License reform proves boost for business

Hu Min
Material review and approval on some affairs was lifted or replaced by registration or self-promising, and the amount of material required for some affairs was cut.
Hu Min

A significant increase in market entities and registered capital has been seen since the city's "one integrated license" reform, Chen Yin, Shanghai's executive vice mayor, told a press conference in Beijing on Thursday. 

The city had registered around 3.03 million market entities with registered capital of about 29.5 trillion yuan (US$4.6 trillion), up 13.3 percent and 15.3 percent, respectively, from late November in 2019 before the reform, Chen said at the press conference hosted by the State Council Information Office on the theme of "advancing the reform for separating operating permits from business licenses to further energize market entities."

In July 2019, the Pudong New Area launched a pilot program that combined multiple licenses into one single permit.

Last November, the State Council approved the district's "one integrated license" reform plan, which expanded the number of industries covered to 31 and extended the legal validity of the license nationwide. The reform enabled companies to do business anywhere in China with one single license from the Pudong New Area. 

The one integrated license can significantly reduce the cost of industry access and foster a world-class business environment, the State Council said.

With citywide implementation of the reform, market entities can now carry out relevant business activities in every city district.

The reform has further stimulated market entities' vitality, said Chen. 

"It has removed and relaxed the restrictions of entrance into a number of industries and eased the burden of businesses in operation, stirring their initiative in business activities," he said. 

As an example, the number of fire protection technology service enterprises registered in the Lingang Special Area of China (Shanghai) Pilot Free Trade Zone surged to 104 after a qualification review and approval item on fire protection technology service agencies was lifted from the previous 21 before the reform.

Under the mechanism, material review and approval on some affairs was lifted or replaced by registration or self-promising, and the amount of material required for some affairs was cut. 

More than 70 percent of enterprises in the city have obtained business licenses via the notification and promising mechanism implemented in 2018, significantly improving government efficiency, according to Chen. 

At the same time, companies with low credibility and high risk will face stricter supervision and management. 

A technological approach has been taken to make business operations more convenient, said Chen. 

So far, the city has established an e-license database with a collection of about 140 million licenses of more than 600 types, enabling the exemption of submission of 96 percent of material issued by government authorities. 

The mechanism also merges multiple affairs and allows online applications and handling for business operation related affairs. 

For example, six categories of affairs such as food operation and tobacco retail permits involving a number of government departments were required for the opening of convenience stores in the city in the past. 

Under the mechanism, multiple affairs are merged and handled online, cutting the handling time to five working days from the previous 38.

The number of materials required was cut to 10 from 53, improving efficiency. 

"The city will further deepen the reform and take a digital transformation approach to empower the reform," said Chen. 

"The number of materials from applicants will be further cut or exempted and the target is to make business application of relevant affairs as convenient as online shopping," Chen said.

At the same time, authorities will improve supervision and management efficiency and safeguard the safety bottom line, he added.

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