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  ZhaoQing Government - Business - Policies & Regulations
Regulations Concerning Incentives and Concessions to Foreign and Inland Investors
TIME2011-12-22
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  In order to improve the investment climate, to encourage investments from both foreign and private inland investors, to expand the scale of fund-raising activities, with a view to accelerating the overall economic development of Zhaoqing, we introduce the following policy guidelines.

  A. Expand the Range of Investment Realms and Simplify the Vetting Procedures

     granted and published by the Zhaoqing Municipality from time to time. Investors are welcome to invest in the following general areas: industry, agriculture, commerce, import and export trade, information consultancy, tourism and entertainment, food and beverage, hotel, property development, construction, energy, transport, warehouse, scientific research, education and culture, health and sports, agencies and intermediaries, community services, estate management, social welfare services. Investors are particularly encouraged to invest in the following types of project: traditional industries renovation, hi-tech, energy and transport infrastructure building, ecological and environmental protection, mining and tourism, export and foreign exchange earning, agricultural product processing, agricultural development projects, industrial parks, entrepreneurial parks, and scientific parks. The Municipality's Development and Planning Bureau will periodically publish materials pertaining to the above, in particular the list of preferred investment items.

  1. With the exception of legally prohibited areas, both foreign and local investor are generally free to invest in Zhaoqing and are entitled to enjoy concessions

     

  2. We encourage different forms of investment ownership such as sole proprietorship, joint venture, take-over or acquisition. There is no restriction on the proportion of shareholding. To facilitate the investment procedures, we keep red tape to the minimum, in particular those related to the following: information provision, guideline to investment, feasibility report, project determination and application, fund-raising, manpower training, taxation and duty, infrastructural facilities. Apart from licensing requirements, quality inspection requirements and special project approvals specially stipulated by the national and provincial authorities, there are no other restrictions on investment. We expect that eventually approval procedures will give way to simple registration and filing rules.

  3. For applications that require national or provincial pre-approval, we will adopt the following methods, namely, 'one-window' application, single- roof processing, centralized fee payment and deadline setting". For applications that require solely the Municipality's approval, its External Trade and Economic Co-operation Bureau and Economic and Trade Bureau will be jointly responsible for the vetting: The vetting authority will ascertain whether a project is going to be considered within 3 working days of submission. For submissions that have successfully passed the vetting procedure, the approval procedure will be completed within a stipulated period (for production projects within 5 working days; for non-production projects 10 working days)

  B. Land Use Concessions and Factory Construction  

  4. Industrial land use -Development zones, industrial parks, entrepreneurial parks and scientific parks that come under government planning will be granted special concessions. Land transfer fees will be charged at 20% of the standard rates. "High-new" technology (used interchangeably hereafter with "hi-tech") development zones that come under the authority of the Municipality are exempted from land transfer fees. Investors, however, have to pay the farmland development fee, the land acquisition fee, and the newly introduced fee for use of land planned for construction purpose as required by the Central Government and the Provincial Government.

  5. Agricultural land use - For priority projects set by the Province or the Municipality, including those under their special inculcation, their land use will be treated as equivalent to agricultural production use. Applications to invest in deserted or undeveloped land or non-essential forest areas will be given priority in processing and rentals will be charged at a minimum. Land rental covers normally a period of 30 years but may be given consideration to extend to 50 years under special circumstances. Land that has already been rented may be transferred, exchanged and treated as part of company shareholding where permitted by existing laws.

  6. Land delegated to investment promotion agents - For land that has been delegated to investment promotion agents, the latter will given a 10% commission on the land transfer cost. In the event that the eventual transfer price is higher than the rate given to the agents, the latter is entitled to keep the balance (having deducted the necessary tax).

  7. Factory premise construction - We encourage investors to take part in industrial park development, to build factory premises within industrial parks or on non-agricultural undeveloped or hilly land, either for self-use or for rental purpose. Factory premises once completed can be rented out or be transferred. Land use prices will be charged at the minimum rates. For transfer of land, prices will be subject to ceilings.

  C. Reduction of Administrative Fees  

  8. Apart from national and provincial stipulations or administrative fees approved by the provincial authority, no bureau or department is permitted to set or collect extra administrative fees. Fees that are officially permitted have to be published publicly and charged at the lowest rates (price floors). Within the preparatory period (i.e., after application approval) and one year of trial operation, no local administrative fees will be charged. Investors can decline to pay any non-official fees or higher than normal fees. The Price Control Bureau will periodically publish a list of bodies that are permitted to collect these administrative fees and their rates. Those who violate these rules will be prosecuted.

