Dear Chamber members and friends,
Advocacy is one of the three central pillars of the Chamber’s offering to its members and 2021 was a busy year for it!
The most recent good news reflecting our advocacy efforts is that China’s Ministry of Finance (MOF) announced on 31 December 2021 that the current non-taxable allowances regime for foreign employees in China will be extended to the end of 2023.
On behalf of our members and British businesses, we have raised the concerns on IIT and were in dialogue with SCOFCOM and InvestShanghai. Together with other foreign chambers of commerce in Shanghai, we have sent a joint letter to the Mayor of Shanghai Gong Zheng.
BritCham supports and appreciates that the Chinese government’s decision on this matter – which was one of the key headlines in the British Business in China: Position Paper 2021. This helps companies better retain and attract critical expatriate employees and helps China to attract foreign investment.
In the next two years, BritCham Shanghai will maintain this as one of our key advocacy priorities and seek further solutions together with the authorities before the end of the timeframe set in the current notice.
Now, let’s look back a bit. The start of 2021 saw one of the strengths of the British Chambers in China, with the coming together of all 4 chambers to survey and compile views of British businesses across the Chinese mainland for our third Position Paper. Our Shanghai and East China members contributed hugely to this paper, completing our questionnaires and joining industry-focused roundtables – an effort for which we are hugely grateful. Members’ feedback created an excellent paper that not only helped the UK business community to understand the issues that industry peers face in-country, but it also provided authoritative data points and conclusions that could be presented to select government leaders at a national-level, including the UK Consulate and Embassy sector leads in Shanghai and Beijing, the Chinese Ambassador to the UK, Zheng Zeguang, and Lord Grimstone, the Minister for Investment at the Department for International Trade.
Seeking to provide constructive opinions and recommendations from UK business on access reform, capital flows, cybersecurity and other key issues for operating in this market, the Position Paper also opened doors for our Advocacy team to further press home critical issues in formal consultations with some of the most influential Chinese ministries dictating the local legal and regulatory landscape for members – the Central Ministry of Commerce and their counterparts at the Shanghai Municipal Commission of Commerce and Invest Shanghai, part of the Shanghai Foreign Investment Development Board. From these channels, our Advocacy team has been able to solicit updates for members on visa application processes in light of the ongoing difficulty navigating Covid-19 restrictions, proposed individual income tax reforms for certain Shanghai-based firms, and other assurances and offers of support to member organisations in this region.
With legal and regulatory changes in mainland China continuing to dominate news headlines in China and abroad, in July, the Shanghai team was extremely pleased to be able to bolster its on-the-ground expertise with the support of a new Government Relations advisor, Eric Qin. Eric has and continues to play an invaluable role in informing the Chamber’s Executive Committee on regulatory issues applicable to all members and specifically providing an additional channel to local government departments. With Eric’s assistance, the Chamber has guided key member groups in the submission of formal letters to the Shanghai Ministry of Education in respect of advancement of collaboration between British and Chinese educational institutions, as well as more recently to the Mayor of Shanghai on restoring direct flights between China and the UK for the sake of long-term business links and cultural exchange.
As well as our formal outreach initiatives in 2021, the Chamber has been involved in a number of ongoing programmes to support members in the advocacy space. As well as publishing some key policy roundups through our newsletters, the Advocacy team together with members of the Executive Committee have met with other Commonwealth chambers to discuss issues of common interest and potential for joint initiatives. Various areas of collaboration have been highlighted and will hopefully bear fruit in the coming months as in-country advocacy remains so crucial while borders continue to be largely closed. From government-level to chamber of commerce-level, we have also provided support at an individual member-level, assisting to connect members with government officials and legal and compliance professionals to advise on disputes and other matters at the intersection of law, regulation and policy.
Finally, we closed out the year by gathering members’ impressions of China’s business environment and their forecasts on prospects for 2022. While the release by the British chambers of our joint annual Sentiment Survey coincided with spikes in Omicron cases in many countries, in turn leading to trade and investment uncertainty globally, UK business leaders in China expressed bullish views on this market’s potential going into the new year. Indeed, despite the general mood being characterised as one of fragile recovery from Covid-19’s impact over the last 20 months, and some members’ sectors having fared better than others, on-the-whole firms told us that they are more confident in the outlook now than in 2020.
The Chamber is looking to communicate the key messages from the Sentiment Survey to stakeholders in the UK and China, in particular seeking to organise fora for members to interface with their supervisory government counterparts here. For example, in December, the Advocacy team led a meeting of representatives of the Chamber’s Advanced Engineering & Manufacturing (AE&M) Committee and Shanghai Municipal Commission of Economy and Informatisation in which participants could discuss the survey results and participate in a focussed question-and-answer session. Through more events such as this being planned for 2022, the Advocacy team’s objectives are to seek to bolster the optimism conveyed in the Sentiment Survey, through advocating for business’s calls for clearer and more predictable regulation going forward.
Thank you again to our Platinum and other members for their constant input to our formal initiatives in 2021, and wider, ongoing contribution to Advocacy efforts.
Should anyone have questions, feedback or suggestions for 2022, please reach out to Alex Roberts, our Advocacy Lead, or James Dunn, Executive Director.
All the best for the New Year!
The following letter is from Alex Roberts, BritCham Shanghai’s Executive Committee Member and Advocacy Lead.
BritCham Shanghai Executive Committee Member and Advocacy Lead;
Counsel, Linklaters LLP