By Alexander Chipman Koty
Chen Qiufa, the governor of China’s northeastern Liaoning province, recently conceded that the province had been fabricating its economic data from 2011 to 2014. As reported by the state-run People’s Daily newspaper, city- and county-level governments altered economic data, including exaggerating their fiscal revenues by at least 20 percent.
The announcement represented the first time that the Chinese government publicly admitted to forging economic data. Previously, the official news agency Xinhua reported that one county in Liaoning had overstated its fiscal revenues by an enormous 127 percent in 2013, among other incidents.
By Dezan Shira & Associates
Editor: Jake Liddle
Companies planning to either sell or import goods to China should have a strong understanding China’s import tax environment before signing sales contracts.
Importing goods to China implicate three types of taxes – customs duties, value-added tax (VAT), and consumption tax (CT) – depending on the nature of the imported good and whether it falls under CT specified categories.
The amount of import tax liability and who is ultimately responsible for paying them generally depends on how the sales contract is concluded between buyer and seller.
To celebrate Dezan Shira & Associates 25 years of professional services in Asia, we are conducting a series of interviews with key personnel. Chris Devonshire-Ellis is Dezan Shira & Associates Founding Partner and Chairman.
China Briefing: So, tell us Chris, exactly how did you get Dezan Shira started?
Chris Devonshire-Ellis (CDE): It was very early days in China, and long before the handover of Hong Kong to Britain. No-one wanted to go to China; Tiananmen had occurred and it was a difficult time. But when Deng Xiaoping, who was Premier at the time, said “To get rich is glorious”, I knew things would start to change. Dezan Shira & Associates actually predates most of the Chinese firms in China. Legal and tax liberalization didn’t occur until 1995, before that all lawyers and accountants worked for the government. So, we really were early birds!
By Alexander Chipman Koty
The competition to become “the Silicon Valley of Asia” is stiff. Hong Kong, Singapore, and Bangalore all have solid claims, while the mainland Chinese cities Shenzhen, Beijing, and Hangzhou are also strong competitors.
A recent report published by Renmin University’s National Survey Research Center replaces this hotly debated topic by dividing China’s innovative cities into three distinct tech business models: Shenzhen’s high-tech model, Beijing’s innovation-driven model, and Hangzhou’s dotcom model.
By Dezan Shira & Associates
The Industrial & Commercial Bank of China (ICBC) has begun providing Chinese RMB clearing services in Moscow. The facility will ease the use of RMB as a trading currency between the two nations, and expedite the use of transactional settlements in financial services and cooperation between the two. The facility began operating on March 22nd.
Russia’s central bank announced the inclusion of the RMB in its national foreign exchange reserves at the end of 2015.
China’s new five year work permit for foreign employees
China’s Ministry of Public Security has recently unveiled a new pilot program for foreign work permits, which allows anyone who has been employed for at least two consecutive years to apply for a new five year work permit. Previously, foreign nationals were required to renew their work permit every year, even if they were on a multiple year labor contract.
In addition to this, foreign nationals who have worked in the same city or province for four consecutive years, and meet other requirements regarding salary and income tax thresholds, will be eligible to apply for a permanent residence permit.
The pilot program will be implemented in “demonstrative zones of innovative reform” in 11 free trade zones, including those in Beijing, Wuhan, Tianjin, Chongqing, Hebei province, and Henan province. This step to ease visa rules is part of an effort to attract global talent to the country, and follows recent reforms such as the unified work permit and relaxed rules for master’s degree holders.
By Harry Handley
Jiaxing, traditionally known as ‘the home of silk’, is a prefecture-level city of 4.59 million people located in East China’s Zhejiang province. With an area of 3,915 square kilometers, Jiaxing is surrounded by Suzhou to the north, Shanghai to the east, Hangzhou and Huzhou to the west and the Hangzhou Bay to the south. In terms of infrastructure, Jiaxing is well developed with a deep-water port, high speed rail links, and six expressways linking to the wider Yangtze River Delta region.
The Chinese Academy of Social Science ranked Jiaxing the 37th most competitive city in China in 2016, a standing that has significantly increased in recent years. A push by the local government to shift away from traditional resource-heavy manufacturing and towards a more high-tech and environmentally friendly economy has led to a range of diverse industries in the city. These industries, and several special development zones within the city, present significant opportunities for foreign firms who are looking to expand their operations in China.
Our weekly round up of other news affecting foreign investors throughout Asia:
Industry Spotlight: Thailand’s Automotive Industry
Established over 50 years ago, Thailand’s automotive sector has developed into the biggest automotive hub in Southeast Asia. In our latest industry spotlight, we highlight recent regulations in the sector and explore why R&D will be required to sustain competitiveness.
Indian Government Revamps Trade Mark Rules
Registering trademarks in India just got simpler: the government introduced its new Trade Mark Rules, 2017 on March 6. A faster, simpler, and transparent registration process will benefit businesses and will serve as an overall boost to India’s intellectual property regime.