Foreign R&D centers strong endorsement of Shanghai's supporting actions
Shanghai has been working on supporting laws and convenient measures for foreign-funded R&D facilities here.
These policies and measures include customs clearance facilitation for cross-border R&D, talent acquisition and development, entry and exit, and stay and residence facilitation.
The foreign-funded R&D centers are also considered a "technologically advanced service enterprise" and may be eligible for preferential corporate income tax rates.
Shanghai Daily spoke to representatives of R&D centers from Herbalife, Carrier, and Henkel to learn about their recent initiatives, strategies, and achievements.
Herbalife's Product Innovation Center not only supports the company's R&D in product packaging in the Asia-Pacific, Brazilian, and European markets, but also provides research, development, and other services to the Asia-Pacific region.
In February 2024, Herbalife's Product Innovation Center, a global nutrition leader, was awarded the certificate of "Foreign-Funded R&D Center in Shanghai" and will be eligible for a number of local government introduced measures.
The Product Innovation Center has already established itself as Herbalife's innovation powerhouse. Since 2022, it has supported Herbalife's R&D in product packaging in the Asia-Pacific, Brazilian, and European markets, contributing significantly to the company's global growth.
Since June of this year, the center has been providing research, development, and other services to the Asia-Pacific region.
The US nutrition giant said that Shanghai excels in government transparency and openness.
The city provides robust legal safeguards for the long-term growth of enterprises that invest in Shanghai. The city boasts modern infrastructure and a broad industrial support system. Shanghai also has a strong industrial structure and a significant market size.
The center has helped Herbalife launch over 40 new products in China in the last four years, including DHA gummies and portable shakes for young people.
In 2023 and 2024, the center's product packaging design earned four international design prizes, eight domestic industry awards, and 11 patents.
Henkel's Asia Pacific and China headquarters in Yangpu District. Last year, the company was awarded commemorative plaques for rooting in Shanghai for 20 years.
Likewise, multinational chemical and consumer goods company Henkel established an R&D center for its Adhesive Technologies business in Zhangjiang as early as 2013 to strengthen its innovation capabilities in China.
Henkel announced in 2021 that it would transform the Zhangjiang R&D center into the Shanghai Inspiration Center (ICS) for China and Asia-Pacific. Henkel invested 500 million yuan (US$702,600) in the Zhangjiang R&D center, reflecting its commitment to the region and drive for innovation.
With a floor area of 33,000 square meters, the ICS will accommodate more than 30 labs and a 300-square-meter customer service center. More than 500 Henkel experts and scientists work in the center and collaborate across departments to develop new technologies that support all Henkel Adhesive Technologies business and service areas.
"Shanghai is a dynamic hub for innovation and business growth," said Anna An, president of Henkel China. "The city offers a strong technological environment, high-end talent from across the world, and a favorable business environment.”
Notably, the center has already achieved some new research results via its cutting-edge technology. For example, Teroson flame retardant coating, designed for the underbody of electric vehicles, addresses fire risks associated with high-energy batteries, offering exceptional protection by withstanding temperatures exceeding 1,000 degrees Celsius with a minimal thickness of just 1 mm, making it ideal for the electric vehicle market to protect drivers and passengers in emergencies.
Carrier's decision to open its fourth innovation incubator, the i3 Lab, in Shanghai is a vote of confidence in the city's dynamic and competitive economic environment.
"Shanghai, being an international metropolis with robust infrastructure and a favorable business environment, also stands out as a hub for technology and innovation," said Yuhui Kuang, head and technical director of Carrier Shanghai R&D Center.
"The government agencies at all levels in Shanghai are well-known for their high efficiency, and the support from the Shanghai government played a significant role in our decision-making process," said Kuang. "The talent pool in Shanghai has also provided strong support and fertile soil for innovation and excellence. The Carrier R&D center has more than 400 employees, approximately 60 percent of whom hold a master's or doctorate degree."
Carrier has a long history in Shanghai and China, dating back to the 1980s, when it was one of the first multinational air conditioning manufacturers to establish operations in the country. As Shanghai and Pudong developed, the Carrier R&D Center grew alongside them. Carrier Shanghai R&D Center is one of the company's key global R&D centers, supporting Carrier's worldwide business needs.
"The city provides numerous advantages for foreign investors, including a streamlined legal framework that offers greater parity with local investors and an updated list of industries encouraging foreign investment. These measures enhance intellectual property protection and contribute to a more open, transparent, and accessible business environment for foreign investment," Kuang said.
Carrier chose to open its fourth innovation incubator, the i3 (“imagine-innovate-ignite”) Lab, in Shanghai because of the city's dynamic and competitive economic environment, which reflects its confidence in the Chinese market.
The Shanghai i3 Lab aims to harness the innovative ideas of all employees, address customer opportunities, and rapidly develop and validate technologies and business models through a 100-day incubation process. The ideas focus on incorporating advanced digital technologies to create differentiated solutions and high-value business plans.
These R&D centers also consider the needs of Chinese customers.
"Shanghai is not just an important market; it is also a source of advanced technology and innovative solutions," Kuang said.
The products that especially cater to the Chinese market for Henkel are Loctite Ablestik ABP 6395T, a high-performance adhesive designed for power semiconductor applications. This adhesive offers excellent thermal conductivity without sintering while maintaining low electrical resistance, making it an ideal choice for China's rapidly growing electronics and semiconductor industries.
Similarly, Herbalife is committed to quickly transforming cutting-edge scientific and technological achievements in nutrition science into health products and quickly pushing forward the launch of new products suitable for Chinese consumers.
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