Issue 104

Shanghai Weekly Bulletin

No.5,July 2025

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.Ten Authorities Release Circular to Replicate and Scale up New Experiences from Comprehensive Pilot Programs for Expanding the Opening up of the Service Sector

【Keywords: Service sector】

 

Recently, the Ministry of Commerce, together with nine other central government departments, jointly released the Notice on Replicating and Scaling up New Experiences from Comprehensive Pilot Programs for Expanding the Opening up of the Service Sector. The notice specifies initiatives to be promoted in Shanghai, including the establishment of an efficient, convenient, and secure cross-border data flow mechanism, as well as the innovation of inbound data processing and transformation models.

 

Source:Ministry of Commerce

https://www.mofcom.gov.cn/zwgk/zcfb/art/2025/art_9d8f6406f5b242de885d66da34300b6f.html

 

【Shanghai】

 

1.Shanghai to Implement Tiered Regulation of Medical Device Manufacturers

【Keywords: Medical devices, Manufacturers, Tiered regulation】

 

The Shanghai Municipal Medical Products Administration (SMPA) recently issued the Implementation Guidelines for Tiered Regulation of Medical Device Manufacturers in Shanghai. The guidelines specify key regulatory scenarios, including but not limited to products involving sterility, implantation, innovation, products selected through the national centralized volume-based procurement program, and medical cosmetic devices, as well as manufacturing models involving cross-provincial contract manufacturing — either as entrusting or entrusted parties. The guidelines will take effect on August 21, 2025, and remain valid for five years, until August 20, 2030.

 

Source:SMPA

 

2.Shanghai Introduces “Shanghai Sci-Tech Credit Score” Model to Evaluate Corporate Innovation

【Keywords: Shanghai Sci-Tech Credit Score】

 

Recently, the Shanghai Municipal Commission of Science and Technology (SMCST), together with five other authorities, released the Implementation Plan for the “Shanghai Sci-Tech Credit Score” Initiative. According to the plan, Shanghai will establish the “Shanghai Sci-Tech Credit Score” model as a new evaluation system for assessing the innovation performance of enterprises. The initiative aims to encourage commercial banks to use the “Shanghai Sci-Tech Credit Score” evaluation results as a reference for offering financial services such as “Shanghai Sci-Tech Credit Loans”, thereby broadening financing channels for tech-oriented enterprises and supporting their business operations and R&D activities.

 

Source:SMCST

https://stcsm.sh.gov.cn/zwgk/tzgs/zhtz/20250724/145f8fec61f746c4b7e4137eabed50c4.html

 

Q&A

 

Q: At a press conference held by the State Council Information Office on the foreign exchange receipts and payments data for the first half of 2025, an official from the State Administration of Foreign Exchange (SAFE) responded to a journalist’s question —We understand that SAFE has been steadily advancing the facilitation of cross-border trade, investment, and financing. How effective have these efforts been in the first half of the year, and in what specific ways have they benefited enterprises?

 

A: Your question touches on many foreign trade and foreign-funded enterprises, and we have been making continuous efforts to enhance the facilitation of cross-border trade,  investment, and financing. In recent years, the SAFE has remained committed to its fundamental mission of serving the real economy through financial services. We have steadily deepened reform and opening up in the foreign exchange sector, continued to improve the quality of our policy offerings, and promoted the stable development of foreign trade and foreign investment. In response to your question, I would like to share an overview of our work in the first half of this year in three areas.

First, we have expanded the coverage of trade facilitation policies. We have promoted high-standard opening-up pilot programs for cross-border trade, advanced policies to facilitate foreign exchange receipts and payments for high-quality enterprises, and expanded the scope of facilitation policies to include more specialized, sophisticated, distinctive, and innovative small and medium-sized enterprises. In the first half of the year, the total volume of related facilitation business handled nationwide exceeded USD 700 billion, marking an 11% year-on-year increase. Moreover, we have actively supported the development of new business models such as cross-border e-commerce and integrated foreign trade service platforms, and encouraged more banks and payment institutions to shift away from traditional trade verification methods. By leveraging technology, they can automatically batch review electronic orders, thereby providing efficient, convenient, and secure foreign exchange settlement services for medium, small and micro-sized cross-border e-commerce businesses. In the first half of the year, more than 510 million such transactions were processed nationwide.