  (1) City Amenities Construction Fees: Investments in local "high and new" technology development zones or those that come under Article 13 of this Regulation are exempted. Investments related to industrial production that take place within the city proper will be charged at half the rate.

  (2) Air Defense Base Relocation Fee: Upon approval by the local government, projects of a social welfare nature in the realm of the tertiary sector that are given priority are exempted from the above fee.

  (3) Dam Maintenance Fee: A fee fixed for 3 years is to be payable by installment, the rate being subject to government approval. Any increase in the fee cannot exceed 1% of the actual amount paid in the preceding year.

  (4) License Document-making Fee: The fee of making license documents as required by the administrative units for normal operation (with the exception of land, property, transport, immigration, quality management and personal identification) will be subject to 50% reduction.

  (5) Service Fees Charged by Intermediaries: For professional confirmations, evaluations or appraisals that are required in the process of investment and operation, investors can employ the services of the government's investment services agent at half of the lowest standard fees.

    

  D. Break up Industrial Monopolization and Protect the Interests of Investors

  9. No unit or bureau is allowed to compel investors into accepting their products or services. Investors are free to invite tenders from the public or use any other effective channels regarding their construction, design, engineering and purchasing needs, including those related to fire services, environmental protection, health and sanitation, water and electricity supply, thunder protection, services from intermediaries etc.

  The government is committed to protecting the legal properties of investors, their premises of operation, their intellectual property rights and legal investment returns. No government unit or official is permitted to trespass such boundaries or intervene with their operations.

  The government will actively inculcate a fuller range of services to avoid the emergence of monopolistic situations in order to facilitate the operation of the investors.

    

  E. Special Concessions Granted to Priority Projects 13. For projects of the following nature, namely, normal investments exceeding 10 million US dollars, hi-tech investments exceeding 5 million US dollars, modern large-scale logistics center, specialized wholesale markets, high-grade hotels, tourist and cultural amenities and those others on the priority list, we will consider extending further and special concessions in accordance with their scale, quality, technological content, in areas related to project vetting and appraisal, land use price, administrative fees etc. .

  10. Priority investments that fall within Article 1 of this Regulation can have their level of registered capital relaxed. Scientific research results, monopoly rights or intellectual property rights can be quantified and taken as part of the registered capital up to 35%.

  11. Interest-free loans to High and new technology projects - Hi-tech projects including telecommunication, biotechnology-based pharmaceuticals, photo-mechatronics, new materials and so on are entitled to interest-free loans for 3 years subject to the approval of the government's finance and technology departments.

  12. For qualified enterprises, we will extend assistance in their fund-raising activities, such as stock-issuing, public listing (inside or outside China) as well as in their obtaining export rights.

  14. We give special support to enterprises operating in industrial parks that pay a high level of income tax. Each year, a portion of the income tax paid by these enterprises will be appropriated into a Special Project Support Fund, which is designed to support special economic growth project. For newly operating enterprises that pay an amount of income tax above 300 thousand Yuan each year for 5 years since the beginning of their operation, the amount retained for the said program will not be less than 50% of the tax paid. The management of the fund is directly in the hands of the highest authority of the government.

    

  F. Encourage Enterprises to Expand their Scale of Investment and to Carry out Technological Innovations 

  15. For enterprises that expand their scale of investment, both Article 4 and Article 8 of this Regulation will be applicable to land use prices and administrative fees. For new projects and newly increased investments that fulfill the conditions listed in Article 13 of this Regulation, special concessions will be granted accordingly.

  16. For joint-ventures or co-operation projects owned by both inland and foreign interests and wholly foreign-owned projects whose products are not subject to quota restriction or special permit requirements or those involve foreign exchange balance considerations, restrictions will be removed over the proportion of their local sales and export sales.

  17. Actively support high-performing and reputable enterprises in their fund-raising activities and facilitate their obtaining credit or credit guarantee from local financial institutions or asset management companies.

  18. To further encourage productivity and innovation - For an enterprise that pays a tax exceeding 10 million Yuan for any one of its products, and for an enterprise or person that makes special contribution to the Municipality's economic development, the government will confer special honor or award to the said enterprise or person.

  G. Encourage Private or Foreign Capital to Take Part in the Reform of State-owned or Collective Enterprises 

  19. Private or foreign capital that engages in reforming state-owned or collective enterprises can trade its technology, its brand, its factory equipment, or its land use rights for shareholding in the said enterprises.

  20. Foreign or private enterprises or individuals that take over a 25% of the equity of a state-owned or collective enterprise will be deemed as starting a brand-new investment and are entitled to all the concessions of this Regulation. Should the take-over represents a 100% acquisition, the value of acquisition will fully discount any non-operating, dubious or ineffective assets that may exist. All fees related to asset evaluation, property rights transfer or transfer registration will be collected at the lowest permissible rates.

