MEASURES FOR THE ADMINISTRATION OF PAWNING

the Ministry of Commerce, the Ministry of Public Security

Order of the Ministry of Commerce and the Ministry of Public Security

No.8

The Measures for the Administration of Pawning, which were deliberated and adopted at the executive meeting of the Ministry of Commerce
and approved by the Ministry of Public Security, are hereby promulgated and shall come into force as of April 1st, 2005.

The Minister of the Ministry of Commerce Bo Xilai

The Minister of the Ministry of Public Security Zhou Yongkang

February 9, 2005

Measures for the Administration of Pawning

Chapter I General Provisions

Article 1

With a view to regulating pawning activities, strengthening supervision and administration, and accelerating the healthy development
of the pawn industry, the present Measures are formulated according to the relevant legal provisions.

Article 2

The present Measures shall be applicable to the establishment of pawnshops and the undertaking of pawning activities within the territory
of the People’s Republic of China.

Article 3

The term “pawning” as mentioned in the present Measures, shall refer to the act that a pawner gives his or her chattel or property
rights to a pawnshop as a pledge for pawned item or gives his or her real estate to the pawnshop as a mortgage for the pawned item,
pays expenses at a certain rate, obtains pawn money and then, within the agreed period of time, redeems the pawned item by repaying
the pawn money and the interest thereof.

The term “pawnshop” as mentioned in the present Measures, shall refer to an enterprise juridical person that is established according
to the present Measures and specially engages in the pawning activities. And its organizational form and its institutions shall accord
with the relevant provisions of the Company Law of the People’s Republic of China.

Article 4

The competent department of commerce shall conduct supervision and administration on the pawn industry. And the public security organ
shall carry out public security administration on the pawn industry.

Article 5

The name of a pawnshop shall accord with the relevant provisions on the administration of enterprise name registration with the word
“pawn” indicated in the name. No other business organization and institution may include the word “pawn” in their names, nor may
they undertake pawn businesses overtly or in any disguised form.

Article 6

When undertaking business activities, a pawnshop shall abide by the laws, regulations and rules, and follow the principles of equality,
free will, good faith and mutual benefit.

Chapter II Establishment

Article 7

When applying for the establishment of a pawnshop, one shall meet the following conditions:

1.

having its own articles of association conforming to the provisions of laws and regulations;

2.

having the minimum registered capital as prescribed in the present Measures;

3.

having a business place meeting the requirements and the facilities that are necessary for business operations;

4.

having managers and appraisers who are familiar with the pawn business;

5.

having two or more shareholders with legal person status, and the institutional shares as comparative controlling shares;

6.

complying with the requirements for management of public security as prescribed in Articles 9 and 10 of the present Measures; and

7.

complying with the state requirements for overall planning and reasonable arrangement of pawnshops.

Article 8

The minimum registered capital of a pawnshop shall be RMB 3 million Yuan; for the pawnshop that undertakes the pawn business of mortgage
of real estates, the minimum registered capital shall be RMB 5 million Yuan; for the pawnshop that undertakes the pawn business of
pledge of property rights, the minimum registered capital shall be RMB 10 million Yuan.

The minimum registered capital of a pawnshop shall be the monetary capital actually paid by shareholders, not including the capital
contributed in the form of in-kind, industrial property rights, know-how and the land use right.

Article 9

A pawnshop shall establish and improve the following safety systems:

1.

the system for checking the certificates or licenses for accepting, renewal of a pawn and redeeming any pawned item;

2.

the system for checking and keeping pawned items;

3.

the system for assisting in the investigation and ordering circularly the arrest of a criminal at large;

4.

the system for reporting suspicious instances; and

5.

the system of equipment of security personnel.

Article 10

The building construction and business facilities of a pawnshop shall conform to the relevant security standards and provisions on
fire control of the state. The specific safety facilities are as follows:

1.

video equipments set up in the business place (the video materials shall be kept for at least two months);

2.

safeguard facilities shall be set up at the business counters;

3.

warehouses for keeping pawned items and safe boxes (counters or deposits), which meet the safety requirements;

4.

the alarm device;

5.

safeguard facilities for doors and windows; and

6.

necessary fire control facilities and equipments.

