Due to the outbreak of Covid-19, which is a significant business challenge for companies operating in China, the Chinese central government along with local governments are making great efforts and mobilizing resources across the country to fight against the epidemic situation and adopt multiple measures to help businesses stabilize and continue operations. Among the large quantity of enacted coping regulations, other than the Shanghai policies we specified in our PHC article, DP has also sorted and extracted the major points from the issued policies in Zhejiang, Jiangsu, Southwest China, and Guangdong for your reference.
- Opinions on Supporting Small and Micro Enterprises to Overcome Difficulties by Leading Groups of Prevention and Control of Pneumonia Caused by New Coronavirus Infection in Zhejiang (February 5, 2020)
1) The price of industrial water and gas will decrease 10% for 3 months.
2) Tax may be deducted for small and micro enterprises encountering difficulties.
3) Small and micro enterprises encountering difficulties can delay the declaration and payment of taxes for 3 months after application.
4) Small and micro enterprises encountering difficulties can delay the payment of employees’ social insurance for 3 months after the termination of the epidemic through application.
5) Small and micro enterprises with no layoffs or fewer layoffs will be refunded 50% of the unemployment insurance of last year.
6) Landlords of state-owned buildings can reduce the rent of the small and micro tenant enterprises.
7) All financial institutions shall not blindly withdraw, cut off or suppress loans. For small and micro enterprises facing difficulties in repayment due to the epidemic situation, loans shall be extended, renewed, a reduction and remittance of overdue interest and repayment plans shall be arranged properly until the termination of “First Response”.
8) Policy financing guarantee institutions at all levels shall increase the credit enhancement services for small and micro enterprises seriously affected by the epidemic, effectively improve business processing efficiency, cancel counter guarantee requirements, and reduce guarantee and re-guarantee rates
9) The local government shall help small and micro enterprises handle the application for the Certificate of Force Majeure related to international trading contracts.
- Opinions on Resolutely Winning the War of Prevention and Control of the Outbreak of The New Pneumonia, and Ensuring the Steady Economic Development of Enterprises by Zhejiang Provincial Committee and Zhejiang Government (February 10, 2020)
1) The current preferential policy of 8.5% discount for freight car tolls will be extended to all ETC freight cars, and the implementation time will be 3 months. The government will also extend the discount of 9.5% to 8.5% for class III and class IV bus tolls using ETC, which will last for three months. The current preferential policy of international standard container transport vehicle tolls from 10 designated toll stations will be expanded to the provincial high-speed road network, and uniformly charge at a discount of 6.5%.
2) During the first level response period of provincial epidemic prevention and control, the government encourages and supports financial institutions to exempt the loan interest of enterprises. For enterprises related to and affected by the epidemic prevention and control, the loan interest rate shall be appropriately reduced, and the service charges for financial services shall be reduced. In 2020, the comprehensive financing cost of loans for small and micro enterprises across the province shall be reduced by 0.5 percentage points compared with the previous year. The overdue interest, penalty interest and liquidated damages shall be reduced or exempted for the overdue enterprise loans due to the impact of the epidemic.
3) For the enterprises affected by the epidemic, if they organize employees (including labor dispatch personnel) to participate in online vocational training during the shutdown period, they shall be included in the scope of special fund subsidies for training such as vocational skills improvement actions, and can enjoy no more than 95% of the subsidies according to the actual training costs.
4) When the enterprises’ booth fees are paid and indeed unable to be returned due to the epidemic situation, and when the enterprises cannot participate in domestic and foreign exhibitions, the subsidy can be continued according to the standard not higher than the original subsidy. For the liquidated damages of foreign trade orders caused by the export of epidemic prevention materials to domestic sales in the province, a certain subsidy will be given.
- 18 Policies and Opinions on Winning the War of Epidemic Prevention and Control, and Helping Small and Medium-Sized Enterprises to Overcome Difficulties Together (February 4, 2020)
The institutions of banks in the city are encouraged to reduce and exempt interest for 3-months for loans of enterprises greatly affected by the epidemic according to the total scale of 10 billion yuan, and each enterprise can enjoy a maximum of RMB 1 million of loans free of 3-month interest. At the same time, the branches of banks in the city are encouraged to actively strive for policies from headquarters and give preferential interest reductions and exemptions to the enterprises suffering a greater impact due to the epidemic.
