Chapter V Research and Development Institutions

Article 48 The state makes overall planning for the development of R&D institutions, and improves the R&D systems.

The state builds national laboratories in major scientific and technological fields that have an overall bearing on national security as well as economic and social development, establishes a laboratory system led by national laboratories and supported by national key laboratories, and improves the support mechanism to ensure stable funding.

R&D institutions established with fiscal funds shall focus on serving national strategic needs, and provide supply of public benefit-related technologies and technological support for emergency response.

Article 49 Natural persons, legal persons and unincorporated organizations have the right to establish R&D institutions according to law. Overseas organizations or individuals may set up R&D institutions in China according to law, independently or together with organizations or individuals in China.

R&D institutions engaged in basic research, frontier technology research and public benefit-related technology research may be established with fiscal funds. The layout of such institutions established with fiscal funds shall be improved to avoid duplication.

R&D institutions and institutions of higher education may set up post-doctoral mobile stations or workstations. R&D institutions may set up branches abroad according to law.

Article 50 R&D institutions shall enjoy the following rights:

(1) organizing or participating in academic activities according to law;

(2) in accordance with relevant regulations of the state, independently identifying R&D priorities and projects, and independently deciding internal management affairs such as the use of funds, institutional setup, performance assessment and remuneration, academic titles, commercialization of R&D results and distribution of the proceeds, posts, as well as personnel recruitment and mobility;

(3) jointly carrying out activities such as R&D, technological consultation and technological services with other R&D institutions, institutions of higher education and enterprises;

(4) receiving donations and obtaining funding; and

(5) other rights provided by laws and administrative regulations.

Article 51 R&D institutions shall formulate their articles of association according to law, and carry out activities in accordance with the functions and business scope specified therein. They shall improve their research integrity and conduct, establish a management system for research integrity and scientific ethics, and abide by the code of conduct for research activities. They shall not organize, participate in or support superstitious activities.

R&D institutions established with fiscal funds shall serve national goals and public interests. Where conditions permit, they shall open their science popularization venues or facilities, and organize science popularization activities.

Article 52 R&D institutions established with fiscal funds shall establish a modern management system characterized by clearly defined responsibilities, appropriate assessment methods, openness and orderliness, and rule-based management. They shall implement a system of presidents or directors assuming full responsibilities, establish a science and technology committee-based consultation system and a staff congress-based supervision system, invite external experts to participate in the management, and accept public oversight. The presidents or directors shall be recruited through competition.

Article 53 The state improves the evaluation system for R&D institutions established with fiscal funds. The evaluation results shall be used as the basis for the establishment, support, adjustment and termination of such institutions.

Article 54 R&D institutions established with fiscal funds shall establish and improve a resource sharing mechanism to promote effective use of scientific and technological resources.

The state encourages R&D institutions established by non-governmental sector to share their scientific and technological resources within a reasonable scope.

Article 55 The state encourages enterprises and other entities in the non-governmental sector to set up R&D institutions on their own, and  protects the legitimate rights and interests of such institutions.

R&D institutions established by non-governmental sector have the right to equally compete for and participate in projects fiscally funded through scientific and technological programs in accordance with relevant regulations of the state.

The state improves the preferential tax regime for non-profit R&D institutions established by non-governmental sector.

Article 56 The state supports the establishment of new forms of innovation actors such as novel R&D institutions, improves the development model to ensure diversified sources of investment, a modern management system, market-based operation and flexible employment, and guides such innovation actors to focus on scientific research, technological innovation and R&D services.

Chapter VI Scientific and Technological Personnel

Article 57 The state fosters a social environment that respects and values talent, an institutional environment that is fair, equitable and competitive, and a living environment that offers appropriate remuneration and strong support. This way, the state creates favorable conditions that allow scientific and technological personnel to devote themselves to research.

The state highlights the importance of scientific and technological personnel, and takes multiple measures to foster professionals, support their involvement in innovation and research, and tap their full potential. Unfair treatment of scientific and technological personnel and their R&D results in any form is prohibited.

Article 58 The state accelerates the cultivation of talent of strategic importance. The state optimizes the structure of scientific and technological personnel, improves the mechanisms for cultivating, identifying, recruiting, using and assessing innovators, such as strategic scientists and leading scientists, and supports them with special policies on career progression, research conditions and management mechanisms.

Article 59 The state improves the mechanisms for educating and training innovative personnel, making more effort to stimulate scientific curiosity in basic education, cultivating technological personnel through vocational education, providing more resources to higher education to foster innovators, and increasing the reserve of strategic scientific and technological personnel.

