The Tianjin Pilot Free Trade Zone (TJFTZ) has become a test field for institutional innovation. Since it was launched on April 21, 2015, the TJFTZ initiated 175 innovative measures in order to streamline governmental services, facilitate investment and trade, and promote financial innovation. Dongjiang Area has actively adopted policies to improve trade facilitation as it sees itself as a pioneer for the whole country to test a brand new system.
One-stop service
The Comprehensive Service Center of Dongjiang Area, a carrier of the TJFTZ's administrative reform, houses the Administrative Committee’s offices of the TJFTZ, the Administrative Committee of Dongjiang bonded area, and several important bureaus. It provides a place for many business services, such as setting up companies, qualification approval, customs clearance, foreign exchange control and taxation. Companies can acquire business licenses, official seals and invoices within one day, as services under the 241 authorities delegated by Tianjin Municipality are accepted in a single window time-frame and processed in a timely fashion. It takes a mere two hours for foreign-invested programs outside the negative list to get registered. From start to finish, companies can complete the procedure within eight days, and foreign-invested companies within 15 days. By providing well-arranged services, the process is further compressed. Dongjiang Investment Service Company covers registry and taxation services, as well as customs clearance and foreign exchange services. These investment facilitation measures are hugely convenient for enterprises and satisfy a wide range of company needs. More companies are enjoying the fruits of reform, and the momentum for future expansion is well accrued.
Enhanced trade facilitation
Since the foundation of the TJFTZ, Tianjin Customs has come up with 29 measures to facilitate clearance. Inspection and Quarantine Administration adopted 24 measures in succession to facilitate inspection and quarantine. At the end of last year, Dongjiang Port was selected as the only eligible port for the inspection and quarantining of fresh aquatic products. These combined measures further promoted trade. The Dongjiang Management Committee actively sought innovative supervision polices with other port authorities in line with measures taken by the Tianjin Customs, Inspection and Quarantine Administration and Border Inspection. Based on the functional advantages of existing policies and the unique location, port authorities chose Dongjiang Area as their innovation base. They enlisted the first batch of innovative measures, for example, a centralized taxation mechanism and electronic clearance documents.
The pioneer of innovative leasing industry
Dongjiang plays a leading role in the financial leasing industry. After the establishment of the TJFTZ, a lot of companies engaged in leasing businesses flocked to the Dongjiang area. In May 2001, the State Council approved the Program on Building Core Functional Area of the Northern International Shipping Centre of Tianjin and approved the building of the National Demonstration Area of leasing innovation. After years of effort, Dongjiang area explored more than 30 kinds of innovative business models including bonded leasing, SPV leasing, off-shore leasing, cross-border leasing and associated leasing. Since the first aircraft leasing business was completed, the leasing item has been expanded to include large equipments, such as ships, subway equipments, high-speed railway locomotives, etc. Leasing industry now becomes a benchmark business in this northern port city and a unique feature of TJFTZ.
Many “firsts” in leasing industry
More and more leasing pilot programs are been located in Dongjiang area. Nearly all types of domestic leasing innovation were originated in Dongjiang. Dongjiang has witnessed the first helicopter leasing business conducted by leasing companies through using foreign debt and the first to receive foreign currency for leasing business. The first SPV equity transfer was completed, initiating the mechanism of using an intermediate for supervision and transaction. The first credit-financing business with Canada was completed. Dongjiang assisted ChunQiu Airlines and Standard Chartered to complete the first financing business in the Japanese yen. Dongjiang helped ICBC Leasing, Minsheng Leasing, CBM Leasing and other large leasing companies explore multiple maritime project platforms. In Dongjiang, a leasing industry including aircraft leasing, ship leasing, maritime platform leasing, infrastructure leasing and large equipment leasing is taking shape.
A platform for registration and transfer of leasing products
The Opinions of the People’s Bank of China on Financial Support in China (Tianjin) Pilot Free Trade Zone serves as strong support for the development of Dongjiang’s leasing industry. By the end of December 2015, 1,449 companies were registered in Dongjiang with registered capital totaling 131.76 billion yuan. Dongjiang has leased 600 aircraft (one in 10 civil aircraft is leased in Donjiang), 11 aircraft engines, 80 global merchant shipping vessels, eight overseas oil drilling platforms, with leasing value mounting to 400 billion yuan. CMI, Shenhua, Chinalco, CITIC security, China Railway Group, Norinco Group, Tiens, Vcanland, Beijing Enterprises Water, Sound Environmental Resources, China Water Environment Group, Tianjin Binhai New Area Construction & Investment Group,Tianjin Yishang and a series of central enterprises and large companies have all established leasing companies in Dongjiang. Shihang Leasing, Ping An Leasing, Anpeng Leasing, Kunlun Leasing and other aircraft leasing companies were also moved in to the area. Overseas companies were also attracted to the area. Top 10 aircraft leasing companies, namely, AerCap, ALC, ACG, and Standard Chartered Leasing have started or will start their business in Dongjiang. The shipping leasing and offshore platform leasing are developing well. Huarong Financial Leasing, CIMC Raffles, Cosco Shipyard, the Far Eastern Group and other offshore engineering companies, the Maesky Group, Kylin Capital, Profundo and other overseas enterprises established partnerships within Dongjiang area. Medical equipment industry advanced rapidly. The management information system for medical equipment in financing and leasing industry was further expanded. Leasing companies such as Nanshan, Union Linker, Shouxin, Weizu, the Far Eastern, Zhongcheng, Derun, Yihui, Universal Medical together signed 652 medical equipment leasing contracts worth of 14.73 billion yuan. Huijin, Weibaili, Ainuo, Feilijinrong, Wankang, Maihe, and Dayin leasing companies stationed their headquarters in Dongjiang. Currently, Dongjiang is engaged in building the National Leasing Industrial Park to attract more leasing companies in order to make Dongjiang the center of the leasing industry.
Looking forward, Dongjiang will further promote policy and carry out systematic reform to offer first-class experience for leasing companies. Dongjiang will also build an internationally advanced leasing center for aircraft leasing and establish an industrial base for ship and offshore construction leasing. Taking advantage of the One Belt and One Road Initiative, Dongjiang is sparing no effort in facilitating large equipments going abroad by financial leasing. Dongjiang will further expand the business scope of leasing and build a platform for the registration and transfer of leasing products.