- Notice on Policies of Strictly Doing Epidemic Prevention and Control, and Helping Enterprises’ Resumption of Work (February 9, 2020)
1) All guarantee institutions in the city are exempt from two-month guarantee fees for financing guarantee services of small and micro enterprises. If non-state-owned guarantee institutions are exempt from the guarantee fee, the government will grant a two-month subsidy according to the rate standard of state-owned policy guarantee.
2) For enterprises affected by the epidemic and having difficulties in paying the housing fund, they can apply to reduce the proportion of the housing fund to at least 3%, or apply to postpone the payment of the housing fund for a period of no more than 12 months.
3) For small and micro enterprises with an annual tax of less than RMB 500000, in sectors such as commerce and trade, catering, tourism, accommodation, transportation, logistics and distribution, the government will provide two-months’ worth of subsidies according to the amount of the urban retained portion of the monthly average VAT payment in 2019.
4) For tenant employees who paid social insurance and did not rent public rental houses or enjoy government housing subsidies, and whose annual salary in 2019 is less than RMB 72000, the government will give 500 yuan per person to rent houses.
- Measures to Support Stable Development of SMEs Enterprises from the Nanjing People’s Government (February 8, 2020)
1) For small-scale VAT taxpayers with annual sales of 5 million yuan or less, subsidies shall be given according to their tax contribution to the local government; During the epidemic period, the proportion of subsidies for purchasing nearby technical transformation equipment shall increase from 10% to 15%; For small and medium-sized scientific and technological enterprises involved in the production of key materials for epidemic prevention and control, each enterprise shall be given a research and development award of no more than 200,000 yuan. The implementation period shall be from February to April 2020.
2) For SME lending fund businesses with a single transaction of less than 10 million yuan and a single account accumulative total of no more than 30 million yuan, the lending fund fee shall be exempted; and the overdue penalty interest caused by the epidemic shall be temporarily reduced. The implementation period is from February to April 2020.
3) The Nanjing financial department will integrate all kinds of special funds amounting to 500 million yuan to subsidize the newly-increased working capital loans of SMEs for three months.
4) In the first half of the year 2020, more than 300 online recruitment activities will be organized for SMEs, and a 24-hour online recruitment platform will be opened.
5) 50% of the unemployment insurance premium paid in the previous year will be returned to those enterprises that have no or a lesser number of layoffs.
6) For SMEs that rent state-owned assets for business, one month’s rent shall be exempted and two months’ rent shall be halved.
- “Benefits” to Support Small and Medium Enterprises Suzhou People’s Government (February 2, 2020)
1) All banking institutions ensure that the credit balance of small and medium enterprises in 2020 is not less than the balance of the same period in 2019.
2) For SMEs in key areas in financial difficulties, all banking institutions are encouraged to lower more than 10% from the original loan interest rate to ensure that the financing costs of SMEs in 2020 are not higher than the financing costs of the same period in 2019.
3) For insured companies that do not lay off staff or reduce layoffs, 50% of the actual unemployment insurance premium they paid last year can be returned.
4) SMEs affected by the epidemic that are unable to pay social insurance in time, after approval in accordance with regulations, can defer pension insurance, unemployment insurance and work injury insurance premiums for a maximum of 6 months.
5) For SMEs that rent state-owned assets for operations, rents are exempted for one month and halved for a further two months.
- Policies on Supporting Enterprises to Overcome Difficulties Together and Ensuring Stable Financial Operation from Wuxi People’s Government (February 6, 2020)
1) Reduce the cost of water, electricity, gas for enterprises.
2) For enterprises that do have special difficulties and are unable to pay taxes on time, the enterprise shall apply for an extension of tax payments for a maximum of three months.
3) Enterprises can apply for real estate tax and urban land use tax relief.
