Quintessentially business class

Whether it’s coffee making, car production, fashion design or wealth management, businesses of all stripes will find Shanghai a city where red tape is being replaced by red carpet.

City officials have continued unabated in their campaign to create a welcoming business environment, from simplifying corporate registration procedures to streamlining tax compliance. The reform process has been praised by the World Bank.

“We should be fully aware of the importance of the business environment,” said Shanghai Party Secretary Li Qiang. “Shanghai has relatively strong competitive advantages as a cumulative result of long-term efforts. We need to make every effort to preserve what we have accomplished and make further improvements.”

Li cited examples of simplifying administrative procedures and decentralizing lines of authority, related to issues such as regulatory efficiency and optimization of services.

Shanghai’s tax authority has created a credit record system to replace the current annual assessment, moving more operations online, said Jiang Xutao, chief economist at the municipal office of the State Administration of Taxation.

The authority is now considering measures to allow small businesses and startups to use credit records to apply for bank loans instead of having to pay substantial fees to acquire commercial guarantees. A more timely rating of companies and their connections to banks and commercial regulators will be created.

“The work will involve more than 1,000 forms and applications that currently can only be submitted offline by visiting tax authority offices,” Jiang said.

At the same time, Shanghai is placing more emphasis on brand building instead of focusing only on manufacturing products. Brands are to be considered an integral part of market competitiveness, according to Liu Pingjun, a member of the economic committee of the Central Committee of the Communist Party of China.

“Pilot work on brand cultivation is underway,” said Chen Yuehua, deputy director of the Shanghai Commission of Economy and Informatization. “The city is paving a path for innovative new models of financial services. Industrial policy is changing to address branding strategy and brand positioning.”