China business: Shanghai issues one-off subsidies for COVID-19 control and prevention enterprises and enterprises severely affected by the epidemic

On 20 March, the Municipal Economic and Information Commission and the Municipal Finance Bureau of Shanghai Municipality issued a subsidy to support epidemic prevention and control enterprises who resumed work during the Chinese Spring Festival and those enterprises within industries severely affected by the coronavirus epidemic.

Epidemic prevention and control enterprises

During the Chinese Spring Festival (through midnight 9 February 9 2020), enterprises who resumed work for emergency production in support of epidemic prevention and control relate to COVID-19 can receive a one-off subsidy of RMB 1,500 per employee. Specifically, enterprises who were approved by the District Economic Commission (Commerce Commission) and referred to the Municipal Economic Information Commission for filing may apply for such an incentive. The subsidy is calculated based on the actual number of workers who returned to work during the Spring Festival. We note that applications may only be made only once and the maximum subsidy is RMB 5 million.

Enterprises within industries severely affected by the epidemic

Enterprises within industries severely affected by the epidemic can receive employment stability subsidies of RMB 800 per employee. Specifically, severely affected industries include the following:

  • Accommodation and catering (including restaurants, hotels, catering and distribution services, and so forth)

  • Cultural and entertainment (including memorials, stadiums, Internet cafes, and so forth) 

  • Transportation (including urban rail transit, public passenger cars, airports, railway transportation, and so forth) 

  • Four types of tourism (travel agency and related services, and management of tourist attractions)

Companies in the above industries are required to meet the redundancy rate of 5.5% or less in 2019 to enjoy the benefits. The subsidy is calculated on the actual number of social insurance monthly payments for urban employees during last month upon the date of application, with the standard being that each enterprise can only apply once, and the subsidy cap is RMB 5 million.

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