo District, Lin-gang Special Area, and Hongqiao International Central Business District. It took effect on January 15, 2024 and will remain effective for three years. 

 

Source:Shanghai Municipal People's Government

https://www.shanghai.gov.cn/nw12344/20240130/a8d17374f1b342d58828f64e93c7e997.html

 

2. Shanghai Deepens "One-stop Online Service" Reform to Optimize Government Services and Improve Administrative Efficiency

【Keywords:One-stop Online Service; Government Services】

 

Shanghai Municipal People's Government recently issued the Action Plan for Deepening "One-stop Online Service" Reform to Optimize Government Services and Improve Administrative Efficiency (2024-2026). The document covers six aspects of content, including overall requirements, promotion of "smart and targeted" government services, promotion of "fair and accessible" government services, building of an intelligent and intensive platform support system, establishment of a science-based and accurate performance evaluation system, and safeguard measures.

 

Source: Shanghai Municipal People's Government

https://www.shanghai.gov.cn/nw12344/20240201/92ea63eb42054fc7aa81980a7317620b.html

 

3. Shanghai Issues Guidelines to Provide Comprehensive Services for the Development of Sci-tech Innovation Center

【Keywords:Sci-tech Innovation; Service Guarantee】

 

Shanghai Municipal Procuratorate Office recently issued the Guidelines of the Shanghai Municipal Procuratorate on Providing Comprehensive Services for the Development of Sci-tech Innovation Center, and the Implementation Plan of the Shanghai Municipal Procuratorate on Performing Four Procuratorial Functions of Intellectual Property Rights in the Whole Chain. The first document contains a total of 20 guidelines in five aspects, including clarifying goals and tasks, accurately performing duties in accordance with the law, deepening reform of mechanisms and systems, exploring new services, improving leadership and enhancing team buildup, and puts forward requirements for the development of procuratorate teams to serve the city's goal of becoming an innovation center of science and technology. The second document clarifies tasks for the comprehensive implementation of the four procuratorial functions of criminal, civil, administrative and public interest litigation in intellectual property disputes.

 

Source: Shanghai Procuratorate

 

4. Shanghai Revises the Rules for Implementation of the Shanghai Municipal Provisions on the Grant of Awards for Science and Technology Innovation

【Keywords:Science and Technology; Provisions on Grant of Awards】

 

Shanghai Municipal Commission of Science and Technology recently issued the revised Rules for the Implementation of Shanghai Municipal Provisions on the Grant of Awards for Science and Technology Innovation. The revised rules have 62 articles in eight chapters, including Scope, Conditions and Evaluation Criteria, Nomination and Acceptance, Evaluation, Objection Handling, Approval and Grant of Rewards and so on. The rules took effect on January 26, 2024.

 

Source:Shanghai Municipal Commission of Science and Technology

https://stcsm.sh.gov.cn/zwgk/kjzc/zcwj/kwzcxwj/20240126/bea15bb64078429aa82d264f9a2b7f84.html

 

5. Shanghai Punishes Some Business Entities for Failing to Fulfill Their Obligations to Protect Consumer Information

【Keyword:Personal Information Protection】

 

Shanghai Cyberspace Administration recently released typical cases of punishing business entities that failed to fulfill their consumer personal information protection obligations, imposing administrative penalties on a number of well-known companies that failed to effectively fulfill their information protection responsibilities and had serious problems.

 

Source:Shanghai Cyberspace Administration

 

One Week in Shanghai

【Latest News】

1. Changning District Confers the Second "Hongqiao Friendship Award" to 10 Foreign Nationals

【Keyword:Hongqiao Friendship Award】

 

Changning District's Second "Hongqiao Friendship Award" award ceremony and the "Hongqiao Friendship Alliance" re-election ceremony were held on January 31, 2024. 10 winners and five nominees of the award were commended.

