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PlanificacinyGestinPortuaria

ThePortofShanghai 1

PLANIFICACINYGESTINPORTUARIA5ICCP

UNIVERSIDADPOLITCNICADEVALENCIA,Septiembre2012

NATALIAMORENORUIZ


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ThePortofShanghai 2

INDEX

SUMMARY

1_INTRODUCTION

1.1_ Location

1.2_TheYangtzeRiverDeltaRegion

1.3_History

1 .4_Port expansion

2_REGULATORYFRAMEWORK

2.1_HistoryofChinasportGovernance

2 .2_ China s Law

2.3_ShanghaiPortAuthorty

2.4_ShanghaiInternationalGroup

3_MAINBUSINESSANDSERVICES

3.1_Terminalcontainers

3.2_Nonterminalcontainers

3.4_ Logi stic

3.5_ Services

4_POLICY

4.1_ShanghaiInternationalShippingCenter

4.2-ShanghaiShippingExchance

4 .3_ EnviromentManagement

4.4_Tax

4.5_PutongNewArea

4.5.1_YangshanFreeTradePort(FTP)andOtherZonesinthePudongNewArea

5_ARBITRATION

5 .1_ Arb itration in China

5.2_ChinaMaritimeArbitrationComission

5.3_ShanghaiArbitrationCommission

5.4_ChinaInternationalEconomicandTradeArbitrationCommission

6_STRATEGIES

CONCLUSION

BIBLIOGRAFY

ANEXO1:PORTLAWOFTHEPEOPLESREPUBLICOFCHINA

ANEXO2:MARINEENVIRONMENTPROTECTIONLAWOFTHEPEOPLE'SREPUBLICOFCHINA


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ThePortofShanghai 3

SUMMARY

Shanghaiis theworldslargestcontainerport.It isstrategicallylocatednextto oneof theworlds

leadingmanufacturingregions,theYangtzeRiverDelta.ThePortsrapidgrowthinrecentyearsisdue

to a number offactors, not the leastof whichhas been Chinas attractive policies for foreign

investment.Shanghaiisnowestablishingapresenceasaninternationalshippingandfinancialcentre.

ThedevelopmentoftheYangshanDeep-waterPortoffthecoastofShanghaihasenabledthePortto

enhance itstranshipment capabilities. Perhapsmostimportantly,the advancement ofShanghais

maritimeclusterofservicesmaychallengethesuperiorityofinternationalmaritimecentressuchas

HongKongandSingapore.Shanghai sultimatesuccesswillbeduemoretoitsabilitytoeffectively

establishawidermaritimeservicesectorthanitsdominanceincontainerthroughput(althoughthis

does enhance its overall attractiveness). It is clearly making substantialprogress in creating an

internationalmaritimecentre.

RegulatoryFramework

Shanghais portgovernance structureis complex.It hasrapidly evolvedwithChinas developing

economybutdrawbacksarecitedinanumberofsources.

ShanghaiInternationalShippingCentre

Beijing plans to create a world-class international maritime centre in Shanghai by 2020. Some

initiatives,for examplethe ShanghaiShippingExchange, haveattracted criticism.Others,such as

education,arbitrationandtaxincentives,appeartobeenticingmaritimebusinesstoShanghai.The

Shipping Service Centre project looksto be successfulin establishing a multifunctional business

districttoservethemaritimesector.

FreeTradeandForeignInvestment

Shanghaisfreetradezonesandbondedlogisticsareashavetheadvantagesofspaceandsignificant

(continuing)governmentinvestment.Bondedzonesensurethatgoodscanmovefreelybetweenfree

tradeareas.TheadministrativelawsgoverningtheYangshanFreeTradePortareverycompetitive.

Increasinglythesepoliciesarebeingtargetedtowardinsuranceandmarinefinancebusinesses.


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ThePortofShanghai 4

1_INTRODUCTION

1.1_LOCATION

PortofShanghailocatedinthevicinityofShanghai,China,issituatedatthemiddleofthe18,000km-

longChinesecoastline,wheretheYangtseRiver,knownastheGoldenWaterway,flowsintothe

sea.ItistheleadingportintheT-shapedwaterwaynetworkcomposedbytheYangtseRiverandthe

coastline,andis alsoChinaslargestcomprehensiveportand oneofthecountrysmostimportant

gatewaysforforeigntrade.

ItisfacedtowardsthenorthernandsoutherncoastalseasofChinaandtheoceansoftheworld,and

islinkedwith theYangtseRiverandthe inland waterways ofYangtseRiverValleyregionsuchas

Jiangsu,ZhejiangandAnhuiprovincesetc.Expresswayandstate-levelhighwaysleadthePorttothe

nationalhighwaynetworktoallregionsofthecountry. The Yangtse River Delta is home to a cluster

of cities which are the most economically vibrant area in China. The Jianghan Plain and Sichuan Basin

are areas that are densely populated and have a developed agriculture and a strong industrial base.

These areas will prove to be the powerhouse for the sustainable growth of the Port of Shanghai.

The annual import and export trade through Shanghai, in terms of value, accounts for a quarter of

Chinas total foreign trade. The Ports container throughput in 2010 reached 29.069 million TEUs,

ranking it the largest container port in the world.

Container liner services from the Port of Shanghai cover all major ports around the world. More than

2,000 container ships depart from the Port every month, en route to North America, Europe, the

Mediterranean, Persian Gulf, Red Sea, Black Sea, Africa, Australia, Southeast Asia, Northeast Asia,

and other regions.

Therefore,thePortenjoysanadvantageousgeographicallocation,favorablenaturalconditions,vast

economicallydevelopedhinterlands,andcompleteinlanddistributioninfrastructureandfacilities.


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ThePortofShanghai 5

TheportofShanghaiincludesserveralworkingzones:

YangtzeRiverestuary HuangpuRivermouthatWusongkou WaigaoqiaoinPudong Yangshandeepwaterport(HangzhouBay&EastChinaSea)

1.2_THEYANGTZERIVERDELTAREGION

The Yangtze River Delta economic zone comprises 16 cities including Shanghai, Hangzhou and

Ningbo.TheregionsurroundstheYangtzeRiver,thelongestriverinChinaandthemajoreast-west

arteryforcontainertraffic. Thereare26portsalongtheriver.In2009theregionsGDPaccounted

foralmostafifthofChina stotalGDP.AccordingtoXu,whenconsideringthelikelihoodofsuccessof

an emerging hub port (and for that matter, an international shipping centre) a favourable

geographicallocationisfirstcritical. XuconsidersShanghaisproximitytointernationaltraderoutes

anditslocationasagatewaytotheYangtzeRiverDeltaasmostfavourable.

The Yangtze River Delta was designated an Open Economic Zone (OEZ) in 1985. The OEZwas

modelled on the Special Economic Zonesalreadyin existence throughout China. Liberal policies

concentratedon attractingforeigninvestmentandtradethroughpreferentialtaxtreatment,lower

tariffs,solidinfrastructureandlessgovernmentinterference.

There is someevidenceof competitionin the region, especially between Shanghai andNingbo,

althoughthedevelopmentofYangshanPorthasarguablyshiftedthebalanceinShanghaisfavour.

ComtoisandRimmerreportthattheexpansionoffacilitiesatbothNingboandShanghaiisasignalof

themagnitudeoftheexpectedtrafficgrowthintheYangtzeRiverdelta. Indeedasagatewaytothe

boomingYangtzeRiverDelta,ShanghaisPorthandlesanenormousamountofcoal,crudeoiland

metalore inadditiontocontainerisedgoods.Furthermore,manycontainersoriginatinginthemid

and upper reaches of the Yangtze River are transhipped at Shanghai Port to international

destinations.ThisisanimportantaspectoftheYangtzeRiverDelta:significantinvestmentoverthe

pastdecadehasboostedinlandportdevelopmentandChina sinlandwaterwaysnetworkcontinues

togrow.


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ThePortofShanghai 6

1.3_HISTORY

Fromthe5thto7thCenturiesAD,theareaoftoday'sPortofShanghaiwasknownasShenorHudu.It

hadfewresidentsandwasnotdeveloped.In1074duringtheSongDynasty,Shanghaiwasupgraded

fromvillagetomarkettownstatus.However,itspositionontheYangtzeRiverdeltasloweddownits

growth.Asecondseawallwasaddedin1172tostabilizethecoastline.UndertheYuanDynasty,the

PortofShanghaibecameanofficialcityin1297.

ThePortofShanghaibegantodevelopduringtheMingDynasty.Acitywallwasconstructedin1554

toprotectthetownfromJapanesepirates,andtheCityGodTemplewasbuiltin1602.Recognizing

thetown'seconomicimportance,thesetwoeventsdidmuchtopromotedevelopment.

By1735, thePort of Shanghaibecamethe Yangtze region'smost importantseaportdue to two

significantfactors. During theQingDynastyin 1684,the portwas allowed toacceptocean-going

vessels,andShanghaigainedexclusivecontrolovercustomscollectionsforallforeigntradeinJiangsu

Province.

Inthe19th Century,thePortof Shanghai'simportancegrewtremendously.Itoccupiedavaluable

strategicpositionfortradewiththeWest.TheBritishheldthePortofShanghaibrieflyduringtheFirst

OpiumWar.WhenthewarendedwiththeTreatyofNanjingin1842,thePortofShanghaibecame

oneofthe treatyportsopenfor internationaltrade.Furtheragreements,theTreatyofthe Bogue

(1843)andthe Sino-AmericanTreatyofWangsai(1844),exemptedforeignpowersfromlocallaws

andbegantheeraofforeignconcessions.

TheBritishandAmericansettlementsjoinedin1863toformtheInternationalSettlementinthePort

of Shanghai, while the French maintained their own separate French Concession. The Port of

Shanghaibecamea magnetfor foreignerswhostayedtherefor years,sometimesfor generations,calling themselves Shanghailanders. ThePort ofShanghaibecamean officialmunicipality in 1927

undertheRepublicofChina,buttheforeigncommunitieswerestillexemptedfromChinesecontrol.

WhiteRussiansandRussianJewsfleeingthenewSovietUnioncametothePortofShanghaibythe

thousandsinthe1920sand 1930s.The "ShanghaiRussians"grewtobe thesecond-largestforeign

group.By1932,thePortofShanghaiwastheworld'sfifthbiggestcityandhadaforeignpopulationof

70thousand.

TheSecond Sino-JapaneseWar,lastingfrom 1937until 1945,made theJapanese communityan

importantgroupinthePortofShanghai.TheybuiltthefirstfactoriesinthePortofShanghaiwhich

otherforeignerssooncopied,startingShanghai'sindustrialsector.

Inearly1932,theJapanesebombedthePortofShanghai,ostensiblyinresponsetostudentprotects

oftheoccupationofnortheastChina.In1937,theBattleofShanghaiendedinJapan'soccupationof

thenon-foreignareasofShanghai,andtheJapaneseoccupiedtheInternationalSettlementin1941,

holdingituntil1945.In1949,thePeople'sLiberationArmy,controlledbyChina'sCommunistParty,

tookcontrolofthePortofShanghai,andmostforeigninterestsmovedtoHongKong.

