Ten Policies and Measures on Foreign Investment in GuangDong Province

广东“外资十条”修订版政策解读英文版

Note: In case of discrepancies in the English and translations, please note that the original Chinese text is the official text and shall prevail. Any questions concerns about the content please contact the Department of Commerce of Guangdong Province.

Policy Interpretation of Revised Edition of “Ten Policies and Measures on Foreign Investment”

I.Further Expand Areas of Foreign Investment Market Access

1. To promote the expansion of opening-up areas. Fully implementation of the Special Management Measures for Foreign Investment Access (Negative List) (2018 Edition), allowing the establishment of wholly foreign-owned enterprises in nine major areas, including special vehicle manufacturing, new energy vehicle manufacturing, design, manufacturing and repair of ships, design, manufacturing and repair of trunk lines, branch lines and general-purpose aircrafts, design and manufacturing of helicopters of 3 tons and above, design and manufacturing of drones and aerostats, construction and operation of gas stations, international maritime transportation, railway passenger transportation, etc. (above mentioned fields only allow joint venture and cooperation, with stock ratio restrictions previously); cancel the restrictions on foreign shareholding of Chinese banks and financial asset management companies established in Guangdong, support foreign banks to set up branches and sub-branches in Guangdong at the same time; support foreign investment to establish joint venture securities companies, securities investment fund management companies, futures companies, life insurance companies in Guangdong and the foreign shareholding ratio shall not exceed 51%.To support foreign natural person investors working in Guangdong to open A-share securities accounts.

II.Increase Financial Incentives for Foreign Investment

2. The foreign invested entity economic projects reach a certain scale shall be rewarded in proportion to the amount of investment. From 2017 to 2022, the new projects (excluding real estate, finance industry and similar financial industry, hereinafter inclusive) with annual actual foreign investment (excluding foreign shareholder loan) of more than $50 million dollars, the capital-increase projects with more than $30 million dollars and regional headquarters of transnational companies (hereinafter referred to as regional headquarters) with more than $10 million dollars will be rewarded no less than 2% of its actual foreign investment of the year by Department of Finance of Guangdong Province, the highest reward can be 100 million Yuan.
The reward objects of this policy are mainly manufacturing and producer services projects and identified foreign multinationals headquarters or regional headquarters. The classification of industries is in line with the Classification Standard of National Economic Trades of the People’s Republic of China.
  Case 1: 1. A medical equipment manufacturing enterprise was established in March 2017 with an actual foreign investment of $60 million dollars; in 2018, its actual foreign investment is $30 million dollars; in 2019, its actual foreign capital is $100 million dollars, including foreign shareholders of $20 million dollars; in 2020, its actual foreign capital is $800 million dollars. To presume that the exchange rate of US dollars against RMB is 1:6.6, in line with the lowest reward proportion of 2%, this enterprise can be rewarded 7.92 million Yuan in 2017 (6000*6.6*0.02), 0 Yuan (fail to meet the reward standard) in 2018, 10.56 million Yuan [(10000-2000) *6.6*0.02] in 2019, 100 million Yuan in 2020 (the highest reward is 100 million Yuan).
  Case 2: A real estate company was set up in March 2017 with a foreign capital of $100 million, while it cannot get any financial reward in 2017 (non-supported objects).
  Case 3: An electronic components manufacturer was established in 2002, to expand its scale of production and improve technical level, it has increased the investment of $30 million in 2017 and paid it in. From 2018, it will increase capital of $50 million and paid in two years, $25 million per year, which will be fully paid in June 2019. Therefore, the company will receive a bonus of 3.96 million Yuan (3,000 *6.6 *0.02) in 2017, while 0 Yuan in 2018 and 2019 (fail to reach the reward standard).

3. The World Top 500 enterprises and global industry leading enterprises invest projects in Guangdong Provinces and in conformity with the regulations will be given key support through “one discussion upon one project.” For the Fortune Global 500 enterprises (the list of Fortune shall prevail, hereinafter inclusive), global industry leading enterprises newly set up (including capital increment) manufacturing project with the actual foreign investment of more than $100 million, a newly-established IAB(new generation of information technology, intelligent equipment, biological medicine) with an actual investment of no less than $30 million  and NEM (new energy, new material) manufacturing projects and the foreign R&D institutions with independent legal person qualification, can enjoy personalized support policies (including capital support) through “one discussion upon one project.”

4. The headquarters or regional headquarters of a foreign multinational company in Guangdong will be given financial rewards in line with its contribution to the provincial finance. The regional headquarters that has first contributed over 100 million Yuan to the provincial financial year, will be given a one-time reward of 30 percent of the provincial financial contribution, with a maximum award of 100 million Yuan.
  Case: A foreign-funded enterprise was established in Guangzhou in 2008 and identified as the regional headquarter of a transnational corporation in 2017, its contribution to the provincial fiscal year in 2018 and 2019 is 85 million Yuan and 90 million Yuan respectively, and it exceeds 100 million Yuan in 2020 for the first time, reaching 130 million Yuan. The company will not be awarded in 2018 and 2019 for failing to meet the reward standard, but it can get a bonus of 39 million Yuan (130 million Yuan * 0.3) in 2020. In 2021, it is not the first time for the company to contribute tax beyond 100 million Yuan, so the provincial finance no longer arranges rewards.

