In the past years, Xiamen People’s Congress, Xiamen Municipal Government, the Administrative Committee of Xiamen Torch Hi-tech Industrial Development Zone and relevant functional departments of the municipal government have adopted a series of encouraging policies to attract overseas Chinese scholars to set up their businesses in Xiamen and promote the development of such enterprises. In March, 2002, Xiamen People’s Congress examined and passed the Regulations of Xiamen Special Economic Zone on Encouraging Overseas Chinese Scholars to Establish Their Businesses and Work in Xiamen, which came into effect on June 1st the same year. This is the first local code in China to encourage overseas Chinese scholars to return to China to establish their businesses and work, providing effective legal guarantee for attracting and supporting overseas Chinese scholars to set up their businesses in Xiamen.

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The major preferential treatments for overseas Chinese scholars and scholars from Taiwan include:

1. The qualified enterprise is entitled to receive a special funding of RMB 100,000.

2. The enterprise meeting the requirements may apply for supporting capital which may be as high as 49% of the combined registered capital and which will not exceed RMB 1 million. It may repurchase the shares at preferential price (the principal of the capital and the interest at the bank loan interest of the corresponding period) within three years.

3. Having the priority in being recommended to the State Technological Innovation Funds for Small and Medium-Sized Hi-tech Enterprises and the Innovation Funds of Xiamen Torch Hi-tech Industrial Development Zone. The enterprise that has received grants from the State Technological Innovation Funds for Small and Medium-sized Hi-tech Enterprises shall be entitled to a corresponding support from the finance Section of the Administrative Committee of Xiamen Torch Hi-tech Industrial Development Zone.

4. The enterprise in the park leasing factory building within 60-150 square meters for research, development or production shall be exempted from the rent in the first year and shall pay the rent at 50% and 80% of the market price in the second and third years respectively. Enterprises in the park may also rent apartments at preferential prices.

5. The minimum registered capital for a limited liability company in the park is RMB 30,000 (or foreign currency of equivalent value). The registered capital of over RMB 1 million may be contributed in installments.

6. There shall not be any restriction to the proportion of scientific-achievement-converted capital in the registered capital if such capital is contributed in the form of a patent or know-how.

7. The overseas Chinese scholar or the scholar from Taiwan, when holding a Xiamen Employee’s Card for Overseas Chinese Scholars, shall enjoy the treatments for local citizen in buying a house, applying for a driver’s license, and sending his/her children to school or kindergarten.

8. When the overseas Chinese scholar or the scholar from Taiwan meets the requirements for a talent of priority and his/her children want to study in a middle school or a primary school in Xiamen, they may select the school they like. When his/her children take part in any entrance examinations for various types of schools during their senior middle school section, they shall be entitled to the preferential treatment for the children of the returned overseas Chinese.

9. When the Overseas Chinese scholar or the scholar from Taiwan establishes his/her business in Xiamen, he/she may apply for a government-subsidized apartment.

10. The overseas Chinese scholar or the scholar from Taiwan holding both a foreign passport and the Overseas Expert Certificate issued by Xiamen Municipal Government, he/she and his/her family members may apply for the Residence Permit for Foreigner valid for 1 to 5 years and the Multiple Entry Permit with same validity.

11. In addition to the above preferential treatments, the overseas Chinese scholar or the scholar from Taiwan running a software or IC enterprise is entitled to other preferential treatments promulgated by the state, provincial and municipal governments.