Law of the People’s Republic of China on Scientific and Technological Progress

(Adopted at the 2nd Meeting of the Standing Committee of the Eighth National People's Congress on July 2, 1993; amended for the first time at the 31st Meeting of the Standing Committee of the Tenth National People’s Congress on December 29, 2007; and amended for the second time at the 32nd Meeting of the Standing Committee of the Thirteenth National People’s Congress on December 24, 2021)

Contents

Chapter I  General Provisions

Chapter II  Basic Research

Chapter III  Applied Research and Commercialization

Chapter IV  Innovation by Enterprises

Chapter V  Research and Development Institutions

Chapter VI  Scientific and Technological Personnel

Chapter VII  Regional Innovation

Chapter VIII  International Scientific and Technological Cooperation

Chapter IX  Support Measures

Chapter X  Supervision and Management

Chapter XI  Legal Liability

Chapter XII  Supplementary Provisions

Chapter I General Provisions

Article 1 This Law is enacted in accordance with the Constitution in order to comprehensively promote scientific and technological progress, give full play to the role of science and technology as the primary productive force, innovation as the primary driver of growth, and talent as the primary resource, facilitate the turning of scientific and technological advances into actual productivity, leverage science, technology and innovation to drive economic and social development, and build China into a modern socialist country in all respects.

Article 2 The Communist Party of China's overall leadership over scientific and technological affairs shall be upheld.

The state stays committed to the new development philosophy, places science, technology and innovation at the core of national modernization drive, and makes scientific and technological development a strategic pillar for national development. The state implements the strategy for invigorating China through science and education, the strategy on developing a quality workforce and the innovation-driven development strategy. By following an innovation path with Chinese characteristics, the state endeavors to turn the nation into a powerhouse of science and technology.

Article 3 Scientific and technological progress shall focus on exploring global scientific and technological frontiers, serving main economic sectors, meeting major national needs, and safeguarding people’s life and health, to contribute to the economic and social development and national security of the country, as well as the sustainable development of humanity.

The state encourages research and development (R&D), and promotes the use of science and technology to transform and upgrade traditional industries, develop high-tech industries and foster public undertakings, thus contributing to achieving carbon peak and carbon neutrality, creating new growth drivers and realizing high-quality development.

Article 4 The state creates a national innovation system that is efficient, collaborative and open. The state makes holistic planning for scientific and technological innovation and institutional innovation, and improves the system for mobilizing resources nationwide in the socialist market economy. By enabling the market to play a decisive role in resource allocation and giving better play to the role of government, the state facilitates the optimal allocation and efficient utilization of scientific and technological resources, the close collaboration among innovators, the orderly flow of innovation factors and the consistent improvement of the innovation ecosystem. The state enhances the nation’s innovation capacity both as a whole and in key fields, and improves the overall efficiency of the innovation system.

The state builds and strengthens the national strategic forces of science and technology, comprised mainly of national laboratories, national R&D institutions, top-notch research universities and leading tech-based enterprises, which shall play a supporting and leading role in making major breakthroughs and original innovation in key fields and priority directions of strategic importance to serve the country's major strategic needs.

Article 5 The state ensures coordination in pursuing development and upholding security. The state enhances its governance capacity for scientific and technological security, improves the systems and mechanisms for forestalling and defusing security risks, and strengthens the security management of R&D and commercialization activities. The state supports innovation in the fields of national security, and enhances the capacity of such  innovation.

Article 6 The state encourages the integration of R&D into higher education and industrial development, as well as the integration and mutual reinforcement of multiple disciplines.

The state strengthens scientific and technological cooperation across regions, industries and fields, and supports scientific and technological development in old revolutionary base areas, ethnic minority areas, remote areas and impoverished areas.

The state coordinates the development of military and civilian technologies, facilitates the sharing of technological resources, the communication of technological development needs and the two-way technology transfer between the two sectors, and strengthens the development of dual-use technologies.

Article 7 The state promotes scientific and technological activities in accordance with the principles of serving national goals and encouraging free exploration. To build the nation’s strength of science and technology at a faster pace, the state adopts a forward-looking approach to deploying major basic research, as well as the frontier technology research and public benefit-related technology research which have great prospects of industrial application, provides sustained and steady support for the development of basic research, frontier technology research and public benefit-related technology research, and stimulates original innovation and breakthroughs in core technologies in key fields.

