Fresh bid to attract more headquarters to Shanghai
New regulations to give a impetus to more multinationals to establish their regional headquarters in Shanghai has been announced in a fresh bid to attract more quality overseas enterprises by the municipal government of Shanghai.
Based on the new rules, if a new-registered company, whether focused on investment or management, sets up its regional headquarters in Shanghai, it will gain financial support from the local government in the start-up period, as well as a preferential rental policy.
Comprehensive functions of operation management, capital management, research and development, sales, logistics and support service, which contribute to Shanghai’s economic development, will receive special incentives. Regional headquarters should have those. Additionally, the local government will grant “honors” to senior management of these companies.
The new regulations have cut the residency red tape for people working in companies headquartered in Shanghai. High-level foreign managers will be recommended to apply for the permanent residency status in Shanghai.
While applying for work permits, foreign hires of such companies will get preference. Domestic employees of regional headquarters and R&D centers will get Shanghai hukou in an easier way.
Liu Jie, an official in Shanghai Headquarters Economy Promotion Center, told China Daily that over 300 domestically listed companies and 183 multinationals had set up their headquarters in Shanghai.
Another 165 overseas-funded investment companies and 244 multinationals’ R&D centers also have Shanghai as their location. As far as concerned, 10 more multinationals have reportedly been given the official permission to establish their regional headquarters in Shanghai this year.
According to Liu, Shanghai has got the better of other mainland cities in appealing regional headquarters of multinationals. However, compared to Hong Kong and Singapore, where 6,000 and 9,000 companies set up their headquarters respectively, Shanghai still has a long way to go.
Shanghai has its own aces, although Hong Kong and Singapore have extraordinary investment environment, favorable government policy, high information transparency and tax breaks.
Shanghai, with a mature financial market, the most sophisticated infrastructure and a broad consumer base, is considered the ideal place by many multinationals to expand their presence in China, Liu said.
By 2030, Shanghai is expected to be home to 3,000 headquarters. Along with big names like Unilever, GE and Alcatel, which have already established their regional headquarters in Shanghai, some multinationals are thinking about shifting their regional headquarters to Shanghai from Hong Kong and Singapore.
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