5. Encourage overseas investors to make investment via profit distribution and give award to all foreign investors who contribute to the local finance. From 2018 to 2022, provincial and municipal financial departments will give awards to re-investment projects of overseas investors in Guangdong via profit distribution; the provincial financial department shall reward the municipal government according to the contribution to the provincial finance in the project investment, which will be used to support the foreign investors to expand their production and operation and invest in new incentive projects in Guangdong.
  At present, foreign investors are required to pay 10% withholding tax on profits from the reinvestment of permitted projects or indirect investment incentives in Guangdong. From 2018-2022, for the reinvestment projects in Guangdong by foreign-funded enterprises using profits they made in China, the province will reward such enterprises according to their contributions to the provincial finance, and local governments may arrange rewards on the basis of provincial rewards. The main purpose is to alleviate the cost of foreign-invested enterprises to use domestic profits to reinvest.
  For the reporting conditions and operation procedures of the 2nd  to the 5th award funds mentioned above, please visit the official website of the Provincial Department of Commerce to check the Attachment to the Notice of the Guangdong Provincial Department of Commerce on the Special Fund for Promoting Economic Development in 2019 (Two-way Investment) (Guangdong Business Letter) [2018] No. 242): Guidelines for the Application of Special Funds for Economic Development in 2019 to Promote Foreign Investment. In addition, the 5th award fund is jointly arranged by the provinces and cities, in which the provincial government rewards the municipal government according to the contribution to the provincial finance during investment, and the eligible foreign investment projects (business registration, tax collection and management relations need to be in Guangdong) can declare and apply for the funds at municipal business and commerce authorities.

III.Strengthen Safeguard of Land Use of Foreign Projects

6. To clarify that foreign-invested enterprises enjoy the preferential land policy of “Ten Items for Real Economy Cost Reduction”. Manufacturing enterprises with foreign investment will enjoy the relevant preferential policies in accordance with Policies and Measures on Lowering the Cost of Manufacturing Enterprises to Support the Real Economy in Guangdong Province (revised edition, short for “Ten Items for Real Economy Cost Reduction”).
  On the basis of Ten Items for Real Economy Cost Reduction, the enterprises can enjoy the following land-use preferential policies: To allow manufacturing enterprises with foreign investment to divide its industrial property rights by taking one building or one storey as basic unit, and industrial projects for introducing relevant industrial chain partners. For preferential-developed industrial projects with foreign investment and intensive land use, the land transfer floor price can be determined by 70% of the lowest price standard of industrial land. To undertake flexible year leasing for industrial land, the term correction coefficient can be determined in accordance with the specific value between lease term and available maximum term, and thus confirm determine the floor lease price. Under the premise of being in conformity with the planning and sticking to the purpose, to rebuild, expand and use underground space of the industrial land and warehouse land, enlarge the plot ratio and building density, will not be collected the land price difference any longer.

7. To guarantee the land for key foreign investment projects. The manufacturing projects with an actual foreign investment of more than 1 billion Yuan and the headquarters or regional headquarters of World Top 500 enterprises and global industry leading enterprises(hereinafter referred to as key foreign headquarters) whose self-built land for office property will be jointly arranged by the provincial and cities governments in line with land-use planning indicators.
  When distribute and deliver the annual land-use planning indicators to the municipal levels, the provincial government will fully take the land demand of foreign-invested manufacturing projects with an actual investment of more than 1 billion Yuan and self-built offices property of key foreign headquarters into consideration and give support to the relevant cities; After receiving the land-use planning indicators from the provincial government, the municipal governments should arrange and give priority to land use demands accordingly.

8. The province will coordinate the land use indicators for major foreign projects. For major foreign-funded projects that meet the conditions of Incentive Measures for Major Industrial Project Plan Indicators in Guangdong Province, the province will reward the land use indicators according to the corresponding standards; for major foreign-funded projects with an investment more than 2 billion Yuan and meet the investment intensity requirements and complete the land provision procedures, the province will fully reward land use indicators. If major foreign-invested projects are introduced in various places but there are insufficient indicators for land use in the current year, they may apply to the province for advance-reward incentive plan indicators. For high-standard factory buildings and industrial buildings constructed by national development zones, provincial-level development zones, and industrial transfer zones (industry transfer clusters), after the local governments confirm that the floor area ratio exceeds 2.0 and make the application, the land used plan indicators will be returned by the provincial land and resources authorities.
  According to the Incentive Measures for Major Industrial Project Plan Indicators in Guangdong Province, projects meeting the following investment scale and investment intensity: projects in Guangzhou and Shenzhen, the investment scale is not less than 1.2 billion Yuan and the investment intensity is not less than 4 million Yuan per mu; projects in Zhuhai, Foshan, Huizhou, Dongguan and Zhongshan, the investment scale is not less than 1 billion Yuan, and the investment intensity is not less than 3.8 million Yuan per mu; projects in Shantou, Shaoguan, Heyuan, Meizhou, Shanwei, Jiangmen, Yangjiang , Zhanjiang, Maoming, Zhaoqing, Qingyuan, Chaozhou and Yunfu, the investment scale is not less than 800 million Yuan, the investment intensity is not less than 2.5 million Yuan per mu; for projects within the provincial industrial park, the investment scale is not less than 600 million Yuan and the investment intensity is not less than 2 million Yuan per mu, and the land use index of 300 mu and below shall be awarded by the province in proportion of 80%. The land use scale exceeding 300mu shall be rewarded by the province in proportion of 60%. The reward standards in the Guangdong-Shenzhen Science and Technology Innovation Corridor will increase by 10%, and the major foreign investment projects that invest more than 2 billion Yuan and meet the investment intensity requirements and complete the procedures for land supply will receive full land use indicators from the provincial government. At the same time, if major foreign-invested projects are introduced in various places but the land use indicators are insufficient in the current year, they can apply to the province for advance-reward incentive plan indicators. For high-standard factory buildings and industrial buildings constructed by national development zones, provincial-level development zones, and industrial transfer zones (industry transfer clusters), after the local governments confirm that the floor area ratio exceeds 2.0 and make the application, the land used indicators will be returned by the provincial land and resources authorities to effectively protect the land for major foreign investment projects.