Article 60 Governments at all levels, enterprises, public institutions, and social organizations shall improve the remuneration mechanism to reflect the value of innovation elements such as knowledge and technology, optimize the salary structure, and establish a regular pay rise mechanism, to raise the income of scientific and technological personnel. Generous benefits and relevant honors shall be awarded to scientific and technological personnel with outstanding contributions.

Scientific and technological personnel of R&D institutions established with fiscal funds and institutions of higher education may engage in part-time work and receive lawful income with the consent of their employers, on the premise that they have performed due obligations and completed their own tasks and that there is no conflict of interest. The rewards and payment for activities including technological development, consultation and services shall be granted in accordance with relevant regulations on the commercialization of R&D results.

The state encourages R&D institutions, institutions of higher education, and enterprises to incentivize scientific and technological personnel by means of equity, stock option and dividend schemes.

Article 61 Governments at all levels, enterprises and public institutions shall guarantee the right of scientific and technological personnel to receive continuing education, and create conditions for the rational, unimpeded and orderly mobility of scientific and technological personnel to fully tap their expertise.

Article 62 Scientific and technological personnel may choose their employers, compete for posts, and obtain corresponding positions or academic titles according to their academic achievements and professional competency.

Scientific and technological personnel shall abide by their commitments, fulfill their responsibilities, and complete the duties called for by their positions or academic titles.

Article 63 The state implements a categorized assessment system for scientific and technological personnel, under which different standards and methods shall be adopted to assess the performance of personnel engaged in different scientific and technological activities by highlighting their innovation value, ability and contribution and by reasonably determining the remuneration package, allocating academic resources, and setting the assessment cycle. This way, the state forms an assessment system that allows scientific and technological personnel to devote themselves to research and innovation and bring about their creativity.

Article 64 Relevant administrative departments of science and technology, enterprises, and public institutions shall improve the management system for scientific and technological personnel, enhance service awareness and capacity, optimize the management process, avoid repeated inspections and evaluations, and ensure that scientific and technological personnel have sufficient time to engage in research instead of being overburdened with project application, document submission and cost reimbursement.

Article 65 For scientific and technological personnel working in hardship and remote areas or in harsh and dangerous environments, their employers shall pay them subsidies in accordance with relevant regulations of the state, provide occupational health and safety services necessary for their posts or workplaces, and create conditions for their continuing education and training.

Article 66 Young, ethnic minority, and female scientific and technological personnel enjoy equal rights to compete for professional positions, participate in science and technology assessment, undertake R&D projects, and receive continuing education. Scientific and technological personnel in their senior years shall be encouraged to play an active role in promoting scientific and technological progress.

Governments at all levels, enterprises and public institutions shall create conditions for the growth of young scientific and technological personnel, and encourage them to explore and reach their full potential. The identification, training and use of young scientific and technological personnel shall be an important factor in the assessment of the work for scientific and technological progress.

Governments at all levels, enterprises and public institutions shall improve the mechanism for training, assessing and incentivizing  female scientific and technological personnel, provide care for those in their maternity period, and encourage them to play a greater role in promoting scientific and technological progress.

Article 67 Scientific and technological personnel shall firmly maintain the spirits of Chinese scientists, which are patriotism, innovation, truth-seeking, dedication, teamwork, and enthusiasm for fostering young talent. They shall adhere to the craftsmanship spirit, be devoted to their work, abide by the code of academic, ethical and professional conduct, and stay honest and trustworthy. They shall not engage in research misconduct, or participate in or support superstitious activities.

Article 68 The state encourages scientific and technological personnel to engage in free exploration and take risks with courage, and creates an atmosphere that promotes innovation and tolerates failure. If the original records prove that the scientific and technological personnel who undertook exploratory and high-risk projects have exercised due diligence but are still unable to complete the projects, they shall be exempted from responsibility.

Article 69 The records of research integrity of scientific and technological personnel shall serve as an important basis for promotion to professional positions, conferment of professional titles, review of project proposals, and awarding of scientific and technological prizes.

Article 70 Scientific and technological personnel have the right to establish or participate in science and technology societies according to law.

Science and technology associations and societies shall facilitate academic exchanges, advance the development of disciplines, promote research and innovation, popularize science and technology, train personnel with expertise, provide consulting services, strengthen the self-discipline of scientific and technological personnel, and safeguard the legitimate rights and interests of scientific and technological personnel in accordance with their articles of association.

The legitimate rights and interests of science and technology associations and societies are protected by law.