Duringthemiddle20thCentury,thePortofShanghaigrewintoabusyindustrialcenterandastrong

supporterofthepeople'srevolution.EventhroughthedifficultyearsoftheCulturalRevolution,the

PortofShanghaicontinuedtobe economicallyproductiveandsociallystable.Throughoutmostof

the People's Republic (Chinese) history, the Port of Shanghai has been the most significant

contributoroftaxrevenuesinChina.

ThePortofShanghai'scontributionstotheeconomyofthenationcameatahighpriceforthecity.

ThePort of Shanghai infrastructure deteriorated, andfurtherdevelopment wasseverely limited.

BecausethePortofShanghaiwassoimportanttoChina'seconomy,itwasnotaffordedmanyofthe

economicliberalizationsthatotherareasreceivedinthemiddle1980s.Finally,in1991,thePortof

Shanghaiwasgivenpermissiontoimplementeconomicreforms.Thisbegantoday'seraofeconomic

andbuildingbooms.


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ThePortofShanghai 7

1.4_PORTEXPANSION

ThePortofShanghaiisthebusiestportintheworldintermsofcargotonnageandcomprisesadeep-

seaportandariverport.

In2006, thePortof Shanghaibecametheworld'sthird-largest containerportwhen itachieveda

containerthroughput of21.71mTEU. In 2006it handled537 million tonnes ofcargo,whichwas

21.1%higherthanthepreviousyear'sfigure.

Totalthroughputfor2007,including560milliontonnesofcargo,wasover26millionTEU.In2008,

the port handled 582 million tonnes of cargo and 28 million TEU, increases of 3.2% and 7%,

respectively, over the previous year. In 2008, the port handled nearly 62,000 domestic and

internationalships.Cargothroughputregisteredbytheportin2009was590milliontonnes.

In 2010, Shanghai port overtookSingapore port to become the world's busiest container port.

Shanghai'sporthandled29.05millionTEUs,whereasSingaporeportwasahalfmillionTEU'sbehind.

In2011Shanghaiportbrokeanewhistoricrecordbyhandlingover30millionTEUs.

YEAR 1984 1999 2005 2006 2007 2008 2009

TM(milliontons) 100 186 443 537 561 582 590

Shanghai Port overtook Singaporeas the worlds busiest container port in 2010. In that year,

Shanghai took up almost a quarter shareof Chinas foreign tradeand it is arguably the most

important commercial city in China. China is the largest container market in the world today.

Consequently Beijing is focusing attention on Shanghai and hopes it will be a world-leading

internationalshippingandfinancialcentreby2020.


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ThePortofShanghai 8

2_REGULATORYFRAMEWORK

2.1_HISTORYOFCHINASPORTGOVERNANCE

Theconsiderationofport governanceasa factor ofportcompetition isnot new. Inmanycases,

advancementsin portgovernancepolicyhavefollowedmarketdevelopmentsas awhole. Asthe

conduitforthenationsinternationaltrade,theportindustryinChinahasalsohadtodeveloprapidly

inorderto keeppacewithanever-expanding economyandcargoflows. Thereformof Chinas

economicsystemsincethe1980shashadadirecteffectuponportgovernance.Ina publicationon

Chinasinlandwatertransportnetwork,Zhangdiscussestheimpetusforthetwostagesofreforms,

thefirstbeginningin1978undertheleadershipofDengXiaoping:

Inthe original economicsystem, theresponsibilities ofadministrationandmanagementwerenot

identified, and the government over-controlled enterprise. Thus, enterprises lacked vitality;

commodity production, the law of value and the market regulation function were neglected;

equalitarianismwaspracticed ineconomic distribution;the economicform andthe businessmode

wereunitary,seriouslyconstrainingthebroadmassesinitiativeandhinderingthedevelopmentofthe

productiveforces.

CullinaneandWangdissecttheevolutionofportgovernanceinChinaintothreephases:19791984,

19842004,and2004present.

Thefirstperiod,19791984,ischaracterisedbycentralcontroloftheportsector.TheMinistryof

Communicationsownedtheports,controlledplanningandstrategy,managedoperationalactivities,

anddeterminedinfrastructurepriorities.DuringthisperiodtheMinistryofCommunicationsneither

benefited nor suffered from under- performing ports. Further, a lack of funding restricted the

developmentoftheports.

From19842004,Chinabegantodecentralisecontrolofitsports.1984sawtheclassificationof14

coastalcities,includingShanghai,asopencities.Increasedforeigninvestmentresulted.In1985the

StateCouncil ofthe Peoples Republic of China(PRC) promulgated regulations whichaimed to

promotetheeconomiccooperationandtechnicalinterchangebetweenChinaandforeigncountries

and to speedup the development of ports and terminals. The regulations gave preferential

treatment tojointventureswithChinesepartners,foreigncorporations,enterprisesor individuals

whenfinancingport orterminalprojects inChina.The Sino-foreign jointventures broughtmuch-

neededskillsandinvestmentintotheportsector.Localportauthoritiesalsogainednewpowers;for

example, the State Council transferred responsibility for the Port of Shanghai to the ShanghaiMunicipalityin1986.China smaritimepolicyframeworkwaspromulgatedduringthisperiodinthe

formoftheMaritimeCode.

From 2004 onwards the ports sector experiencedmoredecentralisation and entered anera of

corporatisation.ThePortActofthePeoplesRepublicofChina(PortLaw) wasadoptedin2003and

is,accordingtoCullinaneandWang,evidenceofthegreatimportanceattachedtotheportindustry

bytheChinesegovernment. ThePortLawisdiscussedfurtherbelow.AlthoughWangetalstatethat

major decentralizationeffortsbeganin 1984,it wasnt untilthe late1990s thatlocal authorities

obtainedprimaryresponsibility(underadualleadership platform).Todaythecentralgovernment

isnolongerinvolvedintheownershipofportsbutitretainsanoversightroleinstrategicplanning.

Chinasports arenotwithoutproblems. Inan article publishedin 2004,Wanget alidentifiedsix

majorproblems:

1. Inadequatephysicalinfrastructure,includingaweakmultimodalinlandnetwork.

2. Inadequatedeep-waterportsbyinternationalstandards.

3. Heavybureaucraticredundancy.

4. Weakandambiguouslegalframework,includingcustomsthickness.

5. Lackofahealthycompetitiveandinnovativeenvironmentinportandshippingindustries.

6. Strongpoliticalcultureoflocalism(danwei)asresistingchange.


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ThePortofShanghai 9

2.2_CHINASLAW

Asnotedabove,ChinasPortLawwasadoptedin2003andcameintoeffectin2004.Ithasbeen

noted that the competitive port environment currentlyat play is further complicated with the

promulgationofthePortLaw.TothecontraryotherauthorsclearlyviewthePortLawasanintegral

andbeneficialpartofthedecentralisationofpowerinChinasportsector.

ThePortLawisdividedintoanumberofchapters:

CHAPTERI:GeneralProvisions

CHAPTERII:PortPlanningandConstruction

CHAPTERIII:PortOperations

CHAPTERIV:PortSecurityandSupervisoryManagement

CHAPTERV:LegalResponsibilities

CHAPTERVI:SupplementaryProvisions

It appliesto portplanning, construction,maintenance, operation,managementandother related

portactivities(art2).Thelawempowersauthorisedlocalauthoritiestoestablishadepartmentfor

administeringlocalports(art6).Whilethelocalauthoritymayengageinportplanning,anyplanmust

beconsistentwiththenationalstrategyandapprovedbythecentralgovernment(chII).Importantly,

thelawencouragesforeigninvestmentinports.CullinaneandWangalsopointoutthattherevised

versionoftheCataloguefortheGuidanceofForeignInvestmentIndustries,approvedbytheState

Councilin2004,abolishestheceilingonstakesinportsheldbyforeigninvestors.

Operatorsofthedocks,passengerfacilities,handling,lighterageandwarehousefacilities,andother

related operators must obtain a licence from the local department (art 22). Chapter IIIdetails

requirementsfor portoperatorssuchas prohibitingmonopolisticconduct,prevention ofpollution

andenvironmentalharm,pricesandstatisticaldata.Article27hascausedsomeconcern:itrequires

port operators to give priority to handling supplies for rescue, relief and national defence

requirements.Failuretodosomayleadtofinesorrevocationoflicences.ChapterIVconcernsPort

SecurityandSupervisoryManagementandoutlinesrequirementsfordangerouscargoes,emergency

plans,portcongestion,andothersecurityrelatedmatters.

2.3_SHANGHAIPORTAUTHORITY

In 2003 Shanghais port oversightbody underwenta restructure resulting in the Shanghai Port

AdministrationBureau,whichtookresponsibilityfor portplanning,administrationand regulations,

and the Shanghai International PortGroup (SIPG). The latter wasdesignated portmanagerand

operatorand alsogivenresponsibilityforthe operationandmanagement ofYangshans firstfive

berths.

TodayadministrationoftheShanghaiPortisthechargeoftheShanghaiMunicipalTransportandPort

Authority(theShanghaiPortAuthority),whichhastheauthorityto:

implement guidelines and polices and enforce laws, rules and regulations related tothe

harbourandshipping;

formulateplansandstrategiesfortheShanghaiharbour(includingYangshan);enforcetrade

regulationsapplicationtotheYangtzeRiver(withintheShanghaimunicipality);

superviseandmanageenvironmental issues in theports vicinity and organise emergency

responseprotocols;

coordinateresearchanddevelopmentintoissuesconcerningtheharbourandshipping;

supervisethequalityandsafetyofconstructionprojectswithintheharbourandinlandwater

passages;

demarcateandauthoriseberthsforthe loading,unloadingandstorageofdangerouscargoes

includingkeyStatematerials,emergency,disasterreliefandmilitarymaterials;

levyandcollectstipulatedfeesandotherfeesrelatedtotheharbourandshipping;

superviseandadministerpilotagewithintheport;


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ThePortofShanghai 10

conductcooperationandtechnicalexchangesbetweentheShanghaiPortandotherdomestic

andforeignports;

administer technical and vocational training, including examinations and the issuance of

certificatesforworkersengaginginportactivities.


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2.3.1_PORTGOVERNANCESHANGHAI

DIAGRAMOFTHEPORTGOVERNANCESTRUCTUREINSHANGHAI


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2.4_SHANGHAIINTERNATIONALPORTGROUP

TheShanghaiInternationalPortGroup(SIPG)isthesoleauthoritarianbodythatmanagesthepublic

terminalsin theportof Shanghai.TheSIPG,a public listedcompany,cameintoexistencein 2003

followingthereorganisationoftheShanghaiPortAuthority.Themajorshareholdersofthecompany

areShanghaiMunicipalGovernment(44.23%),ChinaMerchantsInternationalTerminals(26.54%)and

Shanghai TongshengInvestment GroupCorporation (16.81%). TheShanghaiMunicipal Councils

majorstakeisconsistentwiththemodelofgovernanceadoptedthroughoutChinasinceitbeganto

corporatizeandprivatiseportsfrom2001.However,QiudistinguishesShanghaifromotherChinese

ports because the main port corporate body, SIPG, is not completely owned by the Shanghai

MunicipalCommission.