9. To support the registration and transfer of property rights registration and division for the eligible foreign-funded enterprises. To allow regional headquarters to carry out separate registration and assignment by taking one building or one storey as basic unit towards their property rights of self-built office properties, industrial complexes and foreign-invested high standard factories, they can accordingly transact the registration procedures in real estate registration department, the property rights of which can also be transferred. And the accumulative acreage for the separate registration and assignment regional of the self-built properties of regional headquarters shall not exceed 40% of the total construction area.
  To allow separate registration and assignment by taking one building or one storey as basic unit towards their property rights of self-built office properties, industrial complexes and foreign-invested high standard factories. The registration and assignment shall be filed at the real-estate registration authority, property rights can be transferred after registration. The accumulative acreage for the separate registration and assignment regional of the self-built properties of regional headquarters shall not exceed 40% of the total construction area.

10. To encourage foreign-funded enterprises to lease the land. The foreign-invested enterprises that lease industrial lands can determine the lease term correction coefficient when being sure of the basic lease price according to the specific value between its lease term and available maximum term; The lease contract and payment voucher signed with land department can used for transacting planning and reporting procedures; During the lease term, the above-ground buildings, structures and ancillary facilities can be subleased and mortgaged.
  For the occasion of providing industrial land to the foreign-invested industrial projects on a rental basis, the term correction coefficient can be determined in accordance with the specific value between lease term and available maximum term of 50 years, and thus confirm determine the floor lease price. The foreign-invested enterprises that lease industry lands for construction projects can use the lease contract and payment voucher signed with land department to transact planning and reporting procedures without the approval of construction land. During the lease term, the above-ground buildings, structures and ancillary facilities can be subleased and mortgaged.

11. To guarantee the resettlement land for foreign-funded enterprises who meet the conditions. The government has implemented the reconstruction of the old city, which can be negotiated or leased to rearrange the industrial lands for foreign industrial projects that need to be relocated.
  For the foreign industrial projects that need to be relocated due to the implementation of urban and rural planning and reconstruction of the old city, and the project is in conformity with the national industrial policy, in addition to retrieve land and give fund compensation, after approved by municipal or prefectural territorial resources departments and reporting to the people’s government at the same level, the department concerned will also rearrange the industrial lands for foreign industrial projects that need to be relocated through approved selling or leasing.

12. To encourage the transformation of foreign-invested manufacturing enterprises. The foreign manufacturing enterprises utilize the stock industrial real estate to develop productive service industry and establish spaces for makers and innovation workshops can use the land according to the original purposes and types of land use within 5 years, and transact in accordance with relevant provisions after the expiration of five years.
  The manufacturing enterprises with foreign investment that set up independent legal entity through whole or partial transformation and system-transition, utilize stock industrial real estate to carry out such business and service as R&D and design, investigation, transformation of scientific and technological achievements, information technology services, software research and development, intellectual property rights, integrated science and technology, energy conservation, environmental protection, etc., as well as pursue integrated development of manufacturing, cultural creativity, science and technology service industry, can apply to the transitional policy according to the original purpose and the type of land rights without transacting the land use changing procedures. The transitional support policy shall be limited to 5 years, at the expiration of 5 years and assignment required related land formalities shall be handled through negotiation according to the new application, new the type of rights and the market price.

13. To encourage foreign investors to build public service projects with the government. Such public service projects as medical treatment, education, culture, pension, sports, etc. jointly funded by foreign investment and government that can use allotted land is allowed to supply state-owned construction land through investment or shares buying.
  The Opinions of the General Office of the State Council on Further Stimulating Investment in Social Sectors ( [2017] No. 21) indicates that “The new-supplied lands for such areas as medical treatment, pension, education, culture, sports, etc. which are conform to the Catalogue of Allocated Land(,hereinafter referred to as the Catalogue), can be provided according to transfer settlement. The projects that can used allotted lands are encouraged to supply lands through transferring and leasing on a voluntary basis, to support the municipal and prefectural governments to supply lands through investment of use rights or share buying of the state-owned construction land together with the social capital investment”. Such public service projects as medical treatment, education, culture, pension, sports, etc. jointly funded by foreign investment and government that can use allotted land is allowed to supply state-owned construction land through investment or shares buying if they are in conformity with the Catalogue.

IV.Support the R&D Innovation of Foreign Investment

14. To support foreign R&D institutions to participate in the construction of public service platform and government science and technology projects in Guangdong Province. To support foreign R&D institutions (including internal research and development institutions of enterprises) to participate in the construction of R&D public service platform and government science and technology projects in Guangdong Province and enjoy matching funds support. At present, Guangdong Province supports foreign R&D institutions to participate in the construction of public service platform and government science and technology projects in the form of international cooperation projects, the application funds will be jointly managed with the cooperation units in Guangdong who also serve as the application subject. According to the national relevant fiscal policy, funds are only available for using in the Mainland China currently.

15. To grant financial assistance to the foreign-funded research and development institutions who meet the requirements.
  Firstly, the foreign R&D institutions designated as new research and development institutions by the provincial finance can be given no more than 20% of the subsidies to the research and development expenditure quota of the previous year that supported by non-financial resources, the subsidies for individual institutions are not more than 10 million Yuan (Institutions that have already received subsidies from other financial departments at all levels will not be subsidized).
  Secondly, according to the Opinions on Accelerating the Innovation and Development of Doctorate and Post-doctorate Talents in the New Era jointly issued by 13 departments including Organization Department of the Provincial Party Committee and Provincial Bureau of Human Resource and Social Security, foreign-invested R&D institutions recognized as postdoctoral workstations and academicians workstations of the Chinese Academy of Sciences and Chinese Academy of Engineering can receive a maximum subsidy of 1 million Yuan.
  Thirdly, the enterprises registered in Guangdong Province, who has independent legal person qualification, has been identified as the provincial enterprise technology center without fiscal fund support from enterprise technology center, and is equipped with strong technical strength or high scientific research level and sound financial management structure and financial management system, as well as has paid taxes in accordance with the law (except construction enterprises), can receive subsidies. The subsidies will be given afterwards and be approved by The Economic and Information Commission of Guangdong Province and Department of Finance of Guangdong Province. The subsidy for individual project is no more than 2 million Yuan, and the fiscal subsidy amount shall not exceed 40% of investment of the purchase of equipment and software. The financial capital should be used to purchase equipment and software.
  Besides, the foreign R&D institutions with independent legal person qualification newly-established by Global Fortune 500 Enterprises can be given support in the fields of finance, land, products market access and industrial development fund through “one discussion upon one project” by the municipal and provincial governments.