Chapter VII Regional Innovation

Article 71 The state makes overall planning for the regional distribution of scientific and technological resources, aligns national resources with local development needs, and adopts multiple ways to support regional innovation.

Article 72 Governments at or above the county level shall support R&D, create conditions for commercialization of R&D results, and provide a favorable innovation environment for regional innovation-driven development.

Article 73 Scientific and technological programs related to industrial development as formulated by the governments at or above the county level and their relevant administrative departments shall reflect the needs of industrial development.

Enterprises shall be encouraged to equally compete for and participate in projects under the scientific and technological programs formulated by governments at or above the county level and their relevant administrative departments. Enterprises, R&D institutions, and institutions of higher education shall be encouraged to jointly implement projects that meet the needs of industrial development and have a clear market potential.

The implementation of major local scientific and technological programs shall be aligned with the deployment of major national tasks.

Article 74 The State Council may approve the establishment of national high-tech industry development zones, national innovation demonstration zones, and other scientific and technological parks as appropriate. The State Council shall provide guidance and support in the development of such zones and parks, and enable their distinctive features and advantages to produce agglomeration and demonstration effects.

Article 75 The state encourages governments at or above the county level with necessary conditions to develop major innovation bases and platforms, establish platforms for innovation and entrepreneurship, and build regional innovation hubs according to the national development strategy and local development needs.

The state supports the development of science, technology and innovation centers and comprehensive science centers in regions with necessary conditions, and enables such centers to function as locomotives of regional innovation, pioneers of institutional reform, and players in global cooperation.

Article 76 The state establishes a mechanism for regional innovation cooperation and mutual assistance, and encourages local governments at all levels and their relevant administrative departments to carry out cross-regional innovation cooperation, and promote the rational flow and efficient concentration of innovation factors.

Article 77 Major regions of national strategic importance may rely on regional innovation platforms to establish a benefit sharing mechanism, to facilitate the free flow of factors such as talent, technology and capital, promote the sharing of scientific instruments, equipment and infrastructure as well as scientific, engineering and technological information resources, and to improve the efficiency of regional commercialization.

Article 78 The state encourages local governments to explore regional innovation models. Local governments shall respect the inherent laws of regional concentration of innovation factors, and choose an innovation path based on regional characteristics.

Chapter VIII International Scientific and Technological Cooperation

Article 79 The state promotes open, inclusive, and mutually beneficial international cooperation and exchanges on science and technology to support the building of a community with a shared future for humanity.

Article 80 The government of the People’s Republic of China shall develop scientific and technological cooperation and exchanges with foreign governments and international organizations.

The state encourages innovators such as R&D institutions, institutions of higher education, science and technology societies, enterprises, and scientific and technological personnel to carry out international cooperation and exchanges, actively participate in scientific research, and promote the flow of international scientific and technological resources, so as to pursue scientific and technological openness and cooperation at a higher level and promote scientific and technological progress of the world.

Article 81 The state encourages enterprises, public institutions, and social organizations to build platforms and provide services for international science, technology and innovation cooperation through various channels.

The state encourages enterprises, public institutions, social organizations, and scientific and technological personnel to participate in or found international organizations of science and technology to enhance international cooperation and exchanges.

Article 82 The state uses multiple ways to support outstanding scientific and technological personnel at home and abroad in collaborative R&D to meet the common challenges of humanity and explore the frontiers of science.

The state supports R&D institutions, institutions of higher education, enterprises, and scientific and technological personnel in participating in or initiating international mega-science programs and projects.

The state improves the mechanisms for the protection of intellectual property rights and for the review of scientific and technological ethics and security in international research cooperation.

Article 83 The state increases the openness of scientific and technological programs to international cooperation, encourages foreign-funded enterprises and foreign scientific and technological personnel in China to undertake and participate in projects under scientific and technological programs, and improves the mechanism for overseas scientific and technological personnel to participate in such projects.

Article 84 The state improves relevant social services and support measures, to encourage Chinese scientific and technological personnel working abroad to return to China and attract foreign scientific and technological personnel to engage in R&D in China.

R&D institutions and other scientific and technological organizations may employ overseas scientific and technological personnel according to their needs. R&D institutions established with fiscal funds and institutions of higher education that employ overseas scientific and technological personnel to engage in R&D shall provide convenience for their work and life.

Outstanding foreign scientific and technological personnel who are engaged in R&D in China may obtain permanent residency in China or Chinese nationality on a priority basis in accordance with relevant regulations of the state.

