Financial support for innovation center with global influence (2015)

Updated:2016-02-05 (chinadaily.com.cn)

I. Increase input  

1. Increase science and technology expenditures with a worldwide focus, giving priority to a national science center and innovation platforms, and Shanghai’s major strategic projects. Support public science and technology activities and people who have made breakthroughs in innovation or key technology. 

2. Improve the fiscal expenditure mechanism for science and technology in the following ways: a decision making and department coordination mechanism for innovation, planning in scientific and technical innovation resources, improve top design, stop regional segmentation; change government science and technology management, develop a science and technology innovation strategy and review mechanism through institutes, get government departments to increase evaluations, supervision and inspection, and establish an adjustment mechanism for science and technology planning, specific goals and performance, and unify science and technology information management for better sharing and public supervision.

3. Integrate fiscal plans for science and technology in an optimal way based on the following programs: science and technology innovation centers, government science and technology management, a system that covers fundamental frontier science and technology, science and technology innovation support, guiding technology innovation, innovation and entrepreneurial talent, innovation environment development and strategic tasks, separate existing science and technology plans based on fiscal goals, integrate those without a clear function, or that are repetitive. 

II. Respect scientific and technological innovation and improve input

1. Increase stability and sustainability in the following ways: improve competitiveness mechanism for frontier studies, support research institutes in independent planning of scientific research projects, encourage researchers to do original work, boost industry-college-institute cooperation, use scientific research input management in line with results-oriented innovation that focuses on incentive and restraints for new industrial technology R&D organizations, make clarify and evaluate work through strategic cooperation agreements, and support autonomous fund use. 

2. Explore new ways to guide and support in the following: make better use of the market in technical innovation resource and business technology innovation and fund use for activities with clear market demand, support company independence in decision making through risk compensation, -subsidies, venture capital, and angel investment funds, adjust or improve innovative decision-making and organizational model, and increase transfers, transformations, capitalization and industrialization of scientific and technological developments.

3. Improve fund management for competitive scientific research In the following: transfer of scientific research budget approval rights to a lower level, increase funds for scientific researchers, let the budget cover meetings, travel, international cooperation and exchanges within reason, improve fund carry-over and balance management, carry forward surplus money and use it the following year for project implementation, use surplus money for scientific research if a project passes acceptance check and is done by a unit with a good credit ratings. 

III. Implement national tax policy and use fiscal policy guidance 

1. Favor scientific and technological innovation In the following ways: follow national requirements and use the tax system to encourage businesses in increasing innovation input and scientists in using scientific findings, improve enterprise R&D expense calculations and reviews, improve management, expand preferential policy applications by using R&D expenses to offset taxes, use the preferential tax policy for innovation investment, restrict investment in new high-tech enterprises, give limited partnership venture capital firms favorable tax policies in accordance with the law, allow scientific researchers in new high-tech small-to-mid-sized enterprises to pay individual income tax from the commercialization of research over a 5-year period, and improve new high-tech enterprise recognition and provide a 15-percent cut in corporate income tax for accredited high-tech service businesses. 

2. Improve preferred procurement policies for innovative products and services in the following ways: ensure that government gives priority to these and push for application of innovative products, draw up recommended innovative product inventory and for those on the list that are marketed for the first time use a government procurement contract for suppliers, cooperate in major innovation products and technology needed by the government, choose developers and producers through competition and negotiation or sole source purchase, let government purchase innovative products that are patented through sole source purchase, explore polices that support government purchase of innovative products, apply government incentives and policies on R&D and use of top intelligent equipment. 

3. Increase government support for angel investment in the following ways: increase guidance funds from government, increase innovation result input in seed and start-up stages, use capital to increase investment, use guidance funds in angel investment to transfer stock equity to other shareholders over a 5-year period, and let government establish risk compensation of no more than 60-percent of actual investment loss by venture capitalists who invest in science companies during seed and start-up stages. 

4. Establish large policy financing assurance institute and build credit guarantee fund for micro-to-small-to-mid-sized enterprises, make optimal use of financing assurance services to help innovative development of small-to-mid-sized technology enterprise and micro-to-small businesses, and provide credit services for small-to-mid-sized technology enterprises through financing assurance, re-guarantee and equity investment. 

5. Encourage public entrepreneurships and innovation, increase fiscal input at the city, district and county level, make optimal use of fiscal support, develop national micro-to-small business start-ups and innovation bases, increase service capacity, encourage districts and counties to cover some costs of remodeling business incubation space, infrastructure and interest on loans, provide intermediary, accounting and legal services for micro-to-small businesses through government purchases to reduce start-up costs, use "scientific innovation coupon" as a subsidy for business innovation or start-up teams in using equipment from Shanghai’s R&D public service platform, use the market to support business start-up projects, use a guidance program for university students in innovative undertakings and provide business start-up loan guarantees. 

IV. Streamline administration and delegate power to lower levels

1. Release scientific and technological achievements and earnings by making the rights available to institutes of higher learning and scientific researchers, assess achievements that are funded by Shanghai and are not involved in national defense or security that can be assessed without government approval, and let the profits from the transfer or conversion of achievements stay with the academic and scientific research institutes. 

2. Increase the profit from the conversion of scientific achievements for scientific research personnel, letting them go first to personnel or teams that have contributed the most, let the rest be used for scientific research, intellectual property management or other technical transfers, and let no less than 70-percent of the profit go to research teams and do not count it as salary. 

3. Explore market pricing for the transformation of scientific and technological achievements gradually in conformation with the scientific and technological achievement transfer law, let institutes of higher learning and scientific research in Shanghai determine the price through negotiations, markets, or auction, and base the price negotiations similar achievements in public, before setting the final price.  

4. Apply a liability exemption policy for "investment failure" in transforming scientific and technological achievements, and develop an atmosphere of honesty and innovation and acceptance of failure to stimulate institutes of higher learning and scientific research for innovation, so that institutes that invest in scientific achievement transfers won't be penalized for investment loss if they fulfill their responsibilities. 

5. Develop an environment that is conducive to scientific and technological achievement transfers, make full use of services and technical support from institutes, government R&D services, industrial technology research institute, the Zhangjiang industrial research institute, and technology markets at institutions of higher learning, introduce a market mechanism, use government purchasing services, encourage participation of enterprises and social research institutes, be innovative in industry-university-institute cooperation, and provide services for institutions of higher learning and scientific research to restudy and redevelop those transformations. 

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