16. To support foreign drug companies to enter Guangdong market. In the process of adjusting the medicine directory with national authorization, Guangdong Province will open the Green Channel under the authority of the State for the Foreign Medicine Marketing Authorization Holder approved to list the new first-class medicine of the national large varieties and carried out production and settlement in Guangdong Province, and give priority to its incorporating them into the the list of medical insurance medicines in Guangdong and link up with drug price negotiations and centralized purchasing work, so as to support the industrialization of foreign R&D achievements in Guangdong. The foreign drug marketing authorization holder in this policy refers to the foreign-invest drug research and development institutions or pharmaceutical producing enterprises that set up in accordance with the law, can independently bear the responsibility, be able to implement the Drug Administration Law of the People’s Republic of China and other laws and regulations related to drug registration applicant, and perform the corresponding obligations bear legal responsibilities in the aspects of pharmaceutical research and development, registration, production, distribution, monitoring and evaluation.

17. To implement preferential taxation policies for foreign R&D institutions.
  Firstly, the recognized foreign research and development centers that import technology development supplies will be exempted from tax or enjoy tax refund. According to the regulations of the Notification of Ministry of Finance, Ministry of Education, National Development and Reform Commission, Ministry of Science and Technology, Ministry of Industry and Information Technology, Ministry of Civil Affairs, Ministry of Commerce, General Administration of Customs, State Administration of Taxation, State Administration of Press, Publication, Radio, Film and Television on the Tax Policy of Management Measures of Supporting Technological Innovation Import Policy([2016]No. 71), and the Notification of Ministry of Finance, Ministry of Commerce, State Administration of Taxation on Continuously Implementing the Value-added Tax Policy for Foreign Research and Development Institutions to Purchase Equipment ([2016]No.121), The foreign R&D center shall be approved or confirmed by commercial departments in accordance with the relevant regulations. The recognized foreign research and development centers that import technology development supplies can apply to regional customs office for the exemption of tax, and apply to tax departments for refunding when purchase domestic equipment. Refer to the Qualification Review and Identification Measures of Duty-free Import Equipment of Guangdong Foreign Investment R&D Center issued by the Department of Commerce of Guangdong Province together with other organs.
  Secondly, to conduct tax exemption for foreign invested enterprises provide technical services. According to the Notification of the Ministry of Finance and Sate Administration of Taxation on the Comprehensive Introduction of VAT Reform ([2016] No. 36), Technology transfer refers to the business activities of transferring technology ownership or the use of the right, the technology includes patent technology and non-patented technology. Technological development refers to the research and test development of new technologies, new products, new processes or new materials and their systems. Technological consultation means to carry out feasibility studies, technical forecasts, technical surveys, and analysis and evaluation reports on specific technical projects. The technological consultation and technological services related to technology transfer and technological development refer to the transferor (or entrusted party) help the transferee (or entrusting party) to master the transferred technology (or entrusted the development of technology) and provide technological consultations and technological services business according to the regulation of technical transfer or development contract, and the price of the technological consultation and technological services shall be issued on the same invoice with the total price of technology transfer or technological development. When apply for the exemption of value-added tax, the eligible taxpayers must hold the written contract of technology transfer or technology development to the provincial science and technology departments for identification, as well as submit related written contract and audit opinion documents of science and technology department to the competent tax authorities for future reference.
  Thirdly, to give preferential income tax to technology advanced service enterprises. According to the Notification of the State Council on Measures to Promote the Growth of Foreign Investment ([2017] No. 39) and Notification of the State Council, State Administration of Taxation, Ministry of Commerce, Ministry of Science and Technology and Development and Reform Commission on Promoting the Income Tax Policy of Technology Advanced Service Enterprises to the Whole Nation ([2017] No. 79), to promote income tax preferential policies for the eligible technology advanced service enterprises in service outsourcing model cities to the whole country. The technology advanced service enterprises that have been recognized by the provincial departments of science and technology, commerce, finance, taxation, development and reform shall be levied at the rate of 15% for enterprise income tax. The expenditure of education for the employees of the technology advanced service enterprise which are within 8% of the total salary, shall be deducted when calculating the taxable income amount. For the exceeding part shall be deducted in the subsequent annual payment of the tax. Previously, only qualified enterprises in Guangzhou and Shenzhen can enjoy preferential policies.

