Information on Weihai’s Development Zones
Investment Environment
Between the various Zones, 4 billion RMB has already been invested in infrastructure. The Qingwei and Yanwei Expressways have been constructed, as well as the Taowei Railway line. Regular commercial and cargo flights are schedules from across China, including Beijing, and in the region, including Japan and Korea. Weihai’s port has the capability to accept 10,000 ton and 50,000 ton traffic. The Weihai power plant has a total generating capacity of over 2 gigawatts, with 850 megawatts already in use. Weihai’s telecommunications have been enhanced from 19,000 telephone lines to 60,000 lines, with a satellite communications system to Korea. Weihai’s water system now has the capacity to provide 100,000 tons of water each day while the central heat supply, from 2 power stations, can provide 170 tons of steam per hour. China’s most advanced sewage disposal plant is being built in Weihai, which will quadruple its disposal ability to 100,000 tons per day.
Preferential Policies
On taxation(1).No V.A.T and consumptive tax is levied on goods and taxable labor service processed and produced inside the Zone.On processing trade management
(2).The tariff and import-related tax on goods coming into the Zone, except stipulated by laws and administrative regulations, are handled as follows:
a. Machines, equipment for use in the productive infrastructure items and constructive materials needed in workshop building, storage facilities etc., are duty free .(3). The manufactured goods and the leftovers, bits and pieces, damaged and substandard goods, waste caused during processing, except stipulated by laws and administrative regulations, are duty free when sold abroad.
b. Machines, equipment, modes and maintenance parts used by enterprises are duty free .
c. Raw materials, parts, components, packing and consumptive materials needed by enterprises for processing exports-oriented goods are bonded .
d. Reasonable number of administrative articles used only by the enterprises and the administrative committee are duty free.
(4). The formalities of home-made machines, equipment, raw materials, parts, components, and packing materials coming into the Zone and used by the enterprises and a reasonable number of constructive materials used by the enterprises and Administrative Committee for infrastructure, production and office building are handled by the Customs in accordance with the relevant regulations. The Customs also issues export tax refund forms to outside enterprises. The outside enterprises apply to the tax authority for the refunded tax based on the tax-refund (free) forms.
(5) For productive foreign-invested enterprises in the Zone, the income tax will be levied at a rate of 15%. Among them, enterprises whose operation period is over 10 years will be exempted from the income tax in the first two years, and pay the income tax at a rate of half reduction from the third year to the fifth year.
(6) After the tax free period, if the export output value of the enterprises gets more than 70% of the overall output value at that year, the income tax will be levied at a rate of 10%.
(7) Any foreign investors in the Zone who reinvest its share of profits obtained from the enterprise directly into that enterprise to increase its registered capital, or use the profits as capital to establish other enterprises and operate for a period of not less than 5 years, upon the investors application and the approval by the tax authorities, should be refunded 40% of the income tax paid on the reinvested amount. If reinvestment is taken away within 5 years, the refunded taxation should be recovered. For those reinvestments which are to operate or extend product export enterprises or advanced-tech enterprises, all the paid income tax on the reinvested amount should be refunded.
(8)Foreign enterprises, who have no organizations in China, obtain the divided interest, rent, fee of charted right and other income from the Zone, except exempting from income tax of enterprises, the income tax of enterprise should be reduced at a rate of 10%. Among them, income tax of enterprise can be reduced or exempted for those enterprises who provides the capital, equipment favorably or the advanced technology.
(9) Foreign-invested enterprises will be exempted from the local income tax for ten years from the profitable year.
(10) Any foreign investor who obtains profits from the foreign investment enterprises is exempted from income tax.
(11)The foreign-invested enterprises are free from the orientation regulatory tax for fixed investment.
(1) Enterprises in the Zone do not the implement processing trade bank deposit accounts system, and the Customs do not implement Processing Trade Registration management.On import & export management
(2) Goods not forbidden by the State can come in and out of the Zone freely for processing or trade.
(3) The enterprises in the Zone can obtain import and export rights by registration.
(1) Import & export quota license management are not imposed on goods going between the Zone and abroad, except those imposed on passive quota management.On supervision management
(1) Customs supervises goods going between the Zone and abroad by direct passing or trans-customs transport mode.On foreign exchange management
(2) For the goods going inside or out of the Zone all the formalities of putting on file, declaration, check, release, and cancellation after verification are handled inside the Zone. The inspection department will carry out a one time quarantine and inspection.
(3) For goods-intercourse between Export Zones, the consignor and consignee should jointly submit applications to Customs located in the consignor' side. After the examination and approval of Customs it is handled in accordance with relevant trans-customs transport regulations.
(1) Verification formalities for receiving and paying foreign exchange are not needed to be handled when goods flow between the Zone and abroadOn land management
(2) An organization inside the Zone, which is registered in RMB, if there is not enough capital in their foreign exchange account, can apply to the Foreign-Exchange Bureau for foreign exchange with relevant documents when paying foreign exchange to those outside the Zone or abroad. After the verification by the Foreign Exchange Bureau, the organization can buy foreign exchange at designated banks with the ratification letter of the Foreign Exchange Bureau. The RMB capital, equivalent to the total accumulated buying foreign exchange, can not be exceeded its registered RMB for investment.
