Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone Authority Document

Shenzhen Qianhai Regulations No.8 [2019]

Notice of Shenzhen Qianhai Cooperation Zone Authority on Printing and Distributing the “Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone’s Office Space Rent Subsidy Measures to Promote the Return of Enterprises”

All relevant units:

The “Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone’s Office Space Rent Subsidy Measures to Promote the Return of Enterprises”has been reviewed and approved on the office meeting of the director of Qianhai Cooperation Zone Authority, which will be printed and distributed now. Please follow and implement this document.

Qianhai Cooperation Zone Authority

17 June, 2019

Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone’s Office Space Rent Subsidy Measures to Promote the Return of Enterprises

Chapter I General

Article 1

In order to reduce the operating costs of enterprises in Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone (hereinafter referred to as Qianhai cooperation zone), enhance regional competitiveness, guide registered enterprises to accelerate the return to Qianhai for operation, accelerate the aggregation of industries and talents, according to “The Interim Measures for the Administration of Industrial Development Funds of the Qianhai Shenzhen-Hong Kong Modern Service Industry Cooperation Zone (Shenzhen Qianhai No.43 [2015]), combined with the actual situation of Qianhai, these subsidy measures are formulated.

Article 2

The office space referred to in the measures refers to properties that have been completed, accepted, and recorded in the Qianhai cooperation zone, the utility of the space should be office.

Article 3

If the following properties of the Qianhai cooperation zone are rented for office use, no subsidy will be given:

Commercial apartment

Properties for commercial use

Properties belong to the government or Qianhai Cooperation Zone Authority

Article 4

The subsidy funds for office spaceis budgeted and arranged annually from the industrial development fund of Qianhai Cooperation Zone Authority.

The allocation and use of the subsidy funds will be disclosed to the public through the official website and will be supervised by relevant departments and the society.

Chapter II Objects and Standards of the Subsidy

Article 5

The objects of the office space rental subsidy are the leaseholder units or property units.

Article 6

The leaseholder unit applying for the subsidy should meet the following requirements:

Enterprises or social organizations that are set up according to law, and is off the list of abnormally operating enterprises；

The registered address, business address and tax payment address are all in Qianhai Cooperation Zone；

The business scope is in line with the industry access list of Qianhai Cooperation Zone；

The lease of office space in accordance with the provisions of the Measures should be not less than three years;

Article 7

The financial subsidies for the leaseholder unit is divided into three categories: general, focused and exclusive.

In accordance with the provisions of Article 6 of the Measures, the leaseholderunit that lease office space of not less than 150 square metersis subject to the general subsidy category.

In accordance with the provisions of Article 6 of the Measures, the leaseholder unit that lease office space of not less than 150 square metersand meet one of the following conditions, is subject to the focused subsidy category:

Headquarter enterprises recognized by Qianhai Cooperation Zone Authority;

Headquarter enterprises and financial headquarter enterprises recognized by Shenzhen City;

Financial enterprises approved by the state and their first-level branches;

Enterprises listed on the Shanghai Stock Exchange, Shenzhen Stock Exchange or overseas stock exchanges such as Hong Kong, New York, London, Tokyo, Singapore, Nasdaq (excluding small capital markets and over-the-counter transactions) and their first-level or second-level subsidiaries with a holding share of more than 50%;

Fortune 500 and China Top 500 enterprisesand their first-level or second-level subsidiaries with a holding share of more than 50%;

Unicorn enterprises and their first-level or second-level subsidiaries with a holding share of more than 50%;

National e-commerce demonstration enterpriseand their first-level or second-level subsidiaries with a holding share of more than 50%;

Enterprises with a direct economic contribution of not less than 10 million yuan in the Qianhai Cooperation Zone in the previous year.

In accordance with the provisions of Article 6 of the Measures, the leaseholder unitthat lease office space of not less than 100 square meters, with Hong Kong investors holding more than 50% of the shares and meet one of the following conditions, is subject to the exclusive subsidy category:

Established by a natural or legal person holding a Hong Kong Service Supplier Certificate

One of the enterprise shareholders is a legally registered or commercial registered legal entity in Hong Kong with an operating period of not less than 3 years and is paying profits tax or exempted from tax according to law;

One of the shareholders of the enterprise is a Hong Kong permanent resident. The operation period of the enterprise established in Qianhai is not less than one year.

