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Social Insurance Contributions by Foreigners in Shanghai

Foreigners in China are subject to Social Insurance Contributions, with the only exception being Shanghai. This is based on a notice from the Shanghai Municipal Human Resource and Social Security Bureau issued a notice —沪人养发 [2009] 38号 stipulating that foreign employee in Shanghai can contribute to the basic pension, health, and work-related injury insurances. This notice is set to expire on the 15th of August 2021.

The PRC Social Insurance Law was issued in 2011, pursuant to this law, all foreign nationals in China are obliged to participate in the social insurance system. National law in practice and theory supersedes local regulations. Nevertheless, Shanghai never enforced the national regulations and renewed the Shanghai notice in 2016. Unless the notice is further extended from 15th of August 2021, the Shanghai notice will no longer be applicable and foreign workers will be subject to the national regulations.

Pursuant to the PRC Social Insurance Law, foreign employees in Shanghai and their employers are in theory obliged to pay the social contributions. Up until the 15th of August 2021, based on the currently applicable Shanghai policy, foreigners were not obliged by the local bureaus to contribute. However, the future of the exception in Shanghai is unclear for the time being, we expect further announcements to be made in the coming weeks on whether the Shanghai Notice will be extended again.


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