SIPG is a large-scale business conglomerate specialized in the operation of port and related

businesses.In June2005,SIPGwasturnedintoa shareholdinglimitedcompany.InOctober2006,

SIPGlistedinShanghaiStockExchangeandbecamethe firstwhole-listedcompanyofChinasport

industry

ThebusinessscopeofSIPGincludes:thecargohandling(includingtransloading),transshipping,and

marineandoverlandtransportationofdomesticandinternationalcargo(includingcontainers);the

de-stuffing,consolidation,cleaning,repair,manufacturingandleaseofcontainers;internationaland

domesticshipping service;warehousing, custody,processing, distribution, andlogisticsi nformation

management;provisionofwaiting,ship embarkationand disembarkationfacilitiesandservicesfor

internationalpassengers;shippilotage,towage,shipagency,andfreightforwarding;theprovisionof

in-portservicessuchas bunkeringandship-chandling;leaseofport equipmentandfacilities;port

informationand technical consultancyservice;port andterminal construction, management and

operation.

Intotal,SIPGoperates125berthsonatotalquaylengthofaround20kilometers,amongwhich,82of

theseberths can accommodate vessels of 10,000dwt class or above. QC. Except the container

terminal,SIPGalsoownspublicbulk,breakbulk,specializedRo/Roterminalandcruiseterminal.SIPG

operateswarehouseswithatotalareaof293,000m2,storageyardswithatotalareaof4,721,000m

2,

andowns5,143unitsofcargohandlingequipment.

ManagementofteSICP


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3_MAINBUSINESS

3.1_CONTAINERTERMINALS

ContainerterminalsofShanghaiPort

WUSONGKOU(HUANGPURIVER)

ShanghaiContainerTerminal

SCTwasfoundedbyShanghaiContainerCo.,Ltd. andHutchisonPortHoldingsLimited (HPH).The

totalinvestmentisRMB5.6billion,theregisteredcapitalisRMB2.0billion,andeachpartyholds50%

ofthesharewithjointoperationperiodof50years.

SCT hasthree containerterminals,i.e.,the Zhanghuabang Terminal, JungongRoad Terminaland

BaoshanTerminalaltogetherwith10berthsandatotalof2,281mquaylength.Itisequippedwith20

quaycranesandtheareaofcontaineryardsputtogetheramountsto550,000m2.

SCT wholeheartedly offers its extensivedock services to its customers.Its mainbusiness scope

includes: container handling, storage, transport, container washing, shipping and freight agency,

electronicdatainterchange,storageofinlandgoodsinShanghaiandtheoperationoffreighttransfer

station. Following its quality policysincereservice,constantimprovementof service quality, the

Companycontinuallyintroducesfreshservicecontentsandtimelycopeswithspecialrequirements

putforwardbycustomers.TheSCTsservicequalitysystemofcontainerterminalsbasedonISO9001:

2000standardswillguaranteethesafeandprompttransportationofcustomerscargoes.

WAIGAOQIAOAREA(PUTONG)

ShanghaiPudongInternationalContainerTerminalsWGQT1(SPICT)

ShanghaiPudongInternationalContainerTerminalsLimitedisajoint-ventureestablishedonMarch1,

2003andinvestedbyShanghaiWaigaoqiaoFreeTradeZoneStevedoringCo.,HutchisonPortsPudong


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Limited,COSCOPacific(China)InvestmentsLimitedandCOSCOPorts(Pudong)Limited.

Shanghai Pudong International Container TerminalsLimited is located on the southbank of the

YangtseRiver,inAreaAoftheWaigaoqiaoFreeTradeZone,andadjacenttotheOuterRingRoad,

YanggaoRoadandtheHu-Chong-Su(Shanghai-Chongming-Jiangsu)Cross-RiverProjectwhichisunder

preparation forconstruction. TheTerminalhas a totalquay length of 900meters, andits three

containerberthsareabletoaccommodatethefifthandsixthgenerationcontainerships.Itslandarea

is500,000m2withacontaineryardof8,200flatcontainerslotscapabletostack30,000TEUsatthe

sametime.Furthermore,specialpurposeareasforreefercontainersanddangerouscargocontainers

andacontainerstuffingandstrippingshedhavebeensetup.Itisamodernizedcontainerterminal

withperfectfacilitiesandfunctions.

The well-equipped and technology-intensive Shanghai Pudong International Container Terminals

Limitedhas147machineryandequipmentofvariouskinds,including10quaycranes,36 RTGs,73

container trucks and11 forklifts.It is oneof themodernized containerterminalswith high-tech

contentinChina,throughtechnologicaldevelopmentandinnovation,itemploysadvancedsystemsin

theoperationof containerssuchasCTMSreal-timeproduction,marshallingandcontrollingof the

containertrucksofthewholeyard,handlingofcontainerswiththesamemultiplesandtheintelligent

containeryard.TheCompanyprovidestheshippinglinesanditscustomerswithtailor-madequality

servicebytheestablishmentofasafe,convenient,economicandreliableserviceplatform.

SIPGZhendongContainerTerminalBranchWGQT2-3

SIPGZhendongContainerTerminalBranch,aSIPGwholly-ownedsubsidiarycompany,issituatedon

thewestbankoftheYangtseRiveratthenorthsideofWaigaoqiao,PudongNewArea,Shanghai.Itis

atadistanceof6kmfromWusongkouinthewest,andabout85kmfromthemouthoftheYangtse

River inthe east. Theterminalhasa quaylengthof 1,566mwith5 large containerberthsand isequippedwith 13quay cranes.The landareais 1,659,000m2.It hasmaintained amomentumof

developmentbyleapsandboundssinceitsformaloperationinJuly2000.

Theportareaisequippedwithworld-classadvancedtechnicalequipmentandfacilities.Theinternal

computernetworksystemdevelopedbytheCompanyitselfisastate-of-artproductionsystemwitha

completesetof scientificandreasonable handlingprocesses.ThePort Areaprovidestheshipping

lines and customers with efficient, convenient and safe service. Meanwhile, telephone enquiry

systemand enterprisenetworkenquirysystemcanbe accessedroundtheclock forcustomersto

obtaininformationconcerningshipsandcontainers.

ShanghaiEastContainerTerminalsWGQT4

ShanghaiEastContainerTerminalsCo.,Ltdis ajoint-venturecompanyinvestedand establishedbyShanghai International Port Group Co., Ltdand APMT Terminals. The Company was set up on

September12,2002witharegisteredcapitalofRMB1.10billion.Ithasatotalquaylengthof1,250

meters,fourcontainerberthsforthemainservicesandothertwofortheinlandfeederservices.It

coversalandareaof1,550,000m2andisequippedwith13quaycranesand48RTGs.

With to be the world class leading public container terminal as its vision and with high

performance,productivity,efficiencyandreliabilitywithsuperiorcustomerserviceasitsphilosophy,

theCompanywillsparenoeffortstoprovideitscustomerswithfirst-rateandtailor-madeservices

andfulfillitsgoalasacontainerterminalleadinginefficiency,economicperformanceandserviceby

meansofadvancedmanagementandtechnology.TheCompanyhandled1.05millionTEUsinthefirstyearof its opening, setting a newglobal record in this respect. Presently,the annual container

throughputof theCompany hascomeup to3.63millionTEUs andis stridingsteadilytowardsthe

targetof4millionTEUs.Inashortspanoffouryearssinceitsestablishment,theCompanyhasbeen

listedamongthetoptenduetoitshandlingcapabilityandefficiencyfortwoconsecutiveyears.Itwas

evaluatedbyChinaPortAssociationastheTopTenContainerTerminalsinChina,theOutstanding

TerminalofChinasPortsforHigh-EfficientOperationofContainerQuayCraneandtheContainer

Terminalof theBestComposite KeyPerformance Indicators. Besides,it wasnominatedby Asian

FreightandSupplyChainAward(AFSCA)astheBestContainerTerminal(belowfourmillionTEUs)in

Asiain2006,andthatistosay,ithasearnedtherecognitionofitsinternationalcounterpartsand

theindustry.

ShanghaiMingdongContainerTerminalsWGQT5

Shanghai Mingdong Container Terminals Limited (SMCT) is established to meet the demands

associatedwiththerapiddevelopmentofShanghaiasaninternationalshippingcenter.TheCompany

isa50/50jointventurebetweenShanghaiInternationalPort(Group)CompanyLimited(abbreviated


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asSIPG)andHutchisonPortHoldingsLimited(abbreviatedasHPH).

SMCT provides a comprehensive range of services for container and bulk cargoes for both

international and domestic shipping routes, including loading/discharging, transshipment,

warehousing, distribution, container cleaning/repair, cargo consolidation and deconsolidation,

storage,safekeeping,freightstationandtransportationwithintheport area,and relatedtechnical

consultationandinformationservices.

By fullyleveraging its two investorsadvantages in terminal operations,safetymanagement and

customer services, SMCT strives to uphold a high professional standard and customer-oriented

approach.Weaimatprovidingefficientandhigh-qualityservicestocustomers.

SMCThasbeenguidedbytheprincipleofachievingawin-winsituationthroughconcertedeffortsand

has been playing a vital part in building Shanghai into an international shipping center and

contributingtowardstheflourishingeconomyinShanghai.

YANGSHANDEEPWATERPORT

ShanghaiShengdongInternationalContainerTerminals

ShanghaiShengdongInternationalContainerTerminals Co.,Ltdwasinvested bySIPG onMay 31,

2005witharegisteredcapitalofRMB5billion.ThemajorresponsibilityoftheCompanyistooperate

andmanagethePhase-1andPhase-2terminalsoftheYangshanDeepwaterPortAreaaswellasto

fundandruntheauxiliaryandsupportingproject,theInternationalLogisticsParkinthePortArea.

ThePhase-1terminaloftheYangshanDeepwaterPortwasofficiallylaunchedonDecember12,2005.

Since then, the Company has constantly improved the production efficiency with its matured

productionmanagementsystem,perfectcomputeroperationsystem,sophisticatedequipmentand

facilitiesandhigh-qualifiedstaffteams.AndnowtheYangshanPhase-1terminalissecondtononein

termsof operation with its annual designedcapacity of2.2million TEUs atthefirstyear ofits

launching.On December10, 2006,YangshanPhase-2 terminalwassuccessfully opened, andthe

harmoniousandcombinedoperationofthePhase-1andPhase-2terminalswasrealized.Currently,

thePort boasts a 3,000m-longdeepwaterquay length, 34worldmostup-to-datecontainerquay

cranes,120RTGsandotherhandlingandtransportationfacilities.

ShanghaiGuandongInternationalContainerTerminal

ShanghaiGuandongInternational ContainerTerminalCo., Ltd.(SGICT),wholly owned bySIPG, is

specializedincontainerterminaloperation.SGICTis committedtoprovidinghighquality, efficient

andprofessionalcontainerhandlingandrelatedsupportingservicestoalltheclients.

SGICTrunsterminalsphase3and4ofYangshanDeepwaterPort,whicharelocatedinthecentreofthe Ports northern area. The terminal enjoys not onlymodern container terminal facilities and

equipment,butalsoprofessionalandqualitymanagement,whichiscapableto handleall kindsof

largecontainervesselsandprovideafullrangeofterminalservices.

SGICTboastsaquaylengthof2,600metersand7berthsfor70,000to150,000-toncontainerships.

Thewaterfrontdepthis-17.5mandlanddepth913m.Totallandareais2.3813millionm2andthe

designedcapacityofannualterminalthroughputismorethan5millionTEU.


