The China (Shanghai) Pilot Free Trade Zone. [Photo/yicai.com]

Shanghai recently issued the Implementation Plan for Implementing the Measures to Support Deepening Reform and Innovation in the Pilot Free Trade Zone. 

It puts forward 59 reform measures, including 19 items optimizing the investment environment, 21 enhancing trade liberalization and facilitation, 13 advancing financial openness and innovation and six innovating the human resources guarantee mechanism. 

The measures show that the reform effect of the Shanghai FTZ is gradually expanding with the aim of promoting reform linkage between the free trade zone and the whole city of Shanghai.

For example, the implementation plan proposes to promote the pilot project for comprehensive land use reform in the bonded area and the free trade zone.

To meet the planning requirements and in accordance with the regulations, the land in the zone is allowed to appropriately increase the floor area ratio according to functional requirements, and the same plot or the same building is able to have multiple functions. 

In addition, the plan proposes to try out a land pricing model based on differential rents and supplemented by the nature of land in the free trade zone. The industrial land is subject to flexible annual supply. According to industrial policies and project categories, land supply measures such as rent before release and differentiated annual transfers can be adopted to explore a new mode of economical and intensive land use.

The Pilot Opinions on Comprehensive Land Use Planning and Land Management in the China (Shanghai) Pilot Free Trade Zone released in 2014 proposed that in order to coordinate the adjustment of industrial functions within 28.78 square kilometers and promote secondary development of land in the region, after the existing construction land was approved for transformation into comprehensive land, land prices could be based on market evaluation to complete the transformation.

The release of the implementation opinions means that within the 120 square kilometers of the Shanghai FTZ, the plot ratio can be appropriately increased to further promote industrial transformation and improve the output efficiency of the land.

The State Council issued the Notice on Supporting the Measures for Deepening Reform and Innovation in Pilot Free Trade Zones on Nov 23, 2018, which proposed 53 measures to support the pilot free trade zones’ deepening of reform and innovation, and further improve the quality of construction.

Of the 53 measures proposed in the notice, 39 are applicable to all the pilot free trade zones, and 14 are more targeted and applicable to a specific free trade zone. Measures allowing the pilot free trade zone to carry out pilot labor management and service in the form of non-standard employment are only applicable to the Shanghai FTZ.

The implementation plan put forward six measures to innovate the human resources guarantee mechanism, including piloting a flexible working system, enabling manufacturing enterprises in Pudong New Area to sign labor contracts including short-term fixed term labor contracts with workers to complete certain work tasks during the peak production season, and allowing labor dispatching employees to take temporary jobs in R&D centers.