4) Enterprises affected by the epidemic and unable to pay social insurance premiums in full may apply for a suspension of payment of endowment insurance, unemployment insurance, work-related injury insurance and medical insurance premiums for a maximum period of six months. No overdue fine will be charged during the period of suspension.
5) 50% of the unemployment insurance premium paid in the previous year will be returned to those enterprises that have no or a lesser number of layoffs.
6) Enterprises shall be given training subsidies by the related department, according to the standard of 300 yuan per person.
7) Ensure that the credit balance of SMEs in 2020 is higher than that of the same period in 2019.
- Twenty policy measures of the General Office of Chongqing Municipal People’s Government to support small and medium-sized enterprises in coping with the pneumonia caused by the novel coronavirus infection (February 4, 2020)
1) Small and medium-sized enterprises that are affected by the epidemic situation and have real difficulties in paying the real estate tax and urban land use tax may apply to the competent tax authorities, and after approval, they shall be granted no less than 2 months of tax deductions or exemption.
2) For small and medium-sized enterprises that are affected by the epidemic situation and are unable to file tax returns on time, they shall be allowed to postpone their tax declarations in accordance with the law; if they meet the conditions for postponement of tax payments, they shall be allowed to postpone their tax payments in accordance with the law, and the maximum period shall not exceed 3 months.
3) For insured enterprises that are affected by the epidemic situation and faced with temporary difficulties in production and operation and are expected to recover with no or a lesser number of layoffs, 50% of the social insurance premium for 3 months as standard shall be returned to the enterprises and their employees after being approved according to the regulations..
4) During the epidemic period, the rent of small and medium-sized & micro enterprises renting state-owned assets for business use will be reduced or exempted for one to three months.
Such policies and measures shall be implemented from the date of promulgation to June 30, 2020. The relevant supporting policies issued by the State shall prevail.
- Policies and Measures of the General Office of the People’s Government of Sichuan Province in Response to the Outbreak of Novel Coronavirus Pneumonia to Alleviate the Small and Medium-sized Enterprises’ Difficulties in Production and Operation (February 5, 2020)
1) For small and medium-sized enterprises that rent state-owned asset-type operating houses, rents are reduced or exempted for 1 to 3 months.
2) New loans issued by banking financial institutions are implemented in accordance with the minimum standards in the policy scope.
3) Where small and medium-sized enterprises organize employees to participate in various online vocational training during the suspension period, they shall be included in the relevant special funds to subsidize the employees’ training scope in the locality, and full subsidies shall be given according to the actual training costs.
4) 4) For insured enterprises facing temporary production and operation difficulties, which are expected to resume, and insist on no-layoffs or fewer layoffs, based on the 6-month local monthly unemployment insurance premiums and the number of employees insured, these enterprises their employees shall have 50% of the social insurance premiums returned for 6-months for the stabilized posts.
5) The government will establish a “service package” system for SMEs, open up green channels for legal aid, and provide free legal services.
- Notice of the Guangdong Provincial People’s Government on issuing several policies and measures to support the resumption of production and work of enterprises in curbing the new coronavirus epidemic. (February 6, 2020)
1) Return unemployment insurance. Unemployment insurance fees will continue to be returned to enterprises with no layoffs or fewer layoffs, and 50% of the total unemployment insurance premiums actually paid in the previous year will be returned.
2) Provide subsidies to stabilize posts. The municipal government will subsidy the salary paid to employees during the period of diagnosis or quarantine due to the epidemic situation. The subsidy shall be no more than 50% of the basic endowment insurance payment basis of the affected employee, and the required funds shall be disbursed in the special bonus and subsidy funds for structural adjustment of industrial enterprises. Enterprises who organize employees (including dispatched workers working in enterprises) to have online job training will be subsidized according to regulations.
