The Yantai municipal government enacted incentive policies for significant investment projects eight months ago with the aim of accelerating the city's conversion of old and new growth drivers and promoting the high-quality development of the city's real economy.

The incentive policies took effect on Aug 1, 2018, and this year's application process for grants is set to start around September.

The news conference, which marks the official release of Yantai's incentives for significant investment projects, is held in Yantai, East China's Shandong province, on Jan 28. [Photo/jiaodong.net]

Incentive contents

Grants for projects that have made great contributions to the city's development

1. Enterprises covering the fields of modern oceans, equipment manufacturing, electronic information, high-end chemical engineering, cultural tourism, healthcare, high-efficiency agriculture and modern logistics, whose actual fixed asset investment (excluding land purchase costs) within three years from the date of industrial and commercial registration amounted to more than 500 million yuan ($72.47 million; taking the audited balance sheet of enterprises as the criterion), can receive a grant of two-thousandths of their actual fixed asset investment. The maximum grant is 5 million yuan.

2. Enterprises, which contributed more than 5 million yuan to the local government's fiscal revenue annually within three years from the date of industrial and commercial registration, can receive a grant of 50 percent of their annual contribution amount in the first year, 30 percent in the second year, and 20 percent in the third year.

3. Enterprises, invested in by Fortune Global 500 companies with a paid-in registered capital between 20 million yuan and 50 million yuan or of more than 50 million yuan, can receive a one-time grant of 500,000 yuan or 1 million yuan respectively.

4. Headquarters, invested in by foreign transnational corporations or by central enterprises and Chinese top 500 enterprises from outside Yantai city, with a paid-in registered capital of not less than 100 million yuan and owning more than three branches or holding companies outside the city, can receive a case by case grant.

The grant for a regional headquarters will be no more than 1 million yuan, while that for a functional headquarters involved in research and development, logistics, financial settlement, purchasing, sales, data services, and investment and financing, will not be more than 500,000.

5. Newly founded enterprises, which contribute to the development of the city's digital, intelligent, green, creative and sharing economies, and whose annual operating revenue exceeded 20 million yuan for the first time, can receive a one-time grant of 2 million yuan at most.

Yantai Port, first built in 1861, is one of the 25 major ports in the coastal area of China. [Photo/IC]

Grants for projects invested in innovative ways

1. Increase of registered capital through spot exchanges, cash, material objects and debt-to-equity swaps. Enterprises, which, with a single increase of registered capital surpassing 100 million yuan that is fully funded within a year, can receive a grant of 100,000 yuan for every 10 million yuan of fully funded capital. The annual maximum grant for an enterprise is 300,000 yuan.

2. Restructuring and reform of enterprises in the city by acquisitions and joint stock. Enterprises, whose transaction volume of a single merger and acquisition case exceeds 50 million yuan and which pay more taxes after the mergers and acquisitions, can receive a grant of 60 percent of their actual costs for the financial and legal intermediary services and property transaction fees during the mergers and acquisitions.

The annual maximum grant for one merger and acquisition case is 400,000 yuan at most. For one enterprise which has several merger and acquisition cases in one year, the annual grant should be no more than 1 million yuan.

3. Joint venture by enterprises in Yantai and from overseas. Joint venture enterprises in the manufacturing industry, with registered foreign capital between $10 million and $30 million, between $30 million and $100 million, or of more than $100 million, coming into operation within one year and fully funded within two years, can achieve a grant of 100,000 yuan, 300,000 yuan and 1 million yuan respectively.

4. Investment attraction through intermediary agents. Intermediary agents, who introduced advanced manufacturing or modern services-related projects with a registered capital of more than 100 million yuan or $10 million, can receive a reward of one-thousandth of the projects' actual fixed asset investment or one-thousandth of the projects' paid-in registered foreign capital within two years. The maximum grant for one project is 1 million yuan.

Agents, who introduced domestically funded projects with investment of more than 5 billion yuan, or foreign funded projects with an investment of more than $100 million, can receive a grant of 1.5-thousandths of the projects' actual fixed asset investment or 1.5-thousandths of the projects' paid-in registered foreign capital. The maximum grant for one project is 5 million yuan.

Note:

1. Headquarters should meet the relative requirements of the province's incentive policy for headquarters and be identified by relevant departments.

2. Enterprises, involved in real estate development and construction, development of commercial complexes, characteristic towns and functional parks, as well as investment in fund programs and public-private partnership projects, do not qualify for these incentive policies.

3. Enterprises must have industrial and commercial registration in Yantai city with independent legal qualification, and have paid taxes in accordance with the law.

File photo taken on Sept 28, 2018 shows an aerial view of the industrial park of Wanhua Chemical Group, the largest production base of polyurethane in China. [Photo/IC]

Procedures

1. Eligible enterprises or agents can file an application with the local bureau of commerce for the grants after official notice is given.

2. The bureau of commerce, cooperating with the city's department of finance, will check the authenticity of application materials, and then submit the materials to the city’s investment promotion bureau.

3. The investment promotion bureau will check the materials by itself or invite a third party to conduct assessments independently, and decide the list of recipients.

4. The list of recipients will be published on government websites for public review for five working days.

5. If there are no objections, the grant money will be allocated according to relevant regulations.

Supervision and inspection

1. Enterprises that have received the grants should keep the promise that they will not leave Yantai and reduce their registered capital within 10 years.

2. Enterprises or agents that cheat to receive grants have to return the money if found out. Their dishonest behavior will be added to the enterprise credit information file.

This English version is only for reference. To learn more, please refer to the authoritative Chinese version on the official website of Yantai government.