The Shanghai Municipal Government passed the Shanghai Municipality Regulations Encouraging Multinational Corporations to Establish Regional Headquarters (the “Regulations”) on 7 July 2008, as part of its efforts to integrate with the world economy and promote economic development.

The Regulations allow investment companies established by foreign investors which have already been established in Shanghai to make direct applications to become regional headquarters. Newly registered investment companies and management companies that have been recognised as regional headquarters will enjoy set-up and rental subsidies. Senior executives such as legal representatives may receive awards by the local government. The Regulations also provide for regional headquarters and their research centers that meet certain conditions to enjoy preferential policies from customs and the quarantine authorities for declarations of their imported and exported goods.

In addition, Regulations also provides policies that simplify procedures for staff of regional headquarters entering or leaving China. Chinese nationality staff members who need to visit Hong Kong, Macao, Taiwan or foreign countries for business will be able to leave China conveniently. Foreigners in regional headquarters that need to reside in Shanghai long-term may apply for 3 to 5-year residence permits.

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