Article 11

When establishing a pawnshop, an applicant shall submit the following documents to the competent department of commerce at the level
of districted city (prefecture) of the locality where the pawnshop is to be established:

1.

an application for the establishment, which shall specify the name, residence, registered capital, shareholders and their amount of
capital contributions, business scope of the pawnshop to be established and etc., and a feasibility study report;

2.

the articles of association of the pawnshop, the agreement on capital contributions and the commitment on capital contributions;

3.

business rules, internal management system and safeguard measures of the pawnshop;

4.

the capital verification certificate issued by a capital verification institution that has legal qualification;

5.

resumes of the individual shareholders, the legal representative to be appointed and other senior managers as issued by the personnel
department of the entity where their archives are placed;

6.

the recent financial auditing report of the shareholders with legal person status and the certificate of capability for capital contribution
as issued by the accountant firm that has legal qualification, the resolution of the board of directors or the shareholders’ meeting
of the shareholders with legal person status and a photocopy of the duplicate of the business licenses thereof;

7.

the effective certification documents of ownership or use right of the business place, which meet the requirements; and

8.

the Notice of Approval of Enterprise Names in Advance as issued by the administrative department for industry and commerce.

Article 12

Any pawnshop that meets the following conditions may establish a trans-province (autonomous region or municipalities directly under
the Central Government) branches:

1.

having engaged in the pawn business for three years or more with the registered capital of not less than RMB 15 million Yuan;

2.

making profits consecutively in the past two years; and

3.

having no records of violating laws and regulations in its business operations during the past two years.

The branches of any pawnshop shall implement the safety system as prescribed in Article 9 of the present Measures, and shall have
the safety facilities as prescribed in Article 10 of the present Measures.

Article 13

A pawnshop shall allocate the working capital of not less than RMB 5 million Yuan to each of its branch.

The total working capital of all the branches of a pawnshop shall not exceed 50% of the registered capital of the pawnshop.

Article 14

When applying for establishing any branch, a pawnshop shallsubmit the following materials to the competent department of commerce
at the level of districted city (prefecture) of the locality where the branch is to be established:

1.

the application report for establishment of the branch (which shall specify the name, residence, person-in-charge, amount of working
capital and etc. of the branch to be established), a feasibility study report and the resolution of the board of directors (or the
shareholders’ meeting);

2.

the financial report of the pawnshop in the past two years as issued by a qualified accountant firm;

3.

the resume of the person to be appointed in charge of the branch, which is issued by the personnel department at the locality where
his archives are placed;

4.

the effective certification documents of ownership or use right of the business place, which meet the requirements; and

5.

the certificate of having no records of violating any law or regulation in the past two years as issued by the competent department
of commerce at the provincial level and the public security organ of the people’s government at the level of the county where it
is located.

Article 15

After receiving an application for establishing a pawnshop or an application of a pawnshop for establishing a branch, the competent
department of commerce at the level of districted city (prefecture) shall report it for examination to the competent department of
commerce at the provincial level which shall in turn submit the examination opinions and the application documents to the Ministry
of Commerce for approval and issuance of a License for Operation of Pawn Business. The competent department of commerce at the provincial
level shall circulate a report on the relevant conditions to the public security organ of the people’s government at the same level
within 5 days (workdays, the same hereinafter) after receiving the approval documents of the Ministry of Commerce. And the public
security organ of the people’s government at the provincial level shall notify the public security organ of the people’s government
at the level of districted city (prefecture) of the report within 5 days.

Article 16

After receiving a License for Operation of Pawn Business, the applicant shall apply for a License of Special Trades for the pawnshop
to the public security organ of the people’s government at the level of the local county within 10 days, and submit the following
materials:

1.

an application report;

2.

the License for Operation of Pawn Business and its photocopy;

3.

the resumes of the legal representative, individual shareholders and other senior managers as well as the photocopies of their effective
identity certificates;

4.

the certificate of having no records of intentional crimes as issued by the respective public security organ of the people’s government
at the level of the county where the registered permanent residences of the legal representative, individual shareholders and other
senior managers are placed;

5.

the ichnography and constructional drawing of the business place and the warehouse of the pawnshop;

6.

the video equipments, safeguard facilities, safe boxes (counters, warehouses) and the distribution plan of the sites for the installation
and setup of fire control facilities;

7.

various rules on public security safeguarding and fire control; and

8.

basic information of the public security safeguarding organizations and personnel.

Article 17

The public security organ of the people’s government at the level of the county where the applicant resides shall, within 10 days
after accepting the application, report the application documents and the result of preliminary examination to the public security
organ of the people’s government at the level of districted city (prefecture) which shall finish the examination and approval within
10 days and issue a License of Special Trades to those to whom approval is granted.

