Issue 41
Shanghai Weekly Bulletin
No. 4,April 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.
Laws and Regulations
【National】
1. China Issues Document to Facilitate Payment in the Commercial Sector
【Keyword: Payment Facilitation】
The People's Bank of China (PBC), together with the Ministry of Commerce and the State Administration of Foreign Exchange, issued on April 16, 2024 the Circular on Further Improving Payment Services to Facilitate Payment in the Commercial Sector. The document aims to better meet the demand of the elderly, foreign nationals in China and other groups for various payment services in the commercial sector.
Source: PBC
http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/5331929/index.html
2.SAFE Revises the Guidelines for Foreign Exchange Business under the Capital Account to Improve the Convenience of Business Processing
【Keywords: Capital Account; Foreign Exchange Business】
The State Administration of Foreign Exchange (SAFE) recently issued the Guidelines for Foreign Exchange Business under the Capital Account (2024 Version), to be effective on May 6, 2024. The document consists of three parts, namely the guidelines for foreign exchange business under the capital account at foreign exchange administrations, the guidelines for foreign exchange business under the capital account at banks, and template formats and texts.
Source: SAFE
https://www.safe.gov.cn/safe/2024/0412/24226.html
【Shanghai】
1. Shanghai Issues Document to Promote High-quality Development of Professional Services
【Keyword: Professional Services】
The Guidelines on Further Improving the Development Environment and Promoting High-quality Development of Professional Services in Shanghai, which were issued on April 16, 2024, propose that by 2035, professional services in Shanghai will reach world class in terms of scale, capacity, quality, and efficiency, with rules, regulations, management and standards aligned with international norms and a new system of high-quality and efficient professional services basically established. The move aims to help Shanghai elevate its position in the global service network, and build the city into the central node of the domestic circulation, as well as the strategic link between the international and domestic circulations.
Source: Shanghai Municipal Development and Reform Commission
https://fgw.sh.gov.cn/fgw_cyfz/20240418/9a5d50eae01c4a139c75eaa2a42a61cd.html
2. Shanghai Issues Measures for the Administration of Food Business Licensing and Filing
【Keywords: Food; Business Licensing; Filing】
Shanghai Municipal Administration for Market Regulation recently issued the Implementation Measures of Shanghai for the Administration of Food Business Licensing and Filing, which will come into force on May 10, 2024 and remain valid until May 9, 2029. The document is divided into nine chapters, including General Provisions, Application and Acceptance, Review and Decision, License Management, Filing for Sales of Prepackaged Food Only, Food Operator Reporting, Supervision, Inspection and Management.
Source: Shanghai Municipal Administration for Market Regulation
https://scjgj.sh.gov.cn/007/20240415/2c984a728ee0ba36018ee12e52fc0c63.html
One Week in Shanghai
【Latest News】
1. "Our Water", a Program of China-France Year of Culture and Tourism, Held in Paris
【Keyword: China-France Culture】
On the afternoon of April 18 local time in Paris, France, the first Paris series of "Our Water: Starting from Shanghai - Global City Humanities Dialogue", a program of the China-France Year of Culture and Tourism, officially kicked off with the theme "Our Water, To a Boundless Future". The launch ceremony and Paris forum were held at the Palais Brongniart on the banks of the Seine.
Source:Shanghai Release
2. Shanghai Hongqiao One-stop Service Center for Overseas Talents Reopens at New Location
【Keyword: One-stop Service Center for Overseas Talents】
The inauguration ceremony of Shanghai Hongqiao One-stop Service Center for Overseas Talents was held in Changning on April 16, 2024. The Shanghai Hongqiao Immigration Affairs Center was opened at the same venue, and the first batch of new versions of the permanent residence ID cards were issued to foreign nationals. Besides, three new buildings of "Changning District International Student Talent Apartments" were put into use; and the "comprehensive service package for overseas talents" was launched.
Source:Shanghai Changning
3. English Version of MaaS App Enables Inquiry of Real-time Bus Locations
【Keywords: MaaS; Real-time Bus Locations】
In order to provide convenient public transportation services to foreign nationals, the English version of the Shanghai "Mobility as a Service" (MaaS) App has enabled inquiry of real-time bus locations. Foreign tourists and foreigners living in Shanghai can check the real-time information of Shanghai subways, bus lines and ferries through the English version of the App, and use the "Suishenma" (Shanghai City Travel Code) to enjoy the same discounts as local citizens.
