Accelerating the Opening-up of the Service Sector: China's High-Level Opening-up as Seen Through Shanghai's Experience

At a recent press briefing held in Shanghai on the expansion of high-level opening-up, relevant officials from the Shanghai municipal government stated that openness is Shanghai’s greatest strength. In accordance with central government directives and with the strong support of relevant national ministries and commissions, Shanghai is continuing to expand its high-level opening-up, guided by major national strategies. Shanghai will promote the implementation of more projects in new areas of opening-up and strive to create a world-class business environment.

It was reported that Shanghai will introduce new opening-up measures in multiple sectors this year: in cross-border trade, it will launch a special campaign to facilitate cross-border trade, deepen innovation in customs clearance and supervision models, and support the scaling up of new business models such as cross-border e-commerce and bonded maintenance; in financial opening-up, it will advance cross-border and offshore financial services, and support eligible foreign financial institutions in applying for qualifications such as personal pension schemes and government bond futures trading; Regarding foreign investment, departments including the Municipal Development and Reform Commission and the Municipal Commission of Commerce have issued the “Several Measures of Shanghai Municipality to Encourage Domestic Reinvestment by Foreign-Invested Enterprises”.

Following the removal of all prohibitive items in the manufacturing sector from the negative list for market access to foreign investment, the service sector has become a key area for China’s expansion of openness. Among these, value-added telecommunications services are one of the areas attracting significant attention from foreign-invested enterprises. According to relevant officials in Shanghai, 26 foreign-invested enterprises have already obtained licences for value-added telecommunications services. In October 2024, Shanghai was approved as the first pilot zone for the expansion of opening-up in value-added telecommunications services, permitting foreign-invested enterprises to operate, either wholly-owned or as controlling shareholders, businesses such as Internet Data Centres (IDCs), Content Delivery Networks (CDNs), Internet Service Providers (ISPs), Electronic Data Interchange (EDI) and Internet Content Providers (ICPs) within the Lingang New Area of the China (Shanghai) Pilot Free Trade Zone and Pudong New Area. The aforementioned 26 licensed enterprises represent the tangible outcomes of this pilot scheme.

Judging by the business focus of the licensed enterprises, their operations primarily fall into the following categories:

• In the area of Internet Content Provider (ICP) services, HSBC FinTech has been approved to provide financial knowledge information services; Siemens Healthineers has leveraged its qualifications to establish a digital knowledge service platform, offering training courses for grassroots doctors;

• In the area of Internet Data Centres (IDC), IBM has been approved to provide data centre hosting and cloud services, supporting the digital transformation and global expansion of local enterprises;

• In the area of Electronic Data Interchange (EDI), Rongshu Information has developed user engagement solutions centred on retail banking customers, including loyalty point redemption and marketing campaigns;

In addition, other enterprises are utilising relevant licences to conduct business in areas such as human resources services and cross-border supply chain finance. The above cases span multiple sectors including fintech, digital health, supply chain services and internet data centres, reflecting the practical business explorations of foreign-invested enterprises under different licence types.

From a national policy perspective, the 2026 Government Work Report proposed “further expanding high-level opening-up”, specifying that “market access and areas of opening-up will be expanded with a focus on the service sector, and pilot schemes for opening-up in areas such as value-added telecommunications, biotechnology and wholly foreign-owned hospitals will be further expanded”. “ The 15th Five-Year Plan outlines the need to “promote the orderly expansion of opening-up in sectors such as telecommunications, the internet, education, culture and healthcare, and to prudently implement pilot schemes for opening-up in areas such as value-added telecommunications, biotechnology and wholly foreign-owned hospitals”. This implies that the opening-up of value-added telecommunications services will continue to advance, with the scope of pilot schemes expected to extend to more regions.

As a professional organisation with a long-standing focus on policies and markets within the value-added telecommunications sector, we will continue to monitor developments regarding foreign enterprises’ participation in the opening-up of China’s value-added telecommunications services. We welcome your continued interest.

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