Issue 51

Shanghai Weekly Bulletin

No.1,July 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. SPC Issues Judicial Interpretation on Antitrust Lawsuits

【Keywords: Monopoly; Civil Disputes】

 

The Interpretation of the Supreme People’s Court on Certain Issues Concerning the Application of Law for the Trials of Civil Dispute Cases Involving Monopoly was released on June 24, 2024. The document, effective on July 1, 2024, consists of 51 articles in six chapters, including procedures, definition of relevant markets, monopoly agreements, abuse of market dominance, civil liability, and supplementary provisions. 

 

Source: SPC

 

【Shanghai】

 

1. Shanghai Issues Document to Speed up New Industrialization 

【Keyword: New Industrialization】

 

The Shanghai Municipal Committee of the Communist Party of China (CPC) and Shanghai Municipal People’s Government recently released the Shanghai Action Plan on Speeding up New Industrialization. The document introduces five actions and 20 measures. The actions include fostering new quality productive forces, improving economic capacity, optimizing the industrial landscape, upgrading services for enterprises, and enhancing opening-up cooperation. 

 

Source: Shanghai Municipal Commission of Economy and Informatization

 

2. Shanghai Issues Rules Governing Special Fund to Draw Foreign Investment

【Keywords: Foreign Trade and Economics; Special Funds for Development】

Shanghai Municipal Commission of Commerce and Shanghai Municipal Finance Bureau recently issued the Implementation Rules for the 2024 National Special Fund for Foreign Trade and Economic Development (Attracting Foreign Investment). Consisting of 10 articles in four chapters, the document clarifies the targets for fund support, fund use procedures, and fund supervision and management.

 

Source: Shanghai Municipal Commission of Commerce

https://sww.sh.gov.cn/zwgkgfqtzcwj/20240624/640dad60e86c4b5c98090b8aa7c9f86d.html

 

3. Shanghai Advances Ad Hoc Arbitration of Foreign-related Commercial and Maritime Disputes

【Keywords: Foreign-related Commercial and Maritime Disputes; Ad Hoc Arbitration】

 

Shanghai Municipal Bureau of Justice recently issued the Measures for Promoting Ad Hoc Arbitration of Foreign-Related Commercial and Maritime Disputes (for Trial Implementation), which will come into force on August 1, 2024. The document specifies the scope of application of ad hoc arbitration, the selection of arbitrators, arbitration rules, services provided by arbitration institutions, and the promotion and guarantee of arbitration procedures. It aims to benchmark the high-standard international economic and trade rules and actively develop foreign-related legal services.

 

Source: Shanghai Municipal Bureau of Justice

 

4. Shanghai High Court Issues New Rules on Jurisdiction of Arbitration Cases

【Keyword: Arbitration】

 

Shanghai High People's Court issued on June 24, 2024 the Regulations of Shanghai High People's Court on the Collective Jurisdiction of Judicial Cases Involving "Three Specific" Ad Hoc Arbitration and "Foreign Arbitration Institutions". The rules clarify that for "three specific" arbitration cases between enterprises registered in the pilot free trade zone, the jurisdiction shall be determined in accordance with the regulations if the parties have submitted relevant applications to a court in Shanghai.

 

Source:International Services Shanghai

https://english.shanghai.gov.cn/en-Latest-WhatsNew/20240626/807b4f7fd4bd4dec9a2969fb15eb9db9.html

 

One Week in Shanghai

 

【Latest News】

 

1. Terminal 2 of Pudong Airport Puts One-stop Service Station for International Travelers into Trial Operation

【Keywords: Pudong Airport; One-stop Service Station for International Travelers】

The one-stop service station catering to international travelers arriving at Terminal 2 of the Pudong International Airport was put into trial operation on June 29. Featuring four functional models namely payment, tourism, communication and transportation, the station provides comprehensive, around-the-clock, considerate and convenient services for inbound international passengers, including entry service guide, International Services Shanghai Handbook, tourist maps, WIFI equipment rental, mobile phone SIM card sales, transportation card sales, foreign currency exchange, mobile payment and real person consulting.

 

Source: International Services Shanghai 

https://english.shanghai.gov.cn/en-Latest-WhatsNew/20240629/fe650daaea334b0bb44e8cbfa442c90d.html

 

2. Yangtze River Delta Professional Services Alliance Established in Shanghai

【Keywords: Foreign Trade; Services Alliance】

 

The 2024 Yangtze River Delta Trade Adjustment and Assistance Conference and the Launch Ceremony of the Yangtze River Delta Professional Services Alliance were held in Shanghai on June 26. The conference was jointly guided by commerce authorities of Shanghai, Zhejiang, Jiangsu and Anhui and organized by the Shanghai Chamber of Commerce for Import and Export. 