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YANGTZERIVER

TaicangInternationalContainerTerminal

In 2002 the Taicang International Container Terminal Company was established. Originally, 70

percentofitsshareswereheldbyHongKongsModernTerminals,theremaining30percentbythe

cityofSuzhou.Latein2004,CoscoPacificboughtapartof thesharesandnowholdsa46percent

stake.(ModernTerminalsnowown51%andSuzhou3%).TheTaicangterminalestablishedatendof

2003asacombinedcontainerandbulkcargofacility.Ithasaquaylengthof930metres,awater

depthof12metresandisdesignedtohandle550,000TEUandsome3.5milliontonnesofbulkcargo

annually.Thequayisequippedwithfivepanamaxship-to-shoregantriesandtwoconventional25-

tonnecranes.LikethePudongterminals,TaicanusesaquaythathasbeenbuildoutintotheYangtze

andisconnectedtothecontaineryardbymeansofbridges.Presently,theterminalextensioniswell

underwayanda firstberthhasalreadybeencompleted.Until 20081,100metresof quaywillbe

addedtoTaicangport:Fourdedicatedcontainerberthsforvesselsofupto50,000tdw.Thenewpart

oftheTaicangterminalwilleventuallybeequippedwitheightpost-panamaxgantrycraneswitha

hoistcapacityof60tonnesandanoutreachof47m.TheTaicangdevelopmentplanisinlinewiththe

ChineseCentralGovernment'spolicyofpositioningShanghaiasthehead,andTaicangandNingboas

thewingsoftheShanghaiMaritimeCentrespeakinginatypicallyChinesedragon-metaphor.Sofar,

theTaicangContainerTerminalhasbeensuccessfulinattractingdomesticintra-Chinesetradeaswell

ascontainerservicestoSouthKoreaandJapan.Recently,GoldStarLine,amemberoftheZIMGroup,

hasestablishedaservicetoThailandandVietnamthatsailsoutofTaicang.Furthermore,theterminal

isusedtofeedercargotoYangShan,Shanghaisgiantnewdeepwaterport.

3.2_NON-CONTAINERTERMINALS

ThePortofShanghai'snon-containerterminalssupporttheeconomicdevelopmentoftheYangtze

RiverValley.PrimarilylocatedontheHuangpuRiverthatfeedstheYangtze,theyserveasdistribution

centersforthePortofShanghai?shinterlands.

SIPGCoalBranch

ThePortofShanghai?sSIPGCoalBranchhandlesmostlycoal,sand,andgravel,anditalsoactsasa

shippingagency.LocatedinthePortofShanghai'sPudongNewAreaneartheLujiazuiFinancialand

TradeZone, the terminals coveran areaof almost 142 acresandhavequays totalingovertwo

thousandmeters(6.6thousandfeet)inlength.ThePort ofShanghai?sSIPG CoalBranchhasfour

terminalmanagementofficesand17 berthsalongtheHuangpuRiver.The PortofShanghai'sSIPG

CoalBranchoffersstorageyardsofover50acres.Thecombinedthroughputoftheseberthsismore

than30milliontonsperyear.

SIPGZhanghuabangCompany,Limited

ThePortofShanghai?sSIPGZhanghuabangCompanyisfourkilometers(2.5miles)fromthemouthof

theYangtzeonthe HuangpuRiver.Covering aland areaof49 acres inthe PortofShanghai,the

terminalhasthree10-thousand-tonberthsand540meters(1.8thousandfeet)ofquays.

The terminal handles about 1.8 million tons of cargo per year.This Port ofShanghai terminal

specializesinhandlingsteelproducts,largeandheavy-liftequipment,andcontainers.ItisthePortof

Shanghai terminal best fitted for handling over-sized equipment and installations. In fact, SIPGZhanghuabang has been used in many state-sponsored projects including the Shanghai Jinshan

PetrochemicalWorks, theQuinshan NuclearPower Station, PudongInternational Airport, Shanghai

RailTransitandTunnels,andmanyotherimportantnationalefforts.

SIPGJungongRoadBranch

TheSIPGJungongRoadBranchinthePortofShanghaiislocatedwithinthedeep-draftchannelofthe

HuangpuRiveraboutsevenkilometers(4.3miles)fromWusongkou.Coveringanareaof62acresin

thePortofShanghai,theterminalhasfourmulti-purposeberthswithtotalquaylengthof743meters

(2.4thousandfeet)andcontainsover33acresofwarehousesandstorageyards.

Handlingforeigncargoesofiron,steel,vehicles,pulp,equipment,containers,andbulkcargoes,this

PortofShanghaicompanyalsoconductscontainerinspectionsandactsasashippingagent.Itisalso

involved in motor transportation, manufacturing of tools and rigging, and leases and exports

management technology. Equipped with eight gantry cranes and a variety of cargo-handling

machines,thisPortofShanghaiterminalisservedbya6.3thousandmeter(20.6thousandfeet)long


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exclusiverailroad.

ThePortofShanghai'sSIPGJungongRoadterminalspecializesinhandlingforeignbulkandbreakbulk

cargoesthat include steel, iron,pulp,vehicles, equipment,andcontainers. Handlingfreightis the

terminal'sprimary business, and theyhave developeda widerange of services to support that

business. Services include a shipping agency, storage, motor transportation, lease/export of

managementtechnology,toolandriggingmanufacture,andcontainerinspection.

SIPGBaoshanTerminalBranch,Limited

ThePortofShanghai'sSIPGBaoshanTerminalspecializesinhandling,storing,andtransportingboth

domesticandforeignbulk,breakbulk,andcontainers,includingover-sizeditemsandsteelproducts.

Designedtohandle2.9milliontonsofcargoperyear,thisPortofShanghaiterminaloffersavariety

ofservicesthatincludemotorvehicle transportation,containerinspection, andcontainerfreights.

Located four kilometers (2.5 miles) from Wusongkou, the terminal is in the northeast part of

ShanghaineartheBaoSteelsGroup.

TheSIPGBaoshanTerminalcoversanareaof66.7acresoflandandwaterinthePortofShanghai.It

containsfiveberths-threeforuptotenthousandtonsandtwoforuptoonethousandtons.The

terminal is equippedwithover 100 cranes, palletforklifts, lorries, containerforkliftsand trailers

capableof handlinga widerangeofloads.This PortofShanghaiterminal hasovereightacresof

storageareaanda25.6-acrecontaineryard.

SIPGLongwuBranchLimited

Serving theHangzhou-Jiaxing-Huzhouregion,the SIPGLongwuBranch in thePort of Shanghaiis

locatedontheupperHuangpuRiver.Thefacilityhasninecargovesselberths,includingfivecontainer

berths,and20500-thousand-toninlandbargeberths.

Coveringabout183 acres inthe Portof Shanghai,theLongwuBranchis engagedin anumberof

activities that include cargo-handling, storage, distribution, and transfer. This Port of Shanghai

terminalalsooffersfreightagencyservicesandmanufactureandmaintenanceofequipment.

SIPGLuojingSubsidiaryCompany

Operatingsince1997,thePortofShanghaisSIPGLuojingSubsidiaryCompanyspecializesinhandling

bulkcargoes.TheSIPGLuojingSubsidiaryCompanyinthePortofShanghaiwassetupin2007asaco-

investment by HongkongRuijue Investment Company, Bao Steel, and MaSteelto specialize in

handlingoresandPu-steellogisticsservices.Today,SIPGLuojingisastate-of-the-artoreterminaland

apioneerinhandlingindustriallogisticsbetweenterminalsandlargesteelfactories.

LocatedontheYangtze?ssouthbankabout38kilometers(24miles)fromthecitycenter,thisnew

high-techPort ofShanghaiareacovers about 123acres ofland andhas anunloadingquaywith

alongsidedepthof11meters(36.1feet).Theunloadingquaycanaccommodatehugevesselsupto

180thousandDWT(afterloadreduction),andtheloadingquayhasalongsidedepthof8meters(26

feet)andcanaccommodateshipsoneitherside.ThecompanysupportsthePortofShanghaislarge

steelworksontheYangtzeandareaironoremerchants.Thestorageyardhascapacityformorethan

1.1milliontonsofcargo.

ShanghaiLuojingOreTerminals.Co

ShanghaiLuojingOre Terminals.Co.,Ltd.isco-investedby HongkongRuijueInvestmentCompany,

BaoSteelandMaSteel,whichwassetuponNovember1st,2007.Thecompanyisspecializedinore

handlingandPu-steellogisticsservices.

Asa modern high-techore terminal,the companyis apioneerin dealingwith industriallogistics

transportationbetweenbigsteelfactoriesandterminals.

Theterminaliscommittedtoforgingaworldsfirst-classoreterminalandprovidingqualityservices

forclientsinYangtzeRiverregion.

3.3_PORTLOGISTICS

SIPGLogisticsCo

TheSIPGLogisticsCo.,Ltd.wasincorporatedthroughconsolidationandmergerofmorethantwenty

enterprises,includingtheformerShanghaiInternationalContainerFreightCo.,Ltd.,ShanghaiJixiang

Freight Co.,Ltd., ShanghaiPudong ContainerLogisticsCo., Ltd.and ShanghaiPort Technology&


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EngineeringServiceCo.,Ltd.,formingacompletelogisticservicechainspecializedinportlogistics.It

isa logisticsenterprisewhollyownedbyShanghaiInternationalPortGroupCo.,Ltd.(SIPG)witha

registeredcapitalofRMB2.5billion.

Thebusinessscopecoversallaspectsoflogisticsindustry,includingtheinternationalfreightagency

service,shippingagencyservice, shippingagencyserviceforinlandfeederlines,storageand stock

piling, road transport, handling of bulk and break-bulkcargoes, domestic multimodal transport,

containerstuffingandstripping,storageandtransportofhazardousgoods,transportationofheavy

lift,washingandrepairingofcontainersanddevelopmentoflogisticsmanagementsoftware.

Relyingonits goodresourcesuperiorityandforginga perfectportlogisticsservicechain,theSIPG

LogisticsCo., Ltd.willspare itseffortson thegrowthof modernizedandspecialized logisticsand

constantimprovementofdomesticandinternationallogisticnetworksforthepurposeofproviding

thecustomerswithone-stopandconvenientlogisticsservices.

HanghaiJihaiShippingCo

hanghai JihaiShipping Co.,Ltd wasestablishedon September21, 2001with theapprovalof the

Ministry of Communications.It is jointly invested byShanghaiInternational PortGroup Co.,Ltd,

ShanghaiHaihuaShipCo., Ltd.andChina ShanghaiOceanShippingAgency.It isa domesticjoint-

ventureshippingenterprisewitharegisteredcapitalofRMB250million.

TheCompanymainly dealswithlinerservicerelatedto internationalcontainershipping oninland

feederroutesalongthe YangtseRiver andcoasts,theinter-provincetransportof generalcargoes

(includingcontainerandlarge-sizedequipment)oninlandwatersandalongthecoasts,andactsasan

agencyforwatertransportofcargoes,shippingserviceandinternationalcargotransportbyseaorby

land.

TheCompanyis inpossession of80 shipswitha totalcontainer-carryingcapacity of11,503TEUs,

rankingsixthonthelistofChinascontainerfleetspublishedbytheMinistryofCommunication.

TheCompanyhasmorethan130customers.Ithasenteredintolong-termcooperativepartnerships

withsuchworld-knownlinercompaniesasMaerskLines,Hanjin,Zim,Evergreen,NYK,Happag-lloyd,

MOSK,K-Line,OOCL,MSC,PILandCMA-CGM,etc.Also,cooperativetieshavebeenformedbetween

theCompanyandsomeinlandfreightforwardingcompaniesandotherfeederroutesoperators.