 

Source:Shanghai Changning

 

2. Pudong New Area People's Association for Friendship with Foreign Countries Established

【Keyword:Association for Friendship with Foreign Countries】

 

The founding conference of the Pudong New Area People's Association for Friendship with Foreign Countries was held on January 29, 2024. The association is a social organization specialized in non-governmental friendly exchanges with foreign countries. It has 29 institutional members and 28 individual members, covering various industries and fields such as economy and trade, science and technology, culture and health.

 

Source: Pudong Release

 

【Forum & Exhibition】

1. WDEC 2024 Held in Shanghai

【Keyword:World Digital Education Conference】

 

The 2024 World Digital Education Conference (WDEC 2024) was held in Shanghai on January 30-31, with the theme of "Digital Education: Application, Sharing, and Innovation". At the closing ceremony, a compilation of international digital education cases, the Global Digital Education Development Index, and the "China Smart Education Development Report 2023" were released, the launch ceremony of the "Digital Education Frontier" was held, and the 2024 World Digital Education Conference Shanghai Initiative was released.

 

Source:Press Office of the Ministry of Education

 

2. 32nd East China Fair to Be Held in Shanghai

【Keyword: East China Fair】

 

The 32nd East China Fair will be held at the Shanghai New International Expo Center from March 1 to 4, 2024. The total exhibition area is 126,500 square meters, covering Garments, Textiles, Home Products, Gifts, Overseas Products and Cross-border E-commerce.

 

Source:Pudong Release

 

【Culture & Art】

1. Shanghai Kicks off Serial Activities to Celebrate Spring Festival

【Keyword:Spring Festival】

 

During the Spring Festival, Shanghai will leverage its resources and advantages to highlight the city's image as an international metropolis. The city will present some 200 special culture & tourism activities, including art exhibitions, cultural museums, opera works, singing parties, overseas study tours, aesthetics education, sightseeing tours, and food tastings. They are expected to create a strong festive atmosphere with metropolitan characteristics.

 

Source: Shanghai Release

 

2. "10,000 Dragons Art Exhibition" Opens in Shanghai

【Keywords:Dragon; Exhibition】

 

On the occasion of the Spring Festival of the Year of the Dragon in 2024, the "10,000 Dragons Art Exhibition" co-presented by many Chinese and foreign artists opened at the Wang Xiaohui Art Museum in Shanghai on January 25. It will last until April 20.

 

Source: CGTN

 

3. "Pictures of China - Artworks by Lin Fengmian and Wu Guanzhong" Opens in Shanghai

【Keywords: Lin Fengmian; Wu Guanzhong】

 

The "Pictures of China - Artworks by Lin Fengmian and Wu Guanzhong" is being exhibited at the China Art Palace (Shanghai Art Museum) from January 27 until May 5, 2024. The exhibition brings together 200 representative works (groups) of the two Chinese art masters. With new curation and magnificent spirit, the exhibition presents an epic artistic dialogue between the two painting giants to the audience.

 

Source:Shanghai Tourism

 

【Corporate Activities】

1. Roland Berger Relocates Asia Pacific Headquarters to Jing'an District

【Keyword: Roland Berger】

 

Roland Berger Management Consulting, one of the world's top strategic management consulting companies, recently announced the relocation of its Asia-Pacific headquarters to the Suhewan Center. It also released the Roland Berger “Foreseeing 2024" China Industry Trend Report.

 

Source:Shanghai Jing'an

 

2. British Drugmaker Clinigen's First Chinese Subsidiary Settles in Waigaoqiao

【Keyword: Clinigen】

 

Shanghai Cognigen Trading Co., Ltd., Clinigen's first wholly-owned subsidiary in the Chinese mainland, recently settled in Waigaoqiao. Cinigen is a British medical and pharmaceutical services group. 

 

Source:Pudong Release

 

 Q&A

In order to further improve Shanghai's business environment to attract foreign investment, relevant departments in the city have combed through and summarized the recent hot issues that foreign-invested enterprises have paid attention to, and launched a "Hot Q&A" column to help you understand and master policy information more clearly, and use policy information more effectively. 

