Shanghai Municipal People’s Government announced in Circular No. 9, amendments to the policy framework for encouraging MNC’s to set up regional headquarters in the city. Recognizing that Shanghai plays a leading role in China’s opening-up reform, the circular relaxes the business scope and the assessment criteria for Regional Headquarters. Additionally, the Circular clarifies that branches functioning as RHQ’s that cannot satisfy all of the assessment criteria may be eligible to hold status as a functional headquarter. The incorporation of functional headquarters will attract more RHQ’s to come to Shanghai and further strengthening the development of the headquarter economy in the city.