State Council Issues Guideline to Scale Up 77 Pilot Measures from Shanghai FTZ
Published 14 July 2025
Yu Du
On 3 July 2025, the State Council released the Notice on Scaling Up Pilot Measures in Free Trade Zones to Align with International High‑Standard Economic and Trade Rules and Promote High‑Level Systemic Openness (Notice). The document aims to extend successful institutional innovations from the Shanghai Free Trade Zone (FTZ) to other FTZs and nationwide, deepening reform and fostering high-quality development. A total of 77 pilot measures are being scaled up - 34 to be implemented in other FTZs, and 43 to be applied nationwide - spanning key areas such as services trade, goods trade, digital trade, intellectual property protection, government procurement reform, post-border regulation, and risk control.
Since its establishment in 2013, the Shanghai FTZ has served as a testing ground for market liberalization, financial opening, and administrative reform. China now operates 22 provincial-level FTZs, including in Guangdong, Tianjin, Fujian, and Jiangsu. These zones are designed to trial new policies aligned with international trade rules, enhance transparency, and create a globally competitive business environment. Through this Notice, the State Council calls for local authorities to tailor implementation of the pilot reforms to their regional conditions, prioritize measures urgently needed by businesses and the public, and unlock institutional benefits on a broader scale, ultimately advancing China’s high-level opening and deeper structural reform.
Key Pilot Measures Being Promoted
1. Digital RMB in Cross-Border Transactions
The Notice promotes broader use of the digital renminbi (RMB) in cross-border trade, such as for settlement and invoicing. This innovation enhances transaction efficiency, reduces reliance on third-party payment systems, and supports the internationalization of the RMB - an increasingly strategic goal in China’s digital trade agenda.
2. Centralized Capital Management for Multinationals
Measures to optimize centralized cross-border capital operations by multinational corporations are being extended to other FTZs. By allowing unified domestic and foreign currency accounts, these policies improve cash flow efficiency, reduce exchange costs, and enhance oversight of multinational capital movement - boosting China’s attractiveness for regional headquarters and global operations.
3. Negative List for Data Exports
A negative list approach to data export regulation, trialed in Shanghai, will be adopted more broadly. Under this framework, data exports are allowed unless explicitly restricted. This simplifies compliance, facilitates cross-border data flows, and aligns with global norms for digital governance and trade liberalization.
4. Electronic Trade Documentation
Digital trade tools such as electronic bills of lading and cargo manifests are being promoted beyond Shanghai. These streamline logistics, minimize human error, and reduce customs clearance times, modernizing China’s trade infrastructure in line with global supply chain digitization trends.
5. Cross-Border E‑Payments
To improve financial integration, measures to enable cross-border electronic payments and digital foreign currency transactions will be expanded. These reforms support faster, cheaper, and safer cross-border financial services, helping businesses scale internationally.
6. Recognition of Commercial Encryption Testing
A mechanism for mutual recognition of commercial cryptography testing and certification is being rolled out nationwide. This reduces duplicative testing requirements for domestic and foreign enterprises, supports tech innovation, and builds mutual trust in cybersecurity standards - critical for cross-border collaboration.
7. Certified Data Security Management
A national data security management certification scheme is being introduced to enhance regulatory compliance and establish consistent practices across industries. By formalizing a clear and verifiable standard, this certification builds international confidence in China’s digital governance framework.
8. Bilingual Government Procurement Reform
The government will digitalize and offer bilingual (Chinese–English) public procurement information, improving transparency and making it easier for foreign companies to access public tenders. This step levels the playing field for international bidders and reflects a broader push to align procurement practices with global standards.
Comment
This directive from the State Council marks a significant advance in China’s transition toward systemic, high-standard openness. By promoting mature reforms from Shanghai, ranging from digital RMB applications to data export regulation and transparent procurement, China is demonstrating a clear commitment to aligning its institutions with global economic norms. For foreign investors and multinational companies, these measures promise reduced compliance costs, streamlined access to markets, and more predictable operating conditions. As more FTZs adopt these tested innovations, China’s business environment will become more stable, open, and internationally integrated.
Since its establishment in 2013, the Shanghai FTZ has served as a testing ground for market liberalization, financial opening, and administrative reform. China now operates 22 provincial-level FTZs, including in Guangdong, Tianjin, Fujian, and Jiangsu. These zones are designed to trial new policies aligned with international trade rules, enhance transparency, and create a globally competitive business environment. Through this Notice, the State Council calls for local authorities to tailor implementation of the pilot reforms to their regional conditions, prioritize measures urgently needed by businesses and the public, and unlock institutional benefits on a broader scale, ultimately advancing China’s high-level opening and deeper structural reform.
Key Pilot Measures Being Promoted
1. Digital RMB in Cross-Border Transactions
The Notice promotes broader use of the digital renminbi (RMB) in cross-border trade, such as for settlement and invoicing. This innovation enhances transaction efficiency, reduces reliance on third-party payment systems, and supports the internationalization of the RMB - an increasingly strategic goal in China’s digital trade agenda.
2. Centralized Capital Management for Multinationals
Measures to optimize centralized cross-border capital operations by multinational corporations are being extended to other FTZs. By allowing unified domestic and foreign currency accounts, these policies improve cash flow efficiency, reduce exchange costs, and enhance oversight of multinational capital movement - boosting China’s attractiveness for regional headquarters and global operations.
3. Negative List for Data Exports
A negative list approach to data export regulation, trialed in Shanghai, will be adopted more broadly. Under this framework, data exports are allowed unless explicitly restricted. This simplifies compliance, facilitates cross-border data flows, and aligns with global norms for digital governance and trade liberalization.
4. Electronic Trade Documentation
Digital trade tools such as electronic bills of lading and cargo manifests are being promoted beyond Shanghai. These streamline logistics, minimize human error, and reduce customs clearance times, modernizing China’s trade infrastructure in line with global supply chain digitization trends.
5. Cross-Border E‑Payments
To improve financial integration, measures to enable cross-border electronic payments and digital foreign currency transactions will be expanded. These reforms support faster, cheaper, and safer cross-border financial services, helping businesses scale internationally.
6. Recognition of Commercial Encryption Testing
A mechanism for mutual recognition of commercial cryptography testing and certification is being rolled out nationwide. This reduces duplicative testing requirements for domestic and foreign enterprises, supports tech innovation, and builds mutual trust in cybersecurity standards - critical for cross-border collaboration.
7. Certified Data Security Management
A national data security management certification scheme is being introduced to enhance regulatory compliance and establish consistent practices across industries. By formalizing a clear and verifiable standard, this certification builds international confidence in China’s digital governance framework.
8. Bilingual Government Procurement Reform
The government will digitalize and offer bilingual (Chinese–English) public procurement information, improving transparency and making it easier for foreign companies to access public tenders. This step levels the playing field for international bidders and reflects a broader push to align procurement practices with global standards.
Comment
This directive from the State Council marks a significant advance in China’s transition toward systemic, high-standard openness. By promoting mature reforms from Shanghai, ranging from digital RMB applications to data export regulation and transparent procurement, China is demonstrating a clear commitment to aligning its institutions with global economic norms. For foreign investors and multinational companies, these measures promise reduced compliance costs, streamlined access to markets, and more predictable operating conditions. As more FTZs adopt these tested innovations, China’s business environment will become more stable, open, and internationally integrated.