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Several Measures for the Concentrated Development of the Integrated Circuit Industry in Lin-gang Special Area of China (Shanghai) Pilot Free Trade Zone

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(Excerpts from the Supportive Provisions of the Measures) 

1. Supporting the prior planning of major projects. Integrated circuit (IC) enterprises with great influence at home or abroad are supported to set up research and development (R&D) centers and invest in industrialization projects. IC transnational corporations are supported to set up offshore R&D and manufacturing centers. Enterprises are supported to apply for national or Shanghai municipal major IC projects and corresponding government funding for such projects will be offered. Specific incentives and supportive measures will be discussed and determined by Lin-gang Special Area Administration.

2. Supporting problem tackling in core technologies and products. According to the State and Shanghai municipality's requirements for industrial and technological innovation, Lin-gang Special Area Administration will collect product demands and select high-quality projects in the IC field each year, and choose teams to take on the tasks through competitive international bidding. Based on project requirements and expert review results, enterprises (or consortiums) that undertake and complete the core technology problem tackling tasks will receive funding up to 50 percent of the technology R&D expenses.

3. Supporting the large-scale development of enterprises:

1) IC design enterprises that achieve for the first time an annual sales revenue exceeding 50 million yuan ($7.10 million), 100 million yuan, 300 million yuan, 500 million yuan and 1 billion yuan will respectively be offered a one-off reward of 1 million yuan, 1.5 million yuan, 2 million yuan, 3 million yuan and 5 million yuan maximum after confirmation. Enterprises that increase their rank will be offered a supplemental reward for the deficiency.

2) IC manufacturing, packaging and testing enterprises that achieve for the first time an annual sales revenue exceeding 500 million yuan, 1 billion yuan, 5 billion yuan and 10 billion yuan will respectively be offered a one-off reward of 2 million yuan, 8 million yuan, 12 million yuan and 15 million yuan maximum after confirmation. Enterprises that increase their rank will be offered a supplemental reward for the deficiency.

3) IC equipment and material enterprises that achieve for the first time an annual sales revenue exceeding 50 million yuan, 100 million yuan, 500 million yuan and 1 billion yuan will respectively be offered a one-off reward of 2 million yuan, 8 million yuan, 12 million yuan and 15 million yuan maximum after confirmation. Enterprises that increase their rank will be offered a supplemental reward for the deficiency.

As for the above supportive measures (1) (2) (3), if an enterprise satisfies the conditions for more than one reward, it shall choose to apply for the highest one among them instead of receiving all. The cumulative maximum reward amount for one enterprise is 15 million yuan.

4) Leading IC enterprises are encouraged to conduct vertical industrial chain integration and non-related mergers and acquisitions (M&A) at home or abroad. For enterprises that successfully make acquisitions of domestic or foreign enterprises or key R&D institutions in the IC industry chain with a cost of more than 10 million yuan, a subsidy of 10 percent of the actual transaction amount will be offered with a maximum accumulative amount of 10 million yuan.

5) The financial support for non-related enterprises in Lin-gang Special Area that purchase IC products or services for more than 5 million yuan annually in Lin-gang Special Area is 20 percent of the purchase invoice amount maximum (10 million maximum for each enterprise each year).

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