(CFP Photo)
The General Office of Jiangsu Provincial Government has recently published a new guideline on multinational companies setting up regional headquarters and functional agencies in the coastal province.
The new guideline is the third revision to the province’s original policy first introduced in 2012. It’s updated to reflect the new situation and requirements of attracting foreign investment, help companies play a more important role amid the global industrial changes, and also increase the province’s opening up.
By the end of 2020, the province had recognized 295 regional headquarters and functional agencies of multinational companies in total, most of which are located in Suzhou (151), Nanjing (48), Wuxi (41) and Changzhou (24).
The amendment includes a relaxed requirement of assets of the parent company when its functional agency applies for recognition, such as from no less than $200 million to $100 million for companies in the service sector, as well as the expansion of applicants. It's also required that the company needs to operate continuously in Jiangsu for at least one year and has no record of serious untrustworthy conduct.
Meanwhile, the support measures were mainly in the form of rent subsidies in the past, but the new regulation allows more flexibility in the incentives, such as to attract top professionals with up to 20% of the subsidy. Regional headquarters and functional agencies can use 40% of the incentive funds, provided for their capital increase and expansion, to reward senior management or technical staff.
The province has also relaxed the restriction over age, education and working experience for foreign technical staff in regional headquarters and functional agencies, who can acquire a work permit valid for two years. For foreign employees who need to stay in the province for a long period of time, they can apply for a residence permit valid for up to 5 years with their work permit and a letter from their employer.
In terms of trade facilitation, Jiangsu supports a pilot program of tariff bonds for customs clearance, and adopt risk assessment and category-based management of import and export materials for testing purposes to support R&D.
To facilitate cross-border settlement, investment and financing, the province has also introduced a slew of measures, such as under the RMB/FCY cross border pooling scheme and a more flexible approach.
Relying on the joint meeting of regional headquarters and functional agencies, Jiangsu will increase support for the Fortune 500 companies, industry leaders and those based in the pilot free trade zones. The province plans to roll out management measures specially for hubs with many multinational companies and help their better development in the economic powerhouse.