  21. Enterprises that take part in the above-mentioned activities will be granted concessions in accordance with Article 15 of this Regulation. Enterprises whose payable income tax reaches the level stipulated in Article 14 of this Regulation will be qualified for support from the Special Project Support Fund.

    

  H. Support to Manpower Recruitment  

  22. Senior level technicians or professionals employed by the said enterprises, together with members of their family, can have their resident status transferred free of charge.

  23. We provide a full range of services to assist employees of the said enterprises at the medium, senior level or university graduate level. The Public Security Department will arrange the transfer of resident status and the obtaining of resident permits. The Personnel Department will arrange matters related to filing and registration, employment status determination, emigration vetting etc. . The Labor Department will assist members of their family in job-seeking. The Education Department will facilitate children of their family to find school places and will charge only half of the school-choosing fee.

    

  I. Award Intermediaries that Successfully Introduce New Investments    

  24. Any unit or person that successfully introduces a new investment, or that effectively arranges the takeover or acquisition of state-owned or collective enterprises with positive results, will be awarded upon confirmation by the Finance Department according to the following scheme: 0.2% of the actual amount of investment will be awarded to those whose official duty is already in the realm of investment promotion; a 0.4% will be awarded to all others. Beyond this scheme, we will also award, by way of cash or any other means, anyone who makes major contributions in this area, details of which will be proposed by the Finance Department and subject to government approval.

    

  J. Establish a Special Protection Scheme for Enterprises in Industrial Park Zones 

  25. For investments in industrial parks, entrepreneurial parks, scientific parks, and hi-tech development zones approved by the government, a special agent for coordinating enterprises with all relevant departments is set up in order to keep outside interference to a minimum and to protect the former's legal rights. Some selected industrial park zones are to be exempted from local management fees charged experimentally in 'low-cost' zones.

    

  K. Commitment to Efficiency and Guaranteed Services 

  26. All units related to the management of the said enterprises or to the collection of administrative fees arising therein are required to establish a system of guaranteed services within one month following the announcement of this Regulation. These include working procedures, charge items, charge rates, vetting time, information enquiry, quality of service and complaint handling. These services have to be officially published and publicly posted. The idea is to reduce where possible, red tape, simplify procedures, unify communication channels, and integrate the different fees to be collected into a single one to improve the transparency, efficiency and visibility of the entire system. Where possible, the electronic media will also be employed. We will employ legal and administrative means as well as solicit the help of the media to create a better investment climate for our investors.

    

  L. Implement a Monitor and Inspection System 

  27. To the end of improving the overall investment climate, we will institute an accountability system. Guiding all our work are the principles of "openness, fairness, accountability, simplification of red tape and quality improvement". In so far as investment rules are concerned, we will improve in all areas of consultation, publicity, explanation, monitor and feedback. All working departments have to report to the Municipal government periodically on their progress. Whatever regulations that contradict WTO rules, or that have been suspended or canceled by the central government, must be eliminated. Trade associations or industry federations should enhance their self-discipline, expand co-operation and protect where possible the interests of the investors.

  28. Under the guidance of the Municipal Party Committee and Municipal Government, a joint assembly is to be set up, enlisting members from relevant departments, representatives from the Central and Provincial Government and to be held responsible for over-seeing the planning, co-ordination and inspection of these investment promotion activities. The daily routine of the joint assembly will be handled by the Bureau of External Trade and Economic Co-operation. Based on the principle of functional division of labor, the Bureau of External Trade and Economic Co-operation will handle foreign investments, whereas the Bureau of Economic and Trade will handle inland private investments. To co-ordinate these activities, a centralized investor complaint unit with a hot line is to be set up to receive and to follow up complaints. Where important issues arise, the joint assembly should seek advice from the Municipal Party Committee and the Municipal Government.

  29. Any unit or official who does not abide by the rules contained in this Regulation, or whose service is of an inferior quality, or who neglects his duty or who deliberately stands in the way of the interests of the investors, will be thoroughly investigated by a disciplinary body and be asked to make the necessary improvement within a stipulated period. An official confirmed of the above behavior will be subject to criticism and reprimand. The same person found to act in the same way twice will be dismissed. In serious cases, he will be subject to penalty. In the event that he has acted against the law, he will be prosecuted accordingly.

  30. This Regulation takes effect from the date of publication. All rules in previous documents that contradict those in this Regulation will be superseded by the latter. All counties (municipalities) under the jurisdiction of the Zhaoqing Municipality are free to draw up their own plans for execution based on this document.