Chapter IX Support Measures

Article 85 The state increases funding from fiscal revenue, and formulates policies in areas such as industrial development, finance, taxation, and government procurement to encourage and guide private capital investment, in order to ensure the sustained and steady growth of the gross domestic expenditure on R&D.

Article 86 The state gradually raises the overall level of investment in science and technology. The state’s fiscal investment in science and technology shall increase faster than the growth rate of the state’s regular revenue. The gross domestic expenditure on R&D shall account for an appropriate proportion of the GDP, and shall gradually increase.

Article 87 Fiscal funds for science and technology shall be mainly used for the following matters:

(1) development of basic conditions and facilities for R&D;

(2) basic research and advanced interdisciplinary research;

(3) frontier technology research, public benefit-related technology research, and key general-purpose technology research, which have strategic, fundamental and forward-looking impacts on economic and social development;

(4) application of key general-purpose technologies, and demonstrative application of high-tech in industries;

(5) R&D related to ecological environment and people’s life and health, as well as the wide application of the results of such R&D;

(6) R&D of new crop varieties and agricultural technologies, and the wide application of the results of such R&D;

(7) cultivation, attraction and use of scientific and technological personnel; and

(8) science popularization.

The state provides R&D institutions established with fiscal funds with support in funding, means for experiments, and other aspects.

Article 88 National scientific and technological programs shall be established in accordance with national needs. They shall focus on major national strategic tasks, and follow the inherent laws of research, innovation and commercialization.

The state enhances professional management of scientific and technological programs by establishing a coordination mechanism and a performance evaluation system.

Article 89 The state sets up funds to support small and medium-sized enterprises in technological innovation and the commercialization of their innovation results.

When necessary, the state may set up other non-profit funds that support basic research, public benefit-related technology research and international joint research, to finance scientific and technological progress.

Article 90 Entities and individuals that engage in the following activities are entitled to preferential tax treatment in accordance with relevant regulations of the state:

(1) technological development, transfer, licensing, consultation and services;

(2) import of products for R&D or science popularization which are not available in China or where the performance of domestic products do not meet the needs;

(3) import of key equipment, raw materials, spare parts and components that are not available in China, for the implementation of major national scientific and technological projects or major projects under national scientific and technological programs;

(4) science popularization activities organized by science popularization centers and bases that are open to the public;

(5) donations for scientific and technological activities; and

(6) other R&D and commercialization activities specified by laws and relevant regulations of the state.

Article 91 In government procurement, if the function, quality and other indicators of innovative products and services produced by natural persons, legal persons and unincorporated organizations in China meet the needs, such products and services shall be procured.  If  such products and services are marketed for the first time, the government shall be the first buyer, and shall not restrict the procurement on the ground of commercial performance.

If the products needed by the government are yet to be developed, the procurement shall proceed through ordering. The procurer shall select, mainly through competition mechanism, R&D institutions, institutions of higher education or enterprises for the development of such products, and make purchase according to the agreement after qualified products are developed.

Article 92 The state encourages financial institutions to provide financing secured with intellectual property, and encourages and guides financial institutions to support the commercialization of R&D results and the development of high-tech industries when issuing credit and making investment. The state encourages insurance institutions to develop insurance products according to the needs of high-tech industries to promote the application of new technologies.

Article 93 The state integrates and sets up national research and experiment bases under the principle of “overall planning and optimal structure”.

The state encourages the establishment of comprehensive experiment service institutions that can either provide, or entrust others to provide experiment services for R&D institutions, institutions of higher education, enterprises, and scientific and technological personnel.

Article 94  The state, in light of the needs for scientific and technological progress, coordinates the purchase of large scientific instruments and equipment under the principles of “overall planning, open access, optimized resource allocation, comprehensive integration, leadership by government, and multi-stakeholders”. Joint appraisal shall be carried out as to instruments and equipment purchased mainly with fiscal funds.

Article 95 The state strengthens the development of academic journals, improves the exchange mechanisms for research papers and scientific and technological information, promotes open science, and facilitates scientific and technological exchanges and dissemination.

Article 96 The state encourages organizations and individuals at home and abroad to fund R&D and science popularization by donating property or setting up scientific and technological funds.

Article 97 In the process of making pioneering efforts in science and technology management reform, R&D, and commercialization of R&D results, the leading persons of R&D institutions established with fiscal funds, institutions of higher education and enterprises shall be exempted from responsibility for mistakes or inaccurate decisions, provided that they have exercised due diligence, and fulfilled due responsibility for supervision and management, and have not sought illegal benefits.