Rajah & Tann Regional Round-Up

your snapshot of key legal developments in Asia

Issue 1 - Q1 2020 (Special Edition on COVID-19)


Control and Support Measures in China Amid the COVID-19 Pandemic

China is at a different stage in combating the COVID-19 pandemic. Generally speaking, the COVID-19 pandemic in China has been under control, but China is at the stage of preventing the virus from being imported and the potential occurrence of a second wave of infections. Most of the lockdown and movement control measures in China have been lifted, including the lockdown of Hubei Province (except for Wuhan City),  which ended on 25 March 2020. The lockdown of Wuhan City (the epicenter of the outbreak) ended on 8 April 2020. Currently, most of the businesses in China have resumed normal production and operations or are in the process of resuming normal production and operations, subject to certain relevant local rules such as the working space and safe social distancing requirements. For example, as of 2 April 2020, 16 industries in Shanghai (including industrial enterprises above the designated scale (规模以上工业企业), enterprises involving in major projects, foreign-invested enterprises and foreign trade enterprises, etc.) have almost fully resumed production and operations. However, entities operating in certain industries such as theatrical performances, cinemas and indoor stadiums are still required to  file an application for resumption of operations with the local authorities to seek a confirmation of the resumption.

The central government of China has released temporary policies, reliefs and guidelines to support businesses affected by the pandemic. The ministries of the central government and the local governments have also issued temporary policies and reliefs in accordance with the guidelines issued by the central government. For example, the State Taxation Administration released several announcements which established preferential tax policies involving value-added taxes, individual income taxes and enterprise income taxes. The Ministry of Human Resources and Social Security, together with other governmental authorities, issued a circular on phased reduction of social insurance contributions for enterprises. People's Bank of China issued a circular on further strengthening financial support for enterprises and individuals substantially affected by the COVID-19 pandemic which include relevant policies of extension of loans, adjustments of interest rates, introduction of interest subsidy etc. Most of the above measures are aimed at helping enterprises (especially SMEs) relieve their burden and overcome the difficulties during this period.

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Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice.


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