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Regulations of Shanghai Municipality on Encouraging the Digestion and Renovation of Imported Technologies
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| (Adopted at the 16th Session of the Standing Committee of the 11th Shanghai Municipal People's Congress on January 25, 2000) 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 digest and renovate the imported technologies, accelerate industrial upgrading and technological progress, and promote socio-economic development. Article 2 " To digest and renovate imported technologies" (hereinafter referred to as "digestion and renovation" ) hereunder means to acquire trade, economic-technical cooperation, or otherwise from overseas advanced technologies 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 digestion and renovation within this Municipality. Article 4 The digestion and renovation must comply with laws and regulations as well as those international treaties and agreements acceded to or signed by the PRC, all protecting intellectual property. If a technology import or export contract contains an agreement on technology secret, such an agreement governs. Intellectual property generated by digestion and renovation programs is protected by law. Article 5 The Municipal People's Government is responsible for the organization and coordination of the digestion and renovation by effective macro control so as to minimize the low-level repetitive import. Shanghai Municipal Economic Commission (hereinafter referred to as CEC) is responsible for the organization of the preparation and implementation of the digestion and renovation plans city-wide, the preparation and publication of the guiding list of city-wide priority projects for digestion and renovation (hereinafter referred to as the list), 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 digestion and renovation as required by their respective functions and duties. Article 6 Enterprises, as subject of digestion and renovation, 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 digestion and renovation. Large enterprises or enterprise groups may establish digestion and renovation bases according to relevant provisions of the State and undertake major technological equipment or digestion and renovation 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 digestion and renovation or jointly establish technological development institutions. Parties to digestion and renovation 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 digestion and renovation projects in the annual city plan for digestion and renovation according to the guiding list and prescribed conditions and procedures. Upon receiving such applications, the CEC 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 digestion and renovation, 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 digestion and renovation 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 CEC shall be responsible for the settlement and management of the special-purpose fund for digestion and renovation. District and county people's governments may establish corresponding special-purpose funds for supporting digestion and renovation projects in their respective areas, in the light of the economic development status of their respective areas and the needs of digestion and renovation projects. Article 10 Relevant departments of this Municipality shall ear-mark more than 10% of other special-purpose funds for technological progress to encourage digestion and renovation, with priority given to the support for the development, interim experiment and industrialization of products of imported high and new technologies. Article 11 Units with their projects listed in the annual city plan for digestion and renovation 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 and products are eligible for subsidies from technological development funds: 1.State technological innovation projects or digestion and renovation projects under the priority support of this Municipality; 2.Technologies and products innovated on the basis of assimilation, endowed with market competitiveness or granted independent intellectual property; 3.Projects not listed in the annual city plan for digestion and renovation, but up to the requirements of the guiding list and, after appraisal organized by the CEC, found to represent major technological breakthroughs of a certain commercial scale. Article 13 Technological development expenses actually incurred by enterprises for digestion and renovation may be included in the costs. Key equipment and testing instruments used for digestion and renovation 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 digestion and renovation may have their equipment depreciated at a faster rate and enjoy corresponding preferential treatment with reference to the city plans for trial production of new products or for interim trial products. Article 14 Digestion and renovation projects that involve the transformation of high and new tech results or the transfer of results 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 results. Article 15 Applications may be submitted to the CEC for projects listed in the annual city plan for digestion and renovation to be included in a preferential order in the city plan for technical renovation and financial assistance in the form of capital fund input or subsidized interest rates for loans. Article 16 To apply for domestic or foreign patents on digested and renovated technologies or products, applications may be made, to the city' s science and technology administrative departments, municipal patent administrative departments and CEC for financial assistance to cover part of the patent application fees, patent maintenance fees and patent agency fees. Enterprises importing foreign patented technologies to be used for the first time in China in technological development may apply to the CEC for subsidies against such valid certificates as contracts on patent transfer or licensing. Article 17 Enterprises intending to set up the following institutions for digestion and renovation in this Municipality may apply to the CEC for subsidies for their start-up funds: 1. State or city-level enterprise technological development centers; 2. State or city-level digestion and renovation 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 digested and renovated high and new tech products may enjoy the preferential zero VAT rate according to relevant State regulations. Enterprises whose digested and renovated products have entered the international market may apply to the CEC for subsidies for expenses for technological quality certification or licensing of technology. Article 19 Units undertaking projects of the annual city plan for digestion and renovation 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 digestion and renovation, 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 digested and renovated 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 digestion and renovation. Enterprises shall set aside a percentage of the profits from the digested and renovated products to reward the enterprisers, project managers, and scientists and technologists who have contributed significantly to the digestion and renovation-either in cash payment or in terms of stocks or capital contribution for the awards to share in the profits accordingly. Article 22 For results or products of digestion and renovation 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 digestion and renovation 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; project units, which 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 digestion and renovation project units in the course of digestion and renovation 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 digestion and renovation 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 enterprises 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 CEC 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. Those get rewarded by fraud, the rewardee is to be divested of the reward by the CEC 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 Digestion and Assimilation of Imported 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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