 

Source:Shanghai Municipal Commission of Commerce

 

3. Lujiazui Financial City Welcomes First Batch of Multinational Corporate Treasury Centers

【Keywords: Multinational Corporations; Treasury Centers】

 

Lujiazui Administration held a roadshow on June 24, 2024 to encourage multinational corporations' regional headquarters to set up corporate treasury centers at the Lujiazui Financial City. It was confirmed at the roadshow that five enterprises, including Fujifilm, HTDK, Decathlon, CBRE, and Volvo Cars Consultancy, would be the first batch of treasury centers, and their cooperative banks are Bank of China, Bank of Communications, Standard Chartered, HSBC, and JPMorgan Chase.

 

Source:Pudong Release

 

【Forum & Exhibition】

 

1. DSH International Shipping Innovation Conference to Be Held in July 

【Keyword: Shipping Services Industry】

 

The 2nd DSH International Shipping Innovation Conference will be held at the Lingang Special Area on July 8, 2024. Some 30 international shipping organizations and related institutions will conduct extensive and in-depth discussions on building world-class development environment and international rules of conduct, promoting international exchanges and cooperation, filling the gaps in high-end shipping services for Shanghai, creating a shipping function cluster, and advancing the digital, intelligent, green and low-carbon transformation of the shipping industry.

 

Source:Shanghai Lingang

 

2. ChinaJoy 2024 to Be Held at Shanghai New International Expo Center

【Keyword: ChinaJoy】

 

The 21st China Digital Entertainment Expo and Conference (ChinaJoy 2024) will be held from July 26 to 29 at the Shanghai New International Expo Center. With the theme "Stay True, Game on", the exhibition will feature about 600 well-known companies from 31 countries and regions, including France, the United States, Canada, Germany, the United Kingdom, Japan, the United Arab Emirates, Australia, Belgium, South Korea, Malaysia, Portugal, Turkey, and Singapore. The exhibition will cover a total area of 130,000 square meters. There are nearly 200 foreign exhibitors, accounting for 30 percent of the total.

 

Source: Pudong Release

 

【Culture & Art】

 

1. Shanghai Museum East Reopens on June 26

【Keyword: Shanghai Museum East】

Shanghai Museum East reopened to the public on June 26, 2024. The museum has now entered the second node of opening, adding 10 exhibition halls and interactive experience spaces, and the opened area has accounted for about 80 percent of the total exhibition space. There are four permanent exhibition halls of the "General History of Ancient Chinese Art Series" - Ceramics Hall, Seal Carving Hall, Jade Hall, and Currency Hall.

 

Source:Pudong Release

 

2. 145-year-old SSO Unveils Performances for 2024-25 Music Season 

【Keyword: Shanghai Symphony Orchestra】

 

Shanghai Symphony Orchestra (SSO) recently released its performance plan for the 2024-25 music season. The new season consists of SSO Season and SSO Presents, with a lineup of 83 performances in various genres including symphony, opera, chamber music and crossover. 53 performances, which include band concerts, chamber music, music map classroom, and evening peak concerts, will be staged by SSO’s artists, while the remaining 30 will be performed by visiting artists.

 

Source:Shanghai Symphony Orchestra

 

【Corporate Activities】

 

1. Two Major Foreign-related Industrial Projects Start Construction in Jinshan

【Keywords: Takemoto; Asanuma】

 

A groundbreaking ceremony was held on June 26, 2024 to kick off two major industrial projects in Jinshan District, Shanghai. One project is invested by Takemoto Oil & Fat (Shanghai) Co., Ltd. to expand production of additives. With a planned investment of RMB375 million, the project expects to put idle land of 120 mu to good use, and add 14,000 square meters of floor space, generating annual output value of RMB1.2 billion. Shanghai Asanuma Cosmetics Co., Ltd. plans to invest RMB140 million in an intelligent production line of high-quality cosmetics. The project will cover a land area of 26.47 mu and a planned floor space of 25,000 square meters. After reaching the design production capacity, the project will generate an estimated annual output value of RMB230 million. 

