Policy Measures to Support the Steady Development of Foreign Trade Companies in Response to COVID-19
(Draft Version and Subject to Revision)
To thoroughly implement the instructions of Mr. Xi Jinping, General Secretary of the Communist Party of China, on maintaining stable fundamentals of foreign trade and to carry out the decisions and deployment made by the CPC Central Committee and the State Council on the coordinated epidemic prevention and control as well as the socio-economic development, the following policy measures are formulated and approved by Shanghai Municipal People's Government to give full play to the role of foreign trade companies in epidemic prevention and control as well as reduce the impact of the epidemic on production and operation of foreign trade companies:
I. The mechanism for import of key medical supplies will be optimized.
Dedicated efforts are made to secure fast customs clearance and to improve on the green access for import of medical supplies needed in the fight against COVID 19, which include drugs, disinfectants, protective products, medical equipment, and etc. Lists of importers and medical supplies used in the epidemic prevention and control are formed. Medical supplies directly used in the epidemic prevention and control as well as imported under the instruction of the health authority are exempted from import duty; previous levies will be refunded before September 30th of 2020 upon application of importers. In the post-epidemic period, the residual imported medical supplies, if any, will be included in municipal-level strategic reserve system following established procedures. The imported products of designated categories and volume for civilian use in the epidemic prevention and control, with expressed and verified difficulty in sales on the part of importers, will be taken over as municipal-level strategic commodity reserves following the prescribed procedures. (Shanghai Municipal Commission of Commerce, Shanghai Municipal Health Commission, Shanghai Medical Products Administration, Shanghai Food and Strategic Reserves Administration, Shanghai Municipal Finance Bureau, Shanghai Development and Reform Commission, Shanghai Administration of Work Safety, Shanghai Customs District P.R. China)
II. Full support will be given to companies' resumption of work and operation.
Shanghai will scale up its efforts to improve labor availability for companies'resumption of operation and will actively coordinate supplies for companies to combat the epidemic. Priority support will be given to port-related and container truck transportation companies for their restoration of operation in a bid to maintain supply chain security for key enterprises. Companies facing difficulties in production and operation due to the epidemic are encouraged to negotiate with staffs to stabilize employment by adopting salary adjustment, working in shifts, shortened work hours and other approaches. Companies are encouraged to organize employees to return to Shanghai by inter-provincial chartered bus. (Shanghai Municipal Commission of Economy and Informatization, Shanghai Municipal Commission of Commerce, Shanghai Municipal Health Commission, Shanghai Municipal Human Resources and Social Security Bureau, Shanghai Municipal Transportation Commission)
III. Stronger financing support will be given to foreign trade companies.
Financial institutions in Shanghai are encouraged to provide greater support to foreign trade companies playing key roles in the epidemic prevention and control by offering concessional loans to satisfy their reasonable capital needs based on credit risk aversion as well as comprehensive assessment on factors such as enterprises’ funding gap and market supply and demand. For the hard-hit foreign trade companies with prospects of returning to profitable operations, support will be given by adjusting debt repayment schedule, extending repayment period and renewing loans without the repayment of principal among others. The Shanghai Branch of China Export and Credit Insurance Corporation is supported to enhance cooperation with banks and Shanghai Policy Financing Guarantee Funds on policy-backed financing, giving full play to the role of risk diversification and credit enhancement in promoting trade financing. And the policy-backed financing will benefit a wider audience by lifting the previous annual export volume ceiling from USD 5 million to USD 30 million. Shanghai Policy Financing Guarantee Funds will better support foreign trade enterprises that have played key roles in guaranteeing medical supplies and have suffered huge impact by the epidemic. During the epidemic period, the rate of fees for financing guarantee for new loan applications is to be reduced to 0.5% per year and the re-guarantee fee will be cut by half. (The People’s Bank of China Shanghai Head Office, China Banking and Insurance Regulatory Commission Shanghai Bureau, Shanghai Municipal Financial Regulatory Bureau, Shanghai Municipal Finance Bureau, Shanghai Municipal Commission of Commerce, China Export and Credit Insurance Corporation Shanghai Branch)
IV. Regulatory services for customs clearance will be optimized.
A “green access” for customs clearance will be put in place to facilitate the imports of materials, parts, equipment and other products urgently needed by enterprises in their resumption of work and production. In terms of the delayed delivery of goods, refund requests or return of goods incurred by the epidemic, relevant authorities should provide convenience for enterprises in a timely manner. The alteration and withdrawal of customs declaration manifests caused by the epidemic will not be recorded as an error. When processing formalities for affairs such as centralized customs declaration for multiple batches of goods, consolidated sell back, deep processing transit and bonded exhibition and transaction, enterprises will see the time limit for declaration extended by an extra month. During the epidemic prevention and control period in Shanghai, processing trade companies (including the companies in the customs special supervision areas) that experience expiration of their manual of processing trade (or account book is overdue for verification) due to the delay in work resumption incurred by the epidemic can go through formalities and submit related materials afterwards. The customs declaration for deep processing transit, tax payment of goods for domestic sales and other businesses under the processing trade manual (account book), if exceeding the prescribed time limit, can be postponed. (Shanghai Customs District P.R. China)
