FTP Policy Focus Series——
Relaxation of Market Access
Since the 18th National Congress of the Communist Party of China, we have continuously introduced new measures to expand opening up which achieved an accelerated pace. Relaxing market access, promoting fair competition, and creating a more attractive investment environment are important measures for deepening reform and opening up in the new era. It also plays a significant role in building the new development paradigm with domestic circulation as the mainstay and domestic and international circulations reinforcing each other. On April 7, 2021, National Development and Reform Commission and Ministry of Commerce jointly issued the Opinions on Special Measures to Ease Market Access for the Support of Hainan FTP Construction, specifying relevant departments will further support Hainan in creating a free trade port market access system and market environment with Chinese characteristics, promoting the free and facilitative flow of production factors, speeding up the cultivation of international competitive industries, and constructing a free trade port of high quality in high standards.
I. Innovating on market access methods in the medicine and health field
1. Supporting the sale of prescription drugs on the Internet. The Hainan Electronic Prescription Center (providing third-party information services for prescription drug distributors) in the Boao Lecheng International Medical Tourism Pilot Zone (hereinafter referred to as the “Lecheng Pilot Zone”) shall be established, and any prescription drug domestically marketed other than that subject to special management under state drug administration laws shall be permitted to be sold on the Internet through the Electronic Prescription Center, and cease to be subject to separate approval. The Hainan Electronic Prescription Center shall be connected to the unified online medical service platform shared by Internet-based hospitals, the Hainan Medical Institution Prescription System, distribution platforms of prescription drugs, medical insurance information platforms, payment and settlement institutions, and commercial insurance institutions, to achieve the one-website-handling of unified collection of prescription-related information, purchases of prescription drugs, information security certification, medical insurance settlement, and other matters. The Hainan Electronic Prescription Center and the relevant authorities of Hainan shall formulate detailed work plans, strengthen the management of high-risk drugs, and implement the relevant primary responsibilities such as cybersecurity, information security, and personal privacy protection. Blockchain, quantum information, and other technologies will be used to achieve online and offline linkage supervision, full traceability of drug flow, and secure data storage.
2. Supporting the development of high-end home-grown medical equipment in Hainan. We encourage the first piece (set) of high-end medical equipment to be produced in Hainan, and the requirements of relevant documents for the first piece (set) of home-grown equipment shall apply to the large-size home-grown medical equipment produced in Hainan which is on the Guiding List for Promoting the Application of First Piece (Set) of Major Technical Equipment or the List for Licensing the Acquisition of Classes A and B Large Medical Equipment.
3. Increasing access to the pharmaceutical market. The People’s Government of Hainan Province shall optimize the R&D, trials, production, and application environment of pharmaceuticals (traditional Chinese medicines, pharmaceutical chemicals, and biological products), encourage R&D and production enterprises for homegrown high-value medical consumables, national innovative drugs, and TCM to be settled in Hainan, improve the financing system for new drug R&D in Hainan, develop a new drug R&D support system that matches that of the drug listing license holder, and encourage domestic and foreign pharmaceutical companies and drug development institutions to develop various types of innovative and improved new drugs in Hainan. We encourage medical institutions based in the Lecheng Pilot Zone to carry out clinical trials in accordance with regulations. For an innovative drug of a pharmaceutical enterprise registered in Hainan which has had the Phase I-III clinical trials completed in China, and has been authorized to go to the market, a qualified Hainan-based medical institution shall be encouraged to use the drug directly on the principle of “purchases upon approval”, and the relevant authorities shall not impose additional market access requirements.
4. Fully relaxing the access restrictions for contract research organizations (“CRO”). The People’s Government of Hainan Province shall formulate policy opinions on CRO’s settling down in Hainan, support to establish a regional ethics center of international standards for medical research in Hainan, encourage Hainan’s medical institutions to cooperate with CRO, and improve the technical capabilities for clinical trials and quality management level of the medical institutions. The Government of Hainan shall streamline the approval and filing procedures for TCM preparations of medical institutions, develop relevant standards on the principles of safety and effectiveness, and launch a pilot program of clinical trials and post-marketing re-evaluation of TCM medicines in Hainan.
5. Supporting the development of the upmarket medical cosmetic industry in Hainan. We will encourage well-known medical cosmetic institutions to move into the Lecheng Pilot Zone, and medical cosmetic institutions based in the Lecheng Pilot Zone may use the products for cosmetic surgery marketed in the United States, the EU, Japan, and other countries or regions in quantity, among which drugs, medical apparatus and instruments, and cosmetics that need to be registered or filed domestically shall be registered or filed in accordance with the law, and the Lecheng Pilot Zone may formulate incentive measures. The relevant authorities of Hainan shall work out a list of imported drugs, medical apparatus and instruments, and cosmetics enterprises and products required for the development of the medical cosmetic industry in Lecheng Pilot Zone, and assist related enterprises in registration, and the national medical authorities shall provide relevant support. High-level foreign plastic surgeons shall be encouraged to practice medicine in Hainan for a short period of time in accordance with laws and regulations. We will promote the development of the medical cosmetic and tourism industry, encourage the introduction and organization of international and specialized exhibitions, summits, and forums in relation to the medical cosmetic industry, and regulate the approval and oversight of medical cosmetic industry institutions.