 

Source:iJinshan

 

Q&A

 

Q1: Leaders of the National Development and Reform Commission (NDRC) answered questions at the regular policy briefing held by the State Council Information Office to introduce the Several Policy Measures on Promoting the High-quality Development of Venture Capital - We noticed that the latest policy paper is another important document to promote the development of venture capital after the State Council issued the Several Opinions on Promoting the Sustainable and Healthy Development of Venture Capital in 2016. I would like to ask what the main considerations for issuing the document again after eight years are. What are the key measures in the new document?

 

A1: As we know, venture capital is connected to industry on one end and finance on the other. It must connect the upstream R&D activities and adapt to the downstream applications. Many venture capital institutions and invested firms are small and medium-sized private enterprises. Venture capital investment involves a wide range of areas and has a broad impact. Venture capital carries important positive significance for the high-quality development of the economy and society. The latest policy paper aims to optimize the development environment of venture capital, further stimulate the vitality of venture capital, and promote high-quality development of the industry.

The document puts forward the following policy measures around all links in the entire life cycle of venture capital, from fund raising, investing to project management and divestment.

On the fundraising side, we will guide long-term investors such as insurance funds to invest in venture capital, expand the pilot scope of direct equity investment by financial asset investment companies, and mobilize qualified private capital to serve as "patient capital" to solve the industry's problems of "lack of long-term money" and "no money to invest".

On the investment side, many venture capital institutions said that they have money, but they cannot find good investment targets and projects. To address this problem, the NDRC will work with relevant ministries and commissions to establish a mating mechanism between venture capital and entrepreneurship projects, provide a number of high-quality projects that are in line with the national development direction and strategic orientation, and solve the problem of nowhere to invest money.

On the management side, the document proposes to strengthen management of venture capital funds contributed by the government and state-owned enterprises, and to establish and improve a management system and due diligence and compliance accountability exemption mechanism that conforms to the characteristics and development laws of the industry. In response to the tax and regulatory issues, it proposes to implement the tax preferential policies for venture capital enterprises. In accordance with the relevant requirements of the "Regulations on the Supervision and Administration of Private Investment Funds", we would introduce differentiated regulatory policies for venture capital funds that are different from other private equity funds.

On the divestment side, we will strive to expand the divestment channels and optimize policies for venture capitals to cash out on their investment.  

In the next stage, the NDRC will work with relevant departments and local governments to thoroughly implement the policy document and promote the high-quality development of venture capital. We also believe that with the care and support of all sectors of society, China's venture capital will continue to grow bigger and stronger.

 

Source: State Council Information Office

http://www.scio.gov.cn/live/2024/34168/tw/

 

Expert Perspective

 

Impact of New Cross-border Data Regulations on Domestic and Overseas Investment Projects

 

By: Fu Peng, Yu Qin, Wei Longjie (Haiwen & Partners)

 

[Continuing from the Last Issue]

II Impact of the new regulations on foreign direct investment projects 

(1) It is more convenient to transfer personal information out of China after foreign investment projects are implemented

For commercial activities, foreign investment decision-making assessment is aimed at economic benefits and based on commercial analysis. However, when evaluating investment projects, foreign investors also pay special attention to compliance costs and the convenience of subsequent data transmission.

For example, foreign investors (especially industrial and business investors) pay great attention to the site selection of IT equipment, system deployment, data center and cloud services, as well as data flow. In this process, in addition to procurement costs of physical equipment, systems and cloud services, the data flow method and the convenience of outbound transfer of important data and personal information are also important considerations. In particular, after a large number of foreign-invested projects are implemented, since they have business locations in China, it is necessary to transmit the human resources information, customer information, partner information and part or all of business information of the local companies to overseas. Therefore, overseas investors pay special attention to the compliance requirements for transmitting such information across the border, whether it is convenient, and whether the compliance costs are too high.

According to the Data Security Law of the People's Republic of China, the Personal Information Protection Law of the People's Republic of China ("Personal Information Protection Law") and their supporting regulations and requirements, after a foreign-invested project is implemented, if the local company seeks outbound transfer of important data or personal information, it should conduct a security assessment on outbound data transfer, sign and file a standard contract for the outbound transfer of personal information, or conduct a personal information protection certification (including outbound transfer). 

Among them, the threshold for triggering the filing of standard contract for the outbound transfer of personal information was extremely low. According to Article 4 of the Measures for the Standard Contracts for the Outbound Transfer of Personal Information, any act of outbound transfer of personal information may trigger the obligation to sign a standard contract, regardless of the amount and sensitivity of the personal information to be transferred.

[To Be Continued]