ShanghaiPuyuanShippingCo

ThemajorbusinessofShanghaiPuyuanShippingCo.,Ltd.isthereductionofloadsonthesea.Italso

carries on coastal and offshore shipping service. Currentlyit possessesa load-reducing platform

known asXin Shuang FengHai andthree shipsnamedas Yunling,Wanlingand Baoshan

respectively.Thebusinessscopeincludestheload-reductionoflargequantityofbulkcargoonthe

LuhuashanSeaArea;internationaltransportation;freighttransportalongthecoastsandthemiddle

andlowerreachesoftheYangtseRiver.

The Company has a registered capital of RMB100million. It implements the system of general

manager responsibility under the leadership of the board of directors. Since its formal

commencementofbusinessonJune1,1999,theCompanyhascarefullyorganizedanddoneagood

jobofthe load-reducingproductionoftheXinShuangFengHai andasaresult ithaskept arecord

of1,855successivedaysofsafeproductionfreefromanyaccident.TheCompanyhasattainedthe

SMC,ISPSandothercertificatesrecognizedinternationally.

ShanghaiHaihuaShippingCo

ShanghaiHaihuaShipping Co.,Ltd. Hereafterabbreviatedas HASCO wasfoundedinMay1989

undertheapprovaloftheMinistryofCommunications.InJuly2000,ShanghaiPortContainerCo.,Ltd.

purchased88.5%sharesofHASCO.InJune2006,ShanghaiPortContainerCo.Ltd.increaseditsshare

inHASCO to100%.When SIPGlistedas awhole companyin September2006,HASCO became a

holding companyof SIPG. HASCOcoversa business range of shippingagency,freightforwarding

agency,YangtzeRiverandcoastalfeederservice,containerleasingandseamanslaborserviceetc.

Eversinceitsset-up,HASCOhaswonagoodreputationforthepunctualschedule,reasonableprice

andhigh-quality service in the international shippingmarket.Withabout 20 years of marketing

experience and achievement in shipping line operations, HASCOhas developed from the initial

Shanghai-Hong Kong service into a container liner service network centering in Shanghai and

radiatingtoabout20portsofJapan,Taiwan,HongKong,VietnamandThailandetc.


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YangtzePortsLogisticsCo

SIPGYL,whichiswhollyownedbySIPG,isspecializedinlogisticsservices,especiallyinYangtzeRiver

Region.

AssetsofSIPGYLincludeshippingfleet,terminals,logisticsparks,warehousesandshippingagencies,

totalingRMB10billion.Thecompanyowns100ships,withtotalshippingcapacityranksChinasNo.

5,andshippingnetworkcoversthewholeYangtzeRiverregion.Affiliatedterminalsincludefacilities

inYibing,Chongqing,Changsha,Wuhan,Jiujiang,NanjingandJiangyin,etc.SIPGYLalsosetsupbig

logisticsparkstoprovidequalityservicesforclients.

SIPGYL is committedto consolidating resourcesboth in Shanghaishome portand Yangtze River

regiontobuildupaswiftlogisticslaneservingcustomersdomesticallyandinternationally.

hanghaiHaitongInternationalAutomotiveTerminalCo

HanghaiHaitongInternationalAutomotiveTerminalCo.,Ltd.isajointventurecompanyinvestedby

SIPG,Anji AutomotiveLogistics Co.,Ltd, Nippon Yusen KabushikiKaisha,NYK HOLDING (EUROPE)B.V., WalleniusWilhelmsen Terminals Central AB and SAICHK LIMITED. Major business includes

foreignanddomestictradeofvehiclesRo-Rooperation,H&HRo-Rooperation,storageservicesand

PDIvalue-addedservices.Thecompanyhasacquiredinternationallyadvancedmanagementsystem

ofRo-Roterminalmarks.

ShanghaiHaitongInternationalAutomotiveLogisticsCo.,Ltd.isajointventurecompanyinvestedby

AnjiAutomotiveLogisticsCo.,Ltd.andSIPG.ThecompanyacquiresNon-VesselCarrierandClass-A

International Forwarding certificates. Companyboasts a professional logisticsprojectdesignand

operationteam,organizingallresourcesincludingcustoms,terminal,highwaysandrailroads,etc.The

company has strength in integrated domestic and foreign port services, international shipping,imports andexportscustoms clearance,domesticwatertransportation, traffic transportationand

railroadtransportation,packingandunpackingofcomponents,storageandforeigntradescustoms

transfer.Integratedlogisticsinformationservicesplatformandlistedservicesareprovidedtomake

tailor-made solutions to customers. KPI index is used to make continuous improvements and

managementofdailyqualityoperation.HaitongLogisticsCompanyhaspassedtheISO9001:2000test

andis dedicatedto fullydevelop componentscontainerslogisticsand givepriority todeveloping

vehiclesimportsandexportsby taking ports resourcesas platform,andhighlyintelligent services

products asthe mainstay.Company vision is to buildup themost competitive supply chainand

becomeareliablelogisticssupplier,providecustomerswithsatisfactoryservices.

ThePortofShanghaiHaitongInternationalAutomotiveTerminal'sberthis219.4meters(719feet)

longwithalongsidedepthof 14meters(46feet),andit canaccommodate5th and6thgeneration

roll-on/roll-offvessels.ThisPortofShanghaiterminalcoversmorethan65acres,andit hasayard

that can parkseven thousand cars. The terminal offers other services that include PDI, battery

charging,andtireinflation.ThePhase2terminalwillcoveranareaofalmost25acresinthePortof

Shanghaiandcontainspecializedfacilitieslikewarehousesfor

3.4_PORTSERVICES

Port-relatedlogisticsservicesarevitaltoeffectiveandefficientoperationsin thePortofShanghai.

(SIPG)ofthePortofShanghai'scontainer,bulk,andbreakbulkbusinesses.

PortServicesunitisasupplementarybusinesswhereTheShanghaiInternationalPortsGroupplaysan

importantrole in thedevelopment. Theimprovementand expansionof theservicefunctionsis

gearedto enhancetheGroupsoperationalcapabilityofverticalintegration,optimizeportservice,

andimproveport efficiency.Currently,theport-relatedservicesunit include sixmaincategories,

namely,pilotage,towage,tally,agencyandportinformationtechnologyservice.

ShanghaiPortPilotAdministrationStation

Providing professional pilotage service for the Port of Shanghai, the Shanghai Port Pilot

AdministrationStationprovidesthemandatorypilotsforforeignvesselsusingthePortofShanghai.It

isthelargest,mosttechnicallyadvancedstationinChina.Thereare210pilotswithinitstotal500

employees.TheStationhas23 auxiliaryboatsandshipsthatofferpilotageforsomeofthelargest

vesselsthatusethePortofShanghai.

PortofShanghaiHarborFuxingShippingService


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A subsidiaryof SIPG,Shanghai Harbor Fuxing Shipping Service is thebiggesttugboatproviderin

China.InadditiontopilotingtugboatsforthePortofShanghai,thecompanyoffersheavy-lifthoisting

andshipping,domestictransportofgeneralcargoes,shipbuildingandrepair,transportofgeneral

cargoesforinternationalvessels,andgeneralcargo-handling,storage,andtransportservices.

Operatingmodernfull-swingtugboats,derrickbarges,andsea-goingbarges,ShanghaiHarborFuxing

ShippingServiceoperatesmainlyinthePortofShanghai,butitsservicesalsocoverdomesticcoastal

portsandports onthe YangtzeRiver.The companyhas anexcellentreputationfor handlingand

transporting bulkandheavy-lift cargoesused toconstructtheQinshanHetianwanNuclearPower

Station, theYangshanDeepwaterPort,and theShanghai chemicalindustryarea.The companyis

instrumentalinthedevelopmentofthePortofShanghai'scontainerindustry.

PortofShanghaiHarbourEngineeringCorporation

Since1993,theShanghaiHarbourEngineeringCorporationhasbeenageneralcontractorforport-

buildingandchannelprojectsinthePortofShanghai.ShanghaiHarbourEngineeringisalsoageneral

contractorfortheconstructionof housing,municipalworks,highways,andconcreteprefabricated

structuresintheregion.TheCompanyownsthreefloatingpiledriversandafloatingconcretemixer.

Otherfloatingand landconstruction assets owned by thePort of ShanghaiHarbourEngineering

Corporationincludetowboat,pontooncrane,sea-goinglighter,andanimportedtyrecrane.ThePort

ofShanghai'sHarbourEngineeringCorporationhaswonmanyawardsforitsachievementsincluding

the"WhiteMagnoliaAwardforShanghaiQualityConstructionProject,"the"SilverPrizeofStatefor

QualityProject,"andthe"ZhantianyouCivilEngineeringAward.

ShanghaiOceanShippingTally

ShanghaiOceanShippingTallyCo.,Ltd.wassetuponOctober8,2003afterinstitutionalreform.ItisthelargestregionaltallycompanyjointlyformedbyShanghaiInternationalPortGroupCo.,Ltd(SIPG)

andtheHeadOfficeofChinaForeignShipTallyCompanyonthebasisofthelattersoriginalShanghai

BranchaftertheapprovaloftheMinistryofCommunications.

TheCompanyhas a registered capital of RMB50 million andmore than1,300 workersand staff

members.UndertheCompanythereare8tallydivisions,2containerstuffingandstrippingdivisions

andan office.Its businessinvolvesthetally ofshipsand containersin allthe publicandowners

terminals,aswellasthetally,vanninganddevanningofthegoodsofthecontainerscominginand

goingoutof thePortofShanghai.TheCompanyhasorienteditsdevelopment"torelyon thePort

andservethemarket,developin adiversifiedwaywhileholdsonejobasitsmainstay,implement

scientificmanagementandplacethetradeinaleadingposition".

Businessscope:Totallythecargoescarriedbydomesticandinternationalships;tolistandcheckoff

cargoes;strippingandstuffingofcontainers;totakemeasurementsanddimensionsofthecargo;to

superviseoverloadingandunloading;tosurveythedamagetogoodsandcontainers.

In1997,the CompanywascertifiedwithB/T19002-1994idt.ISO9002:1994by ChinaClassification

Society. In April 2004,it was certified withGB/T19000-2000idt. ISO9001: 2000. Since1997, the

Companyhasbeenchosenasa"CivilizedOrganization"inShanghaithreetimesinsuccession.

ShanghaiInternationalCruiseTerminals

ShanghaiInternationalCruiseTerminalsissituatedatthecenterofHuangpuRiverdistrict,adjacent

to the famous Bundwith universalarchitectural essence exhibition andopposite to thePudong

LujiazuiFinancialArea.The terminal,meltingitssplendidbuildingsandbeautifulsurroundingsinto

thebackgroundoftheShanghai,hasbecomeanewattractionofthecity.

Theterminalwasputintoservicein2008,coveringanareaof165,000m2with-10mwaterdraftand

1197quaylength.With annual capacity of 1 million passengers, the terminal has the ability to

accommodatethree70,000tonsclasscruisesatatime.


