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China Subsidy Exchange

September 6, 2017

China Enhances Supports for Small and Medium-sized Enterprises

On September 1, 2017, the Standing Committee of the National People’s Congress of China passed the amended Small and Medium-sized Enterprise Promotion Law of the People’s Republic of China, effective as of August 1, 2018, to meet the needs of small and medium-sized enterprises (“SMEs”) for development in today’s world. The amendments clarifies that the national government shall arrange a Small and Medium-sized Enterprise Development Special Fund at the national government level, primarily supporting the construction of public service system and financing service system for SMEs. The amendments also attach importance to providing financial supports for micro and small-sized enterprises (“MSEs”). The amendments mandate the central bank and the banking regulatory commission to implement relevant policies to encourage and guide financial institutions to increase credit loan supports for MSEs, and direct state-owned commercial banks and regional banks to actively serve MSEs. The amendments also restate that the state shall implement preferential tax policies and reduce or eliminate administrative charges for micro and small-sized enterprises.