Supplementary Provisions on the Implementing Opinions on the "Shanghai  Municipality Provisions Encouraging Multinational Corporations to Establish Regional  Headquarters" (the  “Supplementary Provisions”) (关于鼓励跨国公司设立地区总部规定实 施 意 见 的 补 充 规 定 ), issued by  Shanghai  Municipal Commission of Commerce, Shanghai Municipal Human Resources and Social Security Bureau, Exit-Entry  Administration of Shanghai Public Security Bureau, and Shanghai Entry-Exit  Inspection and Quarantine

Shanghai Municipal Government issued the Shanghai Municipality Provisions on  Encouraging Multinational Corporations to Establish Regional Headquarters (“Provisions”), launching several favorable policies to  encourage multinational  corporations (“MNCs”) to establish or relocate  their  headquarters to Shanghai and  improve the development of existing MNCs’ Shanghai-based regional  headquarters.

In line with the Provisions, the  Shanghai Municipal Commission of Commerce, cooperating with other relevant  authorities, further enacted the Supplementary  Provisions to expand some of the favorable policies under the Regulations, such  as the following:

  • Under the Supplementary Provisions,  foreign-owned enterprises  (including branches) not meeting the requirements to be “headquarters,”  but  having the responsibilities of multinational companies and meeting other  criteria, can be regarded  “Quasi-Headquarters Institutions” and benefit from  Shanghai’s economic development policy for corporate  headquarters. The  conditions for qualifying as a  Quasi-Headquarters  Institution are below:
    • The MNC has total assets of  at least US  $200 million, and has  invested  in  and established at least three foreign-invested  enterprises in Mainland China,  and  at least one of these is  registered in Shanghai Municipality.
    • The person in charge of the MNC’s regional business and the senior  management personnel responsible for  its main functions are  based in Shanghai for work on a long-term basis.
    • The Quasi-Headquarters Institution occupies  at least 500 square  meters, and has at least  50 employees  operating and managing  the headquarters.
  • The favorable policies for Quasi-Headquarters Institutions mainly aim to ease the immigration procedures in China for foreign staff:
    • Under the Supplementary Provisions, foreign employees of QuasiHeadquarters Institutions who need to enter China temporarily on  multiple occasions are eligible to apply for a multi-entry visa,  which is valid for up to one year with a stay of up to 180 days per  entry.
    • Quasi-Headquarters Institutions’ management is eligible to apply  for  long-term residence.  Their legal representatives (persons-incharge), general managers, deputy general managers and chief  financial controllers are eligible to apply for  five-year  foreigner  residence permits; department managers are eligible to apply for four-year foreigner residence permits; and ordinary employees  who are foreign nationals are eligible to apply for  three-year foreigner residence permits. Foreign spouses, parents and children  under 18 years of age of foreign nationals are eligible to apply for  foreigner residence permits with the same validity period as the  permits described above.

Date of issue: July 14, 2014. Date of effectiveness: July 14, 2014.