What sort of tax preferential policies can foreign investors enjoy in Pudong New Area?

(1) The income tax of foreign -invested manufacturing enterprises shall be levied at a reduced rated of 15%.

(2) Foreign -invested enterprises scheduled to operate for a period over 10 years shall be exempted from income tax in the first two years starting from the profit-making year and be granted a 50% reduction in the next three years.

(3) " High-tech Projects" invested by foreign investors in Pudong New Area can enjoy 10% income tax rate for another three years after the period of tax exemption and tax reduction. Export enterprises with foreign investment shall pay their income tax at a reduced rate of 10% when their annual export sales value amounts to more than 70% of the annual sales value.

(4) The income tax of foreign-invested enterprises in the field of ports , energy and transportation shall be levied at a reduced rate of 15% . If the operation period of the above-mentioned enterprises is over 15 years, the income tax shall be exempt for the first 5 years starting from the first profit-making year and allowed a 50% reduction in income tax for the next 5 years.

(5)All foreign-invested enterprises shall be exempt from local income tax before 2000.

(6) The buildings or houses build or purchased by foreign investors for their own use shall be exempt from house property tax for five years, starting from the date when the transaction is done

(7) The foreign -invested financial institutes in Pudong new Area such as foreign-invested banks and JV banks with its injected capital over USD10 million or its operating fund as a branch allocated by its headquarters over USD10 million, after approval, can enjoy a reduced income tax rate at 15% . And starting from the first profit-making year, the above-mentioned enterprises can enjoy income tax exemption for one year and 50% income tax reduction for another two years.

How does foreign or Taiwan, Hongkong and Macau enterprise apply for the establishment of Representative Office in Shanghai

If a foreign or Hongkong, Taiwan and Macau enterprise (referred to trading company, manufacturer, forwarding agent, contractor, consulting company, advertising company, holding company, and leasing company) intends to establish a representative office (a nondirect-operational institution representing its enterprise to engage in such activities as liaison services, marketing survey, product
introduction and technical exchange), it shall entrust Shanghai Foreign Investment Service Center (SFISC) or other sponsors authorised by the government authority according to the nature of its business on its behalf to apply to the Shanghai Municipal Commission of Foreign Economic Relations and Trade. Once approved, the foreign enterprise shall register with the ICAB of Shanghai with the Certificate of Approval within thirty days.

How is a dispute solved between the two parties of either a Sino-foreign joint venture or a Sino-foreign cooperative joint venture?

Any dispute that occurs in the explanation or implementation of the joint ventures agreement, contract and charter had better be solved through negotiation or conciliation, If negotiation or conciliation fails, it can be brought to the court of arbitration or administration of justice.
According to the written-agreement on arbitration, each party of the association can have their dispute solved by the court of arbitration. Arbitration can be handled in accordance with the arbitration procedures of the China International Trade Arbitration Committee. With the consent of each party concerned, the dispute can also be handled by an arbitrary organisation in the country of the prosecuted or in a third country, following its arbitration procedures.

If there is no written agreement on arbitration between the parties of the negotiation, either party can bring the dispute to the People's Court of Justice.

What's the basic requirements for the land developing, utilising and managing?

The grantee shall develop, utilise and manage the land according to the planned use and requirements, duration and conditions of the development stipulated in the contract. If the grantee develops real estate on the land, it shall go through the relevant applying and examing procedures respectively according to the regulations by Departments of Planning and Administration, Construction, Real Estate Administration, Transportation, Hygiene, Environment protection, Environment health, Fire Protection and other city administration.

Can a foreign-invested enterprise set up an import-export trade company?

A foreign-invested enterprise can import equipment, raw materials and etc. needed in production and export its product on its own. If it intends to set up an import-export trade company, the foreign-invested enterprise can apply for it.
According to the present policy, a foreign investor can set up a Joint-venture import-export trade company in Pudong New Area after approval by the State Council; it can also set up an import-export trade company in Pudong New Area Waigaoqiao Free Trade Zone after approval by the Pudong New Area Waigaoqiao Free Trade Zone Administrative Committee.

What shall either party of a Sino-foreign joint venture do if it loses?

The Sino-foreign joint venture inside China ratified by the Chinese government is a responsible corporation limited with the position of a legal-person. The investment proportion shall be discussed and agreed upon by both Chinese and foreign parties, who together share investment, operation of the business, risks, profits and losses.

How can a joint venture prolong its term after it expires?

If all the parties of the association are willing to prolong the term when it expires, the joint venture shall submit its application for the extension of the association to the original office for approval six months prior to the termination of the contract. Once approved, the joint venture can have its term prolonged and registered at the ICAB.