- Notice of the General Office of Guangzhou Municipal People’s Government on printing and distributing 15 measures to support the healthy development of small- medium-and micro-sized enterprises in the fight to win epidemic prevention and control (February 7, 2020)
Return unemployment insurance. The floating rate of unemployment insurance will be adjusted periodically until the end of December 2020. If the coefficient is currently 0.6, it will be reduced to 0.4, if it is 0.8 it shall be reduced to 0.6. The floating rate of work injury insurance shall continue to be implemented. For insured enterprises qualified with the conditions such as no layoffs or a lesser number of layoffs, 50% of the actual unemployment insurance premium paid in the previous year can be returned; for insured enterprises facing difficulties and are expected to recover and still insist on no layoffs or a lesser number of layoffs, the government will return the unemployment insurance premium.
- Fo’shan Municipal People’s Government’s ten policy suggestions on actively responding to the pneumonia outbreak of the new coronavirus infection, supporting enterprises to tide over difficulties (February 5, 2020)
1) Return unemployment insurance. For the insured enterprises that insist on no layoffs or a lesser number of layoffs, 50% of the actual unemployment insurance premium paid in the previous year can be returned. The local government will allocate 200 million yuan to give a one-time subsidy to enterprises that comply with the relevant national and provincial regulations regarding the resumption of work, employment registration and salary payment for workers who have not returned to Foshan due to the epidemic.
2) Support the import of epidemic prevention and control materials. Enterprises that import masks, protective clothing and other materials for epidemic prevention and control by general trade and cross-border e-commerce will be granted support at the rate of no more than 10% of their import value, and the ceiling amount of support for a single enterprise will be no more than 1 million yuan; for foreign trade enterprises that need to purchase import prepayment insurance from a Chinese export credit insurance company due to the import of masks, protective clothing and other epidemic prevention and control materials, they will be granted full support as per the premium paid, and in such case, the ceiling amount of support for a single enterprise shall not exceed 200000 yuan.
- Zhuhai Municipal People’s Government’s policy suggestions on supporting small-and medium-sized enterprises to tide over difficulties by coping with the epidemic situation of pneumonia caused by the new coronavirus infection (February 5, 2020)
1) Delayed resumption subsidy. Enterprises that delay the recruitment of Hubei employees or employees still in Hubei due to the epidemic and thus result in a shortage of human resources and facing difficulties can apply to the government for the delayed resumption subsidy, the specific policies of which shall be studied and formulated by the government departments and declared later.
2) Recruitment subsidy. Until 3 months after the epidemic is lifted, if the enterprise recruits new employees and pays social insurance premiums accordingly, it will be granted a recruitment subsidy of 500 yuan per person,, which can be enjoyed one time for each person with a ceiling amount for each enterprise of 1 million yuan.
3) Online training subsidy. If the enterprise organizes or entrusts an organization to carry out online training for employees, if the training task is completed and the training effect meets the requirements of the plan, a subsidy of 30 yuan per class hour (no less than 45 minutes) will be granted as per the actual number of trainees, which can be enjoyed one time for each person with a ceiling amount of 1000 yuan.
4) Loan discount subsidy. For enterprises that have obtained loans from Zhuhai financial institutions, 50% of the current market quotation rate (LPR) when the loan contract was signed shall be granted as an interest subsidy. The ceiling amount of interest subsidy for a single enterprise is 500000 yuan, and the period of interest subsidy shall not exceed 1 year.
5) Loan risk sharing. For small and medium-sized enterprises that are greatly affected by the epidemic and meet the development direction of Zhuhai industry, or play an important role in ensuring people’s livelihood, and key medical material support enterprises, if a loan is granted, 50% of the loan risk will be guaranteed to be borne by the municipal government, provided that the shared risk is no more than 5 million yuan. The fees to be charged for the use of the transfer funds of Zhuhai City to cross the bridge will be reduced to 80%. The guaranteed rate granted by financing guarantee institutions under the current policies shall be no higher than 1%.
Companies are currently going through a testing period, not only in relation to the difficulties caused by NCP on business operations but also for the overwhelming volume of regulations published by all levels of administrative organs. Along with the development of the epidemic and the release of the relevant policy documents from the Chinese government at all levels, DP may adjust the opinions of this summary in due course. For more information/assistance, please reach us at firstname.lastname@example.org.
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