Key Points:

  • More government grants and incentives available to attract corporate headquarters
  • More convenient facilities provided to headquarters established in (or relocated to) Beijing  

On May 21, 2009 Beijing’s municipal government issued Several Provisions on Encouraging Multinational Companies to Establish Regional Headquarters in Beijing. Shanghai issued similar rules in 2008.

The provisions are designed to encourage multinational corporations to establish or relocate their headquarters in Beijing. Companies outside China that set up their regional headquarters (the location managing branches and offering services in different administrative regions) in Beijing will enjoy preferential policies and receive financial support from the municipal government during their startup periods including the following:

  1. Government subsidies will be available for three years for regional headquarters established after January 1, 2009 with a registered capital of over RMB100 million.
  2. Regional headquarters newly registered in, or newly relocated to, Beijing that lease office premises will receive three years’ government-subsidized lease assistance.
  3. Regional headquarters constructing or purchasing offices in Beijing will be granted funding assistance in the form of a lump sum amount.
  4. Financial incentives will be available for three years to regional headquarters in Beijing enjoying annual revenues of over RMB100 million.
  5. Chief executive officers, high-level managers and technicians working for regional headquarters in Beijing will be eligible for undefined government “rewards.”
  6. Immigration procedures will be eased for foreign employees of regional headquarters in Beijing. High-level managers and technicians will be eligible to obtain multiple-entry visas valid for five years and mid-level employees will be eligible for visas valid for three years, while regular employees will be eligible for one-year multiple-entry work visas. Foreign employees of such companies will also be permitted to apply for a Chinese visa after their arrival in Beijing, rather than being required to obtain one before they travel.
  7. Foreign employees of Beijing regional headquarters will also enjoy simplified residency permit procedures. High-level managers and technicians will be eligible to obtain long-term residency permits valid for five years and mid-level employees will be eligible for residency permits valid for four years, while regular employees will be eligible for three-year residency permits.  

This is not the first time Beijing has sought to attract more global enterprises. In 1999, the city government issued “Provisions on Encouraging Multinational Corporations to Set up Regional Headquarters.” Those provisions have been updated by this newest set of incentives. Aiming to become a major global financial center, Shanghai revised its rules for encouraging regional headquarters in October 2008 and, as of March 2009, boasted 224 regional head offices of global companies. By comparison, Beijing is currently home to 121 Asia-Pacific headquarters for global enterprises.

Detailed rules for the implementation of these provisions are expected in a few months, following review and approval by the relevant local government.