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BEIJING, Dec. 29 -- The State Council, China's cabinet, has approved a pilot reform program that will run in Shanghai to trial the separation of business licenses from administrative permits.

The reform, which allows some companies to get their businesses up running without first obtaining administrative permits, will transform government functions and stimulate social innovation, said a statement released by the cabinet.

Altogether 116 administrative permit items will either be canceled or simplified, according to the statement.

In China, businesses have complained of drawn-out and redundant procedures, and the new measures in Shanghai is the latest to streamline government responsibility and delegate power to lower levels.

The State Council has canceled or delegated administrative approval power for 537 items since March 2013, meeting the target of cutting the number of items requiring administrative approval by one-third within the term of this government -- two years ahead of schedule, official data showed.