Authors: King & Wood Mallesons, Linda Liang, Qiuyang Zhao
Jack, a US national, is a middle-level manager of a foreign-funded hotel management company and used to work in Tianjin. In 2004, the company set up a new hotel in Ningbo, Zhejiang and offered favorable subsidies to employees that were willing to accept position adjustment. Being attracted by the subsidies, Jack volunteered to work in Ningbo. At first, he was more than satisfied with his life there. However, he has become more and more regretful about that decision over the past two years.
It turns out that Tianjin has implemented a series of new policies on exit and entry facilitation since June 2017. Under the new policies, a foreigner may apply for permanent residence in China on the recommendation of the employer provided that he/she has worked in Tianjin for four consecutive years, lived in China for no less than six months a year, had stable living guarantee and residence, and had annual pretax salary of more than RMB 400,000 with individual income tax of more than RMB 80,000 paid each year for four consecutive years. The foreigner’s foreign spouse and minor children may apply for permanent residence together with him/her. Jack used to meet these conditions, but now he can only watch his colleagues in Tianjin get China’s “green cards” one after another while he still needs to spend one month every two years to prepare materials for a new residence permit.
Now, Jack’s regret can finally be erased. On July 17 of this year, the Ministry of Public Security held a press conference in Beijing, announcing that 12 policies on immigration and exit-entry facilitation that had been piloted in some areas of 16 provinces and cities would be promoted and implemented nationwide from August 1. One of the policies is what Jack has been longing for: a foreigner may apply for permanent residence if he/she meets the standards of job, period of residency, salary, and tax.
It might not be understandable to the readers how remarkably such new policies on residence may touch a foreigner’s heartstring. Nonetheless, Jack’s concern for the new policies is anything but a fuss. It is said that “China’s green card” is the green card most difficult to get around the world and maybe such description is not exaggeration. The number of green card issued by China and US is not of the same magnitude. According to Annual Report on Chinese International Migration, China issued about 10,000 green cards from 2004 (when “China’s green card” was firstly issued) to 2016 and 1,576 of them were issued in 2016. According to the United States Department of Homeland Security, the US issued about 14 million green cards from 2004 to 2016. In 2016 alone, US issued 1.18 million green cards. Even considering the difference in number of foreign residents between China and the US (a report published by United Nations in July 2017 indicates that there were about 1 million foreign, Hong Kong, Macao, and Taiwan residents in Mainland China while there were approximately 49.8 million foreigners in the US), there’s still a huge difference in proportion of green card issued to foreign residents between the two countries.
Thus, under the 12 new policies, who are the foreigners that will be eligible to apply for “China’s green cards”? What are the other “benefits” that the new policies offer to foreigners in addition to “green cards”?
1. Who Can Apply for Permanent Residence?
According to regulations in the past, there were four types of foreigners that could apply for permanent residence (the so-called “China’s green card”): application through employment, investment, special contribution and turning to their relatives. An employment-type applicant must meet certain requirements regarding the employer type and position level. Specifically, the applicant shall hold a position in entities such as the State Council or people’s government at the provincial level, a key university or college, or a high-tech enterprise. In addition, the applicant shall hold the position of a deputy general manager, factory deputy director or above, or of an associate senior title or above, or enjoy an equal treatment with the aforementioned positions. An applicant of special-contribution-type shall have made a great and outstanding contribution to and being specially needed by China. The basketball star Marbury has obtained a “China’s green card” exactly through this channel.
The new policies have lowered the threshold for applicants of employment and special contribution types, granting eligibility for application to the following three categories of foreigners: 1) high-level foreign talents; 2) foreigners working in China who have worked for four consecutive years, lived in China for no less than six months a year, had annual salary no less than six times the local average salary of urban employees of the place where they are located in the preceding year and paid annual individual income tax of more than 20 percent of their annual salary; 3) Chinese of foreign nationality who have obtained a doctoral degree or who have worked in national key development areas in China for at least four consecutive years and lived in China for at least six months a year.
Among the three new categories, the second and third categories broaden the scope of employment-type applicant, covering a relatively wide range of people.
The inclusion of the second category of talents has struck down the previous requirements regarding the employer type and position level for an employment-type applicant, making the introduction of foreign talents more suitable for market evaluation and demand. A foreigner who holds a position in an ordinary company without a senior title or a senior leadership position may also apply for permanent residence ever since.
The recognition of the third category of talents specifically requires the identity of Chinese of foreign nationality. Compared with other foreigners, Chinese of foreign nationality can be subject to much less rigorous requirements: a Chinese of foreign nationality only needs to have obtained a doctoral degree or meet the requirement of job, period of residency, and location without earning high salary or paying high tax. The “national key development areas” specified in the requirement are yet to be clarified. However, with reference to the scope of pilot areas, key development areas should generally include free trade zones, national independent innovation demonstration zones, comprehensive innovation reform demonstration zones, and state-level new zones.
