China will implement a “One Window, One Form” policy for registering foreign-funded enterprises, according to a recently released circular.
The circular, which was issued jointly by the Ministry of Commerce (MOFCOM) and State Administration for Industry and Commerce (SAIC), will be implemented nationally from June 30, 2018.
Beijing has announced new visa, residency, and foreign investment incentives in a bid to attract top overseas talent to its high-tech Zhongguancun Science Park.
Those who qualify for the incentives will benefit from longer visa terms and permanent residence status – also known as China’s green card. Those holding permanent residency will be allowed to act as the legal representatives of new research institutes in Zhongguancun and lead national-level innovation projects there.
China may legalize gambling in Hainan, the country’s southernmost province, according to a report from Bloomberg.
Online gaming, lotteries, and sports betting could be introduced to Hainan, which would pave the way for casinos to enter in the future, per the report. Legalizing gambling would come in conjunction with a new airport in Dongfang and relaxed visa rules for foreigners.
Top economic advisor pledges market opening
Liu He, a member of China’s politburo and one of President Xi Jinping’s top economic advisors, has pledged that China will accelerate economic reforms in 2018.
Speaking at the World Economic Forum in Davos, Liu stated that “some measures will exceed the expectations of the international community,” and noted that the reforms will celebrate the 40th anniversary of China’s reform and opening up policy.
Work permit renewal policy updated
As of February 28, 2018, foreign companies must submit work permit renewal applications for their foreign workers at least 30 days before his or her work permit expires, according to a notice from SAFEA. If the company misses the deadline to renew the work permit, the company will need to follow the procedures for applying for a new work permit.
Given that it takes about 15 work days to renew a work permit and seven work days to renew a residence permit, as well as another five work days if that company has not yet registered on the online system, companies are advised to begin the renewal process 60-90 days before the work permit’s expiry date. To renew a work permit, the company must provide the labor bureau with a renewal application form along with the employee’s labor contract, passport, residence permit, and current work permit.
Tax incentives for advanced technology service enterprises rolled out nationwide
The Ministry of Finance (MOF), the State Administration of Taxation (SAT), the Ministry of Commerce (MOFCOM), the Ministry of Science and Technology, and the National Development and Reform Committee (NDRC) jointly released a circular on November 2, 2017, to formally roll out the tax incentives for advanced technology service enterprises (ATSE) nationwide.
According to the circular, corporate income tax (CIT) for a qualified ATSE will be calculated at the preferential tax rate of 15 percent, instead of the standard 25 percent rate. Employee education expenses incurred by a qualified ATSE can also be deducted from taxable corporate income, for up to eight percent of the ATSE’s total salary and wage expenses. Further, the portion exceeding eight percent may be carried to the following tax years for CIT deduction.
Withholding tax on China-sourced income of non-resident enterprises clarified
The State Administration of Taxation (SAT) released an announcement on the administration of withholding tax on China-sourced income derived by non-resident enterprises on October 27, 2017 (“the Announcement”). The Announcement further clarifies matters concerning the withholding of corporate income tax (CIT).
According to the Announcement, the administrative burden of the withholding agents will be reduced. The withholding agent will no longer be required to submit contracts to the tax bureaus for record-filing within 30 days after a contract is signed or amended. Further, the current tax settlement requirement of 15 days prior notice to the last payment is now abolished. The required materials to submit tax returns to the tax bureaus were also simplified.
China to adjust registration management for drugs and medical devices
To promote the adjustment of industrial structure and technological innovation in the drug and medical device sector, the Communist Party of China’s Central Committee and the State Council jointly released a guideline on the reform of the review and approval system, which came into effect on October 8, 2017.
The guideline lays out several primary objectives. These include overhauling the management of clinical trials, accelerating the drug and medical device approval process, promoting drug innovation and the development of generic drugs, enhancing the administration of drug and medical devices throughout the product life cycles, and improving technical review infrastructure for greater transparency and oversight.
Notably, the guideline stipulates that qualified overseas clinical trial data can now be used in the drug and medical device registration and approval process. In the face of a grave threat to public health, drug and medical device registration approvals shall be fast-tracked. In addition, a rare disease catalogue will be set up and new products that can treat these rare diseases could be eligible for reduced trials.