Article 8 The state guarantees the freedom of R&D, encourages scientific exploration and technological innovation, and protects the legitimate rights and interests of scientific and technological personnel, such as free exploration.

R&D institutions, institutions of higher education, enterprises, public institutions and citizens have the right to decide their own subjects of research, explore unknown scientific fields, and engage in basic research, frontier technology research and public benefit-related technology research.

Article 9 Guided by the principle of combining theory with practice, schools and other educational institutions shall place greater focus on helping educatees cultivate independent thinking, practical abilities, innovative skills and critical thinking, as well as the scientific spirit of pursuing truth, valuing innovation and respecting facts.

The state ensures that institutions of higher education play an important role in R&D, and encourages them to carry out R&D, provide social services and foster high-caliber professionals with a sense of social responsibility, a spirit of innovation and an ability to put ideas into practice.

Article 10 Scientific and technological personnel, as an important force for socialist modernization, shall be respected by the whole society.

Recognizing the strategic importance of talent for development, the state deepens reform of the institutions and mechanisms for talent development to improve the cultivation, recruitment and utilization of talent in a comprehensive way, creates an environment that conforms to the inherent laws of innovation and talent growth, and gives full play to the role of talent as the primary resource.

Article 11 The state creates a social environment favorable for innovation, and encourages government departments, people’s organizations, enterprises, public institutions, social organizations and citizens to participate in and support scientific and technological activities.

The whole society shall respect hard work, knowledge, talent and creativity to foster a social climate valuing science.

Article 12 The state promotes science popularization, strengthens the development of science popularization facilities and capacity, and improves the scientific literacy of all citizens, especially young people.

Science popularization is a responsibility shared by the whole society. The state establishes and improves incentives to encourage R&D institutions, institutions of higher education, enterprises, public institutions, social organizations and scientific and technological personnel to actively participate in and support science popularization.

Article 13 To protect intellectual property rights and encourage innovation, the state implements the strategy on intellectual property rights, improves the system of intellectual property rights, and creates a social environment where intellectual property rights are respected.

Enterprises, public institutions, social organizations and scientific and technological personnel shall raise their awareness of protection of intellectual property rights, enhance their ability of innovation, build their capacity for the creation, exploitation, protection, management and service provision of intellectual property, and improve the quality of intellectual property.

Article 14 The state establishes a science and technology assessment system  conducive to innovation.

Science and technology assessment shall follow the principles of openness, fairness and equitability, and focus on the quality, contribution and performance of scientific and technological activities. Differentiated approaches shall be adopted to assess scientific and technological  activities according to their classification.

Article 15 The State Council shall lead the scientific and technological work nationwide, formulate medium- and long-term programs for scientific and technological development and plans for science, technology and innovation, and identify major national projects of science and technology and major projects closely related to science and technology. Medium- and long-term programs for scientific and technological development and plans for science, technology and innovation shall set clear guidelines, provide strategic directions, and guide and coordinate scientific and technological development, resource allocation and policy formulation.

Governments at or above the county level shall incorporate scientific and technological work into their economic and social development plans, and ensure that scientific and technological progress is aligned with economic and social development.

Local governments at all levels shall take effective measures to strengthen the organization and management of scientific and technological work and foster an enabling environment for scientific and technological progress.

Article 16 The administrative department of science and technology under the State Council shall be responsible for the macro management, coordination, service, support, and supervision of scientific and technological work nationwide. Other relevant administrative departments under the State Council shall be responsible for scientific and technological work within their terms of reference.

The administrative departments of science and technology under local governments at or above the county level shall be responsible for scientific and technological work of their respective administrative regions. Other relevant administrative departments under local governments at or above the county level shall be responsible for scientific and technological work within their terms of reference.

Article 17 The state establishes a coordination mechanism for reviewing major issues concerning scientific and technological work, and coordinating major matters such as the establishment and coordination of national scientific and technological programs and projects, the allocation of scientific and technological resources, the restructuring of R&D institutions, and the integration of R&D with higher education and industrial development.

