Published by ChinaMNC · Dangshan

China’s New Push to Integrate Tech Innovation With Industry: What Foreign Founders Should Know

A practical summary for foreign founders of China’s official opinion on integrating scientific and technological innovation with industrial innovation, covering enterprise-led R&D, technology transfer, financing, talent, and local pilots.

Overview

China’s central authorities have issued an opinion on deepening the integration of scientific and technological innovation with industrial innovation. For foreign founders building or operating a company in China, the document signals how policy will prioritize enterprise-led research, faster commercialization, and closer coordination among companies, universities, research institutes, and financial institutions. The stated goal is to create a new pattern in which technological advances and industrial development reinforce each other, moving from strength in science and technology to strength in industry and the economy.

The opinion is guided by the broader policy framework set out at recent Party congresses and plenary sessions. It calls for an innovation-driven development strategy, development of new quality productive forces, and a modern industrial system. The emphasis is on an innovation system led by enterprises and coordinated across participants, with full-chain connectivity, broad coverage, and support across all factors. Foreign founders should read this as directional policy rather than a set of immediate procedural rules.

Key principles

Several working principles run through the document. Policymakers are to track new trends in the technology and industrial revolutions and pursue coordinated planning. They are to balance the supply of technology with demand-pull from industry, deploying innovation chains around industrial chains and laying out industrial chains around innovation chains. The document repeatedly stresses strengthening the enterprise’s role as an innovation actor, improving market incentives, and concentrating innovation resources in companies. Reform is to be used to remove ideological and institutional barriers to integration.

Enterprise-led task organization

The opinion calls for reforming how innovation tasks are organized. National science and technology programs should be oriented toward industrial application. Enterprise needs are to be collected on a regular basis. When drafting guidelines, reviewing project proposals, and accepting completed projects, authorities should reasonably increase the number of experts from enterprises and venture capital institutions, and involve the scientific community, industry, and users.

Rules for enterprise-led projects are to be improved, along with mechanisms such as “open competition” and “owner responsibility,” milestone management, and phased funding. Project acceptance should assess technology through application and products through the market, with research and industrialization goals evaluated together. Major national projects and industrial development programs should deploy research tasks in parallel with clear technological objectives.

Technology transfer and commercialization

A key practical theme is moving research results into use. For national science and technology projects with clear industrial application goals, enterprises should in principle lead implementation and drive commercialization. Universities and research institutes are encouraged to set up technology transfer offices or roles and strengthen services in intellectual property, incubation, and technology finance. Results can be applied through technology transfer, licensing, or investment at appraised value.

Reforms will clarify ownership of job-related scientific and technological achievements and treat such assets separately in accounting. Achievers are encouraged to participate throughout commercialization. Universities and research institutes may license results to small and medium-sized enterprises on a “use first, pay later” basis. A nationally integrated technology market is to be developed, along with professional market-based transfer institutions and a technology manager workforce.

Scenarios, supply chains, and emerging industries

The opinion promotes scenario-driven innovation through demonstration actions for new technologies, products, and applications. Local governments are encouraged to open application scenarios in government services, smart cities, and rural development, and to publish supply and demand information. It also targets decisive breakthroughs in core technologies in integrated circuits, industrial machine tools, high-end instruments, advanced materials, and biomanufacturing, alongside efforts to strengthen industrial foundations and major technical equipment.

For emerging and future industries, the document calls for basic research and underlying technology development, identification of disruptive technologies, and industrial innovation projects. It names new energy, new materials, and aerospace as strategic emerging industries, and mentions low-altitude economy development. In frontier fields such as quantum technology, biomanufacturing, hydrogen and fusion energy, brain-computer interfaces, embodied intelligence, and sixth-generation mobile communications, it encourages exploring multiple technical routes, typical application scenarios, and viable business models to commercialize frontier technologies. Traditional industries are to be upgraded through major manufacturing transformation, equipment renewal, industrial internet development, and an “AI+” initiative.

Strengthening companies

Companies are to participate routinely in national strategies, planning, and policy-making for science, technology, and industry. The National Natural Science Foundation is to pilot opening to private enterprises, and enterprise innovation joint funds are to expand. State-owned enterprises are encouraged to establish R&D reserve funds with separate accounting, exemption from value-preservation assessment, and error tolerance. Technology-based SMEs are encouraged to increase R&D spending, with a higher super-deduction ratio for R&D expenses.

Enterprises may lead the construction of science and technology platforms. National major science infrastructure, large research instruments, and national science data centers are to be opened to companies. Talent programs should support enterprises, and enterprise postdoctoral stations should be strengthened. The document also calls for nurturing technology-leading firms, high-tech enterprises, specialized and sophisticated “little giant” firms, and manufacturing champions, while improving incubation and financing services for technology startups. Large enterprises are encouraged to open R&D platforms, application scenarios, and supply chains to smaller firms and to pilot their innovative products.

Collaboration, finance, and talent

Technology-leading enterprises should act as chain leaders and form innovation consortia. National laboratories, research institutes, and research universities should cooperate with them and draw scientific questions from industrial needs. Enterprises are encouraged to join university research and talent training and to build joint R&D institutions and projects.

On finance, the opinion envisions a technology finance system matched to companies’ life-cycle funding needs. The national venture capital guidance fund is to play a role. Government-funded and state-owned venture capital funds should invest early, in small firms, for the long term, and in hard technology, with long-cycle assessment, differentiated supervision, and exit mechanisms. The “innovation points system” is to be promoted to quantify SME innovation capacity. A “technology board” in the bond market and a technology insurance policy system are to be developed.

On talent, education should align with innovation, industry, and national strategy. Discipline-setting mechanisms should involve science and industry departments. University-enterprise joint training, work-study alternation, and dual mentors are encouraged. Policies on temporary assignments, part-time work, and leaving posts to start businesses are to be improved, and science commissioner models promoted. Enterprises’ innovators may serve as industry mentors or professors. Young scientists and technologists are to be supported in innovation and entrepreneurship, and technology entrepreneurs cultivated.

Platforms, market environment, and IP

Innovation platforms are to be coordinated, including national emerging industry innovation centers, industrial technology engineering centers, technology innovation centers, and manufacturing innovation centers. Concept validation and pilot testing platforms are to serve industrialization. Local new-type R&D institutions may develop in a regulated way.

The market environment should remove unreasonable barriers to innovative products. Pilots on relaxed market access and “commitment-based entry” are envisaged in new business forms, along with regulatory sandboxes for new technologies. Laws and rules for frontier fields such as AI and biotechnology are to be improved, as are science ethics rules.

Intellectual property protection is to be strengthened for trade secrets and new business forms, with benefit-sharing and risk-sharing mechanisms in industry-university-research cooperation and commercialization. The patent open licensing system is to be fully implemented, patent and standard布局 strengthened for major national science projects, and national and international standards development in frontier fields expanded.

Incentives and local pilots

Tax incentives for innovation are to be implemented. Due-diligence exemption mechanisms are to be improved for commercialization and venture investment, with negative lists explored. State-owned enterprise assessment is to be categorized, and the proportion of joint R&D expenses with universities and research institutes treated as profit added back is to rise. Industry-university-research cooperation and commercialization results should count in evaluations of research universities, institutes, and researchers.

Local governments are to pilot deep integration. Macro guidance should help regions build on their strengths. Central-local coordination should share technology investment and link major tasks. Regional innovation systems and cross-regional collaboration are to be improved. High-tech zones and independent innovation demonstration zones may pilot policies. International and regional science and technology innovation centers and qualified localities may run reform pilots, and innovative cities are to be built.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.