Article 8

The general subsidy object who rent the office space before December 31, 2019 will be subsidized 30% of the actual rent annually for 3 consecutive years. The annual subsidy amount shall not exceed3 million yuan.

The general subsidy object who rent the office space between January 1, 2020 and December 31, 2020 will be subsidized according to 20% of the actual rent annually for 3 consecutive years. The annual subsidy amount shall not exceed 2 million yuan.

Article 9

The focused subsidy object and exclusive object who rent the office space before December 31, 2019 will be subsidized 50% of the actual rent annually for 3 consecutive years. The annual subsidy amount shall not exceed5 million yuan.

The focused subsidy object and exclusive objectwho rent the office space between January 1, 2020 and December 31, 2020 will be subsidized according to 40% of the actual rent annually for 3 consecutive years. The annual subsidy amount shall not exceed4 million yuan.

Article 10

The leaseholder unit will be subsidized according to the actual rent.If the actual rent exceeds the market evaluation price of the project, the excess will not be subsidized.

The market evaluation price of the project shall be evaluated by a third-party professional organization entrusted by the Qianhai Cooperation Zone Authority, and shall be announced to the public on a regular basis. If the market evaluation price increases by more than 5% year-on-year, the part that exceeds 5% will not be subsidized.

Article 11

A property unit that meets the following requirements can apply for rent subsidy on a project-by-project basis:

The construction area of the office propertyheld by the property unit is not less than 25,000 square meters;

The occupancy rate of the project is not less than 85%;

The leaseholder unit complies with the provisions of Article 6 of the Measures and has not enjoyed the subsidy of the Measures;

The rent price of borne by the leaseholder unit does not exceed 70% of the market evaluation price;

The annual increase rate of rent does not exceed 5%.

Article 12

The property unitwho complies with the provisions of Article 11 of the Measures before December 31, 2019, shall be subsidized by 25% according to the market evaluation price of the actual rented area for 3 consecutive years. The annual subsidy amount shall not exceed 25 million yuan.

The property unit who complies withthe provisions of Article 11 of the Measuresfrom January 1, 2020 to December 31, 2020,shall be subsidized by 15% according to the market evaluation price of the actual rented area for 3 consecutive years. The annual subsidy amount shall not exceed 15 million yuan.

Article 13

Projects that have a major role in promoting the return of the Qianhai-registered enterprises and industrial agglomerations may, with the approval of the Qianhai Cooperation Zone Authority, break through the above subsidy standards, and the specific amount shall be separately agreed by signing a cooperation agreement with the Qianhai Cooperation Zone Authority. However, the total number of enterprises subsidized by the Qianhai Cooperation Zone Authority through this method shall not exceed 10% of the total number of subsidized enterprises, and the subsidy funds shall not exceed 25% of the total amount of the subsidy.

Chapter III Application and Review

Article 14

The property unit shall submit the office space that is expected to be included in the scope of the rent subsidy to the Qianhai Cooperation Zone Authority for review in advance (see Appendix 1 for the application form). If approved, the Qianhai Cooperation Zone Authority will announce it to the public through the official website.

Article 15

Eligible units can apply to the Qianhai Cooperation Zone Authority for the previous year’s rent subsidy. The Qianhai Cooperation Zone Authority will arrange for a specific time to process such applications, and the processing time is not less than 30 days.

The specific application time is subject to the declaration guideline issued by the Qianhai Cooperation Zone Authority.

Article 16

When the leaseholder unit and the property unit meet the application conditions at the same time, if the two parties have agreed on the application subject in the lease contract, they shall decide the application subject according to the agreement; if there is no such an agreement, they principle of “leaseholder unit first” shall prevail.

Article 17

The general subsidy object and the exclusive subsidy object shall uniformly submit the application to the Qianhai Cooperation Zone Authority via the property unit.

The focused subsidy object may submit the application to the Qianhai Cooperation Zone Authorityseparately, or uniformly submit the applicationvia the property unit.

If the office space does not belong to a single property project, it is necessary to uniformly submit the application through the project operation unit.

Article 18

The applicant should be responsible for the authenticity and legality of the application materials. The application materials mainly include:

Subsidy Application Formfor Office Space in Qianhai Cooperation Zone (see Annex 2 and 3);

Business license (unified social credit code certificate) or social group registration certificate;

Lease contract, rent invoice, etc.;

The tax-paid certificate of the previous year;

Other relevant materials that the Qianhai Cooperation Zone Authority considers necessary.