Article 18 May 30th shall be the National Day for Science and Technology Workers.

The state establishes and improves the system of science and technology awards, and sets up awards including the State Preeminent Science and Technology Award to commend organizations and individuals that have made important contributions to scientific and technological progress. Specific measures for science and technology awards shall be formulated by the State Council.

The state encourages organizations and individuals at home and abroad to set up science and technology awards to commend organizations and individuals that have made contributions to scientific and technological progress.

Chapter II Basic Research

Article 19 The state enhances the capacity of basic research,  strengthens the overall planning for research projects, talent and bases in alignment with the inherent laws of scientific development and talent growth, and provides good material conditions and strong institutional guarantee for basic research.

To increase scientific and technological capacity at the source, the state strengthens the planning and deployment of basic research, and promotes the combination of free exploration with goal-oriented basic research. Basic research shall aim at exploring scientific and technological frontiers, serving economic and social development, meeting major needs for national security, and safeguarding people’s life and health, and focus on tackling key technological problems. Basic research in areas such as emerging and strategic industries shall be strengthened.

The state encourages R&D institutions, institutions of higher education, and enterprises to bolster basic research and promote original innovation by taking advantage of their respective strengths.

Article 20 The state establishes an investment mechanism for ensuring stable government funding for basic research.

The state encourages local governments with eligible conditions to strengthen their support for basic research by providing appropriate fiscal investment in light of the needs of local economic and social development.

The state motivates enterprises to increase expenditure on basic research, and encourages the non-governmental sector to invest in basic research through diverse means such as donations and the establishment of funds, by providing fiscal, financial and tax policy support.

The proportion of expenditure on basic research in the gross domestic expenditure on R&D shall be gradually increased to meet the requirements of building China into a powerhouse of science and technology.

Article 21 The state establishes a National Natural Science Fund to finance basic research and support relevant personnel training and team building. The principles of “guidance at macro-level, voluntary application, fair competition, peer review, and merit-based selection” shall be followed to identify projects to be funded by the National Natural Science Fund.

In light of their actual economic and social situation and regional development needs, local governments with eligible conditions may set up their natural science funds to support basic research.

Article 22 The state improves the structure of academic disciplines and the knowledge system, promotes cross-disciplinary integration, and facilitates the coordinated development of basic and applied research.

Article 23 The state strengthens the fostering of researchers in basic science, provides strong and stable support for them, and improves their quality and competence.

The state establishes a resource allocation mechanism that meets the needs of basic research, and assessment and incentive mechanisms that are conducive to basic research, and creates a favourable environment that allows researchers to devote themselves to basic research, so as to encourage and attract the involvement of outstanding scientific and technological personnel in basic research.

Article 24 The state strengthens the development of basic research bases.

The state improves the essential facilities for basic research, and promotes open access to such facilities.

Article 25 The state supports institutions of higher education in the development of basic disciplines, the fostering of researchers in basic science and the independent deployment of basic research, so as to improve the quality of basic research in such institutions.

Chapter III Applied Research and Commercialization

Article 26 The state encourages applied research that can give impetus to basic research, and promotes the integrated development of basic research, applied research and commercialization of research results.

The state improves the general-purpose, fundamental technology supply system, promotes the in-depth integration of the innovation chain and industrial chain, and guarantees the security of the industrial chain and supply chain.

Article 27 The state improves the coordination mechanism for achieving major breakthroughs through collaborative research. Research projects, talent, bases and funds shall be deployed in a coordinated manner to facilitate close collaboration among enterprises, universities and R&D institutions in the R&D of China’s own core technologies in key fields concerning economic and social development, national security and people’s life and health.

Article 28 The state improves the system for mobilizing nationwide resources to make breakthroughs in core technologies in key fields. The state launches and implements major tasks that serve the strategic needs of the country, systematically deploys major projects of pioneering and strategic significance, and adopts a forward-thinking approach to planning for the R&D of core technologies in key fields.

Article 29 The state strengthens the building of general-purpose technology platforms and R&D institutions serving the needs of industrial development, and encourages local governments to build R&D institutions for applied research serving local needs.