Source:Shanghai Traffic
【Forum & Exhibition】
1. 7th China (Shanghai) International Invention and Innovation Exhibition to Be Held in June
【Keyword: International Invention and Innovation Exhibition】
The 7th China (Shanghai) International Invention and Innovation Exhibition will be held at the Shanghai World Expo Exhibition and Convention Center from June 12 to 14. The exhibition is themed on "Invention, Creation and Interpretation of the Future". It features three exhibition areas separately dedicated to innovation and invention, future inventors, and overseas innovation and invention.
Source:Shanghai Association of Inventions
【Culture & Art】
1. Shanghai Museum Launches English Reservation System
【Keywords: Shanghai Museum; English Reservation System】
Shanghai Museum has stretched its booking window from a week to 14 days in advance since April 19, in a bid to facilitate domestic and foreign tourists in making travel plans. It has also launched an English reservation system for overseas individual tourists to make early reservations.
Source:Shanghai Foreign Affairs Office
2. 2024 Shanghai International Flower Show Kicks off
【Keyword: Shanghai Flower Show】
The 2024 Shanghai International Flower Show kicked off on April 18 and will last until May 22, 2024. This year's flower show selects rose - Queen of Flowers - as the theme flower, displaying more than 550 varieties and more than 2,000 new and rare plants (varieties). Through the city-wide flower show across three main venues, six sub-venues and several theme locations, the beauty of spring with "blooming flowers" is created in urban public spaces.
Source:Shanghai Tourism
3. Special Exhibition Commemorating the 460th Anniversary of Shakespeare's Birth Opens in Shanghai
【Keyword: Shakespeare】
A special exhibition commemorating the 460th anniversary of Shakespeare's birth - Transforming Shakespeare into Gold - opened at the Shanghai Art Collection Museum on April 20, 2024, and will last until May 19. The exhibition displays Shakespeare's life stories and literary works through more than a hundred exhibits in various forms.
Source: Shanghai Tourism
【Corporate Activities】
1.Straumann Minhang Plant to Be Completed
【Keyword: Straumann】
Construction of the high-end implant industrialization project of Straumann (Shanghai) Medical Devices Co., Ltd. has entered the final stage and is about to be fully completed. The project is Straumann Group's first base in Asia integrating production, training and innovation. The first phase covers a building area of 20,000 square meters, with a total investment of approximately 1.2 billion yuan. Annual revenue is expected to reach 1.4 billion yuan after the plant begins production.
Source:Minhang Today
【Training】
1. Salon Session on Guidelines for Enterprise Trade Secrets Protection and Rights Protection
【Keyword: Trade Secrets】
In order to strengthen the awareness and ability of foreign-invested enterprises to protect trade secrets, the Third Branch of the Shanghai Municipal People's Procuratorate will join hands with the Shanghai Foreign Investment Association to hold a salon on "Guidelines for Enterprise Trade Secrets Protection and Rights Protection" on the 2024 World Intellectual Property Day (April 26). The salon will discuss the difficulties and problems faced by enterprises in the protection of trade secrets, and explore better solutions to the protection of corporate trade secrets.
Source:Shanghai Foreign Investment Association
Q&A
Q1: Leaders of the State Administration of Foreign Exchange answered reporters' questions at a press conference held by the State Council Information Office to introduce financial operations and foreign exchange receipts and payments in the first quarter of 2024. Since the fourth quarter of last year, overseas institutions have begun to increase their holdings of onshore Chinese bonds in large quantities. Could you introduce the specifics and how you foresee the prospects for foreign investors in China's bond market?
A1: Firstly, the scale of investment has rebounded significantly. Foreign investors recorded a net increase of US$23 billion in net bond holdings in 2023, and the figure spiked to US$41.6 billion in the first quarter of this year. As of the end of this March, 1,129 overseas institutions from more than 70 countries and regions have entered the Chinese bond market, and foreign bond holdings have exceeded US$570 billion, accounting for about 2.6% of the total onshore bond custody, up 0.2 percentage point from the end of last year. Secondly, investment structure continues to be reasonable. In terms of bond-holding entities, overseas central banks and commercial banks have increased their holdings of onshore bonds, and have mostly invested in medium and long-term bonds such as government bonds and policy-based financial bonds. We made statistics and found that from October 2023 to March 2024, foreign holdings of bonds with a maturity of more than one year accounted for 56% of the total. Thirdly, investment income remains stable.