V. Credit insurance will play a bigger role.
Efforts will be made to improve cooperation mechanism among governments, credit insurance institutions and business associations. The Shanghai branch of China Export and Credit Insurance Corporation will enhance its underwriting capacity and provide, to the best of its capabilities, insurance for orders that are real as and for companies with potential. Insurance for the advance payment of imported supplies should be in place with relaxed insurance conditions. The service charge of credit reporting for foreign suppliers will be exempted and a catalog of overseas suppliers and report of bill of lading should be offered free of charge. Priority will be given to the claims made by hard-hit companies. Under the premise of trade authenticity, primary attention will be given to the verification of the trade background and liability level. Terms of claim settlement will be reasonably eased with prioritized initiation of loss assessment and compensation appraisal procedures. The allocation of policy resources will further pivot to key enterprises. Pre-shipment export credit insurance service will be promoted to safeguard companies against the risk of contract cancellation initiated by buyers referencing epidemic influence. (China Export and Credit Insurance Corporation Shanghai Branch)
VI. Support will be given to businesses in adjusting their plans for overseas trade Show participation.
During the prevention and control period in Shanghai, enterprises that have already paid booth fees but won’t be able to attend will continue to be eligible for Shanghai’s supporting policies for businesses attending overseas trade shows. Exhibitors that are unable to attend overseas trade shows due to the epidemic will be assisted in reconciling with domestic and international organizers on issues such as prepaid fees. (Shanghai Municipal Commission of Commerce, Shanghai Municipal Finance Bureau, Council for the Promotion of International Trade Shanghai)
VII. Support will be given to businesses to enhance their presence in the international market
Enterprises will be supported to actively utilize cross-border e-commerce platforms to extend their reach in the international market and expand their scale of sourcing worldwide. We will play to the strength of enterprises accredited as Public Service Platforms for International Marketing and forge longer trade supply chains. Enterprises will also be encouraged to fully utilize the online platform of the China Import and Export Fair and will be guided to adjust their promotional events as well as maintain and enlarge international client base and sales channels. (Shanghai Municipal Commission of Commerce, Shanghai Municipal Finance Bureau, Council for the Promotion of International Trade Shanghai)
VIII. The cross-border financial settlement services will be optimized
International trade companies that import epidemic prevention and control supplies are applicable to measures for extraordinary cases, which entails a marking of “Epidemic Prevention and Control” by local banks as well as streamlined procedures for purchasing and payment of foreign exchanges. Applicants for the registration of Company Name List for Foreign Exchange Account Balance for Trade, after being registered as International Trade Operators, can access the ASOne platform for online registration which will be completed in one working day with no physical presence needed. For domestic receiver institutions without foreign exchange accounts for donation, there is no need to open a new one for the reception of epidemic-related funding donation in foreign exchanges form from home and abroad. Cross-border financing activities pertaining to epidemic prevention and control will be facilitated. International trade companies are allowed to handle their foreign exchange-related businesses under capital account online with streamlined procedures. Other special epidemic-linked foreign exchange businesses can be handled by Shanghai’s banks first with Ex-post case filing. (State Administration of Foreign Exchange Shanghai Bureau)
IX. Paperless filing for import and export permits will be implemented.
Enterprises will be actively guided and encouraged to apply for Import and Export Permit online. For contracts with excessive contents and constituting big files, enterprises are allowed to only upload key pages pertinent to the permit application. There will be more authorizations for the sign-off and printing of ECO. (Shanghai Municipal Commission of Commerce, Council for the Promotion of International Trade Shanghai)
X. Functions of the China (Shanghai) International Trade Single Window will be optimized.
The China (Shanghai) International Trade Single Window just launched a new interface to process, with higher efficiency, the clearance for overseas donations . For imported disinfection products, a new function that allows filing for health and safety assessment report will be implemented in the system. A special service window will be opened exclusively for the SMEs, allowing them to process all the import and export-related businesses such as clearance, logistics and finance without physical presence. With the panoramic data of international trade chain collected through the system, it will be more convenient for the banks and insurers to conduct background checks on trade, thus making loans more accessible to the enterprises with green access services being provided, such as concessional loans, cross-border money transfer and financing. The online services for credit insurance will be enhanced. SMEs with under USD 5 million export volume in the previous year can login on the China (Shanghai) International Trade Single Window to process businesses such as policy purchasing, policy renewal and conversion, claim as well as financing. (Shanghai Municipal Commission of Commerce, Shanghai Municipal Commission of Health, China Export & Credit Insurance Corporation Shanghai Branch)
XI. There will be enhanced accessibility of overseas legal assistance and counseling.
Timely counseling, guidance and mediation services will be offered to companies involved in disputes caused by the epidemic over contract implementation, labor and financial matters. Arbitration institutions and judicial authentication institutions are encouraged to give priority to the expedited handling of cases that involve companies seriously affected by the epidemic. The notary agencies shall give priority to requests that are related to the epidemic and reduce/exempt notary fees for key enterprises for the prevention and control of the epidemic. For trade contract disputes, companies in question will be supported to request proof from trade promotion agencies and national industry associations. The litigants and agents in international trade disputes are encouraged to file application for adjudication and mediation through mail and online channels. Enterprises are also encouraged to carry out legal and compliance risk assessments on international trade. The tracking of international trade policies and legal practices will be intensified with periodic releases of relevant information and issuance of risk alert through public platforms.
Shanghai will continue to implement all the supporting policies made by the central government. The line departments and agencies are responsible for making detailed implementation plans for each policy measure, which will be enforced by district governments. The validity period of this policy extends from the date of issuance to December 31st 2020. (In case of clearly specified validity periods for particular provisions which are different from the aforementioned time span, the specified validity periods shall prevail)
This is a translated version of <Policy Measures to Support the Steady Development of Foreign Trade Companies in Response to COVID-19>
The power of interpreting any provision in this text is entirely vested in the competent departments of Shanghai Municipal People’s Government and relevant organizations.
Should there be any discrepancy of meaning between the Original Chinese Text and the English Text, the Chinese version shall prevail.