The state encourages R&D institutions and institutions of higher education to strengthen the R&D of general-purpose, fundamental technologies, and encourages enterprises to lead R&D activities that serve the needs of the market and industrial development.

Article 30 The state strengthens the pilot-scale test, engineering application, and industrial application of R&D results, and steps up the pace to turn them into actual productivity.

R&D institutions and institutions of higher education established with fiscal funds shall actively promote the commercialization of R&D results. These institutions shall strengthen their technology transfer offices, step up the training of their technology transfer staff, and improve their systems for the commercialization of R&D results.

Article 31 The state encourages enterprises, R&D institutions, institutions of higher education and other organizations to establish cooperation mechanisms that exploit each other’s advantages, clearly define their roles and responsibilities, and ensure risk and result sharing. Under such mechanisms, joint research platforms, technological innovation alliances, and innovation consortia may be set up based on market principles to promote R&D and improve the effectiveness of commercialization.

Article 32 For the R&D results of projects fiscally funded through scientific and technological programs, the project undertaking party may obtain relevant intellectual property rights, and commercialize the R&D results through their own investment, transfer them to others, jointly commercialize them with others, license the use of them to others, or use them as contributions to investment according to law, on the premise that in so doing it will not damage national security, national interests, or major public interests.

The project undertaking parties shall exploit the intellectual property rights under the preceding paragraph according to law, and take measures to protect them. The project undertaking parties shall submit annual reports to the project management institutions on their exploitation and protection. If the intellectual property rights are not exploited within a reasonable period of time and without justifiable reasons, the state may exploit them without compensation, or permit others to exploit them with or without compensation.

For the intellectual property rights under the first paragraph of this Article obtained by the project undertaking parties according to law, the state may exploit them without compensation, or permit others to exploit them with or without compensation, for the sake of national security, national interests, and substantial  public interests.

Where the intellectual property rights under the first paragraph of this Article are exploited by the project undertaking parties, the benefits arising therefrom shall be distributed in accordance with relevant provisions of laws and regulations. In the absence of such provisions, relevant agreements shall be followed.

Article 33 The state implements a distribution policy oriented toward highlighting the value of knowledge. The state promotes reform of the mechanisms for intellectual property rights attribution and benefits distribution in accordance with relevant regulations of the state, and explores the establishment of a system granting scientific and technological personnel the ownership or right of long-term use of the R&D results which are created during their employment.

Article 34 The state encourages the intellectual property rights generated under fiscally funded projects of scientific and technological programs to be first used in China.

Where intellectual property rights under the preceding paragraph are transferred to overseas organizations or individuals, or licensed exclusively to overseas organizations or individuals, relevant approval shall be obtained from the project management institutions. Where the provisions of other laws or administrative regulations provide for other approval authorities, such provisions shall prevail.

Article 35 The state encourages the application of new technologies. Under the principles of inclusiveness and prudence, the state facilitates trials for applying new technologies, products, services and models, and creates conditions for their application.

Article 36 The state encourages and supports applied research in agriculture, disseminates and popularizes knowledge of agricultural science and technology, and accelerates the commercialization of agricultural R&D results. The state promotes the progress in agricultural science and technology to advance rural revitalization and the modernization of agriculture and rural areas.

Governments at or above the county level shall take measures to provide institutions engaged in the R&D and promotion of public benefit-related agricultural technologies with support in the development, application and promotion of new crop varieties and agricultural technologies.

Local governments at all levels shall encourage and guide agricultural technology service agencies, technical task force, and non-government technological organizations to provide technological services for crop farming, forestry, animal husbandry and fishery, and technological training and guidance for farmers.

Article 37 The state combines R&D with the development of product and service standards, and with product design and manufacturing. The state guides the involvement of R&D institutions, institutions of higher education, enterprises and social organizations in the research, formulation and adoption of national standards for major innovative products and services, and in the setting of international standards.

Article 38 The state fosters unified, open and interconnected technology markets that ensure orderly competition. The state encourages the establishment of intermediary service institutions engaged in technology evaluation, technology brokerage, innovation and entrepreneurship services. To promote the wider application of R&D results, the state guides the establishment of a technology transaction service system and an innovation and entrepreneurship service system that are commercialized, specialized, networked, IT-based and intelligent.