"Hot Q&A" No. 1: What are the latest tax policies regarding stabilizing foreign trade and foreign investment?

A1: In order to give full play to the role of taxation in supporting the work of stabilizing foreign trade and foreign investment, the State Taxation Administration has updated the currently effective tax support policies and tax collection and management service measures, and released new version of the Guidelines on Tax Policies for Stabilizing Foreign Trade and Stabilizing Foreign Investment on January 15. The new guidelines aim to make it easier for taxpayers to understand and apply tax policies, and to create a favorable tax environment for the development of foreign trade and foreign investment.

"Hot Q&A" No. 2: What are the specifics of the Guidelines on Tax Policies for Stabilizing Foreign Trade and Foreign Investment?

A2: The Policy Guidelines are divided into two areas: stabilizing foreign trade policies and stabilizing foreign investment policies, and include a total of 51 policy items. Among them are 19 tax policies related to stabilizing foreign trade, including tax policies for exported goods and labor services, value-added tax policies for cross-border taxable activities, tax policies for new foreign trade practices, and measures to facilitate export tax refund (exemption) services. There are 32 tax policies related to stabilizing and encouraging foreign investment.

The new Guidelines on Tax Policies for Stabilizing Foreign Trade and Foreign Investment have been released on the official website of the State Taxation Administration. Taxpayers can log in to check and compare operations, apply for tax support policies suitable for their own development, and enjoy the policy benefits.

 

Source:Shanghai Commerce

 

Expert Perspective

With the implementation of the new Company Law, what do foreign investors need to know? 

By: An Suiyi, Sol Zhang(Llinks Law Offices)

[Continuing from the last issue]

 

Third point: Corporate Governance

1. Audit Committee vs. Board of Supervisors

LLCs are required to have a board of supervisors (or at least a supervisor) ever since the Company Law first came into force in 1993, which has the functions and powers to inspect the financial conditions of the company, and monitor and oversee the performance of directors and senior officers. 

The New Company Law introduces the audit committee under the board of directors (the “BoD”) as an alternative to the board of supervisors, which has the same functions and powers as the board of supervisors. 

Llinks observation

As mentioned above, the audit committee has the same functions and powers with the board of supervisors, which include the power to inspect the financial conditions of the company. But from cautious perspective this should not be read as automatically granting the power to such committee to conduct audits of the company, although it is interestingly called the “audit committee”.

2. Functions and Powers of Corporate Governing Bodies

The 2018 Company Law sets out a rigid regime for functions and powers among the shareholders, the BoD and the general manager, where certain operational matters, such as the operation strategy, investment plan and budget and settlement of account, require approvals from both the shareholders and the BoD. The functions and powers of the general manager are also prescribed by law, where these could be only amended by the articles of association of the Company.

The New Company Law allows more flexibility, as the matters requiring dual approvals above are now left for the BoD to decide only. As to the general manager, it is no longer a mandatory position prescribed by law. If the company still choose to have such position, its functions and powers could be determined by the authorizations from the board, no longer by the articles of association only.

Llinks observation

Now the BoD will become the centerpiece for decision-making of the Company’s operational matters. If a foreign investor is the minority shareholder in the company and does not have any BoD seat, the right to appoint a BoD observer is increasingly meaningful if the foreign investor is seeking the access to more information regarding the business operation of the company.

3. Candidates of Legal Representative

A legal representative is the person that has the power to act on behalf of and thus bind the company by default. Under the 2018 Company Law, the legal representative is to be assumed by either the chairman of the BoD or the general manager. 

Under the New Company Law, a director that manages the affairs of the Company (instead of the chairman of the BoD) or the general manager is eligible to assume the role of the legal representative.

Llinks observation

It is a common practice for FIEs, especially those established by multinational companies, to appoint a senior officer from the headquarter as the chairman of the BoD and the legal representative, while such person is not involved in the business operation of the company. If this is the case, such FIEs may need to consider changing their legal representative to be fully compliant with the New Company Law.

 

[To be continued]