The public security organ of the people’s government at the level of districted city (prefecture) shall finish the examination and
approval on the applications accepted directly by itself within 20 days. And, upon approval, a License of Special Trades shall be
issued

The public security organ of the people’s government at the level of districted city (prefecture) shall, within 5 days after issuing
a license, report the conditions of examination and approval to the public security organ of the people’s government at the provincial
level for archival filing; and the public security organ of the people’s government at the provincial level shall report the relevant
matters to the competent department of commerce at the same level within 5 days.

The applicant shall, within 10 days after receiving the License of Special Trades, apply for checking in and registration at the administrative
department for industry and commerce, and shall not conduct business operations until having received the business license.

Chapter III Alteration and Termination

Article 18

Where a pawnshop alters its name and registered capital (excluding those whose registered capital is more than RMB 50 million Yuan
after alteration), replaces its legal representative, or changes its residence within the scope of the city (region, prefecture,
or league), transfers stocks (excluding those that transfer stocks to anyone else for up to 50% of its total shares accumulatively),
it shall be subject to the approval of the competent department of commerce at the provincial level. The competent department of
commerce at the provincial level shall report it to the Ministry of Commerce for archival filing within 20 days after approval. The
Ministry of Commerce shall change the License for Operation of Pawn Business collectively in June and December each year.

Where any pawnshop is split, merged, or moves its residence to another city (region, prefecture, or league), or transfers its stocks
to anyone else for up to 50% of its total shares accumulatively, or the registered capital after alteration is more than RMB 50 Yuan,
it shall, upon the approval of the competent department of commerce at the provincial level, report it to the Ministry of Commerce
for approval and change the License for Operation of Pawn Business.

The applicant shall, after receiving the License for Operation of Pawn Business, apply for changing the License of Special Trades
and the business license according to the relevant provisions of Article 17 of the present Measures.

Article 19

When increasing its registered capital, a pawnshop shall meet the following conditions:

1.

The time interval between the increase of registered capital and the time when it started its business operations or the preceding
increase of registered capital shall be one year or more; and

2.

having no record of operation in violation of any law or regulation within one year.

Article 20

If any pawnshop alters its registered capital or adjusts the structure of its capital stocks, the new individual shareholders and
the senior managers to be appointed shall accept qualification examination; and the new shareholders with legal-person status and
the shareholders with legal person status after capital increase shall have the corresponding capability and qualification for investment.

Article 21

Where anyone fails to obtain the License of Special Trades or the business license as required without justifiable reasons, or fails
to start business without justifiable reasons for more than 6 months as of the date of being issued of the business license, or stops
the business operation for more than 6 consecutive months after starting business, the competent department of commerce at the provincial
level and the public security organ of the people’s government at the level of districted city (prefecture) shall take back the License
for Operation of Pawn Business and the License of Special Trades respectively, and the original approval documents shall be revoked
automatically. The License for Operation of Pawn Business that has bee taken back shall be returned to the Ministry of Commerce.

Where any competent department of commerce at the provincial level takes back the License for Operation of Pawn Business or any public
security organ of the people’s government at the level of districted city (prefecture) takes back the License of Special Trades,
it shall report to each other the relevant matters through the public security organ of the people’s government at the provincial
level within 10 days.

After its license is taken back, the pawnshop shall apply for writing-off registration to the administrative department for industry
and commerce according to law.

Article 22

A pawnshop shall, three months before its dissolution, file an application to the competent department of commerce at the provincial
level, and shall stop other business operations except redeeming pawned objects or disposing the absolutely pawned objects upon approval
and set up a liquidation group according to law to make liquidation.

Article 23

After the liquidation to a pawnshop is completed, the liquidation group shall submit a liquidation report for confirmation to the
competent department of commerce at the provincial levelwhich shall take back the License for Operation of Pawn Business and notify
the public security organ of the people’s government at the same level within 5 days.

The public security organ of the people’s government at the provincial level shall notify the public security organ of the people’s
government at the level of districted city (prefecture) that has made the original approval decision to take back the License of
Special Trades within 5 days.

The pawnshop shall, after the liquidation is completed, apply for writing off registration to the administrative department of industry
and commerce according to law.

Article 24

The competent department of commerce at the provincial level shall make a public announcement on any pawnshop that has terminated
its business operations, and report it to the Ministry of Commerce for archival filing.

Chapter IV Business Scope

Article 25

A pawnshop may undertake the following business operations upon approval:

1.

the pawn business of pledge of chattel;

2.

the pawn business of pledge of property rights;

3.

the pawn business of mortgage of real estates (excluding the real estates of other provinces, autonomous regions, and municipalities
directly under the Central Government or the projects under construction for which the licenses for advance sale of commercial houses
has not been obtained);

4.

sale of the absolutely pawned objects within a certain value;

5.

appraisal and counseling consultation; and

6.

other pawn businesses as approved by the Ministry of Commerce according to law.