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4_PLANSANDPORTPOLICY

4.1_SHANGHAIINTERNATIONALSHIPPINGCENTER

TheStateCouncilof thePRCapproved theplanto developShanghaiasan InternationalShippingCentre(ISC)in1995.Furtherguidelinesweremappedoutin2009withthegoalofmakingShanghaia

world-leading international financial and maritime centre by 2020.The guidelines identify the

featuresrequiredto establishthe ISC:highlycentralised shipping resources;a complete shipping

servicesector;strongindustrygroupsand anattractivebusinessenvironment;world-classlogistics

services; and capability in allocating global shipping resources. Consequently the Shanghai State

Council has concentrated efforts in three major areas: economic enhancement and business

attractiveness; improved shipping efficiency and customs processes; and continued physical

development through,for example,the YangshanPort,LingangNewCity anda ShippingService

Centreproject.ItshouldbenotedthattheShanghaiISCoftenreferstoawiderareathanShanghai

itself.ItsupportsanumberofairandseaportsincludingYangshan,Waigaoqiao,Zhoushan,Ningbo,

Taicangandothers.

ShanghaisShippingServiceCentreprojectwaslaunchedin2007.Locatedalongthewaterfrontofthe

HuangpuRiverinPudong,theCentreisdesignedtoperformthecorefunctionsofshippingtradeby

establishing a multifunctional business district focused on serving the maritime industry. These

functions include ship financing, leasing, accounting, legal affairs and personnel training. The

developer, Franshion Properties, states that the project will benefit the Shanghai International

Shipping Centre (SISC) by generating economies of scale and creating synergies in shipping

services.60Arecentreporthassuggestedtheareahasbeenalmostfullyoccupiedsinceopeningin

April.61

TheShippingServiceCentreisan integralcomponentin Shanghaisgoalto cultivatea world-class

maritimecluster.However,the ServiceCentrealonewillnotachievethegoal.PresentlyShanghai

accountsforlessthanonepercentoftheglobalshippingfinancemarketandtheShanghaiFinancial

IndustryFederationislobbyingforimprovementinthisfield.InFebruary2011,Shanghailauncheda

50 billion yuan investment fund to support the ISC. The fund will primarily invest in ports,

shipbuilding,modernlogisticsandmodernshippingservicebusinesses.In particular,thefundwill

supporttheemergingmarineinsurancemarketinShanghai.

4.2_SHANGHAISHIPPINGEXCHANGE

TheShanghaiShippingExchange(SSE)wasestablishedbytheMinistryofCommunicationsandthe

ShanghaiMunicipalPeople sGovernmentin1996.Itistheworldsfirstcontainerindexderivative.

TheSSElaunchedtheContainerizedFreightIndex(SCFI)in2009whichpublishesaweeklyrateindex.

Theexchangeenablescompaniestohedgeagainstadversemovementsinfreightrates.

Although itis unlikelythe SCFI will encourage amajorshift tousing the exchangeforall basic

contracts,the useof derivatives hasbeensuggested asa possibleanswerto growingcomplaints

aboutfreightratevolatility.However,itwasreportedinMay2011thatshippinglinesandshippers

havenotembracedtheidea.Thismaystemfromtheinitialsuspicionsomeinternationallinesheld

withthecreationoftheSCFI.SomesawitastheMinistryofCommunicationsattemptingtofavour

ChinasCOSCOwhichatthetimeoftheSCFI sintroductionshippedmostofShanghaiscontainerised

freight. Itremainsto beseen whetherthe SCFI will succeedin enhancing Shanghais maritime

cluster.

4.3_ENVIRONMENTMANAGEMENT

Lawstoimprobtheenvironment

MarineEnvironmentProtectionLawofthePeople'sRepublicofChina(Anexo2)

TheMaritimeSafetyAdministrationformulateslawsandregulationsonairpollutantemissionsfrom

ships.

TheEnvironmentalProtectionBureauformulatestheairpollutantemissionstandardfordiesel

auxiliaryengines.


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TheShanghaiPortAdministrationCentercoordinateswiththeEnvironmentalProtectionBureauand

measuresairpollutantemissionanddispersion.

Pollutioncontrol

SuperviseandmanageShanghaiportterminalenterprisesthatdirectlyemituntreateddomesticand

industrialsewerage,enforcetargetemissionsofsewerageforsuchenterprises.

Requestterminals withmoreseriousfugitivedustemission problemsto establish sprinkler

facilitiesatyardsandperformthehardeningprocessforroads,conditionallyadoptclosureorsemi-

closureofyards

Implementeliminationmechanismsfortransportationvehiclesintheportareas,selectanduse

fuelsofgoodquality

Solid wastes of the ports are all received and treated by the regional environment and

sanitationdepartments,thereceiptandtreatmentrateisabove90%,solidwasteclassificationand

collectionsystemswillbegraduallybuiltintheportareas

Selectanduselow-noise,highlyefficientloadingandunloadingfacilitiesandtransportation

vehicles;placethemonflatsurfaceswithreasonablelayouts

InternationalCooperation

Cooperatewithinternationalshippingsocieties,formulateinternationalconventionsin areas

suchasincreasingthestandardizationofshipenginedesign,increasingthequalityoffueloilsandair

emission

Establishautomatic environmentalmonitoring stationsat containerterminals,Luojing bulk

cargoterminals,Xiaoyangshanports,HangzhoubayportsandHuangpuriverbankports

Developvariouscommunicationandcooperationmethodswithgovernmentalorganizations

andnon-governmentalorganizations

4.4_TAX

Taxlaw inChina isvoluminous, especiallyconsideringthe vastnumber ofclarificationsthat have

beenmadetogeneralprinciplesofpolicy.Thereforethisworkingpaperwillaimtoidentifythemost

importantpoliciesrelated tothe maritimesector.Theanalysisthatfollowswill serveto highlight

ChinascontinuedeffortstopromoteShanghaiasanISC.

The major taxes in China are value-added tax, consumption tax, customs duty, business tax,

enterpriseincometax, individualincometaxandland appreciation tax.Enterpriseincome taxlaw

wasmodifiedin2007totakeaccountofChinasjoiningtheWTO.All enterprises aresubjectto a

generalrateof25percentbutsmall-scaleandnew-technologyenterprisesaretreatedfavourably,

eachbeingsubjecttoalowerrate.Thechangesweresignificantforforeigninvestorsparticularlyin

cases such as the Special Economic Zones...where, under the outgoing law, virtually all foreign

investment enterpriseswerereceivingalow taxrate. Asof 1January2010incomederived from

international transportation services has been exempt. International transportation services

includestransportationofoutboundpassengersorgoods,inboundpassengersorgoods,andcarriage

servicesforpassengersorgoodsprovidedoffshore.Thepolicyappliestoallenterprisesengagedin

internationaltransportation.

TheStateCouncilcontinuestopassadditionalnoticesextendingpreferentialtreatmentandclarifying

previouslyannouncedpolicies.AspartoftheOpinionsissuedbytheStateCouncilinApril2009,71a

number of preferential tax and customs policies were announced. The policies extend the tax

exemptionforChina-fundedflagofconveniencevesselsto30June2011.Forenterprisesregisteredin

theShanghaiYangshanFreeTradePort(FTP),businesstaxisexemptontransportation,warehousing,

loading and unloading revenue, andincome derived within theFTP maybe separatedfrom the

international part of the business. The policies also outline programs to increase customs and

administrativeefficiencywithintheFTP,measuresdesignedtopreventtaxfraud,andpermissionfor

companiestosetupoffshorebankaccounts.

ThesepolicieswerereaffirmedbytheMinistryofFinanceandStateAdministrationofTaxationon1

May2009. Businessrevenueof enterprises registered in theYangshanFTP andengagedin the

international transportation business would be exempt. This exemption would extend to


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transportation,loadingandunloading businesses;and insurancecompanies incomederivedfrom

internationalshippinginsurancebusiness.

FurtherOpinionsaimtofosterthedevelopmentofshipleasingandinsuranceinShanghai.Thefirst,

released on 8May2009, includes providingpreferential treatmentto finance leasing companies

engaged in finance leasing activities for international shipping vessels; supports analysis into

premiumspaidbyimportersandexporters;andincorporatespoliciesdesignedtoattractimportand

exportcompaniestotakeoutdomesticinsurancefortheirshippingenterprises.ThesecondOpinions

werereleasedon24Julyandprovidemoredetail.AccordingtotheOpinions,inordertosupportthe

development ofShanghaias anISC, favourable treatmentmust begivento insurancebusinesses

engagedintheinternationalshippingsector.Moreover,bettertaxrefundcoordinationismentioned

in addition torules designedto preventtax fraud. Toboost domesticinsuranceand leasing,the

policiesfocus onresearchanddevelopmentwhich couldseta clearplanfor shippingbusinesses,

manage industry development, andset up a financial support system forlogisticsprovidersand

professionalservicefirms.In orderto helpestablishthefinancesystemin theshippingindustry,a

pilotprogrammeisoutlinedwhichwillinvolvefurtherresearchintopreferentialpolicies.

Recently a senior official with the Policy and Legal Affairs Department of the State Taxation

Administration announced that further tax benefits will be introduced including, for example,

increasedexemptionsforenterpriseswithintheYangshanBondedZone.

ChinahassignedDoubleTaxationAgreements(DTAs)with95countries.Someincorporatespecific

provisionsdealingwithinternationalshippingincome.Forexample,inthe DTAconcludedbetween

Singapore and Chinaon 11July2007,art8 providesthatprofitsderivedby anenterprise ofa

ContractingStatefromtheoperationof shipsor aircraftin internationaltrafficaretaxableonlyin

thatState.Aprotocolagreed atthetime ofsigningtheDTAclarifiedthatSingaporeancompanies

operatingshipsoraircraftinternationallyshallbeexemptfrombusinesstaxandanyothersimilartax

inChina.

4.5_PUTONGNEWAREA

ShanghaiPudongwas openedin 1990as partof Shanghaisvision topromoteitselfas aleading

financial,tradeandshippingcentre.AmergerwiththeNanhuiAdministrativeAreawasannouncedin

2009makingthetotalarea1210squarekilometreswithapermanentpopulationof4.12million.25It

isconnectedto Chinas high-speed railnetwork. Theareaconsistsof anumberof development

areasincludingLuijiazuiFinancialTradeZone,ZhangjiangHi-techPark,WaigaoqiaoFreeTradeZone,

JinqiaoExportProcessingZoneandYangshanPortArea.TheareaisamajorcontributortoShanghais

GDP.

LingangNewCityisanadditionalareadedicatedtotransportationandlogistics.Itislocatednearto

wherethe Donghai Bridge from the YangshanPort reaches the mainland. Identified aspart of

Shanghaisplanstocreateaninternationalshippingcentre,LingangIndustrialAreawillincorporate

thefunctionsofanexportprocessingzone,freetradezoneandbondedlogisticspark.Oncecomplete

itwillalsoincluderesidentialareasandrelatedamenities.TogetherwiththeWaigaoqiaofreetrade

zoneandthe Lujiazuifinancialhub,Lingangis expectedto beone ofthe majordrivingforcesin

Shanghaistradedevelopmentoverthenext10to20years.