Second, we have continued to promote the facilitation of cross-border investment and financing. This focused on several key areas. Firstly, we have improved the convenience of foreign investment in China. By the end of 2024, we piloted the removal of registration requirements for the domestic reinvestment of foreign-funded enterprises in 19 regions, benefiting over 600 companies and significantly enhancing the efficiency of capital utilization. The registration requirement for preliminary expenses related to foreign investment in China has been removed. Foreign investors can now directly open bank accounts to receive preliminary funds when establishing foreign-funded enterprises in the country. This change significantly shortens the capital turnover time and accelerates the implementation of investments. The relevant policy has been released for public consultation. Secondly, we have made it easier for multinational companies (MNCs) to allocate and manage funds among their domestic and overseas affiliates. In March this year, we expanded the pilot program for integrated RMB and foreign currency cash pooling for MNCs to 16 provinces and cities including Tianjin, Hubei, Xinjiang, and Xiamen. We also allowed MNCs to process certain capital account changes directly with banks, which, according to feedback, reduced processing time by about 50%. Furthermore, in June, we granted a total of USD 3.08 billion in Qualified Domestic Institutional Investor (QDII) investment quotas, better meeting public demand for investing in overseas financial products.

Third, we have steadily expanded the outcomes of the foreign exchange business reform. This reform front-loads banks’ responsibilities in customer identification, document review, and risk monitoring, allowing banks to handle foreign exchange transactions for top-tier clients based solely on enterprise instructions, without the need for transaction-by-transaction documentation reviews. As a result, the average processing time has been reduced by more than 50%, bringing tangible convenience to enterprises and significantly easing the ex ante verification burden on banks. In the first half of this year, six additional banks joined the foreign exchange business reform program, bringing the total number of participating banks to 22. These include large state-owned commercial banks, national joint-stock commercial banks, city commercial banks, and foreign banks, with operations now covering the entire country. As of now, over 20,000 clients have been classified as Tier-1 customers by participating banks — a 23% increase compared with the end of 2024. Since the beginning of this year, more than USD 200 billion in cross-border receipts and payments have been processed for these clients based solely on their payment instructions.

Next, the SAFE will further advance reform and innovation in foreign exchange management, granting greater convenience to trustworthy and compliant market participants. These efforts aim to continuously enhance the sense of gain for both enterprises and the general public.

 

Source:State Council Information Office

http://www.scio.gov.cn/live/2025/36813/tw/

 

Expert Perspective

 

Study on Shareholder Qualification and Equity Transfer Issues in Foreign-funded Enterprises

 

By Cai Shuo, Xing Jingyu, and Tian Yaqi (Beijing Jincheng Tongda & Neal Law Firm)

 

I.Introduction

Since the implementation of the Foreign Investment Law of the People's Republic of China (“Foreign Investment Law”) in 2020, the former “Three Foreign Investment Laws” — namely the Law on Sino-Foreign Equity Joint Ventures, the Law on Wholly Foreign-Owned Enterprises, and the Law on Sino-Foreign Cooperative Joint Ventures — have been repealed. This article explores two common legal issues arising in practice following the enforcement of the new law. The first concerns the determination of shareholder qualification in cases where the equity interest of a Chinese shareholder was previously registered as zero. The second involves the procedural requirements for approval and filing in the event of equity transfers by shareholders of foreign-invested enterprises. Based on these topics, the article further provides practical risk mitigation recommendations.

II. Determining the Shareholder Qualification of Chinese Partners with Zero Registered Equity

(1) Historical Context

In the early days of China's reform and opening-up, Chinese parties often partnered with foreign investors to establish Sino-foreign cooperative enterprises by contributing land use rights or real estate. However, in some cases, the value of such contributions was not formally assessed, resulting in a 100% equity registration under the foreign party and a 0% registration under the Chinese party in official business filings. Following the implementation of the Foreign Investment Law, how to recognize the shareholder status of Chinese partners with zero registered equity under the previous legal framework has become a key issue during corporate restructuring.

According to current judicial practice in China, courts assess both formal and substantive elements when determining the shareholder qualification of the Chinese party. Where there are deficiencies in formal elements, greater emphasis is placed on substantive elements.

[To be Continued]

 

One Week in Shanghai

 

【Latest News】

 

1.China Proposes Establishment of Global AI Cooperation Organization

【Keywords: World AI Cooperation Organization】

 

On July 26, the Chinese government proposed the establishment of a global AI cooperation organization, with preliminary plans for its headquarters to be located in Shanghai.