6. Optimizing the access and development environment for whole-field transplant science. Hainan is to gather various high-quality resources, establish an international center for scientific research on transplant and construct tissue banks in accordance with leading international standards. Hainan shall keep improving related systems and working frameworks and advancing the application and commercialization of the results of research on bio-renewable materials in Hainan. The access environment for various new drugs, inspection and testing reagents, genetic technologies, and medical devices in the transplant field shall be optimized, the links of market access such as R&D, registration, production, and use shall be kept unimpeded, and related products that meet corresponding conditions shall be supported in entering priority or innovation approval procedures. The medical institutions formed by private capital and public medical institutions shall be subject to consistent access standards and be treated equally in the approval of qualifications for practicing human organ transplants. An International Transplant Medical Rehabilitation Diagnosis and Treatment Center shall be formed in the Lecheng Pilot Zone to work with major medical institutions in diagnosis and treatment for transplant rehabilitation. Eligible transplant medical projects shall be included in the scope of medical insurance payments, and facilitative settlement of medical insurance out of the area shall be achieved. Commercial insurance institutions shall be encouraged to explore and research insurance businesses related to transplant diagnosis, treatment, and rehabilitation. Domestic first-class TCM institutions shall be encouraged to open relevant institutions in Hainan to conduct diagnosis and treatment integrating Chinese and Western medicine in transplant and promote the integration of health care and rehabilitation.
7. Establishing a reform fund of mixed ownership for the development of the medical care and health industry in Hainan. Under the guidance of the NDRC, Hainan will establish a reform fund of mixed ownership for the development of the medical care and health industry, funded by private capital and operated in a market-oriented manner, to develop the relevant industries in Hainan. CSRC shall give due support with regard to the listing, mergers, and acquisitions, and restructuring, among others, of strategic key enterprises enjoying the support of the reform fund.
II. Optimizing the market access and development environment in the financial field
8. Developing securities, insurance, funds, and other industries in Hainan. Securities, funds, and other financial institutions are encouraged to settle in Hainan in accordance with the law. We encourage the development of medical care and health, long-term care, and other commercial insurance, as well as various forms of elderly care finance.
9. Strengthening data and information sharing and launching pilot programs to support the entire agricultural chain. A pilot program shall be conducted on certain regions of Hainan so that the data on land and crops, among others, in the entire agricultural industry chain obtained by the geographic information system (“GIS”), satellite remote sensing technology, drone-based information technology, and other information technologies shall be made available to third-party institutions on the marketization principle, based on which they can conduct a risk assessment and credit evaluation. Various financial institutions shall be encouraged to provide financial support for the entire agricultural industry chain in accordance with laws and regulations, as well as the third-party assessment and evaluation information, to meet the needs of agricultural development, based on market-oriented principles and their functional positioning. We will encourage insurance institutions to provide supporting agricultural insurance services. Hainan is encouraged to develop the entire industry chain of plant cultivating, aquaculture, fishery including such links as production, processing, circulation, sales, and experiencing. We will help Hainan work out specific implementation plans in conjunction with relevant financial institutions and third-party information service institutions to give play of the advantages of local agricultural groups in resource and information integration and create a development pattern in which third-party organizations for sci-tech information and financial data participate and agricultural groups, leading agricultural enterprises, and farming households interact with each other.
III. Widening market access and promoting prosperity in cultural front
10. Supporting the construction of the Hainan International Cultural Relics and Art Trading Center. We will help introduce to Hainan International rules for exhibitions, transactions, and auctions, and others in the art industry, and set up the China (Hainan) International Cultural Relics and Art Trading Center, to provide an open, specialized, convenient, and efficient international trading platform for outstanding artworks from countries along the “Belt and Road” and cultural relics tradable under relevant laws and regulations on cultural relics protection. Renowned auction agencies from home and abroad will be welcome to Hainan to conduct business at the Trading Center. The Trading Center will reduce the transaction costs of art and tradable cultural relics to gain an international competitive edge. Policy support shall be provided in terms of customs clearance, supervision of bonded goods, warehousing and logistics, and other aspects.
