As COVID-19 cases decline in Shanghai, local businesses are preparing for work and production resumption. The Shanghai government has released several policy documents detailing the requirements, conditions, and procedures for enterprises to apply for resumption of their operations, but local governments are using their discretionary authority based on their respective area’s epidemic situation. In this article, we discuss the important changes that enterprises in Shanghai must implement to be able to qualify to apply for work and production resumption. Businesses that are not currently classified as eligible for work resumption are also advised to note the actions they can take to prepare in advance. For more questions about production resumption in Shanghai, please contact Allan Xu, Senior Manager, Business Advisory Service, Shanghai Office and Kaiting Wang, Shanghai Office.
With the current wave of COVID-19 outbreaks easing in Shanghai, local enterprises are starting to resume work and production. So far, the Shanghai government has released a series of policy documents specifying the requirements, conditions, and procedures for the resumption of work and production.
In general, Shanghai’s industrial enterprises, construction sites, commercial and trading enterprises, food manufacturers, postal express delivery service providers, agricultural production units, and producer services can restart operations under the precondition of adhering to the epidemic prevention and control measures.
As for foreign invested companies, the key enterprises engaging in integrated circuit, automobile manufacturing, biological medicine, information and communication, software, and information service can apply for resumption of work and production.
However, it must be noted that not all of these industries can resume production immediately, as each district will follow their own production resumption schedules based on the local epidemic situation.
At the time of writing this article, only Qingpu District has announced production resumption plans for commercial enterprises and agricultural enterprises, in addition to industrial enterprises. Other districts have only made production resumption plans for industrial enterprises.
In accordance to the first edition and second edition of Guidelines for Epidemic Prevention and Control for Industrial Enterprises in Shanghai (the “Guidelines”), 10 districts have issued their own guidelines to further clarify how local businesses can resume work and production, which contain certain amendments to the Guidelines based on the actual situation of each district.
In this article, we first discuss the production resumption policies of each district before providing a practical guide to help businesses prepare for work and production resumption.
Enterprises need to meet the requirements stipulated in local policies for resuming work and production. At present, all districts are using the “list management” approach – enterprises must first be included into the “white list” to be eligible for work and production resumption.
There are some differences among the policies released in different districts. Most of them are procedural, concerning required materials and the responsible authorities. For instance, enterprises in Putuo District shall submit their application materials to the local investment promotion center, while enterprises in Huangpu District shall submit the application to the sub-district office(街道办事处).
With respect to the eligibility of an applicant, the city-level guidelines have stipulated that enterprises essential for regular city operations, anti-pandemic supplies, critical function assurance, continuous production, and supporting infrastructure have the right to apply for the resumption of work and production, but district governments have certain discretions to decide the scope of the enterprises that can apply for production resumption. Pudong Distinct, for example, allows all industrial enterprises outside Lingang Area to apply for work and production resumption.
Therefore, enterprises are strongly advised to follow up the latest documents issued by the district government and make applications accordingly.
Despite the differences in district production resumption policies, there are more similarities – as all local policies are based on the two editions of the Guidelines. Below we summarize the common requirements.
In general, enterprises need to specify the following five aspects in its application:
Regardless of whether the enterprises are currently qualified to apply for the resumption of work and production, we suggest all businesses to make necessary preparations in advance.
Enterprises should set up a special team to ensure that various prevention and control measures are effectively carried out. It is noted that the Jinshan District requires that a leader at the vice president level or above shall be in charge of epidemic prevention and control.
Enterprises are required to develop a plan for employee management after resuming work and production. The below aspects should be covered in the plan:
(1) Enterprises shall provide independent accommodation for returning employees and set an observation period (also referred as silent period) for new returning employees. For example, in Jinshan District, the silent period is up to two days. Safe transportation shall be arranged to organize the personnel who return to work on point-to-point basis.
(2) Enterprises need to collect employees’ information, register all the employees by category, and educate employees on the importance of epidemic prevention and production safety.
(3) Enterprises shall reasonably coordinate the shift time and route of employees, and ensure non-contact shift between employees of different teams or groups.