Article 26

No pawnshops may undertake any of the following businesses:

1.

the sale of non-absolutely pawned objects or the purchase or consignment of old objects;

2.

the business of mortgage of chattel;

3.

raising funds or absorbing deposit overtly or in any disguised form;

4.

granting credit loans; or

5.

other businesses not approved by the Ministry of Commerce.

Article 27

No pawnshop may accept any of the following properties in its pawn business:

1.

property that has been lawfully sealed up, detained or property against which other protective measures have been taken;

2.

ill-gotten goods and items without clear sources;

3.

any item that is inflammable, easily explosive, severely toxic or radioactive and the containers thereof;

4.

knife tools under control, guns, ammunitions, marks used by army or police, uniforms and instruments;

5.

the official documents and seals of the state organs and the properties under its control;

6.

the certificates or licenses except the certificate of real right issued by the state organs and the effective identity certificates;

7.

property over which the pawner has no ownership or fails to obtain the right of disposition according to law; and

8.

natural resources or other property or items that are prohibited from circulating by laws, regulations and the relevant provisions
of the state.

Article 28

No pawnshops may have any of the following acts:

1.

borrowing money from entities or individuals except commercial banks;

2.

making inter-bank capital borrowing with other pawnshops overtly or in any disguised form;

3.

getting loans from commercial banks beyond the prescribed limit; or

4.

making foreign investment.

Article 29

To accept those items that are subject to uniform purchase, exclusive sale or monopolistic sale of the state, the pawnshop shall obtain
the approval of the relevant departments of the government.

Chapter V Pawn Tickets

Article 30

A pawn ticket is a loan contract between a pawnshop and a pawner, and is the credence for payment of pawn money to the pawner by the
pawnshop.

If a pawnshop comes to any agreement with a pawner on any matter beyond the pawn ticket, they shall sign a supplementary written contract.
But the contents stipulated in the contract shall not violate the relevant laws, regulations and the provisions of the present Measures.

Article 31

A pawn ticket shall specify the following items:

1.

name and residence of the pawnshop;

2.

name and residence (or address) of the pawner, relevant certificates (licenses) and their numbers thereof;

3.

name, quantity, quality and status of the pawned item;

4.

the estimated value and the amount of pawn money;

5.

the interest rate and comprehensive premium rate;

6.

date and term of the pawn, the term of renewal of the pawn; and

7.

points for attention to the pawners.

Article 32

No pawnshop or pawner may transfer, lend or pledge his/its pawn ticket to any third person.

Article 33

The pawnshop and the pawner shall record their pawn ticket in truth and well keep it.

In case any pawn ticket is lost, the pawner shall in time report the loss to the pawnshop. In case the pawner fails to report the
loss of the pawn ticket to the pawnshop, or the pawned item has been redeemed by any other person before the pawner reports the loss
to the pawnshop, the pawnshop shall not be regarded as blamable and shall not compensate the loss.

Chapter IV Rules for Business Operation

Article 34

No pawnshop may entrust any other entity or individual to handle the pawn business as an agent, nor may it assign any operating person
to any other organization, institution or business place to conduct the pawn business.

Article 35

When a pawner pawns an item or redeems any pawned item, he/it shall show his/its own effective identity certificate. If the pawner
is an entity, the pawn handler shall show the certificate of the entity and the effective identity certificate of himself; in the
case of a pawn by entrustment, the entrusted person shall show the power of attorney of the pawner, and the effective identity certificates
of himself and the client.

Except the certificates as listed in the preceding paragraph, the pawner shall, when pawning any item, provide the source of the pawned
item and the relevant certificate documents according to the facts to the pawnshop. When redeeming the pawned item, the pawner shall
show the pawn ticket.

The pawnshop shall check the certificate documents as listed in paragraph two of this Article, which are issued by the pawner.

Article 36

Both parties shall determine the estimated value and the amount of pawn money of any pawned item through negotiation.

In case both parties cannot come to an agreement on the pawned value of any real estate through negotiation, they may entrust a real
estate price appraisal institution that has the competent qualification to make an appraisal, and the estimated value may be regarded
as a reference for determining the pawned value.

The time limit of a pawn shall be stipulated by both parties, and shall not exceed 6 months at the maximum.

Article 37

The interest rate for the pawn value shall apply the six-month legal interest rate of loans to a banking institution as announced
by the People’s Bank of China after converting the term of pawn.

The interest for the pawn value shall not be deducted in advance.

