Menu
  • Locations
  • About Us
  • Services
  • Experts
  • News & Knowledge
  • Hot Topics
  • Culture & Career
  • Locations
  • Search
  • Press
  • Events & Webinars
  • CI Guide
  • Contact
  • Albania
  • Angola
  • Argentina
  • Armenia
  • Australia
  • Austria
  • Bangladesh
  • Belarus
  • Belgium
  • Benin
  • Bolivia
  • Bosnia & Herzegovina
  • Brazil
  • Bulgaria
  • Burkina Faso
  • Burundi
  • Cambodia
  • Cameroon
  • Canada
  • Chile
  • China
  • Colombia
  • Costa Rica
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Dominican Republic
  • Ecuador
  • Egypt
  • El Salvador
  • Estonia
  • Finland
  • France
  • Georgia
  • Germany
  • Ghana
  • Gibraltar
  • Greece
  • Guatemala
  • Guinea
  • Honduras
  • Hong Kong
  • Hungary
  • Iceland
  • India
  • Indonesia
  • Iran
  • Iraq
  • Ireland
  • Israel
  • Italy
  • Ivory Coast
  • Japan
  • Kazakhstan
  • Kenya
  • Korea
  • Kyrgyzstan
  • Laos
  • Latvia
  • Lithuania
  • Luxembourg
  • Macao
  • Macedonia
  • Madagascar
  • Malaysia
  • Mali
  • Malta
  • Mauritius
  • Mexico
  • Moldova
  • Mongolia
  • Montenegro
  • Morocco
  • Mozambique
  • Myanmar
  • Nepal
  • Netherlands
  • New Zealand
  • Niger
  • Nigeria
  • Norway
  • Pakistan
  • Panama
  • Paraguay
  • Peru
  • Philippines
  • Poland
  • Portugal
  • Puerto Rico
  • Romania
  • Russia
  • Rwanda
  • Saudi Arabia
  • Senegal
  • Serbia
  • Seychelles
  • Singapore
  • Slovakia
  • Slovenia
  • South Africa
  • Spain
  • Sri Lanka
  • Sweden
  • Switzerland
  • Taiwan
  • Tanzania
  • Thailand
  • Togo
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Uganda
  • Ukraine
  • United Arab Emirates
  • United Kingdom
  • Uruguay
  • USA
  • Uzbekistan
  • Venezuela
  • Vietnam
  • Zambia
  • About Us
  • Our CEO
  • Our Board
  • Our Global Executive Team
  • Quality, Process & Risk Management
  • Corporate Tax
  • Customs
  • Financial Services
  • Global Mobility
  • Indirect Tax
  • International Corporate Tax
  • Mergers & Acquisitions (M&A)
  • Private Clients & Family Office
  • Sustainability & ESG in Taxation
  • Tax Controversy
  • Tax Technology
  • Transfer Pricing & Valuation
  • Real Estate
  • Digital Tax Law
  • European Tax Law
  • Latest News
  • Brochures
  • Newsletters
  • Newsletter Subscription
  • Surveys & Studies
  • Pillar Two - Global Minimum Tax
  • Pillar Two - Implementation Status Worldwide
  • Climate Protection, Green Tax & Energy
  • Sustainability & ESG in Taxation
  • Culture and Leadership
  • Diversity
  • WTS Global Academy
  • Career
  • Your Development
  • Jobs
  • Pillar Two Team
  • Pillar Two - Implementation Status Wordwide
  • Press
  • Events & Webinars
  • CI Guide
  • Contact
WTS worldwide
  • Albania
  • Angola
  • Argentina
  • Armenia
  • Australia
  • Austria
  • Bangladesh
  • Belarus
  • Belgium
  • Benin
  • Bolivia
  • Bosnia & Herzegovina
  • Brazil
  • Bulgaria
  • Burkina Faso
  • Burundi
  • Cambodia
  • Cameroon
  • Canada
  • Chile
  • China
  • Colombia
  • Costa Rica
  • Croatia
  • Cyprus
  • Czech Republic
  • Denmark
  • Dominican Republic
  • Ecuador
  • Egypt
  • El Salvador
  • Estonia
  • Finland
  • France
  • Georgia
  • Germany
  • Ghana
  • Gibraltar
  • Greece
  • Guatemala
  • Guinea
  • Honduras
  • Hong Kong
  • Hungary
  • Iceland
  • India
  • Indonesia
  • Iran
  • Iraq
  • Ireland
  • Israel
  • Italy
  • Ivory Coast
  • Japan
  • Kazakhstan
  • Kenya
  • Korea
  • Kyrgyzstan
  • Laos
  • Latvia
  • Lithuania
  • Luxembourg
  • Macao
  • Macedonia
  • Madagascar
  • Malaysia
  • Mali
  • Malta
  • Mauritius
  • Mexico
  • Moldova
  • Mongolia
  • Montenegro
  • Morocco
  • Mozambique
  • Myanmar
  • Nepal
  • Netherlands
  • New Zealand
  • Niger
  • Nigeria
  • Norway
  • Pakistan
  • Panama
  • Paraguay
  • Peru
  • Philippines
  • Poland
  • Portugal
  • Puerto Rico
  • Romania
  • Russia
  • Rwanda
  • Saudi Arabia
  • Senegal
  • Serbia
  • Singapore
  • Slovakia
  • Slovenia
  • South Africa
  • Spain
  • Sri Lanka
  • Sweden
  • Switzerland
  • Taiwan
  • Tanzania
  • Thailand
  • Togo
  • Trinidad and Tobago
  • Tunisia
  • Turkey
  • Turkmenistan
  • Uganda
  • Ukraine
  • United Arab Emirates
  • United Kingdom
  • Uruguay
  • USA
  • Uzbekistan
  • Venezuela
  • Vietnam
  • Zambia
  • About Us
    About Us