(3) Goods, sold out of the Zone by approval are regarded as imports. The organization outside the Zone should pay the foreign exchange to the inside organization in accordance with the relevant rules of settlement, buying, paying foreign exchange and Interim Procedures of Verification, Supervision on Paying Foreign Exchange to Trade Import. The outside organization can entrust the inside organization for buying foreign exchange if it needs foreign exchange to pay the inside organization. When buying foreign exchange on behalf of the outside one, the inside organization should apply to the Foreign Exchange Bureau with relevant documents. After verification by the Foreign Exchange Bureau, the inside organization can buy foreign exchange at a designated bank,with the ratification letter signed by the Foreign Exchange Bureau.
(1) Foreign-invested enterprises who have gained the right to use land in ways of transferring and assignment can transfer, lease and mortgage the right if it is within the approved time limit
(2) Preferential policies provided by Weihai Export & Processing Zone, Shandong.
(3) The preferential price of land is provided to incoming enterprises by the Export & Processing Zone. Toe hi-tech and technology-intensive manufacturing foreign-owned enterprises, a floating price for land transfer can be arranged. For especial big items and high technology-content items the preference of the land policy is treated respectively.
(4). All kinds of charges which can be reduced and exempted must be resolutely reduced and exempted, and gradually turned to a zero - charge transition.
(5). The Administrative Committee can help enterprises in a capital shortage.
Economic Development and Technical Zone
On Oct 21,1992, Weihai Economic and Technological Development Zone was established by the State Council as a National Development Zone. The administrative area is 72KM2, including a programmed area of 36 square kilometers and an initial area of 11.88 square kilometers. There are 10 administrative bureaus, 3 sub district offices and 37 administrative villages under its jurisdiction, including Industrial Parks, Export & Processing Zones, Bonded Areas, a Financial and Trade District, Residential Districts, and a Traveling and Recuperative District. A range of services are provided within each Zone regardless of its designation.
Since the establishment of the Zone, 1735 Projects have been introduced with the total investment of 10 billion RMB Yuan, among which 345 projects are foreign-invested with the total investment of 1.16 billion USD from more than 20 countries. With foreign-invested enterprises as the main body, 8 pillar industries exist, including automobile, machinery, electronics, chemical, medicine, textiles, foodstuff, and building material have been formed.
Weihai Torch High-Tech Development Zone
Introduction
One of three Torch High-Tech Industry Development Zones in China, Weihai’s Zone was jointly developed by the National Science & Technology Ministry, the Government of Shandong Province and the City of Weihai. The zone is located on 12.5 km of coast in a heavily academic area, which includes 3 universities, 30 technical institutes, more than 40 hi-tech enterprises and over 11,200 trained academics and researchers. Within ten years of development the annual mean increase of major economic indicators in the area still remains at 30%. This Torch Zone has been accepted as a Gold Coast for running educational institutes, scientific researching and starting a business.
Technological Environment
The Torch zone has endeavored to create a sound environment for technological innovation and many parks have been successfully established, including the Electronic Industry Park, the Top Software Park, the Weihai Hi-Tech Pioneering Park for Overseas Intellectuals and the Nongyou Software Park. A Pioneering Incubating Center was authorized by the National Science & Technology Ministry as a state-level pioneering center, with 25,000 square meters currently built and another 20,000 square meters under construction. 13 million Yuan in seed capital has been invested into this new Incubating Center, which will support small- and medium-sized technology oriented enterprises. Over 100 new products have been developed in the zone, with 112 patents from 150 scientific programs.
Industrial Environment
Over 1200 projects, with a total investment value of 14.6 billion Yuan, have been authorized of, which only 420 were considered high-tech, for a value of 5 billion. Electronic information (Photoelectron and semiconductor research manufacturing), electromechanical integration (cooling systems and high-performance vibration sensors), bio-engineering and pharmacology (Anesthesia Pumps, Blood Collection Devices, Blood Cell Segregators, Medical Polyesters) and materials research (High-strength Magnesium alloys and Carbon fiber precursors), the zone’s four pillar industries, have taken advantage of Weihai’s proximity to Japan and Korea, with 159 processing centers already set up.
Foreign Investment
Over 340 foreign projects have been authorized from the zone, amounting to $520 million invested. The projects hail from 24 different countries and have a combined import/export value of $2.5 billion and an annual growth rate of 57%.
Weihai Export & Processing Zone
The Waihai Export & Processing Zone was set up under the approval of the State Council in 2000. The Weihai EPZ is located in the Weihai Economic & Technological Development Zone, covering an area of 2.6 square kilometers. Weihai is located on the Shandong Peninsula, near Japan and Korea. The EPZ itself is located only 30 from Weihai airport, 3 km from Weihai train station and 4 km from Weihai Harbor. 1.9 billion RMB has been loaned to the EPZ for infrastructural development. 58 enterprises have been established in the zone, mainly engaged in electronics, food processing, bio-medical products and building materials. In total, $569 million has been invested. 120,000 square meters of processing facilities have been constructed, with another 60,000 under construction. In addition, 2787 projects have been introduced for a total investment of 10 billion RMB, 274 of which are foreign owned from more than 20 countries.
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