The first category of talents can be regarded as an extension of the special-contribution-type applicant, covering a scope of people narrower than the second and third categories. At present, the standards of each place for recognition of “high-level foreign talents” are generally similar with slight differences. In general, high-level foreign talents can be divided into four groups: 1) well-known award winners or finalists of recruitment program of high-level talents; 2) well-known experts and scholars; 3) outstanding talents and professional talents in enterprises; 4) other special talents with special expertise and urgently needed due to local talent shortage. The so-called “outstanding talents and professional talents in enterprises” mainly refer to senior managerial talents, technical talents and scientific research backbones etc. in state-owned enterprises, high-tech enterprises, multinational corporations, certain types of foreign-funded enterprises and other enterprises with greater scale (higher quota) in practice.
2. Who Can Apply For a Work-Type Residence Permit with 5-year Validity at Maximum?
In addition to the relaxation of restrictions on application of “China’s green card”, the new policies also provide more opportunities for foreigners working in China to apply for a “green-card-to-be”: a five-year residence permit.
In the past, rules on application conditions for a work-type residence permit were stated in the Working Rules for the Issuance of Visas for Foreigners. According to the Working Rules, only high-level foreign talents, urgently needed professionals in shortage and investors may apply for a work-type residence permit with 5 years’ validity at maximum. An ordinary foreigner can only apply for a work-type residence permit valid for 1 year or 2 years at maximum. The Ministry of Public Security issued residence facilitation policies specifically for Chinese of foreign nationality in February 2018. Chinese of foreign nationality working in China may also apply for a residence permit with 5 years’ validity at maximum since then.
According to the new policies, there are 5 additional types of foreigners that are eligible to apply for a work-type residence permit with 5 years’ validity at maximum: 1) well-known professionals and scholars invited by key domestic universities or colleges, scientific research institutes and well-known enterprises, and high-level foreign managerial and professional talents recognized by relevant departments of the people’s government at or above the level of a districted city; 2) foreign talents and members of innovative and entrepreneurial teams introduced by national key development fields or industries; 3) foreign members and research support personnel recommended by and from the working team of a foreigner with a great and outstanding contribution and specially needed by China; 4) foreigners who have applied for a over one-year work-type residence permit for two consecutive times without any violation of laws and regulations and apply for a work-type residence permit for the third time; 5) outstanding foreign students who have obtained a bachelor’s degree or above from key domestic universities or colleges and engage in innovative and entrepreneurial activities in China after graduation.
Among the five types, the fourth one covers the widest range of people. In practice, it is not difficult to obtain an over one-year work-type residence permit. Therefore, a foreigner working in China who has applied for a work-type residence permit for two consecutive times can basically apply for a five-year work-type residence permit in his/her next application regardless of diploma, income, job and period of residence.
The recognition of the first three types of talents may involve multiple factors and the recognition standards may be subject to specific local regulations. For example, in the practice of pilot areas, the rules related to “members of innovative and entrepreneurial teams” require not only that the applicant participates in innovative and entrepreneurial activities, but the applicant works in emerging industries of strategic importance while holding a position at middle or senior level in an enterprise or holding over 5% shares.
3. Residence Permits, Visas, and Other Facilitation Policies for Foreign Students
Apart from people with jobs, the new policies specially benefit foreign students in terms of visas and residence permits.
Firstly, the new policies benefit foreign students from overseas universities and colleges who seek internship in China. A foreign student from an overseas university or college invited by well-known domestic enterprises and institutions to take an internship in China may apply for a visa with one-year validity. A foreign student from an overseas university or college who takes an internship in China based on intergovernmental agreement may apply for a work-type residence permit.
Secondly, the new policies encourage foreign students to launch innovative and entrepreneurial activities in China. A foreign student graduating from an internationally well-known university or college who engages in innovative and entrepreneurial activities in China within 2 years after graduation may apply for a residence permit with two-year validity at maximum. An outstanding foreign student graduating from a key domestic university or college with a bachelor’s degree or above who engages in innovative and entrepreneurial activities in China after graduation may apply for a residence permit with validity of 2 to 5 years.
Moreover, the new policies strike down the restrictions on foreigners’ part-time jobs for the first time, making it possible for high-level foreign talents who hold a position in key domestic universities, scientific research institutes and well-known enterprises to engage in innovative and entrepreneurial activities as a part-time job. The new policies also allow foreigners working in China who have obtained a work permit without going abroad for work visa application to apply for a work-type residence permit directly. The new policies also propose to establish immigration affair service centers in foreigner-populated areas to offer legal aid, language and culture service for resident foreigners.
4. Conclusions and Suggestions
Under the new policies, high-level foreign talents and Chinese of foreign nationality are treated favorably, and foreign students and ordinary foreigners working in China also benefit from it. For employers, the new policies can trigger foreigners’ enthusiasm to work in China while facilitating employers’ recruitment of interns from abroad. The new policies also strike down the requirements of employer type for employment-type applicants, making it possible for ordinary enterprises to compete equally with government sectors and high-tech enterprises in the talent market.
Since the new policies list very general standards about the recognition of different types of talents, employers and foreign employees are expected to pay further attention to specific local regulations in the future. Meanwhile, the new policies are not a simple duplicate of the old ones, but a summary and adjustment of the policies of pilot areas. Therefore, even employers and foreign employees in pilot areas should also pay attention to the differences between the new policies and local pilot policies and keep track of future changes of local policies.