18. To simplify the clearance procedures for research and development materials. The foreign R&D centers can willingly choose the mode of advance inspection, booking customs clearance and articles release when import equipment, reagents and samples for research and development.  
  According to the Regulations for the Implementation of the Law of the People’s Republic of China on Import and Export Commodity Inspection, the consignee of the imported commodities should submit the Entry-Exit Inspection and Quarantine Institution of the customs declaration. Within 20 days after customs clearance, the consignee should apply to the Entry-Exit Inspection and Quarantine Institution of the customs declaration. From the perspective of facilitating the import and export enterprises and improving the efficiency of customs clearance, the inspection and quarantine departments shall allow the import and export enterprises to choose to declare the goods in advance after the goods arrive at the ports on the basis of their actual conditions. Regulations for the Administration of Entry-Exit Inspection and Quarantine Procedures and the Notice on Simplifying Inspection and Quarantine Procedures and Improving the Efficiency of Customs Clearance([2017]No. 89), have innovated the new mode of approval, clearance and supervision, so the entry and exit goods can get approval and clearance under the precondition of meeting requirements in the enterprise credit rating, submitting qualified guarantee and not being chosen for spot inspection, namely, after being approved, the entry and exit goods will receive clearance documents without inspection or laboratory tests, so the efficiency of cargo clearance will be greatly improved. At the same time, with regard to the products needed for scientific research and testing and the parts imported for the production line and for assessing technology, enterprises can apply for Exemption from Compulsory Certificate. The Customs provide booking clearance services for foreign R&D centers to import research and development equipment, reagents and samples provide, allow clearance in non-working hours. After the on-the-spot clearance booking, the Customs will work overtime to provide services for the goods mentioned above of related R&D centers.

V.Intensify Financial Support to Foreign Investment Development

19. To increase support for industrial funds. To give key support to World Top 500 enterprises, global industrial leading enterprises and major multinational M&A project to carry out round-trip investments in the way of equity investment through the Guangdong Industry Development Fund.
To include foreign investment into the support scale of Guangdong Industrial Development Fund, to implement “one discussion upon one project ” to the eligible foreign-invested projects by reference to the current capital equity investment mode of financial management funds, and give support in the way of equity investment. After the expiration of the agreed investment, equity investment will quit through such marketization modes as major shareholder buyback, be listed, equity transfer, etc. In accordance with requirements of Department of Commerce of Guangdong Province, Guangdong Industry Development Fund will not charge the project proceeds during the participation, and quit at a lower yield or surrender profits to the foreign-invested enterprises.

20. To explore the financial management and service innovation in Guangdong Pilot Free Trade Zone.   To support the enterprises with foreign investment in Guangdong Pilot Free Trade Zone to conduct fully cross-border financing for domestic and foreign currency, and obtain domestic and foreign currency financing when external debt is within 2 times the net assets; To support the enterprises with foreign investment to issue bonds within the FTZ and overseas, allow companies to reuse the repatriated funds raised abroad; and support the foreign capital to conduct qualified overseas LP business.
  According to the Notification of People’s Bank of China on the Macro-prudential Management Affairs of Fully Cross-border Two-way Financing [2017] No.9), enterprises with foreign investment can obtain domestic and foreign currency financing from non-residents within 2 times of net assets. If the difference between investment and registered investment of the foreign-invested enterprises is higher than two-times net asset, then it is possible to obtain domestic and foreign currency financing from non-residents within the range of the difference. In accordance with the Notification of People’s Bank of China Guangzhou Branch on Supporting of China (Guangdong) Free Trade Pilot Zone to Expand the Cross-border Use of RMB ([2016]No.43), if the foreign-invested enterprises within the Free Trade Zone issue RMB bonds abroad, the raised money could freely flow back and be used in the China, the recycling capital shall be used strictly according to the relevant provisions of the bond prospectus; The foreign shareholders of foreign-invested enterprises in the Free Trade Zone could issue RMB bonds in China and the raised funds using for the foreign-funded enterprises shall be exempted from quota management of the macro-prudential fully cross-border financing. Additionally, it supports foreign capitals to conduct qualified overseas limited partner business in Guangdong Pilot Free Trade Zone.

21. To support the centralized operation of funds of trans-national corporations. Lower the threshold for the cross-border capital pool to support transnational enterprise groups engaging in substantial economy to establish cross-border capital pools in Guangdong Free Trade Zone.
  In accordance with the Notification of People’s Bank of China Guangzhou Branch on Supporting of China (Guangdong) Free Trade Pilot Zone to Expand the Cross-border Use of RMB ([2016]No.43), transitional enterprise groups can choose the member enterprise registered in Guangdong Free Trade Zone as the host company to form a cross-border capital pool. And the total revenue of domestic member enterprises shall not be less than 500 million Yuan and that of overseas member enterprise shall not be less than 100 million Yuan. The capital pool will carry out bidirectional upper limit management, and the upper limit shall be the accrued equity of the owners in the pool. This policy specialized for the Free Trade Zone has lowered the threshold for the transnational enterprises in Free Trade Zone to conduct  cross-border capital pool business, facilitated the centralized operation of cross-border funds for transnational enterprise groups, which is conducive to improve the efficiency of enterprise capital operation and reduce the financial cost.

22. To support the domestic financing by foreign-funded enterprises in Guangdong. The domestic direct financing of foreign-invested enterprises enjoys the same support policies as the listing private enterprises in the province, listing on “National Equities Exchange and Quotations” and the financing of regional equity markets.

VI.Enhance Talent Support to Foreign Investment Enterprise

23. To implement “Guangdong Superior Talent Card”. To include the senior management personnel in foreign-invested enterprises and other seven categories of talents into the service objects, and gradually expand the use of “Guangdong Superior Talent Card” as proof of identity in Guangdong Province.
  In accordance with the requirements of Opinion On Deepening the Reform of the Institutional Mechanism for Talent Development ( [2017]No.1) , The high-level talents identified by personnel departments can enjoy the same treatment with the local residents in the aspects of social insurance, purchasing houses and vehicles, professional title appraisal, etc., and priority facilitation services in locating, Departure and Entry, long-term residence, permanent residence, health care, children schooling, job arrange for spouses, social insurance, living in talent apartments, etc. by using the card. “Guangdong Superior Talent Card”will implement “all-in-one-card” service, the service objects of which include senior management personnel of enterprises with foreign investment, the middle and senior management personnel of regional headquarters, the high-level research and development staff of foreign R&D institutions, high-value PCT international patent inventor, project experts of World Skills Competition, superior talents from Hong Kong, Macau and Taiwan employed by enterprises with foreign investment and other 7 categories of talented persons, as long as they are conform to the application condition for the “Guangdong Superior Talent Card”, according to the regulations, they will receive the same treatment with the local residents and preferential facilitation services in entry and exit, children schooling, social insurance, health care, finance, house purchasing, tax, etc. Please pay attention to the Implementation Measures of Guangdong Superior Talent Card which will be issued soon for details.