11. Encouraging the development of the cultural and performing arts industry. The state authorities shall encourage BRI-related cultural exchanges and cooperation to be conducted in Hainan, and gather the resources of performing, creation, capital, science and technology, and other excellent resources of the “Belt and Road” countries and even the rest of the world. The competent departments are encouraged to offer internationally competitive incentives for the cultural industry, encourage the application of new technologies such as 5G, VR, and AR, and provide systematic support in planning, land use, sea use, energy use, finance, brains introduction, and other aspects. The authorities shall improve the approval procedures of commercial performance, innovate on the method for during-and-post-event regulation, and give full play to the role of performance industry associations to improve the self-discipline of the industry. We will meanwhile optimize the examination of the operating activities of entertainment venues and the content of video games and amusement equipment.
12. Encouraging the development of the online game industry. We will explore to delegate the power to approve domestic online games to Hainan to develop the online game industry in Hainan.
13. Relaxing market access to the cultural relics industry. We shall implement an information commitment on the approval of establishing cultural relics stores in Hainan and encourage the establishment of market-based cultural relics restoration, protection, and authentication research institutions.
IV. Widening market access and promoting resource gathering in the education field
14. Encouraging higher institutions to commercialize scientific research results in Hainan. The state authorities shall support Hainan in its efforts to form bases for commercialization of the biomedicine, electronic information, computer and big data, AI, marine science, and other scientific research results of higher institutions in key development areas such as the Lingshui International Education Pilot Zone and the Lecheng Pilot Zone, encourage researchers of higher education institutions to engage in entrepreneurship, hold part-time jobs, and commercialize research results in Hainan in accordance with the relevant state regulations. Higher institutions shall be encouraged, under the premise of ensuring normal operation and development, to participate in industry investment funds that conform to the national strategy and promote the commercialization of scientific research results by transfer of license, equity purchases, and other means.
15. Encouraging well-known domestic higher institutions to establish international schools in Hainan. Well-known domestic higher institutions shall be supported in forming international schools in the Hainan Lingshui International Education Pilot Zone, Sanya, or areas that enjoy good conditions in school running to serve the BRI. International schools shall operate on a small scale, provide high-quality undergraduate education, and establish basic science, applied technology, and engineering courses as main disciplines and majors, the relevant institutes of the CAS shall give pairing support for the construction of the school as appropriate. Innovative cooperation and academic exchanges with internationally renowned higher institutions shall be encouraged. The initial enrollment shall be 300 to 500 per year, with enrollees mainly international students. Eligible international students to be enrolled shall be mainly outstanding high school graduates and first-year students of higher institutions from countries along the “Belt and Road” admitted upon application and based on fair selection. The Ministry of Education shall endorse the high-quality international education programs of the relevant higher education institutions in Hainan by the Chinese Government Scholarship and other means. The CAS and other relevant units shall, in conjunction with Hainan, formulate a specific construction plan, and implement it with approval obtained under the procedures.
16. Encouraging Hainan to vigorously develop vocational education. Hainan is expected to improve the vocational education and training system, integrate production and education, and deepen school-enterprise cooperation. Social forces are encouraged to provide vocational education in sole proprietorship, joint venture, cooperation, and other various forms. We will help Hainan build a public training base for vocational skills that serves the regional development strategy of the country. We will encourage Hainan to vigorously develop vocational education in the fields of medical care, health maintenance, culture performing arts, and cultural relics restoration and authentication, among others, and implement information commitment administration on the formation, modification, and termination of private schools that only provide vocational skills training and the establishment of technical schools.
V. Relaxing market access in other key fields
17. Improving the market access environment of the commercial aerospace industry in Hainan and promoting high-quality development. We will aim to construct an integrated and open Wenchang Spacecraft Launch Site, establish a world-class spacecraft launch site system operating on a market-oriented basis, coordinate the construction of related measurement and control systems, ground systems, and application systems, and establish a construction management and application model that meets the development characteristics of China’s international commercial aerospace industry. We will work to make the commercial aerospace industry chain, including satellite remote sensing, the Beidou Navigation Satellite System, satellite communications, quantum satellites, chip design, launch vehicles, and measurement and control, among others, settle in Hainan. The procedures for handling such matters as spacecraft launch applications and coordination with spacecraft launch sites shall be improved, and the capabilities for safety regulation of the production, storage, transportation, testing, and other activities of launch vehicles, engines, and related products shall be enhanced. We will make international applications of the Beidou Navigation Satellite System in Hainan a demo project. We will help set up a reform fund of mixed-ownership for commercial aerospace development funded by private capital operating on a market-oriented basis. Insurance institutions shall be encouraged to conduct insurance business in relation to the aerospace field under the premise of compliance with laws and regulations and controllable risks. We will support international cooperation among businesses, education institutions, research institutes, and users in the field of commercial satellites and payloads and encourage international collaboration in the development and application of satellite data and data sharing services. We will improve the approval procedures for international cooperation in technology R&D, engineering R&D, system operation, application promotion, and other areas of the commercial aerospace field. We will formulate special preferential treatments to attract high-end talents and innovative teams in the international commercial aerospace field for the establishment of an international exchange and training platform.