    Here you will find more information on our organization’s structure, experts and global reach.

    Read more
    About Us Our CEO Our Board Our Global Executive Team Quality, Process & Risk Management
  • Services
    Services

    Learn more about our network partners and their services.

    Read more
    Corporate Tax Customs Financial Services Global Mobility Indirect Tax
    International Corporate Tax Mergers & Acquisitions (M&A) Private Clients & Family Office Sustainability & ESG in Taxation Tax Controversy
    Tax Technology Transfer Pricing & Valuation Real Estate Digital Tax Law European Tax Law
  • Experts
    Experts

    With a representation in over 100 countries, our team offers local expertise on a global scale. Learn more about our experts.

    Read more
  • News & Knowledge
    News & Knowledge

    Welcome to WTS Global Insights. Here you will find news and updates from our worldwide network.

    Read more
    Latest News Brochures Newsletters Newsletter Subscription Surveys & Studies
  • Hot Topics
    Hot Topics

    Overview of the current "Hot Topics" in the tax industry and how we can support with individual questions.

    Read more
    Pillar Two - Global Minimum Tax Pillar Two - Implementation Status Worldwide Climate Protection, Green Tax & Energy Sustainability & ESG in Taxation
  • Culture & Career
    Culture & Career
    Read more
    Culture and Leadership Diversity WTS Global Academy Career Your Development
    Jobs
  • Locations
    Locations

    Learn more about our worldwide partner network.

    Read more
  • Search
18.12.2022

Shanghai eases RHQ regulations

Key Facts
Shanghai has revised again its regulations to encourage multinational companies to set up regional headquarters (RHQs) in Shanghai.
The revision looks to maintain Shanghai’s edge as the most densely RHQ-populated city, with 877 in total as of September this year.
Author
Martin Ng
Managing Partner
China
View Profile

The Shanghai Municipal Government has revised, for the fourth time, its regional headquarters (RHQs) regulations providing more impetus to multinational companies (MNCs) to run their RHQs in the city. The new regulations have taken effect from 1 November 2022. So far, Shanghai is home to 877 RHQs since the launch of its RHQ regulations in 2002, making Shanghai the city with the most RHQs in China. 