(4) Enterprises shall designate a person to summarize the health conditions of the employees on a daily basis and conduct daily health monitoring and registration of all the employees. Enterprises should confirm that all employees have received full vaccination for COVID-19 and those qualified, are required to complete their booster vaccination. For enterprises above a certain scale, they shall train their own employees for nucleic acid testing.
Enterprises are also required to develop a plan for classified management of their business premises. The below aspects should be covered in the plan:
(1) Enterprises should establish four different zones based on their epidemic risk levels, namely Green Zone, Blue Zone, Yellow Zone, and Red Zone, within its office premises, which are used for normal production, observation of new workers, placement for close contact or sub-close contact of infected cases, and treatment of infected cases, respectively. All risk zones should be separated from each other and different epidemic prevention standards shall be formulated for different zones.
(2) Enterprises should arrange certain workplaces and accommodations for all employees, to reduce direct contact among employees in different areas to the greatest extent. Based on the different purposes of the premises, enterprises shall divide the areas for handover area (such as entry and exit points, loading and unloading sites, warehouse), production and operation area (such as workshop, conference room, and office area), living area (such as canteen, dormitory, and gym), public sanitation area (such as washroom and waste disposal area), and public space (such as road and outdoor venue) and carry out classified management.
(3) When preparing the dormitory allocation list, enterprises should make the arrangement to ensure convenient and consistent shifts for employees. If possible, the enterprise should reduce the accommodation density, provide rooms with toilets and other necessary equipment, and equip public areas with sterilization facilities.
(4) In order to ensure the safety of employees during dining, enterprises are suggested to put dining table and seats in the same direction, install separation boards, and set one-meter separation lines to enable employees to keep a safe social distance when picking up meals. Enterprise can also choose to deliver meals to employees in a staggered manner.
(5) The enterprise should post the location code (场所码) or install digital sentry (数字哨兵, a machine that measure temperature and checks the nucleic acid test info conveniently) in the office areas, and schedule ventilation and disinfection time for each area. Some enterprises also need to assign a person to be responsible for ventilation and disinfection, as stipulated in the guideline released by the Putuo District.
Routes and places for production and living materials to enter the enterprises should be planned and set up. The enterprises shall arrange regular personnel to receive, load and unload, store, open unseal, and disinfect the materials.
Enterprises should purchase antigen detection reagents, protective gauze masks, alcohol, hand sanitizer, thermometer, protective clothing, protective glasses, medical gloves, and other epidemic prevention supplies in advance. These supplies are advised to be stored well enough to last for at least 14 days.
According to the provisions of Jinshan District, enterprises are required to set up temporary storage sites for receiving and disinfecting takeaway and express deliveries.
Enterprises should carry out sterilization and safety inspection before resumption of work and production, and effectively strengthen the safety management of key industries, key places, key parts, and dangerous operations.
Enterprises should work out a disposal plan for emergencies. Once an epidemic situation happens, they shall control the spread and spillover of the infections to the greatest extent and ensure work safety at the same time. The transport and liaison channel for dealing with the infected personnel should be established, and special management measures to prevent spillover should be formulated.
Enterprises should set up temporary isolation observation areas in proportion to the number of employees, and those with a larger number of employees are suggested to set up makeshift hospitals in the factory area.
It is for sure that Shanghai is gradually getting back to normal. Although most districts are yet to clearly define the requirements for resumption of work and production of enterprises other than industrial enterprises, it is necessary to make preparations in advance. As different types of enterprises in different districts are subject to different requirements for application of production resumption, the above content is only a general guideline. Enterprises need to develop their own plans according to their actual conditions and the latest documents issued by the district government where they are located.
For more information or support for how to resume your operation in Shanghai, please feel free to contact our Shanghai offices for assistance or email us at firstname.lastname@example.org.
China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done so since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at email@example.com.
Dezan Shira & Associates has offices in Vietnam, Indonesia, Singapore, United States, Germany, Italy, India, and Russia, in addition to our trade research facilities along the Belt & Road Initiative. We also have partner firms assisting foreign investors in The Philippines, Malaysia, Thailand, Bangladesh.
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