24. Title Identification of returned innovation talents. The high-level overseas returned talents who have come back to work in foreign R&D institutions can be directly identified senior titles.   
High-level overseas returned talents refer to the overseas students who have engaged in scientific research, teaching, engineering technology, finance, management, etc. and achieved remarkable results after graduation, being the much-needed talents in China, such as, senior management personnel, senior professional and technical personnel, technical academic leader, and the talents who own patents invention, of or proprietary technology with better industrial development prospect. According to the regulations of Opinion on the Further Reform of the Professional Title Evaluation of Scientific and Technical Personnel ([2015] No. 4), the high-level talents included in “The Recruitment Program of Global Experts”, New Century Talents Project and “Guangdong Leading Talents” or foregoers of “The Introduction of Innovative R&D Team for Guangdong”, can be directly identified senior titles, and the Outstanding Contribution Evaluation Committee of Guangdong Province will be responsible for the organization and implementation work. On the Basis of Notification of General Office of the Communist Party of China and General Office of the State Council on Deepening the Reform of Professional Title System([2016]No.77) and its spirit “to ease restrictions on the conditions of seniority and fixed number of years, and to set up “green channel” in professional title evaluation for overseas high-level talents and the much-needed talented persons”,  the approved overseas high-level talents who are in conformity with the requirements of the qualification conditions can be identified directly as senior titles with reference to high-level personnel identifying method by Outstanding Contribution Evaluation Committee of Guangdong Province.

25. To clear up the convenient measures for foreign talents. The identified foreign high-level talents can enjoy the convenient measures such as entry and exit, residence and employment of foreign homemaking workers.
  According to the Approval on the implementation of Exit and Entry Policies and Measures Concerning Supporting the Construction of Guangdong Free Trade Zone and Innovation-driven Development in Guangdong Province and the Approval on the Identification Standard for Foreign High-level Personnel to Apply for Permanent Residence, the identification work for the four categories of foreign high-level personnel outside the Guangdong Free Trade Zone (famous awards winners or candidates of high-level personnel plan, overseas well-known experts and scholars, foreign high-level innovational and enterprising talents and other personnel with special expertise, being the talents in urgent need to Guangdong), will be dealt with by the competent authorities for foreign experts of that city, and report to Administration of Foreign Experts Affairs for approval and issuance of the confirmation letter, which will be submitted to the Exit and Entry Administration Department of Public Security for convenient measures such as applying visa, residence permit and hiring foreign homemaking workers. With the personal guarantee and employment contracts, the high-level talents from other countries, Hong Kong, Macao and Taiwan that have obtained permanent residence or work permits in China can apply residence permit for personal permit (with the note of “household service”) of corresponding period for their hired foreign homemaking workers.

26. To further simplify the entry and exit procedures for talents. Guangdong will gradually promote six exit and entry policies and measures for talents in support of the construction of Guangdong Pilot Free Trade Zone.
  Approved by the Ministry of Public Security, from August 1, 2016, Guangdong Province has implemented the Exit and Entry Policies and Measures Concerning Supporting the Construction of Guangdong Free Trade Zone and Innovation-driven Development in Guangdong Province (hereinafter referred to as 16 exit and entry policies, including 10 policies applying to the entire province, 6 policies applying to Guangdong Free Trade Zone), so as to provide convenience for foreign high-level personnel’s entry and exit, short-term residence and permanent residence. Agreed by the Ministry of Public Security, Department of Public Security of Guangdong Province plans to promote the 6 exit and entry policies which previously applied to Guangdong Free Trade Zone to the administrative regions in Pearl River Delta Area Independent Innovation Demonstration Zone (namely Guangzhou, Shenzhen, Zhuhai, Foshan, Huizhou, Dongguan, Zhongshan, Jiangmen, Zhaoqing) and Sino-German Metal Eco City by December 2017.

VII.Reinforce Intellectual Property Protection of Foreign Projects

27. To speed up the construction of China (Guangdong) Intellectual Property Protection Center. The State Intellectual Property Office of the P.R.C has officially approved the construction of China (Guangdong) Intellectual Property Protection Center, for carrying out collaboration protection of intellectual property rights towards a new generation of information technology and biotechnology industry. Guangdong hopes to rely on the center, first to realize the goal of “rapid protection”: from the fast investigation of the single designs to such three patents as inventions, utility models and designs and the invalid request. Second is to achieve the goal of “large-scale protection” of intellectual property rights: to build an intellectual property rights protection network covering key industries in the entire province, so as to set up an intellectual property service innovation chain from research, development and application to protection. Third is the realization of the “strict protection”, to build cooperation mechanism for intellectual property rights protection, and form a collaborative system for the protection of intellectual property that connected by examination and approval, rights protection aids, conciliation and arbitration, administrative law enforcement and judicial aid.

