Shanghai offers financial incentives for multinational HQs

The Shanghai government has issued new implementing rules to encourage multinational corporations (MNCs) to establish their regional headquarters in the city. The new implementing opinions, issued in December 2008, include favourable financing and rewards for MNCs.

In a significant move, the new implementing rules provide the actual amounts of financing and incentives to be given to MNCs; these figures were missing in the original Provisions issued in July 2008. The Several Implementing Opinions on the «Shanghai Municipality, Provisions on Encouraging the Establishment of Regional Headquarters by Multinational Corporations» state that the government will, among other things, finance Rmb5 billion (US$730.2 million) to foreign-invested companies that select Shanghai as their regional headquarters.

Hubert Tse, head of Yuan Tai PRC Attorneys, said that the rules are good for Shanghai as they further facilitate and encourage more MNCs to set up offices there.