 

Source:International Services Shanghai

https://english.shanghai.gov.cn/en-WAICLatest/20250727/962fc5e93b78432b99cdb883ae614ed5.html

 

2.First Batch of Shanghai Nighttime Economy Landmarks and Nightlife Hotspots Unveiled

【Keywords: Nighttime economy】

The “Vibrant Night Shanghai” series of events recently kicked off, unveiling the first batch of nighttime economy landmarks and popular nightlife destinations across the city. Highlights include night exhibitions and river cruises, the Summer Performance Season, and the German Wine Festival. Notably, Yuyuan Garden will open for night tours for the first time, offering an immersive cultural experience that weaves together light, shadow, and classical garden landscapes under the theme “Enjoying Nature at Yu”. 

 

Source:Shanghai Release

 

3.Shanghai Launches Data IP Registration Service Station in Hongqiao

【Keywords: Data products, Intellectual property, Registration】

 

Recently, the “Shanghai Hongqiao International Central Business District Service Station for Intellectual Property Registration of Data Products” officially commenced operations. The service station provides applicants with essential advisory services, including policy interpretation, procedural guidance, document preparation, and case sharing related to data product intellectual property registration. It assists applicants in completing the registration process and promotes the effective use of data product intellectual property.

 

Source:Shanghai Hongqiao

 

4.Chongming Receives International Wetland City Accreditation

【Keywords: Chongming, Wetland】

 

The third batch of International Wetland Cities was announced on July 24th during the 15th Meeting of the Conference of the Contracting Parties to the Ramsar Convention on Wetlands held in Victoria Falls, Zimbabwe. Nine Chinese cities including Chongming were accredited as international wetland cities. This marks a breakthrough for Shanghai, as it joins the ranks of International Wetland Cities for the first time.

 

Source:Shanghai Release

 

【Corporate Activities】

 

1.Jungheinrich Establishes Global OEM Center in Shanghai

【Keyword: Jungheinrich】

 

Recently, German industrial equipment giant Jungheinrich held a high-profile event in Shanghai to announce the official establishment of its Global OEM Center in the city. At the same event, the company unveiled its new brand, AntOn by Jungheinrich, and signed a strategic cooperation agreement with Zhejiang E-P Equipment Co., Ltd. The new center aims to integrate Jungheinrich’s century-long engineering expertise with China’s robust industrial supply chain, focusing on the research, production, and global distribution of intelligent material handling equipment.

 

Source:Shanghai Foreign Investment Association

 

2.TÜV Rheinland InnoHub Officially Launched in Shanghai

【Keywords: TÜV Rheinland】

 

TÜV Rheinland Greater China, a leading international independent third-party testing, inspection, and certification organization, recently unveiled its cutting-edge laboratory cluster dedicated to frontier technologies, InnoHub, in Shanghai. The InnoHub features six specialized labs including Smart Cockpit Research Lab, SonicUX Research Lab, Pet-Friendly Research Lab, etc. It aims to drive innovation in areas such as smart cockpit, human-machine interaction, display technologies, acoustic ecosystems, and pet-friendly lifestyles.

 

Source:China News Service

http://www.chinanews.com.cn/cj/2025/07-21/10451615.shtml

 

【Competitive Event】

 

1.2025 Rolex Shanghai Masters to Kick Off in September

【Keywords: Shanghai Tennis Masters】

The 2025 Rolex Shanghai Masters is set to take place from September 29 to October 12 at the Qizhong Tennis Center. Tennis legend Roger Federer, serving as the tournament’s Icon Athlete, is scheduled to make a special appearance at the Center Court on October 10.

 

Source:International Services Shanghai

https://english.shanghai.gov.cn/en-SportsEvents/20250722/2f0a5b4abcd9415097c1daa7fd9757a9.html

 

【Culture & Art】

 

1.“Pure by Nature: The Art of Blanc de Chine” Exhibition Opens in Shanghai, Showcasing over 200 Rare Blanc de Chine Masterpieces

【Keywords: Pure by Nature, Blanc de Chine】

On July 18, the grand exhibition Pure by Nature: The Art of Blanc de Chine, opened at the China Art Museum, Shanghai. As a signature event of the 36th Shanghai Tourism Festival, the exhibition showcases over 200 exquisite white porcelain masterpieces, making it the most culturally significant and largest Dehua porcelain exhibition held in Shanghai in recent years.

 

Source:China Art Museum

 

2.“Maijishan Grottoes: Eternal Arts Across Centuries” Exhibition Unveils

【Keywords: Maijishan, Grottoes】

The exhibition Maijishan Grottoes: Eternal Arts Across Centuries recently opened at the Shanghai Powerlong Museum. Organized into six thematic sections, the exhibition features 137 exquisite artifacts from the Maijishan Grottoes alongside 37 contemporary artworks.

 

Source:Shanghai Powerlong Museum