TheLingangIndustrial Parkis administered bythe LingangIndustrialParkAdministration.Special

development funds have been allocated for the future development of Lingang (art 5). Upon

accreditation,enterprisesand projectswithinthe industrialparkenjoypreferentialtreatment(art

15):

1. various preferential policiesforencouraging the developmentandtechnicalprogress ofthe

modernequipmentmanufacturingindustry;

2. various preferential policies for encouraging the transformation and industrialization of

scientificandtechnologicalachievements;

3. various preferentialpolicies for encouragingthe softwareindustry; 4.relevant preferential

policiesforpromotingthedevelopmentofsmallandmediumenterprises;and5.otherpreferential

policiesforencouraginginvestmentandimprovinginvestmentenvironment.


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TheAdministrationshallalsoprovideservicesincludingfinancial,accounting,legal,insurance,patent

andlabourfortheenterpriseswithinthepark(art16).

4.5.1_YangshanFreeTradePort(FTP)andOtherZonesinthePudongNewArea

Itistobenotedthatmanyofthepreferentialpoliciesoutlinedimmediatelyaboveapplytoentities

registered in theYangshan FTP(sometimesreferredto asthe YangshanBondedPort Zone). The

YangshanFTPareaincorporatestheoperationalareaatYangshan,theLuchaogangSupportingArea

(thisareaprovidessupportingservicesfortheportandincludesaninspectionarea,dangerousgoods

areaandotherauxiliaryfacilities)andtheDonghaiBridgeconnectingtheportwiththemainland.

TheFTPismanagedbytheShanghaiIntegratedBondedZoneManagementCommitteewhichalso

overseestheWaigaoqiaoBondedZone(including theWaigaoqiaoBondedLogisticsPark)and the

PudongAirportIntegratedBondedZone.Theareahasthehighestconcentrationofportresourcesin

thecountry.78Additionally,eachareahasaspecificstatutorycommitteetoadministertheindividual

zone.Althoughthethreezoneshavebeencriticisedfornotaligningpolicies,theintroductionofthe

IntegratedManagementCommitteemay enableeach tofocus onparticularstrengthsin order to

establishageneralregionalattractiveness.

Thefollowingsectionsbrieflyidentifytheadministrativelawsapplicabletothekeyportzones.Other

regulationsand regularnotificationsapply;andtheytendtoaddto theregionsattractivenessfor

business.AtthetimeofChina saccessiontotheWorldTradeOrganisation(WTO)in2001therewas

concernthatthecompetitivenessoftheFTZswouldbediminished.Thereappearslittleevidenceof

thisamongtheliterature.Themorefavourablepositionis thatChinasaccessiontotheWTOhas

boostedforeigninvestmentgenerally.

YangshanFreeTradePort(FTP)

Itistobenotedthatmanyofthepreferentialpoliciesoutlinedimmediatelyaboveapplytoentities

registered in theYangshan FTP(sometimesreferredto asthe YangshanBondedPort Zone). The

YangshanFTPareaincorporatestheoperationalareaatYangshan,theLuchaogangSupportingArea

(thisareaprovidessupportingservicesfortheportandincludesaninspectionarea,dangerousgoods

areaandotherauxiliaryfacilities)andtheDonghaiBridgeconnectingtheportwiththemainland.

TheFTPismanagedbytheShanghaiIntegratedBondedZoneManagementCommitteewhichalso

overseestheWaigaoqiaoBonded Zone(including theWaigaoqiaoBondedLogisticsPark)and the

PudongAirportIntegratedBondedZone.Theareahasthehighestconcentrationofportresourcesin

thecountry.Additionally,eachareahasa specificstatutorycommitteetoadministertheindividual

zone.Althoughthethreezoneshavebeencriticisedfornotaligningpolicies,theintroductionofthe

IntegratedManagementCommitteemay enableeach tofocus onparticularstrengthsin order to

establishageneralregionalattractiveness.

Thefollowingsectionsbrieflyidentifytheadministrativelawsapplicabletothekeyportzones.Other

regulationsandregularnotificationsapply;andtheytendto addtotheregionsattractivenessfor

business.AtthetimeofChina saccessiontotheWorldTradeOrganisation(WTO)in2001therewas

concernthatthecompetitivenessoftheFTZswouldbediminished.Thereappearslittleevidenceof

thisamongtheliterature.Themorefavourablepositionisthat ChinasaccessiontotheWTOhas

boostedforeigninvestmentgenerally.

AccordingtotheAdministrationLawapplicabletotheYangshanFTP,itsfunctionsincludetheloading

andunloadingof containers,internationaltransit of cargoes, international logistics,international

procurement,internationaltransittrades,exportprocessingbusinesses,andthesupportingservices

suchasfinance,insurance,lawandsoon.Theprovisionsofthelawoutlinetheresponsibilityofthe

authority empowered to oversee the FTP, list the permits required, proceduresfor establishing

enterpriseswithinthearea,anddealwithtaxandcustoms.

Article19oftheAdministrationLawconcernsCustomsDutiesandImportTaxes.Itprovides:

GoodsoriginatingoutofborderthatcomeinandgooutoftheFTPA[YangshanFreeTradePortArea]

shallnotbesubjecttotheadministrationbyimportandexportlicenses,andshallbeexemptedfrom

customsdutiesandimporttaxes.Wherelawsandadministrativeregulationshaveotherprovisions,

suchprovisionsshallprevail.

Article20dealswithTaxesonProductionandCirculation:

TheproductsproducedbytheenterprisesintheFTPAthatareforsaleswithintheFTPAordeliveryto

Pl ifi i G ti P t i


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destinationsout ofbordershallbeexemptedfromtheVAT andconsumptiontaxes;for thegoods

fromtheFTPAtobesoldwithinthecountry,itisnecessarytogothroughtheformalitiesofcustoms

clearanceinaccordancewithrelevantprovisionsonimports,andlevytaxesinaccordancewiththe

actualconditionofthegoods.

Finally, art 21states that the taxes shallbe reimbursed asprescribedfor the domesticgoods

enteringthe FTPAwhichare tobe taken asexportgoods. TheState Administrationof Taxation

reportedthat thenationalexportrebatetotal fromJanuary toMarch 2011totalled231.1billion

yuan;an increaseof 32percenton the previousyear.Thereport also notedthatomeanalysts

pointedout thatpolicyfactors,in additionto exportgrowth,serveasa criticalcontributor tothe

expandingexportrebate.

WaigaoqiaoFreeTradeZone

TheWaigaoqiaoFreeTradeZone(WFTZ)islocatedinthePudongNewAreaofShanghai.Itisoneof

thelargestFTZs in Chinaand employsover 200,000 people. Thearea specialisesin international

trade,logisticsandhasanadvancedmanufacturingindustry.Themostrecentavailableregulations

werepromulgatedin1997.Article18concernsimportsandexportsandprovidesthatbusinessesmay

conductbasicprocessingsuchaspacking,sortingandsubpackagingwithintheFTZ.Goodsbroughtin

ortakenoutoftheFTZareconsideredexportsandimportsrespectively(art22).However,article38

states that goods exported via the FTZ will be exempted from customs duties. Under these

regulationsenterprisetaxwithinthezoneisleviedat15percent(arts41,42).

It has been reported that policies were implemented in 2009 to increase the number of

manufacturers in the zone; attract new business expertise such as pharmaceutical distribution,

medicalequipmentandautomotivesupplies;improveforeignexchangemanagementpractices;and

expand the bonded functions of the zone. Overall the changes will aim to refine operational

efficienciesacrosstheFTZ.

5_ARBITRATION

One of the core functions of Shanghais ShippingService Centre is to develop legal expertise.

Internationalcommercialarbitrationcentresandspecialisedmaritimearbitrationservicesarealready

established. Asthe experiences ofHongKong andSingapore show, adevelopedmaritimecluster

countsmaritimearbitrationasanimportantcomponent.

The leading arbitration jurisdictions in the Asia-Pacific, resulting from several factors including

geographic convenience, prominence as global financial centres, English as the main business

language,excellentinternationalarbitrationlaws,andefficient,supportive,corruption-freecourts.

Theuse of arbitrationis becomingincreasinglymorecommonin theAsia-Pacific region andthe

leadingmaritimecentresareconstantlylookingtoattractmaritimearbitrationbusiness.

5.1_ARBITRATIONINCHINA

ChinaaccededtotheNewYorkConventionin1987.Theoverridingarbitrationlawprovidesthatany

commissions andassociationsrelatedto arbitrationareto beindependentof anyadministrative

organ.ThelawenablestheChinaInternationalChamberofCommerceto,amongotherthings,create

foreign arbitration commissions, appoint arbitrators, and formulate rules. Greenberg, Kee and

Weeramantrynotethatseveralkeyprinciplesinthearbitrationlawappeartohavebeeninspiredby

theModelLaw.TheChamberestablishedtheChinaMaritimeArbitrationCommission(CMAC)andit

overseestheChinaInternationalEconomicandTradeArbitrationCommission(CIETAC).

5.2_CHINAMARITIMEARBITRATIONCOMISSION

TheCMACisbasedinBeijing,hasasub-commissioninShanghai,andliaisonofficesinTianjin,Ningbo,

DalianandGuangzhou.Its165arbitratorsareexperiencedinnavigation,insurance,maritimelawand

otherrelatedfields.TheCommissionalsoincorporatesaLogisticsDisputeResolutionCentre(LDRC)

andaFisheryDisputeResolutionCentre.Theformerisauthorisedtoacceptallcasesarisingfromor

Planificacin y Gestin Portuaria


27/42



inconnectionwithlogisticssuchasoceanshipping,landandairtransportation,containertransport,

storage,agency,handling,loadingand discharging, andinsurance.The LDRCmaintainsa panelof

arbitratorswhoareconsidered specialistsin logistics.TheChamberhasgivenits approvalfor the

LDRCtoacceptallcasesarisingfromorinconnectionwithlogistics.

Article2oftheCMACRules95permitstheCommissiontoacceptcasesinvolving:

(1)Disputesarisingfromcharterparty,contractofmulti-modeltransport,carriageofgoodsbyseaor

waters orcarriageof passengers inconnectionwith billof lading, waybill orany other transport

documents;

(2)Disputesarisingfromsale,construction,repair,chartering,financing,towage,collision,salvage

andraisingofshipsorotheroffshoremobileunits,orfromsale,construction,chartering,financing

andotherrelativebusinessofcontainers;

(3)Disputesarisingfrommarineinsurance,generalaverageorshipsprotectionandindemnity;

(4)Disputesarisingfromsupplyofshipsstoresorfuel,shipssecurity,shipsagency,seamenslabor

serviceorportshandling;

(5)Disputesarisingfrom exploitation andutilizationof marine resourcesor pollution damage to

marineenvironment;

(6)Disputesarisingfromfreightforwarding,non-vessel operatingcarriage, transportby highway,

railwayor airway,transport,consolidationanddevanningof containers,express delivery,storing,

processing, distributing, warehouse distributing, logistics information management, or from

construction,saleandleasingoftoolsoftransport,toolsofcarryingandhandling,storagefacilities,or

fromlogisticscenter anddistribution center, logistics project planning and consulting,insurance

relatedtologistics,tortorothersrelatedtologistics;

(7) Disputes arising from fishery production or fishing; and (8) Other disputes submitted for

arbitrationbyagreementbetweenparties.

