Foshan has achieved another significant breakthrough in policy support for the cooperation with Germany. On October 28, the Management Committee of Foshan Sino-German Industrial Services Zone (Sanlongwan Sci-Tech City) has issued the Support Measures of Foshan Sino-German Industrial Services Zone (Sanlongwan Sci-Tech City) to Enhance Sino-German Industrial Cooperation (Trial) (hereinafter referred to as the Measures). It aims to optimize the business environment and further improve the level of the cooperation with Germany in manufacturing industry and production service industry.

The release of the Measures has filled the policy gap in Sino-German industrial cooperation of the Foshan Sino-German Industrial Services Zone. The Measures are targeted at enterprises in Foshan that are founded by investors from German-speaking countries in Europe. Those qualified enterprises are entitled to support including business establishment incentive, rental subsidies and purchase subsidies. A single enterprise is able to claim the maximal support of 20 million yuan.
 

This year marks the 10th anniversary since Sino-German Industrial Services Zone established the cooperation with Germany. According to the Management Committee, the Services zone will further improve the cooperation with Germany and seek for more international investors. With the help of high-quality German-funded enterprise projects, local industries can be upgraded and achieve a higher level of development from a higher starting point.
 

A single enterprise enables to claim a maximal support of 20 million yuan 

The Measures matches the actual needs of German enterprises and provides greater support. It is divided into six chapters covering support objects and scope, support content, support funds application, review and disbursement procedures, etc. It will be implemented since December 1, 2022 and valid for 3 years.

Newly established German-funded enterprises will be sponsored in the Sino-German Industrial Services Zone or German-funded enterprises that registered outside of Foshan and moved into the Services zone during the valid period. Among them, German-funded enterprises include those funded by investors from German-speaking countries like German, Austria, Switzerland, Belgium, and Luxembourg.

The Measures applies to the Sino-German Industrial Services Zone, covering Shiwan Town Sub-district in Chancheng District, Guicheng Sub-district in Nanhai District, and Beijiao Town, Chencun Town and Lecong Town in Shunde District.

During the validity period of the Measures, for German-funded manufacturing enterprises, if the actual paid amount of capital is more than USD 500,000, 3% to 5% of its actual paid capital will be given as the business establishment incentive based on the actual amount. The maximum reward for each enterprise shall not exceed RMB 10 million. For German-funded production service enterprises, there is no threshold for support. Similarly, 3% to 5% of its actual paid capital will be given as the business establishment incentive based on the actual amount. The maximum reward for each enterprise shall not exceed RMB 5 million.

In addition, for German-funded enterprises eligible to apply for business establishment incentive, if they are to lease plant buildings and commercial premises, rental subsidies can be applied. Leasing plant buildings will be given a subsidy of no more than five years, while leasing commercial premises of no more than three years.

If the enterprises purchase plant buildings, commercial premises or land for construction, they can apply for purchase subsidies. The maximum subsidy per enterprise shall not exceed RMB 10 million.

Policy gap is filled to support hidden champion 

What are the reasons that Foshan Sino-German Industrial Services Zone (Sanlongwan Sci-Tech City) releases support measures to enhance Sino-German industrial cooperation?

At present, the government has issued relevant policies to utilize foreign investment, but the relevant supporting policies can hardly cover small and medium-sized German-funded enterprises. In this context, the Sino-German Industrial Services Zone, based on the actual situation in Foshan, initiated the Measures according to the provisions of relevant national and provincial laws, regulations and rules.

It is reported that the Foshan Sino-German Industrial Services Zone collected relevant policies about opening up and the utilization of foreign investment from the country and Guangdong province, as well as other relevant local policies about industrial cooperation with Germany and support for open economy adopted by other cities in China. It also went to foreign chambers of commerce in Guangdong as well as German enterprises in Foshan in research for essential needs of Sino-German industrial cooperation.

The Measures accurately matches the actual needs of German enterprises and provides strong support for German SMEs to settle and develop. “Preliminary research results show that German enterprises are mainly small and medium-sized enterprises, and most of large German enterprises have already settled in China. To better achieve incremental progress is to target high-qualitative hidden champion,” said by the person in charge of Sanlongwan. The investment amount of these enterprises is not large, but they belong to niche areas of global leaders, which will play an important role in promoting the transformation of Foshan manufacturing and internationalization.

In addition, compared with the policies introduced in other places, the Measures has strong support with the settlement incentives exceeding other similar policies and generous rental subsidies, greatly reducing the cost of German-funded SMEs to settle in Sanlongwan.

“By strengthening investment cooperation with Germany, we will further implement the spirit and deployment requirements of the 13th CPC Party Congress of Foshan. We will take good advantage of the platform of Foshan Sino-German Industrial Services Zone to empower the digital and intelligent transformation of Foshan’s manufacturing industry. In this way, we can also provide a vivid case for the action plan for a favorable enterprise service system and the best business environment, promoting Foshan to be a leader of prefecture-level high-qualitative development,” the person in charge said.

Support Measures of Foshan Sino-German Industrial Services Zone (Sanlongwan Sci-Tech City) to Enhance Sino-German Industrial Cooperation (Trial)
 

Measure 1: 

business establishment incentive 

1. For German-funded manufacturing enterprises 

--actual paid amount of capital is more than USD 3 million: 5% of its actual paid capital as the business establishment incentive

--actual paid amount of capital is more than USD 1 million but less than USD 3 million: 4% of its actual paid capital as the business establishment incentive

--actual paid amount of capital is more than USD 500,000 but less than USD 1 million: 3% of its actual paid capital as the business establishment incentive

The maximum reward for each enterprise shall not exceed RMB 10 million.

2. For German-funded production services enterprises 

--actual paid amount of capital is more than USD 1 million: 5% of its actual paid capital as the business establishment incentive

--actual paid amount of capital is more than USD 500,000 but less than USD 1 million: 4% of its actual paid capital as the business establishment incentive

--actual paid amount of capital is less than USD 500,000: 3% of its actual paid capital as the business establishment incentive

The maximum reward for each enterprise shall not exceed RMB 5 million.

Measure 2: 

rental subsidies 

1. Leasing plant buildings 

--subsidies for the 1st to 3rd years: RMB 30/㎡·month max.;

--subsidies for the 4th and 5th years: RMB 15/㎡·month.

The maximum area that each enterprise can obtain subsidies each year shall not exceed 5,000 ㎡.

2. Leasing commercial premises 

--subsidies for the 1st year: RMB 60/㎡·month max.;

--subsidies for the 2nd and 3rd years: RMB 30/㎡·month.

The maximum area that each enterprise can obtain subsidies each year shall not exceed 1,000 ㎡.

Measure 3: 

purchase subsidies for purchasing plant buildings, commercial premises or land for construction 

A purchase subsidy of 10% of the total purchase price (excluding taxes and fees) shall be granted.

The maximum subsidy per enterprise shall not exceed RMB 10 million.