(Adopted at the 16th Session of the Standing Committee of the
11th Shanghai Municipal People's Congress on January 25, 2000.
Revised
according to the "The Decision on the Revision of the 'Provisions of Shanghai
Municipality on Encouraging the Absorption
of and Bringing Forth New Ideas in
Introduced Technologies' " adopted on February 1, 2002 at the 36th session of the
Standing
Committee of the 11th Shanghai Municipal People' s Congress)
Article 1 On the strength of relevant laws and regulations and with
reference to the context of this Municipality, these Regulations are formulated
in order to encourage and strengthen this Municipality to absorb and innovate
the introduced technologies, accelerate industrial
upgrading and technological
progress, and promote socio-economic development. Article 2 "To absorb
and innovate introduced technologies" (hereinafter referred to as "absorption
and innovation" ) hereunder means to
acquire advanced technologies from overseas
through trade, economic-technical cooperation, or otherwise, and to successfully
apply
technologies in production and operation by mastering such technological
factors as their design theory and work processes and the
development and
commercialization of those new technologies and products on such a
basis. Article 3 These Regulations are applicable to the absorption and
innovation within this Municipality. Article 4 The absorption and
innovation must comply with laws and regulations as well as those international
treaties and agreements acceded
to or signed by the PRC, on protecting
intellectual property. If a technology import or export contract contains an
agreement on technology secret, such an agreement governs. Intellectual
property generated by absorption and innovation programs is protected by
law. Article 5 The Municipal People's Government is responsible for the
organization and coordination of the absorption and innovation by effective
macro control so as to minimize the low-level repetitive import. Shanghai
Municipal Economy Commission (hereinafter referred to as MEC) is responsible for
the organization of the preparation and
implementation of the absorption and
innovation plans city-wide, the preparation and publication of the guiding list
of city-wide
priority projects for absorption and innovation (hereinafter
referred to as the list) and the annual plan, and guiding the implementation
of
the projects under the annual plans and organizing their appraisal and
acceptance. Relevant departments of this Municipality, district, and county
people's governments shall join their efforts in ensuring the success
of the
absorption and innovation as required by their respective functions and
duties. Article 6 Enterprises, as subject of absorption and innovation,
have the right to import on their own advanced and appropriate technologies
in
light of their production and operation needs and market demand and to decide on
the contents and mode of absorption and innovation. Large enterprises or
enterprise groups may establish absorption and innovation bases according to
relevant provisions of the State
and undertake major technological equipment or
absorption and innovation projects of the State and this
Municipality. Workers shall comply with the technology-secret regime legally
set up by the enterprises. Article 7 This Municipality encourages
enterprises, scientific research institutions and institutions of higher
learning to jointly research
and develop absorption and innovation or jointly
establish technological development institutions. Parties to absorption and
innovation projects shall sign contracts, agreeing on the ownership of relevant
technological rights and
interests and their other respective rights and
obligations. Article 8 Enterprises may apply for the inclusion of their
own absorption and innovation projects in the annual municipal plan for
absorption
and innovation according to the guiding list and prescribed
conditions and procedures. Upon receiving such applications, the MEC shall
organize experts to examine and evaluate them fairly, impartially and
rationally,
determine the projects to be included in the annual plan for the
first quarter of each year, and inform the applicant units in writing
to that
effect. Article 9 A special-purpose fund for absorption and
innovation, to be increased gradually, is to be established in this Municipality
and listed
in the city budget. Such special-purpose fund is, according to
these Regulations, to be used to extend such financial assistance to absorption
and innovation
projects as low interest loans, subsidized interest rate for
loans and subsidies for technological development. The Enterprise-wise
Technical Innovation Service Center (hereinafter referred to as the Service
Center) authorized by MEC shall
be responsible for the settlement and management
of the special-purpose fund for absorption and innovation. District and
county people's governments may establish corresponding special-purpose funds
for supporting absorption and innovation
projects in their respective areas, in
the light of the economic development status of their respective areas and the
needs of
absorption and innovation projects. Article 10 Relevant
departments of this Municipality shall earmark a proportion of more than 10 per
cent of other special funds for technological
advancement to encourage
absorption and bringing forth of new ideas, with priority given to the support
for the research and development,
transformation of achievements, and
authentication of introduced high and new technologies. Article 11 Units
with their projects listed in the annual municipal plan for absorption and
innovation may apply for low interest loans, while
those granted loans by
financial institutions may apply for subsidized interest rates for their loans.