Inorderto enhanceefficiency ofproceedings,theRulesprovidea SummaryProcedurefor claims

totalling not more than 1,000,000 yuan or in other caseswhere the parties agree. Under the

SummaryProcedure,writtensubmissionsareprovidedwithincertaintimeframesandthetribunalis

empoweredtohearthecaseonthewrittenmaterialsalone.Thewiderangeofcapabilities(suchas

theLDRCandShanghaisub-commission)andrulesfocusedonefficiencyandfinalityoftheaward97

arguablyplacetheCMACinaninternationallycompetitiveposition.Neverthelesschallengesremain

forChinaespeciallyinrespectofitshostilitytowardenforcingforeignarbitralawards.

5.3_SHANGHAIARBITRATIONCOMMISSION

TheShanghaiArbitrationCommission(SAC)wasfoundedin1995bytheShanghaiMunicipalPeople s

Government.It hasover500arbitratorswhosecollectivespecialtiescovera broadrangeof areas

includingfinance,engineering,maritime,internationaltradeandinvestment,andgeneralcommercial

suchascontracts.It isempoweredtoacceptandheardisputesovercontractsandotherproperty

rightsandinterests.99 The Rules also provide a summary procedure where the disputed

amountofthecaseislessthan500,000yuan.100 In the summary procedure, only one arbitrator

presidesandshortertimeframesareinplace,includingashortertimeforthemakingoftheaward.

5.4_ CHINAINTERNATIONAL ECONOMICANDTRADEARBITRATION COMMISSION

(CIETAC)

TheCIETACindependentlyandimpartiallyresolves,bymeansofarbitration,disputesarisingfrom

economicandtradetransactionsofacontractualornon-contractualnature.TheRulesprovidethat

CIETACwillalsoacceptcasesinvolvingdisputesrelatedtotheHKSARanddomesticdisputes(art3).

AgreementsmayincorporateanarbitrationclauseprovidingforarbitrationbyCIETACoroneofits

sub-commissions.

CIETACs international caseload appears to be significant. Between 2001 and 2008 it received

between 422 and 562 new international cases annually and in 2009 it received 559.102 in

comparison,theHKIAChad309internationalarbitrationsin 2009.It isunclearwhethertheCIETAC

Planificacin y Gestin Portuaria


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hears anymaritime-related arbitrations but it is certainly possible, according to the Rules, that

commercialdisputesinvolvingmaritimepartiescouldbereceivedbyit.

6_STRATEGIES

Tobecomeanoutstandingglobalterminaloperatoristheirvision;andfurtherdevelopingthehome

portwhileexpandingtotheworldistheirmainstrategy.

The SIPG has threestrategies aimed at maintaining growth in container throughput, expanding

transhipmentbusinessandEstbaliz,reinformeandsupportingShanghaispositionasaninternational

shippingcentre.Thestrategiesrepresentlocal,regionalandinternationalfoci.

6.1_THEYANGTSERIVERSTRATEGY

The Yangtse River Strategy is designed, through the exportation of management, capital and

technology,to foster the container market, strengthen cargo consolidation network and gather

hinterlandcargosources,withaviewtoservingtheYangtseRiverDeltaandYangtseRiverValleyand

achievingthesustainabledevelopmentofSIPG.

Through the implementation ofthe Yangtse RiverStrategyand on the basis ofthe framework

characterizedbydot-line-planethathasalreadybeenaccomplished,SIPGwillcarryoutmorein-

depthoptimizationof itsinvestment layout in YangtseRiver ports, andfostera number ofmain

feedering hub ports in the Yangtse River represented by Chongqing, Wuhan and Nanjing.The

potentialsoftheGoldenWaterway,thatis,theYangtseRiver,willbefullydevelopedandexploited,

andtheadvantagesofintensivemanagementoftheDispatchCenterforYangtseRiverInnerFeeder

Serviceswillbefurtherutilized.SIPGwilljoinintheeffortstopromotetheupgradingofvesselsize

andstandards onthe YangtseRiver, andthe improvement ofnavigationaland shippingcapacity.

Eventually, as a result of consolidating port, shipping and agency resources, a regional cargo

gatheringnetworkwill takeshape, onethat hasShanghaias its terminus andcovers theentire

YangtseRiverValley

6.2_NORTHEAST

The Northeast Asia Strategy is designed to develop ship-to-ship transshipment operations with

Yangshanportareaasthecenter,establishthePortofShanghaiasaninternationalshippingcenter,

andachievetherapiddevelopmentofSIPG.

Toimplementthe NortheastAsiaStrategy,the functionalpositioningof Yangshandeepwaterport

area,WaigaoqiaoportareaandWusongkouportareawillbedecidedsoasto determinethefocal

aspectsof theservicesprovidedby therespectiveportareas,todesignarationalshippingservice

placement plan, to establish a highly efficient and economical barging system, and to enable

integratedoperationoftheportareas.Theseeffortswillleadtothedecisionbylinercompaniesto

choose thePort ofShanghaias theirpriority hubfor theircontainertransshipmentoperations in

NortheastAsia.ThedevelopmentofacoastalpublicfeedernetworkwillupgradeShanghaisabilityto

gathercargowithintheNortheastAsiaregion,andachieveseamlessconnectionsofYangtseRiver,

coastalandinternationaltransshipment.Overallmarketingandmajoraccountmanagementwillbe

promotedsoastowincustomerswithhigh-qualityservices.TheconceptofThePortofShanghai,

Your Best Choice will be publicized, and a good pattern will be take shape whereby various

stakeholdersandthePortcanachievemutualprogressandgrowth

6.3_INTERNATIONALIZATION

SIPGwillalsoimplementitsInternationalizationStrategy.Tothisend,it willfosteritscapabilityof

internationaloperations,improveitslevelsofinternationalmanagement,andgraduallyformacross-

regionalandmultinationaloperationalpatternthatisgearedbothtothedomesticandinternational

markets.

In addition to the above strategies,the Shanghai Port has instituted cooperative arrangements

witinternationalports.ThepurposeofcooperationistoexposeShanghaitointernationalexperience

from foreign ports and seek opportunities for business collaboration. The Port has signed

memoranda ofunderstandingwith theGeorgia PortsAuthority,PortsofSeattleandMiami(USA),

PortofBarcelona(Spain),BusanPortAuthority(SouthKorea),PortsofHakataandNagoya(Japan),



29/42

f y


PortofRotterdamAuthority(TheNetherlands),andthePortofLondon(UK).Italsohasanumberof

PortsofFriendship.

6.4_EDUCATION

Educationis a vitalpartof the strategyto expand Shanghais maritime cluster and experience.

ShanghaiMaritimeUniversityandDNV(aglobalriskmanagementcompanyandoneoftheworld s

leading classification societies)have signed a partnership agreementto establishthe SMU-DNV

InternationalCooperationCentre.The Centreprovidestraining,maritimeresearch,technicalskills

developmentandscholarshipstopromotethegrowthoftheSISC.

TheShanghaiShipandShippingResearchInstitutehasbeeninexistencesince1962.Moreover,the

ShanghaiMaritimeUniversity isworkingwith theindustryin thedevelopment ofthe ISC.It has

established theShanghai InternationalShippingResearchCentre.Also,ZurichFinancialServices in

collaborationwiththePudongNewAreagovernmentcreatedtheZurichResearchandDevelopment

Centreinearly2010.Itsresearchfocusisconcentratedondevelopmentsandtrendsintheglobal

shippingandfinanceindustries.Inparticular,researchwillbetargetedtoassistthedevelopmentof

marineinsuranceandfinancinginShanghai.



30/42


CONCLUSION

Oneneed onlylookat thethroughput growthin ShanghaisPorttogain aperspective ofhowa

combinationof favourable policiesand growthin Chinasexportshas benefitedtheport. Foreign

investmentandapolicyshifttoencouragingprivatisationofportsinMainlandChinawillcontinueto

contributetothecountrysrisingattractivenessasamaritimecentre.

Thecitysaimtobecomealeadinginternationalfinanceandshippingcentreby2020isambitious.

Majorachievementshavebeenrealisedandexcellentincentivesarein place.However,competing

withextremelywell-establishedmaritimecentressuchasSingaporeandHongKongisnot aneasy

feat,especiallywhenthosecentresarealsopositioningthemselvestobetheleadingmaritimecentre

inthe Asia-Pacificregion.NonethelessShanghaiboasts enormousamounts offoreigninvestment,

excellent freetrade zones connectingthe port to cargo services,a growing professional service

sector,and incentivesto encouragethedevelopmentof amarineinsurance andfinancing sector.

Additionally,thecontinuingexpansionoftheYangshanDeep-waterPortis oneofShanghaismost

criticalcompetitiveadvantages.NotonlyisitperfectlysituatedclosetotheYangtzeRiverDelta;ithas

agreatdealofpotentialasatranshipmenthub.

Itis tobe remembered thatShanghai isstill aworkin progress. Thatconsidered,it ishavinga

markedeffectupontheattractivenessofotherportsinAsia:itistheworld slargestportintermsof

container throughput. It must still confront a number of challenges in its own administrative,

regulatoryandoperationalstructure.TheShanghaiPortissubjecttoanumberoflayersofcontrol

whichcouldleadtoinefficiencies.Undoubtedly,businessescravecertaintyandconsistency.Despite

thepreferentialpolicies,Shanghaiscomplexregulatorystructuresurroundingthevariousfreetrade

zonesmaynotbeasclearandconsistentasotherwisepossible.

Shanghaiwill continueto attract shippingbusinessby virtue ofits geographical location andthephysical enhancements being made to its port.Whetherit will succeed in developing an entire

maritimeclusterof industrieswilldependupon numerousfactorsincluding acarefullymeasured,

consistentand clearapproach to regulationand policy-making by thegovernment.It is a major

competitorforleadingmaritimecentresworldwide:butitssuccessisnotaforegoneconclusion.



31/42


BIBLIOGRAFIA

SIPGhttp://www.portshanghai.com.cn/jtwbs/webpages/flash.html

THECENTRALPEOPLESGOVERMENTOFTHEPEOPLESREPUBLICOFCHINAhttp://english.gov.cn/

SHANGHAIEASTCONTAINERTERMINALhttp://www.apmterminals.com/asia/shanghai/

SHANGHAISHENGDONGINTERNATIONALCONTAINERTERMINALShttp://www.shsict.com/

SHANGHAIPUTONGINTERNATIONALCONTAINERTERMINAL

http://www.spict.com/dotnetweb/pubinfo/en_infolist.aspx?class=110

http://www.haitongauto.com/

HUTCHINSONPORTHOLDINGShttp://www.hph.com

http://www.sipgl-freight.com/en/index.asp

http://www.taicangterminals.com/engb/contact/map.htm

http://www.worldportsource.com/ports/review/CHN_Port_of_Shanghai_411.php

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http://containership-info.com/misc_publ_shanghai.pdf

COASTALPORTREFORMINCHINA,MinQiu,TheWesternUniversityAustralia

NATIONALPLANFORCOASTALPORTShttp://info.hktdc.com/shippers/vol29_6/vol29_6_trade03.htm

http://es.wikipedia.org/wiki/Puerto_de_Shanghi

GOOGLEEARTH

http://www.portarrivals.com/list.asp?sec=Port&item=59970&t=SHANGHAI

PORTGOVERNANCEINCHINAhttp://www.inrets.fr/fileadmin/ur/splott/Evenements/EMAR/Presentati

ons/Presentation_Wang.pdf

http://www.slideshare.net/chinaintel/china-logistics-development-report-2010-edition-ii

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pg p shanghai

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