Article 38

The comprehensive premium of a pawn shall include all kinds of service fees and overhead expenses.

In the case of a pledged pawn of chattel, the monthly comprehensive premium rate shall not exceed 42￿￿f the pawn value.

In the case of a mortgaged pawn of real estate, the monthly comprehensive premium rate shall not exceed 27￿￿f the pawn value.

In the case of a pledged pawn of property right, the monthly comprehensive premium rate shall not exceed 24￿￿f the pawn value.

Where the term of a pawn is less than 5 days, the premium shall be charged as that the term is 5 days.

Article 39

Upon the agreement of both parties during the period of a pawn or within 5 days after the expiration of the pawn term, the pawn may
be renewed for 6 months at maximum each time. The renewed term of the pawn shall be calculated from the day when the pawn term expires
or when the former renewed term of the pawn expires. To renew a pawn, the pawner shall settle all the interest for the pawn in the
form term and the premium in the present term.

Article 40

After a pawn term or a renewed term expires, the pawner shall redeem the pawned item or renew the term within 5 days. In case the
pawner fails to redeem the item or renew the term, it shall be deemed as an absolute pawn.

Where a pawner redeems a pawned item during the period between the expiration of the pawn term or the renewed term and the time for
absolute pawn, he shall, apart from repaying the pawn value and the interest thereof as well as the comprehensive premium, make up
the interest for the pawn value and other relevant expenses in light of the penalty level of interest rate of an overdue loan for
banks and other financial institutions as prescribed by the People’s Bank of China, and the premium rates for the pawn and the number
of days overdue as formulated by the pawnshop.

Article 41

The pawnshop shall not lease, pledge, mortgage or use any pawned item within the term of a pawn.

Where a pledged item of a pawn is lost or damaged during the pawn term or the renewed term, the pawnshop shall make compensation pursuant
to the estimated value. Where the pledged item of a pawn is damaged due to force majeure, the pawnshop shall not be responsible for
the compensation.

Article 42

Where a pawnshop undertakes the pawn business of real estate mortgage, it shall handle mortgage registration in advance with the pawner
at the relevant departments according to law, and then go through the formalities for a mortgaged pawn.

When conducting the pawn business of pledge of motor vehicles, the pawnshop shallgo through the formalities for registration of the
pledge at the administrative department of vehicles.

Where any other pawn business managed by the pawnshop is subject to registration according to relevant laws and regulations, the pawnshop
shall go through the registration formalities according to law.

Article 43

The pawnshop shall treat with the absolutely pawned items according to the following provisions:

1.

If the estimated value of a pawned item is more than RMB 30,000 Yuan, it may be treated with according to the Guaranty Law of the
People’s Republic of China or may be publicly auctioned by an entrusted auction house pursuant to the agreement reached upon by both
parties concerning absolute pawns. The proceeds from auction shall be returned to the pawner after deducting the expenses of auction
as well as the pawn value and the interest thereof; in case the proceeds from auction are lower than the estimated value, the pawnshop
may demand the pawner to make up the margin.

2.

If the estimated value of an absolutely pawned item is less than RMB 30,000 Yuan, the pawnshop may sell off it by itself or deal with
it by converting it into money, and shall be responsible for the profit or loss thereof.

3.

The absolutely pawned items, which are restricted by the state from circulating, shall be treated with after being reported to and
approved by the relevant administrative departments or being handed over to the designated entities for disposal.

4.

When setting up spots for the sale of absolutely pawned items outside its business place, the pawnshop shall report to the competent
department of commerce at the provincial level for archival filing, and shall voluntarily accept the supervision and inspection of
the local competent department of commerce. And

5.

When disposing of the shares of any listed company belonging to absolutely pawned items, the pawnshop shall win the consent and cooperation
of the pawner, and shall not sell off the shares or convert them into money by itself, or entrust any auction house to auction them
publicly.

Article 44

The assets of a pawnshop shall be managed pursuant to the proportions below:

1.

Where a pawnshop gets loans from a commercial bank within the time when it starts business operation till it first submits the annual
financial reports to the competent department of commerce at the provincial level and the local competent department of commerce,
the balance of the loan shall not exceed its registered capital. Where a pawnshop gets loans from a commercial bank after submitting
the financial reports for the first time to the competent department of commerce at the provincial level and the local competent
department of commerce, the balance of the loan shall not exceed the rights and interests of the owners as stated in the financial
reports submitted to the competent department in the previous year. The pawnshop shall not get loans from any commercial bank outside
its own city (region, prefecture, or league). No branch of any pawnshop may get loans from any commercial bank.

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