In technology transaction, the principles of voluntariness, equality, mutual benefit, and good faith shall be followed.

Chapter IV Innovation by Enterprises

Article 39 The state establishes a market-oriented system for technological innovation under which enterprises are the principal actors who engage in close cooperation with R&D institutions and institutions of higher education. The state guides and supports enterprises in conducting technological innovation activities, and supports them in leading national tasks for technology breakthroughs. The state enables enterprises to play a major role in technological innovation by encouraging them to become principal actors in innovation decision-making, research investment, organization of research activities, and commercialization, and by facilitating the flow of innovation factors to them, so as to improve their capacity for technological innovation.

The state cultivates leading tech-based enterprises with great influence and competitiveness, and gives full play to their role in stimulating innovation.

Article 40 The state encourages enterprises to carry out the following activities:

(1) establishing internal R&D institutions;

(2) cooperating with other enterprises, R&D institutions and institutions of higher education for joint research, establishing joint R&D bodies and platforms, setting up technology business incubators as well as innovation and entrepreneurship platforms, or conducting R&D through commissioned service;

(3) training, attracting and using scientific and technological personnel;

(4) jointly training personnel with expertise and highly skilled personnel, and recruiting graduates from institutions of higher education, by cooperating with R&D institutions, institutions of higher education, vocational colleges, or training institutions;

(5) setting up post-doctoral workstations or mobile stations; and

(6) combining science popularization activities with technological innovation and staff skills training, and setting up science popularization venues or facilities open to the public.

Article 41 The state encourages enterprises to strengthen original innovation, conduct technological cooperation and exchanges, increase investment in R&D and technological innovation, identify research topics independently, and carry out innovation activities.

The state encourages enterprises to make further innovation based on assimilating acquired technologies.

The R&D expenses incurred by enterprises in developing new technologies, products and processes may be deducted before tax in accordance with relevant regulations of the state. The depreciation of R&D instruments and equipment of enterprises may be accelerated.

Article 42 The state improves the multi-tiered capital markets, establishes and improves the mechanisms for promoting innovation, and supports qualified tech-based enterprises to use the capital market for their development.

The state strengthens guidance and policy support, broadens the sources of venture capital, and supports the development of business startups.

The state improves the public listing system for tech-based enterprises, provides them with smooth channels for seeking financing through domestic listing, and gives play to the role of the capital market in the financing of innovation.

Article 43 The following enterprises shall be entitled to preferential tax treatment in accordance with relevant regulations of the state:

(1) enterprises engaged in the R&D and manufacturing of high-tech products;

(2) small and medium-sized tech-based enterprises;

(3) venture capital enterprises that invest in tech-based startups; and

(4) other enterprises related to scientific and technological progress as specified by laws and administrative regulations.

Article 44 The state supports the development and operation of public R&D platforms, science and technology intermediaries, as well as innovation and entrepreneurship service institutions.

Public R&D platforms, science and technology intermediaries, as well as innovation and entrepreneurship service institutions shall provide services for technological innovation of small and medium-sized enterprises.

Article 45 The state protects the intellectual property rights of enterprises obtained through R&D. Enterprises shall constantly improve the quality and effectiveness of intellectual property, and enhance their innovation capacity and market competitiveness.

Article 46 State-owned enterprises shall improve the mechanism for offering incentives and imposing constraints by establishing an R&D input system, a distribution system and an assessment system which are conducive to technological innovation.

The leading person of a state-owned enterprise shall be responsible for the technological progress of the enterprise. The performance assessment of the leading person shall include factors such as investment in innovation, innovation capacity building, and innovation outputs.

Article 47 Local governments at or above the county level and their relevant administrative departments shall create a market environment enabling fair competition and technological progress of enterprises.

Relevant administrative departments of the State Council and provincial governments shall adopt industrial, fiscal, financial, energy, environmental, and climate change policies that guide and encourage enterprises to develop new technologies, products and processes, upgrade technologies and equipment, eliminate obsolete equipment and processes, and stop manufacturing products with outdated technologies.