18. Relaxing market access to the civil aviation industry. We will improve the method for managing civil airports in Hainan and the licensing of the use of civil aviation security inspection equipment and simplify the approval process for general aviation airport planning and construction application. In the field of general aviation, efforts will be made to establish a hierarchical and classified personnel qualification management mechanism and aircraft airworthiness technical standards system, simplify the approval process for flight training centers, civil aircraft pilot schools, and flight dispatcher training institutions, and minimize the access threshold under the premise of compliance with safety technical requirements. We will encourage the application of new technologies such as 5G safety communications for civil aviation, Beidou, and automatic dependent surveillance-broadcast in the fields of air traffic control and flight service guarantees, among others. We will offer financial, tax, talent, and other policy support and encourage private capital to go into general aviation, jet fuel guarantees, aircraft maintenance services, and other fields.
19. Relaxing access to the sports market. We will help establish the southern base for national athletic training and provincial sports centers in Hainan. We will help build a national sports tourism demonstration zone, organize outdoor programs such as beach sports and water sports, and grant the relevant authorization under procedures.
20. Relaxing the market access to the seed industry in Hainan and simplifying approval procedures to promote the development of the seed industry. We will help simplify the qualification, import, and export licensing, and other approval processes for quality inspection institutions for the seeds of crops and Chinese medicinal materials, and improve and standardize the approval procedures for agricultural biotechnology research and testing. Hainan is encouraged to carry out cooperative research with overseas institutions and experts in accordance with the law, to further optimize the management methods for the introduction of excellent agricultural and forestry germplasm, seedlings, and other propagation materials as well as the promotion and application.
21. Helping Hainan roll out a unified layout of NEV charging and battery swap infrastructure. Hainan is encouraged to plan, construct, and operate in a unified manner new-energy vehicle charging and battery swap infrastructure, relax market access to 5G converged products and services, and promote IVICS (Intelligent Vehicle Infrastructure Cooperative System) and the application of driverless technology. The focus shall be on speeding up the process of rolling out fast charging and battery swap facilities in service stations along arterial highways, advancing the construction of centralized charging and battery swap facilities in parking spaces in urban areas, industrial parks, scenic spots, and parking lots. We will simplify project filing procedures and approval processes in the examination and acceptance inspection of planning, construction, fire protection design, and others, and remove implicit barriers to market access. We will encourage relevant enterprises to innovate on business model centering on charging and battery swap business, explore for an inclusive, innovative, and prudent regulation system, and help power grid enterprises and enterprises in NEV production, battery manufacturing and distribution, transport, real estate, property, and other related fields set up market-based investment and operation companies. We will encourage innovative ways to carry out various types of business cooperation and create an island-wide “one network” operation model.
22. Optimizing the access environment and launch pilot programs for the innovative development of rural tourism and leisure agriculture. Certain regions in Hainan shall be entitled to share and apply the data on rural real estate registrations, and pilot programs of market access for rural tourism shall be launched on a municipal and county basis. Relevant local governments shall make an overall assessment of the townships and administrative villages under the pilot areas that are suitable for rural tourism and leisure agriculture. In the principle of the rural land ownership system and market-orientated operation, companies shall be established to run the rural tourism asset. On the basis of consultation and consensus, we support the assets suitable for rural tourism businesses such as BNBs and agritainment to cooperate with the operators in legitimate manners such as the long-term lease, joint venture, and equality participation. We will actively transform the idle farmhouses and homesteads into BNBs and agritainment resorts, and include these two businesses into the development plans, taking account of their coordination and matching with the surrounding industries and rural constructions. Hainan shall unify the service standards of agritainment and BNB. And the authorities of rural homestay shall be in charge of information management platforms planning, capability assessment, and operational regulation. We will firmly safeguard farmers’ interests. When formulating specific pilot plans, we should consider the local conditions. Any one-size-fits-all approach that transforms rural areas into scenic spots shall be prohibited. Instead, the interests of investors, operators, collective economic organizations, farmers, and other parties shall be accommodated. We support collective economic organizations and farmers to obtain income in such forms of rent, participation in operations, and dividend payment. We encourage financial bodies to finance eligible operating companies on the principle of market orientation, to improve the quality of rural tourism in an all-round manner and increase farmers’ income. We sustain insurance bodies to develop property insurance products, to provide risk guarantees for the rural tourism industry. We also guide banks to increase support for the rural tourism industry in accordance with the principles of risk control and commercial sustainability, optimize business processes and improve service efficiency.