Calling all MNC headquarters to Shanghai

The Shanghai government has released a refined set of rules to entice multinational companies (MNCs) to set up regional headquarters in China's largest financial hub.

On January 27, 2017, the Shanghai municipal government promulgated the Provisions on Encouraging the Establishment of Regional Headquarters by Multinational Corporations (Provisions), which polish the criteria for recognition and preferential policies of regional headquarters of MNCs in the city. Having come into effect on February 1, the Provisions are expected to further optimize the foreign investment environment in Shanghai and boost its status as an international metropolis.

Shanghai passed its local municipal regulation on establishing regional headquarters in 2002—making it the first city to do so—which was later revised in 2008 and 2011. The previous rules have been helpful in attracting foreign investment into Shanghai, particularly large MNCs. According to official statistics released by the Shanghai Municipal Commission of Commerce, foreign investors have established a total of 580 regional headquarters, 330 investment holding companies and 411 R&D centers in the city by the end of 2016; the total investment of regional headquarters amounted to $45.7 billion and their total operating revenue amounted to Rmb592.6 billion in 2015. Shanghai has largely been recognized by global investors as the most attractive destination in China.