Shanghai investment guide

1. Shanghai introduction
Geographical position
Shanghai is located in front of the Yangtze River, close to the East China Sea in the east, face the Hangzhou bay in the south, connect with Jiangsu and Zhejiang province in the west, and close to the mouth of Yangzi River in the north. Yangtze River and East China Sea conjuncts here. Shanghai, a sound harbor of river and sea, locates in the middle of north-south coastal line, with convenient transport system, vast land resource, and advantageous geographic location.

In terms of future development for Shanghai, great attention should be attached into geographic advantage, breaking down traditional limit and expanding business into new fields so as to seek large development.

Shanghai will include four parts as follows, central business district, namely center of city; industry processing district as second part; modern agricultural districts of urban area as third part; city near to Yangtze River, as the forth part. All the four parts above consists of integration of Yangtze River delta, and promote economy development of China.

Population structure
In 2005, actual population of Shanghai has been over 19million, and long living population increased by1.39million than that in the fifth census of 2000, as well as with average population of 278,000. Increasing population from other cities makes up shortage of Shanghai population structure provides diversity of population resource. According to the principal of ' Accept all experts and talents from different fields and give priority to key parts', new development content for key field in Shanghai has been issued to guide talents from different walks of life to make contribution to considerate industry.

Economy situation
In ' ten five-year' plan, Shanghai industry pays great attention to science development, carries out strategy of rejuvenate nation by science and education, strict on new-industry road, strengthening creation, upgrading facilities and infrastructures and finished each index of ' ten five-year plan, and made great success.

2. Investment environment
Shanghai has great investment environment, which is seen by many businessmen and enterprises as follows: ever-increasing efficiency of government; construction of social honest; sound social security system; international cooperation is increasing; more perfect legal system; developed information-based level; large group of talent in different fields; special language advantage; balanced industry mix; complete adequate and systematic service, etc. additionally, in terms of productive efficiency and market share, lots of advantages are equipped with Shanghai.

Water traffic
Yangtze River in Shanghai connects with parts in Jiangsu province, another parts connect with mouth of river, including deep sea-route, south route, Baoshan sea-route, and Nangang route. It is totally 65 sea miles, major route for shipping and Yangtze River, which is famous compact district for water traffic.

Harbor trade
In 1997, China government launched large quantity of money into renovating of sea-route。 Presently, the second project has been on the track. In 2002, Yangshan harbor has been started to build and has been core infrastructure of Shanghai international Shipping Center, which build up a more complete, efficient system. After operation for 10 years, throughput of Shanghai is ever increasing, the throughput of container has been increase to No.3 from No.10. Shanghai international shipping center, placed Yangtze River as center, direct transportation as feature, has been shaped initially.

New policy for foreign investment
To encourage FDI in China and establishing headquarter of multinational company in China, four policies has been issued as follows: on the one hand, expanding fund management function of local headquarter; on the other hand, perfecting management of staff to quit and enter; thirdly, local headquarter appointed with research function by government, can enjoy relevant preferential policy of high technology; finally, exporting rights should be equipped to local headquarter.

Investing in foreign market
In 2005, oversea investment of Shanghai has been up to 49, and amount has been reached to 7000million, which is twice as much as that last year and make highest recording in history. During 49 projects, 25 private enterprise investments have been carried out and account for half business. Shanghai foreign investment has been carried out in 21 oversea countries, including USA, UK, HONGKONG, and Republic of Uzbekistan, Chile, Brazil and some emerging markets.

3.Investment
The wholly foreign owned enterprise (WFOE)
The wholly foreign owned enterprise is enterprise owned by foreign investors including investors come from Hong Kong, Macao, Taiwan Island who are legal person or natural person at the age of above 18 years.

Representative office (RO)
Representative office (RO) is established by foreign companies to engage in business liaison. Production promotion, market research, exchange of technology and other permitted activities in china. RO is not allowed to directly engage in operational activities. The AIC usually specifies in the business scope .as shown in the business license of ROS. That a ROS should not engage in direct operational activities therefore ROS are not forms of foreign investment in china. the representative office can't work on the following activities: directly engage in any business for profit; Sign contracts or deals on behalf of the parent company; Represent any firm other than its parent company; Collect money or invoice organizations or individuals within China for services or products; Buy property or import production equipment.

The Joint Venture Enterprise
The Joint Venture Enterprise, which is qualified as Chinese legal corporation and jointly invested by the company, enterprise and other economic organization or individuals from a foreign firm(include Hong Kong, Macao or Taiwan), and the company, enterprise and other economic organization in mainland of China.

Local company
Local company owned by national investors who are legal person or natural person at the age of above 18 years. In case of form of company, it includes limited liability Company, limited company and Partnership Company. Relevant issues about local company will be in accordance with ' Corporate Law' issued in 2006.

4.Tax of Shanghai
Usually Shanghai Company can be registered in development areas. So that it can't only get preferential policy but also do business in urban district. When the company registered in development area pay for the income tax, after some time it can get a return from 70% to 80% of the local tax. All the preferential policies for investors home and broad will be in accordance with government policy actually.

5.Human resource
According to the principal of ' Accept all experts and talents from different fields and give priority to key parts', new development content for key field in Shanghai has been issued to guide talents from different walks of life to make contribution to considerate industry.

6.Work Visa
A foreigner who has fixed work with relevant and certain working experience and effective passport and good health without crime recording can apply for work visa. For the foreigners who want to live in Shanghai, or work in Shanghai, Tannet can provide service for them, including living permit, living permit certificate, working permit, employment permit, etc.

7.Open an account
Any enterprises or persons can open an account in shanghai in all of the domestic capital banks, city bank, standard chartered bank and so on. Tannet keep in good touch with every bank in Shanghai. To choose ATA is to make opening a bank account more quick and convenient.


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