28. To introduce the convenient response channel of intellectual rights protection for major foreign-invested enterprises. According to Opinion of People’s Government of Guangdong Province on the Innovation-driven Development of Intellectual Property Service, Guangdong Intellectual Property Office establishes intellectual property protection system for key enterprises according to the policy of “motivate to create, protect in accordance with the law, improve efficiency, promote application” and combined with the demand of enterprise in the aspect of intellectual property protection, and to build convenient response channel for intellectual property rights in major enterprises, so as to solve enterprises’ difficulties and problems related to the protection of intellectual property rights. High-tech enterprises and foreign invested enterprise whose patent application or holding quantity is more than 30 can be considered as municipal key enterprises of intellectual property rights protection, and whose is more than 100 can be applied to be provincial key enterprises of intellectual property rights protection.

29. To promote the construction of trademark business acceptance windows. Trademark business acceptance windows include enterprise trademark registration and pledge windows, which were only available in Trademark Office of the State Administration for Industry and Commerce of the P.R.C. After the implementation of this measure, the registered trademark application windows of Guangdong Provincial Industrial and Commercial Bureau, Shenzhen Administration for Industry and Commerce, Zhuhai Hengqin New Area Administration will accept relevant business applications. Besides, Trademark Examination Cooperation Center (Guangzhou Branch Center) of Trademark Office of the State Administration for Industry and Commerce and Guangzhou Trademark Office will also accept enterprise trademark registration.

30. To encourage foreign enterprises to apply for and implement patents in China. Their inventions, discoveries and other scientific and technological achievements made in Guangdong can be involved in the evaluation of various awards at all levels in Guangdong Province.
  To encourage and support eligible foreign-invested enterprises to participate in the evaluations of patent awards in accordance with the Patent Award Evaluation Measures in China and Patent Award Evaluation Measures in Guangdong Province. According to the regulations of Science and Technology Award Incentives of Guangdong Province, the Science and Technology Award of Guangdong Province aims to reward citizens and organizations that have made outstanding contributions to the progress of science and technology in the province. The programs applied for provincial science and technology awards must conduct research and development, application and promotion within the jurisdiction area of Guangdong Province, or belong to the achievements that first completed in Guangdong or researched and developed through domestic and foreign cooperation. At present, the above conditions should be met to implement the evaluation.

VIII.Improve the Level of Investment and Trade Facilitation

31. To delegate a batch of provincial review and approval management permissions. Establishment and change of foreign investors in the Negative List with a total investment of less than 1 billion US dollars will be reviewed, approved and managed by municipal governments at and above prefecture-level. Authorize cities at prefecture-level or above to approve the expansion and location adjustment of provincial-level economic development zones, and submit the result to the provincial government. To entrust the 18 items of provincial administrative licensing matters concerning the establishment and change of foreign-invested enterprises in such fields as medical institutions, travel agencies, gas stations to the relevant departments of people’s governments at municipal level or above in accordance with the law, and gradually entrust to management committees of state-level development zones after conditions becoming mature.
  The 18 items of provincial administrative licensing matters include: the establishment and change approval (contract and regulations) of foreign-invested enterprises (Department of Commerce of Guangdong Province) in the areas of cinemas, for-profit medical institutions, travel agencies, gas stations and shipping design (with piecewise); The approval of foreign investment projects that must be conducted by Guangdong Provincial Development and Reform Commission; The approval of foreign restricted technical transformation projects in industrial and information fields which must be approved by the Economic and Information Commission of Guangdong Province; Examination and approval of retail business qualification of refined oil products (Economic and Information Commission of Guangdong Province); The establishment and approval of Sino-foreign joint venture talent agencies and job-introduction agencies (Guangdong Human Resources and Social Security Office); The land-use pre-examination for foreign-funded construction projects in the state-level development zones  managed by the province(except for the construction projects of administrative buildings that shall be reported to and approved by the National Development and Reform Commission and/or People’s Government of Guangdong Province) (Department of Land Resources of Guangdong Province); The examination and approval of the environmental impact report of the construction projects (Department of Environmental Protection of Guangdong Province); The approval of foreign-invested road transport industry (Department of Transportation of Guangdong Province); Approval of international shipping management business (Department of Transportation of Guangdong Province); Approval of the soil and water conservation program for production and construction projects (Water Resources Department of Guangdong Province); Examination and approval of foreign-invested medical institutions (Health and Family Planning Commission of Guangdong Province); Establishment, registration, change and cancellation of foreign-invested enterprises and their branches (Administration for Industry and Commerce of Guangdong Province); The approval of foreign-invested cinemas (Administration of Press, Publication, Radio, Film and Television of Guangdong Province); The business license of foreign-invested travel agencies (Tourism Administration of Guangdong Province).

32. To integrate taxation convenience measures.  
  Firstly, to allow head offices and branches of foreign-invested enterprises that carry out trans-regional operation within Guangdong Province and have independent legal person qualification to pay VAT on a consolidated basis and their branch offices can pay it in the local places. According to the Article 22 of The Provisional Regulations on Value Added Tax of People’s Republic of China that the fixed service shall make tax declaration to the local competent tax authorities, if the head offices and branches are not in the same county (city), they should report to local tax authorities respectively. In accordance with the Notification of Ministry of Finance and the State Administration of Taxation on the Policies of Paying Value-added Tax on a Consolidated Basis for the Head Offices and Branches of Fixed Business Subjects ( [2012]No.9), with the approval of departments of finance and administrations of taxation, the head offices and branches are not in the same county (city), but in the same province (area, city), can make value-added tax declaration to the local tax authorities by the head offices. Therefore, the head offices and branches of foreign-invested enterprises that carry out trans-regional operation within Guangdong Province shall make tax declaration respectively, and the enterprises can pay value-added tax on a consolidated basis with the approval of the Departments of Finance of Guangdong Province and Guangdong Office of State Administration of Taxation.
  Secondly, the eligible foreign investors directly invest encouraging investment projects by using the profit distributed from the domestic enterprises will conduct deferred tax policy and are not required withholding tax. In line with the deployment of Notification of the State Council on Measures to Promote the Growth of Foreign Investment, the eligible foreign investors directly invest encouraging investment projects by using the profit distributed from the domestic enterprises will conduct deferred tax policy and are not required withholding tax. For details, please refer to the Notice on the Issue of Non-collecting Income Tax Policy for Foreign Investors Making Direct Investment via Profit Distribution issued by the Ministry of Finance, the State Administration of Taxation, the National Development and Reform Commission, and the Ministry of Commerce (Financial Taxation [2017] No. 88) and Announcement on the Implementation of the Issue of the Non-tax Levy of the Withholding Income Tax on the Direct Investment of Foreign Investors (State Administration of Taxation Announcement No. 3 of 2018) issued by the State Administration of Taxation.

