- Beware of policy promises; verify conditions
- Clarify land titles and planning limits
- Calculate hidden costs; document contracts
Introduction: Information Asymmetry Behind the Enthusiasm
Park investment promotion is a key lever for local economic development and an unavoidable step for private firms seeking to expand. Yet the information, expertise, and bargaining power between promoters and enterprises are inherently unequal. Since the Private Economy Promotion Law took effect on May 20, 2025, there is a clearer legal basis for fair competition and property rights protection, but enterprises still need to exercise sound judgment on the ground.
Common tactics are not mysterious; they exploit the fear of missing policy windows and leave gray areas between verbal promises and written contracts.
Tactic 1: Policy Promises and the Flexibility of Case-by-Case Deals
Promoters often attract firms with packages of fiscal incentives, rent subsidies, and talent rewards, saying verbally that whatever others get, you get, and whatever others do not have can be negotiated. In reality, fulfillment often comes with conditions such as local registration, tax payment years, and output thresholds, or is delayed under the pretext of a case-by-case discussion.
The key to avoiding pitfalls is to demand the original policy text and examples of past fulfillment, write key terms into the investment agreement, and specify liability for breach. Any benefit that remains verbal and is not put in writing should be treated as nonexistent.
Tactic 2: Ambiguous Land and Factory Titles, Deferred Planning Restrictions
Some parks push for signing with the promise of "move in first, get certificates later," but restrictions on land use, planning purposes, and fire safety acceptance may surface later, preventing firms from obtaining environmental permits, production licenses, or mortgage financing.
Before signing, private enterprises should obtain the plot's planning conditions, title certificates, and completion acceptance documents to confirm legal use of the factory. For split transfers or leases, verify whether the lessor has the right to dispose of the property to avoid sublease disputes. Clear title is a prerequisite for long-term operation and should not be compromised for speed.
Tactic 3: Hidden Costs and Unfulfilled Supporting Promises
Low rents may conceal additional expenses such as property management fees, energy capacity expansion fees, and wastewater treatment charges; promised amenities like public transport, canteens, and talent apartments may shrink as occupancy changes.
Enterprises should request a full list of costs and include delivery timelines for supporting facilities in contract annexes. Also, check whether the park's industrial positioning matches their own to avoid entering an unrelated cluster for short-term incentives, which may increase collaboration costs.
Conclusion: Turn Promotional Rhetoric into Accountable Contract Terms
Park investment promotion is not a one-off deal but the start of a long-term partnership. Under the legal environment created by the Private Economy Promotion Law, private firms should use legal tools to turn promotional rhetoric into enforceable, accountable contract terms. More prudence and less wishful thinking will help the park truly support enterprise growth.