Article 12 The following projects or technologies are eligible for
subsidies from technological development funds: (1) State technological
innovation projects or absorption and innovation projects under the priority
support of this Municipality; (2) Technologies innovated on the basis of
absorption, endowed with market competitiveness or granted independent
intellectual property
right; (3) Projects not listed in the annual municipal
plan for absorption and innovation, but up to the requirements of the guiding
list
and, after appraisal organized by the MEC, found to represent major
technological breakthroughs of a certain scale. Article 13 Technological
development expenses actually incurred by enterprises for absorption and
innovation may be included in the costs. Key equipment and testing
instruments used for absorption and innovation may be included in the cost
either in a lump sum or in
installments, provided their unit price is below the
prescribed amount. Subject to the examination and approval of municipal
financial and tax authorities, projects listed in the city municipal plan for
absorption and innovation may have their equipment depreciated at a faster rate
and enjoy corresponding preferential treatment
with reference to the municipal
plans for trial production of new products or for interim trial
products. Article 14 Absorption and innovation projects that involve the
transformation of high and new tech achievements or the transfer of achievements
of innovations on the basis of assimilating high and new technologies with
profits are eligible for preferential treatment according
to the State and
municipal regulations on the transformation of high and new tech
achievements. Article 15 Applications may be submitted to the MEC for
project listed in the annual municipal plan for absorption and innovation to be
included
in a preferential order in the municipal plan for technical renovation
and financial assistance in the form of subsidized interest
rates for
loans. Article 16 To apply for domestic or foreign patents on absorbed
and innovated technologies or products, applications may be made, to the city'
s
science and technology administrative departments, municipal patent
administrative departments and MEC for financial assistance
to cover part of the
patent application fees, patent maintenance fees and patent agency
fees. Enterprises introducing foreign patented technologies to be used for
the first time in China in technological development may apply
to the MEC for
subsidies against such valid certificates as contracts on patent transfer or
licensing. Article 17 Enterprises intending to set up
the following institutions for absorption and innovation in this Municipality
may apply to the MEC
for subsidies for their start-up funds: 1. State or
city-level enterprise technological development centers; 2. State or
city-level absorption and innovation bases; 3. City-level technological
development institutions set up in alliance with scientific research units or
institutions of higher
learning. Article 18 The export of absorbed and
innovated high and new tech products may enjoy the preferential zero VAT rate
according to relevant State
regulations. Enterprises may apply to the MEC for
subsidies for expenses for authentication of technological quality of their
absorbed and innovated
products. Article 19 Units undertaking projects of
the annual city plan for absorption and innovation that need to recruit
technologists from other cities
or provinces may directly apply for going
through the formalities for their transfer into this Municipality accordingly.
Units
that need to recruit foreign technologists-administrators or high-level
returned students from overseas may apply accordingly for
support from relevant
specific funds. If it is necessary to employ foreign experts for the purpose
of brainstorming on key technologies in projects listed in the annual
municipal
plan for absorption and innovation, applications therefore may, accompanied by
employment contracts, be made to competent
municipal departments for financial
subsidies. Article 20 Other conditions being equal, government offices
at different levels of this Municipality shall give priority in their
procurement
to absorbed and innovated products of those industries whose
development is under support. Article 21 Competent departments shall
award enterprises, project managers, and scientists and technologists who have
contributed significantly
to the absorption and innovation. Enterprises shall
set aside a percentage of the profits from the absorbed and innovated products
to reward the enterprisers, project
managers, and scientists and technologists
who have contributed significantly to the absorption and innovation either in
cash payment
or in terms of stocks or capital contribution for the awards to
share in the profits accordingly. Article 22 For achievements or products
of absorption and innovation application may be made for awards for scientific
and technological achievements
at various levels. Article 23 Innovation
service centers shall sign contracts with project units on the basis of the
absorption and innovation projects and sums
as approved by the MPC and
appropriate through relevant financial institutions these sums in full and on
time to the project units;
The project units shall perform their obligations as
agreed in the contract. Article 24 Personnel of competent departments and
innovation service centers in this Municipality who violate these regulations,
neglect their
duties, engage in fraudulent practices to pursue personal ends or
infringe on the legitimate rights and interests of absorption
and innovation
project units in the course of absorption and innovation shall be ordered to
make corrections and subjected to administrative
penalties by their own units or
competent superior authorities; those who embezzle, withhold or divert
special-purpose funds for
absorption and innovation shall be ordered to return
them within a specified time limit and subjected to administrative penalties
by
their own units or competent superior departments; those who commit crimes shall
be prosecuted according to the criminal law. Article 25 Any infringement
of others' intellectual property in violation of Article 4 of these Regulations
shall be dealt with according to
relevant laws and regulations. An enterprise
has the right to claim damages from those who violate Clause 3, Article 6 of
these Regulations to the prejudice of
the enterprise and to hold them
accountable therefor accordingly. Article 26 If enterprises secure
financial assistance in the form of low-interest loans, subsidized interest
rates for loans or of technological
development subsidies by fraud, the MEC
shall, in coordination with other competent departments, recover the funds so
secured and
impose on them a fine of 1 to 3 times the sum so secured; those who
secure other preferential treatment by fraud shall be dealt
with according to
relevant laws and regulations. For those get rewarded by fraud, the rewardee
is to be divested of the reward by the MEC and other competent departments after
the
same departments have canceled their rewardeeship. Article 27 These
Regulations become effective on March 1, 2000, when the "Interim Regulations of
Shanghai Municipality to Encourage the Absorption
and Assimilation of Introduced
Technologies" ratified by the Eighth People's Congress of Shanghai Municipality
at its 29th Session
on June 20,1987 is simultaneously
annulled.
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