Original Title: Notice from the Department of Industry and Information Technology of Shandong Province and the Department of Finance of Shandong Province on Issuing the "Implementation Rules for Provincial Fiscal Equity Investment in Enterprise Technological Transformation in Shandong Province"
Article 1: To guide enterprises in accelerating the implementation of technological transformation, fully leverage the guiding and catalytic role of fiscal equity investment, increase investment support for enterprise technological transformation, accelerate the pace of industrial transformation and upgrading, and promote high-quality development.Pursuant to the “Opinions of the People’s Government of Shandong Province on Implementing Pilot Reforms for Equity Investment with Fiscal Funds” (Lu Zheng Zi [2020] No. 16),the "Notice of the Shandong Provincial Department of Finance on Further Improving the Working Mechanism for the Reform of Provincial-Level Fiscal Funds Equity Investment" (Lu Cai Ban Fa [2021] No. 18), the "Notice of the Shandong Provincial Department of Finance and the Shandong Provincial Department of Industry and Information Technology on Issuing the Implementation Rules for Policies on Provincial-Level Fiscal Support for High-Level Technological Transformation" (Lu Cai Gong [2021] No. 1),the "Notice of the Department of Finance of Shandong Province, the Department of Industry and Information Technology of Shandong Province, and Four Other Departments on Issuing the Implementation Rules for the Management of Interest Subsidy and Guarantee Subsidy for Provincial-Level 'Special Loans for Technological Transformation'" (Lu Cai Gong [2022] No. 2), and other relevant documents, these Implementation Rules are hereby formulated.
Article 2 The Shandong Provincial Enterprise Technological Transformation Fiscal Equity Investment Fund (hereinafter referred to as the “Technological Transformation Fiscal Equity Investment Fund”) shall be allocated by the provincial finance department through the coordination of funds from the provincial budget and other sources.
Article 3 Fiscal equity investment projects for technological transformation shall focus on accelerating the transition between old and new growth drivers and promoting high-quality development. They shall concentrate on key areas of industrial transformation and development, supporting enterprises in carrying out high-level technological transformation and upgrading traditional industries.Priority support shall be given to enterprises’ ongoing technical transformation projects in sectors such as next-generation information technology, high-end equipment, advanced materials, high-end chemicals, pharmaceuticals, construction machinery, light industry, shipbuilding and offshore engineering equipment, new energy, textiles and apparel, and agricultural machinery. Priority shall also be given to national industrial infrastructure and high-quality manufacturing development projects, provincial-level key technical transformation projects, and initiatives designated for support by the provincial government.
Article 4: Fiscal equity investment funds for technological transformation shall be primarily directed toward enterprises undertaking major technological transformation projects, national industrial infrastructure and high-quality manufacturing development projects, major innovation and application projects in the digital economy, projects addressing key foundational elements, core technologies, and “bottleneck” weaknesses in key industrial chains, as well as projects identified by the provincial government that meet the conditions for equity investment.
Article 5: Fiscal equity investment for technical transformation shall be implemented through phased equity holdings and timely exits. Fiscal equity investments may take the form of common stock, preferred stock, or other forms, and may be carried out through participation in private placements by listed companies, equity investments in unlisted companies via agreements, or the establishment of project companies. The term of fiscal equity investment is generally 3 to 5 years.
Article 6: The investee enterprise must be registered within Shandong Province and have been in continuous operation for at least two years; it must have good development prospects, operate legally, and have no adverse credit history. In principle, it shall meet the following conditions: the enterprise’s average annual revenue over the past two years shall not be less than 100 million yuan, net profit shall not be less than 10 million yuan, and paid-in capital shall not be less than 20 million yuan; ongoing projects shall comply with industrial policies, and approval procedures (filing, land use, planning, etc.) shall conform to relevant regulations, with a total investment of 50 million yuan or more.
Article 7: When submitting an application for equity investment, the investee enterprise shall prepare an equity investment project application and, in accordance with the management authority and prescribed procedures for equity investment projects, submit it step-by-step to the Provincial Department of Industry and Information Technology for review. Provincial-level enterprises may submit applications directly to the Provincial Department of Industry and Information Technology. The investee enterprise shall be responsible for the authenticity, validity, and completeness of the project application materials.
Article 8: The exit from fiscal equity investments in technological transformation shall be achieved through equity transfer, repurchase by shareholders (enterprises), or liquidation and dissolution, in accordance with the terms of the equity investment agreement.
Article 9: The wishes of the investee enterprise shall be fully respected. Upon review and approval by the Provincial Department of Finance and the Provincial Department of Industry and Information Technology, concessions shall be granted based on the timing of early exit. Specifically, if the early exit occurs 2 years or more in advance, all investment returns from fiscal funds may be waived; if the early exit occurs 1 year or more in advance, the portion of investment returns from fiscal funds exceeding the one-year Loan Prime Rate (LPR) of the month prior to exit may be waived.
Article 10 Private funds are encouraged to participate concurrently in equity investments in the investee enterprises. If private funds participate in the investment, the investment term may be extended to 5 years.
Article 11: If a decision to provide fiscal equity investment support to an enterprise has already been issued and the enterprise subsequently declines the fiscal funds, it may not reapply for such support within two years.
Article 12: The fiscal equity investment support policy for technological transformation shall be implemented by entrusted management institutions under the guidance of the Provincial Department of Finance and the Provincial Department of Industry and Information Technology. The Provincial Department of Finance shall be responsible for the budgeting of equity investment funds, the review of expenditure policies, and budget performance management; it shall take the lead in formulating comprehensive management systems for equity investments and carry out the selection, assessment, and evaluation of entrusted management institutions;The Provincial Department of Industry and Information Technology shall take the lead in compiling and implementing the list of equity investment projects and the equity investment plan, carry out project application and reserve management, and participate in the assessment and evaluation of entrusted management agencies; entrusted management agencies shall be responsible for establishing project supervision and risk prevention mechanisms, actively assisting investee enterprises in resolving operational difficulties, and promoting the growth and strengthening of projects.
Article 13: Matters not covered herein shall be implemented in accordance with the relevant provisions of the “Notice of the Shandong Provincial Department of Finance on Further Improving the Reform Mechanism for Provincial-Level Fiscal Fund Equity Investments.”
Article 14 These Detailed Rules shall take effect from the date of issuance and remain valid until April 28, 2023.