33. To reduce the time limit of corporate business transaction. Reduce the time for setting up a foreign-invested company to within 5 working days. Implement the “multi-certification integration” reform and the combination of business registration and industrial and commercial registration of foreign-invested enterprises beyond the Negative List. The business registration “Bank Securities Express” service will be expanded to countries and regions along the “Belt and Road” to promote the local registration of foreign investors and remote processing. Simplify the materials that Hong Kong and Macao investors should submit in Guangdong, and carry out a pilot version of the simplified version of the commercial registration notary. To further standardize the government’s examination and approval authority and standards, optimize the approval process for enterprises’ investment, and compress the existing investment approved items and approval times by a quarter. The time limit of business transaction will be promised to be less than one half of the legal limit for the work permits and residence permits for foreigners. To optimize the approval process of the flexible working hour system and comprehensive calculation working hour system, and reduce the time limit of business transaction by a third of the legal time limit. To promote “Single Window” of international trade in all the ports of Guangdong Province, reducing the time of goods clearance by a third.

IX.Optimize the Environment for Foreign Investment in Key Parks

34. To optimize the administrative examination and approval mode of national-level development zones. To support qualified national development zones to implement the administrative examination and approval authority model and “one-seal management examination and approval”.
  The Notification of State Commission Office of Public Sectors Reform  and Legislative Affairs Office of the State Council on the Issuance of the Pilot Scheme of Relatively Concentrative Administrative Licensing Rights ( [2015] No. 16) made Guangdong Province as the first batch of pilot provinces, which are required to organize and undertake the exploration of the implementation patterns of relatively concentrative administrative licensing rights in accordance with the requirements based on the principle of simplicity, unity and effectiveness. Within the organizational manning quota, the state-level development zone can implement the administrative examination and approval authority model, the mode of administrative examination and approval authority shall be positively promoted in all kinds of development zones, and “one-seal management examination and approval” is expected to be conducted, and the pilot work plan shall be reported to and approved by the provincial CPC committee and the provincial people’s government through the municipal CPC committee and the municipal people’s government.

35. To support foreign direct investment in the provincial industrial transfer parks (Industrial transfer clusters). The newly established foreign investment projects in the provincial industrial transfer parks (industrial transfer clusters) will enjoy the financial support policy of the provincial co-building industry.
The newly established foreign enterprises in the provincial industrial transfer parks (industrial transfer clusters), since the beginning of production, will be given inclusive reward of 40%, 20% respectively in its first three years and 4th-5th years according to their financial contribution to the local government; The manufacturing enterprises in the provincial industrial transfer parks (industrial transfer clusters) invested (holding) by large backbone enterprises, the Fortune Global 500 enterprises, China top 500 enterprises (including wholly owned subsidiaries and holding companies), will be rewarded according to 30% of the proportion of fixed assets investment of the year, the highest reward can be 100 million Yuan; The enterprises that set up foreign-funded R&D institutions, identified as national high-tech enterprises, included those from the provincial high-tech enterprise incubation base, will be awarded separately.
Besides, to include the management of provincial development zones in the Eastern, Western and Northern part of Guangdong Province into provincial industrial transfers parks, and enjoy the relevant supporting policies of provincial industrial transfer according to the regulations.

36. To delegate the approval authority of the expansion and location adjustment of provincial-level development zones to the lower levels. To delegate the approval authority of the expansion and location adjustment of provincial-level development zones to cities at prefecture level and above and the examination and approval results shall be submitted to the provincial government.
  According to the Notification of Department of Commerce of Guangdong Province, Guangdong Provincial Development and Reform Commission, Department of Land Resources of Guangdong Province, Department of Housing and Urban-Rural Development of Guangdong Province on the Issuance of the Management Measures of the Establishment, Expansion and Location Adjustment of Provincial-level Development Zones, the expansion and location adjustment of provincial-level development zones shall be applied to the People’s Government of Guangdong Province by municipal governments at prefecture level and above, and examined by relevant departments and submitted to the provincial government for approval. For further building major foreign investment attraction platforms and giving greater decision-making power to the municipal governments on the construction of economic development zones, Guangdong Province will further simplify the approval process of the expansion and location adjustment of provincial-level development zones, the municipal people’s government can authorize the expansion and location adjustment of provincial-level development zones according to the conditions and requirements of Management Measures of the Establishment, Expansion and Location Adjustment of Provincial-level Development Zones.

X.Improve the Mechanism for Foreign Direct Investment

37. To establish special coordination mechanism. To establish foreign investment attraction work coordination mechanism led by the main leadership of provincial and municipal governments, optimize the “direct train” mechanism in which the provincial governor could contact the multinational company directly, coordinate and solve the key issues that restrict foreign investment attraction at regular intervals, especially the Fortune Global 500 companies in Guangdong. At the same time, establish a provincial joint conference mechanism on utilization of foreign investment and implement the “one discussion for one project” mechanism of key foreign projects.

38. To integrate investment attraction resources. To integrate and optimize overseas economic and trade offices of Guangdong Province, and accelerate the construction of an international investment promotion system for Guangdong Province.

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