Looking ahead, foreign investment in the Chinese bond market is expected to continue its steady growth.
From the economic perspective, firstly, we have favorable macroeconomic environment. The long-term positive trend of the Chinese economy has not changed, and various policies have continued to shore up the economy, providing a good and stable macro environment for foreign investors. Secondly, the investment value is protected. RMB exchange rate is relatively stable, and RMB assets have relatively independent return performance, which helps investors diversify risks across global markets. At the same time, China's bond market is the second largest in the world, with continuous expansion in breadth and depth and very good liquidity, which will also enhance the investment value of RMB bonds. Third, there is a demand for global asset allocation. The proportion of RMB in global cross-border transactions has steadily increased. The latest data suggests the international influence of RMB is gradually increasing, and RMB assets have become an important choice for overseas institutions in their global investment allocations.
From the policy perspective, the People's Bank of China and the State Administration of Foreign Exchange will continue to follow the direction of marketization, rule of law and internationalization, steadily expand the opening of China's bond market to the outside world, and make it more convenient for foreign investors to participate in the Chinese bond market. We are now working on the following areas: First, we are opening the repurchase business to more overseas institutions and offering more liquidity management tools for overseas investors. The second is to push for onshore RMB bonds to become widely accepted collateral at offshore bond market. Since the beginning of this year, bonds traded under the "Bond Connect" channel have been added to the list of eligible collateral for the RMB liquidity facility of the Hong Kong Monetary Authority. Currently, we are studying to expand more application scenarios, including using bonds from the "Bond Connect" channel to offset margins on "Swap Connect". The third is to optimize the direct access mechanism of overseas institutions, the operating mechanism of "Bond Connect" and "Swap Connect", continue to strengthen communication with overseas institutions, and create a better investment environment. Generally speaking, China continues to improve institutional openness of the financial market, enhance the investment environment and optimize services. Foreign investment in China's bond market has stable and sustainable room for growth.
Source: State Council Information Office
http://www.scio.gov.cn/live/2024/33806/tw/
Expert Perspective
Several Issues to Be Watched and Addressed by Foreign Businesses under New Company Law
By: He Kan, Chen Leyi, Gao Fangjiao, Liu Zijing, Yang Yanhua (Junhe Law Firm)
[Continuing from the Last Issue]
Q9: The powers and responsibilities of directors, supervisors and senior executives expanded (Part I)
A prominent highlight of the amendment to the New Company Law is to expand the powers of directors in maintaining company capital adequacy and company liquidation, which reflects the trend of corporate governance shifting from shareholder-centrism to board-centrism. It also strengthens the role of directors and supervisors, senior managers (According to the New Company Law, "senior managers" refer to the company's manager, deputy manager, financial manager, secretary to the board of directors of a listed company and other personnel specified in the company's articles of association) (Hereinafter collectively referred to as "directors, supervisors and senior executives"). They shall fulfill obligations of loyalty and diligence, and their liabilities to the company and third parties mainly include the following:
a) It stipulates the principles and standards for the loyalty and diligence obligations of directors, supervisors and senior executives, and includes supervisors within the scope of supervision of related-party transactions and horizontal competition. At the same time, their close relatives, enterprises directly or indirectly controlled by them as well as other related persons are also subject to supervision on related-party transactions.
b) If directors and senior managers cause damages to others while performing their duties, the company shall bear liability. Directors and senior managers shall also be liable for compensation if they are intentionally or grossly negligent;
c) Strengthening the obligations of directors and senior managers to independently perform their duties in compliance with regulations. If they violate the regulations and are instructed by the controlling shareholder or actual controller to engage in behavior that damages the interests of the company or shareholders, they will have to bear joint and several liability;
d) Strengthening the obligations of directors, supervisors and senior executives to safeguard the company's obligations in capital replenishment. Directors, supervisors and senior executives who fail to fulfill their responsibilities will have to bear joint and several liability or compensation liability;
e) Directors are the company's liquidation obligors and will be liable for compensation if they fail to perform their duties.
[To be continued]