The main amendments bought by the 2022 regulations are summarized below. 

1. New addition and relaxation 

The 2022 regulations have added a third type of RHQ entity, called the RHQ business unit, and introduced some relaxation to the shareholding requirements for RHQ entities. RHQ business unit refers to a Shanghai registered entity set up by an MNC (or its Chinese investment holding company) based on its line of functions, business, products, brands or services, authorized to oversee its investment, management, and servicing in China or the region. The following table highlights the latest changes to the RHQ recognition requirements.

2. Improved assessment mechanism 

Changes are made to delegate more rights to district-level authority and to clarify the assessment mechanism.

3. More explanatory notes 

The 2022 version provides further clarifications on the application documents for RHQ recognition, especially the application form. An applicant is required to provide a more comprehensive description of its shareholding and management structure. In addition, an enterprises seeking an “RHQ – business unit” recognition is required to provide special audit materials on its parent company's business units and operating revenue. 

4. More supportive measures 

The regulations have added more supportive measures to the 2019 version, as summarized below.
 

WTS China’s observation

Existing and new RHQs applicants should note the favorable changes, and consider how to optimize their operations to maximize the benefits, notably the following: 

  • All three types of RHQ entities – not only RHQs – can now benefit from the incentives and supportive measures. Further subsidies and grants could be available from the district governments which are now given the discretion to formulate their own supportive policies. 
  • In particular, Shanghai RHQ entities can enjoy the benefit of cross-border cash pooling, by virtue of the pioneering foreign exchange regulations, the "Facilitation Measures for Cross-border Funding of RHQs in Shanghai", issued by the Shanghai government in 2019. The said regulations facilitate the operation of domestic and foreign funds, enhance cross-border fund coordination, and reduce the exchange risk and financial costs of RHQs. 

 

It should be noted that new tax implications may arise while adjusting the operation to meet Shanghai’s RHQ requirements. For instance, tax revenue reallocation will result due to intra-group business restructuring. Therefore, a detailed tax implication study is advised prior to the implementation.
 

Author
Martin Ng
Managing Partner
China
View Profile
Author
Ened Du
Associate Partner
China
View Profile
Shanghai eases RHQ regulations
View PDF
Articles you might be interested in

With the Polish implementation of the "SUP Directive" entering into force, businesses will now face new compliance duties aimed at reducing the environmental impact of certain plastic products.

Poland: The Polish implementation of the "SUP Directive" enters into force
Read more

The Supreme Court declares the existence of discrimination in the taxation of non-resident hedge funds when receiving dividends from Spanish companies

Spain: WHT on dividends obtained by a non-resident AIF
Read more

As a result of the new amendments in Portugal, the contribution on single use packaging made of aluminium (or a multi-material containing aluminium) will apply from 1 September 2023.

Plastic Taxation in Portugal
Read more

Get in contact

If you have any questions about WTS Global or our global services, please get in touch.
We will respond to you as soon as possible.

Contact
About Us
  • About Us
  • Our CEO
  • Our Board
  • Our Global Executive Team
  • Quality, Process & Risk Management
Services
  • Corporate Tax
  • Customs
  • Financial Services
  • Global Mobility
  • Indirect Tax
  • International Corporate Tax
  • Mergers & Acquisitions (M&A)
  • Private Clients & Family Office
  • Sustainability & ESG in Taxation
  • Tax Controversy
  • Tax Technology
  • Transfer Pricing & Valuation
Latest News
  • News & Knowledge
  • Brochures
  • Newsletters
  • Newsletter Subscription
  • Surveys & Studies
Hot Topics
  • Pillar Two - Global Minimum Tax
  • Digital Tax Law
  • European Tax Law
  • Climate Protection, Green Tax & Energy
  • Sustainability & ESG in Taxation
Culture & Career
  • Culture and Leadership
  • Diversity
  • WTS Global Academy
  • Career
  • Your Development
  • Jobs
Exclusive Cooperation With
© 2023 WTS Company Information Data Protection Disclaimer