Article 19

If the application materials meet the requirements, the Qianhai Cooperation Zone Authority shall accept the application and complete the review process within 90 working days. If the application fails to pass the review, the applicant shall be informed of the reasons.

Article 20

For applicants who pass the review, the QianhaiCooperation Zone Authority will publicize the list of subsidy acceptors to the public through the official website. The publicity time shall not be less than 5 working days. If there is any objection during the publicity period and the objection is established, the corresponding determinations shall be cancelled and an announcement shall be made.

Article 21

If there is no objection during the publicity time or the objection is not established, the Qianhai Cooperation Zone Authority shall issue a subsidy support plan and allocate the subsidies to the general account of the subsidy objects.

Chapter IV Supervision and Management

Article 22

Office space that receive rent subsidies are limited to the leaseholder units for their own use, and may not be sublet or changed in the functions during the lease term.

Article 23

The property units and the operating units shall strengthen their management. If aleaseholder unit are found to be in violation of the Measures, the Qianhai Cooperation Zone Authority shall be noticed promptly.

Article 24

If the property unit intentionally obstructs the leaseholder unit from applying for subsidy according to law, or bid up the rental price, disrupts the market order, and seriously weakens the leaseholder’s willingness to rent, all office space in the Qianhai Cooperation Zone held by the property unit shall not be included in the subsidy scope of the Measures within three years.

Article 25

If the leaseholder unit or the property unit defrauds the rent subsidy, or the leaseholder unit sublet or change the original function of the office space that receives the rent subsidy, the unit shall return the rent subsidy that has been paid and pay interest according to the bank’s loan default interest rate, and the company of the default unit will be included in the city’s public credit information and related credit records of Qianhai Cooperation Zone Authority, be banned from obtaining any form of industrial fund support from Qianhai within five years and will be notified to the relevant departments of the city. Anyone suspected of violating the law shall be transferred to the judicial organ according to law.

Article 26

If the staff of the Qianhai Cooperation Zone Authority fails to perform their duties or perform their duties improperly in the process of managing and approving the rent subsidy, they shall be investigated for their corresponding responsibilities according to law; if they are suspected of violating the law or committing crimes, they shall be transferred to the relevant authorities in accordance with the law.

Chapter V Supplementary Provisions

Article 27

If a unit complies with the provisions of the Measures and otheroffice space subsidy policies ofthe Shenzhen city and the Qianhai Cooperation Zone, the principle of preferential and non-repetition will be adopted, and the subsidy policy shall not be repeated, but the difference may be supplemented in accordance with the provisions of the Measures.

The qualifications of the subsidy objects will be reviewed once a year. If the subsidy object is no longer qualified after the review, the subsidy will not be given. If the qualification is changed, the subsidy will be given based on the changed qualification.

Article 28

The relevant terms in the Measures are explained as follows:

“Direct economic contribution” refers to the total amount of corporate income tax, value-added tax, stamp duty, urban maintenance and construction fee, education surcharge, local education surcharge, property tax, urban land use tax, and the construction fee for cultural undertakings paid by the subsidy object in Qianhai during the taxation period (excluding customs duties, personal income tax withheld and paid, and related taxes and fees arising from the purchase of land and real estate in Qianhai).

“Unicorn enterprise” refers to an enterprise that has been established within 10 years and has been valued at more than US$1 billion in the latest round of financing and has not yet been listed.

The “Fortune 500” is subject to the latest statisticsin the FortuneMagazine; the “China Top 500” is subject to the latest statistics jointlyreleased by the China Enterprise Confederation and the China Enterprise Directors Association.

The“Actual rent” refers to the rent agreed by the leaseholder and the property owner in the lease contract, and does not include other charges such as water and electricity charges, air-conditioning fees, and property management fees.

Article 29

The rent subsidy for office space is calculated from January 1, 2019. If thelease is signedafter this date, the subsidy will be calculated from the date of the actual lease contract.

Article 30

The Measures shall be implemented from July 1, 2019 and shall be valid until December 31, 2023.

Annexes:

Review Application Form for Property in the Qianhai Cooperation Zone;

Rent Subsidy Application Form for Office Space in the Qianhai Cooperation Zone (Leaseholder Unit);

Rent Subsidy Application Form for Office Space in the Qianhai Cooperation Zone (Property Unit).