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RULES FOR THE ESTABLISHMENT OF FOREIGN-SHARED SECURITIES COMPANIES

The China Securities Regulatory Commission

Decree of the China Securities Regulatory Commission

No.8

The Rules for the Establishment of Foreign-shared Securities Companies are hereby promulgated, and shall come into force on July 1,
2002.

Chairman of the China Securities Regulatory Commission Zhou Xiaochuan

June 1, 2002

Rules for the Establishment of Foreign-shared Securities Companies

Article 1

To meet the demand of opening the securities market, to strengthen and improve the supervision and administration of foreign-shared
securities companies and to clarify the preconditions and procedures for the establishment of foreign-shared securities companies,
the Rules is therefore formulated in accordance with relevant provisions of the Company Law and the Securities Law.

Article 2

Foreign-shared securities companies as referred to in the Rules shall include domestic securities companies whose shares are transferred
to or purchased by foreign shareholders or those that are co-funded by foreign and domestic shareholders.

Article 3

The China Securities Regulatory Commission (hereinafter referred to as CSRC) shall be responsible for the examination, approval, supervision
and administration of foreign-shared securities companies.

Article 4

The organizational structure of a foreign-shared securities company shall be that of limited liability. The name, registered capital,
founding and functions of the departments of a foreign-shared securities company shall be compliant with the relevant provisions
of the Company Law, the Securities Law and CSRC.

Article 5

A foreign-shared securities company may engage in the following businesses:

1)

Underwriting of shares (including RMB ordinary shares and foreign shares) and bonds (including bonds issued by the government and
companies);

2)

Brokerage of foreign shares;

3)

Brokerage and proprietary dealing of bonds (including bonds issued by the government and companies);

4)

Other businesses approved by the CSRC. The foreign shares as used in the preceding paragraph shall refer to domestic listed foreign
shares (B-shares) and overseas listed foreign shares. The securities company shall file the application for business scope to the
CSRC according to the first paragraph of this Article. Those engaging in the lead underwriting of stocks shall obtain the license
for share lead underwriting in accordance with the provisions of the CSRC on the administration of share lead underwriting license
for securities companies.

Article 6

A foreign-shared securities company shall possess the following qualifications:

1)

The registered capital is in accordance with the provisions of the Securities Law on the registered capital of comprehensive securities
companies;

2)

The shareholders should possess the qualifications as provided for by the Rules, and the proportion and form of their capital contribution
be in accordance with the provisions of the Rules;

3)

Staff members that have obtained the qualifications as securities practitioners according to the provisions of the CSRC shall be no
less than 50, and there shall be professionals in accounting, law and computer as required.

4)

The company should have sound systems of internal management and risk control, separate systems of organization, personnel, information
and business execution for such businesses as underwriting, brokerage and proprietary trading and a well-designed technical system
for internal control.

5)

The company should own the operating place and other facilities for transactions as required.

6)

Other prudential conditions provided for by the CSRC.

Article 7

The foreign shareholders of a foreign-shared securities company shall possess the following qualifications:

1)

Their home countries shall have sound legal and regulatory systems on securities transactions, and the securities regulatory bodies
should have signed the memorandums of understanding on securities regulation with the CSRC, and maintained effective cooperation
with the CSRC;

2)

They have legitimate qualifications for securities dealing in their home countries and have engaged in the financial business for
no less than 10 years without being imposed severe punishments by the securities regulatory bodies and judicial departments during
the past 3 years;

3)

The various risk supervision indicators during the past three years should conform to the legal provisions and the requirements of
the securities regulatory bodies of their home countries;

4)

Having sound internal control systems;

5)

Having good reputation and sound track record on the international securities market;

6)

Other prudential conditions provided for by the CSRC.

Article 8

The domestic shareholders of a foreign-shared securities company shall possess the qualifications as shareholders of securities companies
as provided for by the CSRC. At least one of the domestic shareholders of a foreign-shared securities company shall be a domestically
funded securities company. However, it does not include foreign-shared securities companies changed from domestically funded securities
companies.

Article 9

The domestic shareholders may invest by cash and tangible objects essential for the business operation; while the foreign shareholders
shall invest by free convertible currencies.

Article 10

The shares held by foreign shareholders or the equity possessed by them (both directly and indirectly) in a foreign-shared securities
company should not exceed one third of the total. At least one of the domestic shareholders of a domestic-funded securities company
shall hold o less than one third of the shares or equity of the company. As for a foreign-shared securities company changed from
a domestically funded securities company, at least one domestic shareholder shall hold no less than one third of the shares.

Article 11

The board chairman, general manager, and deputy general manager of a foreign-shared securities company shall possess the qualifications
as senior management of securities companies as provided for by the CSRC.

Article 12

To apply for the establishment of a foreign-shared securities company, the representatives appointed or the agents entrusted by the
shareholders shall submit the following documents to the CSRC:

1)

The application form jointly signed by legal representatives or authorized representatives of the domestic and foreign shareholders;

2)

Contract and draft corporate statute for the establishment of the foreign-shared securities company;

3)

Application forms of qualified candidates for the board chairman, general manager and deputy general manager of the foreign-shared
securities company;

4)

Photocopies of the business license or registration certificate and securities transaction credentials of the shareholders;

5)

Audited financial statements of the foreign and domestic shareholders of the year prior to the application;

6)

Statements issued by the securities regulatory bodies of the home countries of the foreign shareholders on whether those shareholders
possess the qualifications as provided for in Items 2) and 3) of Article 7 of the Rules;

7)

Legal opinions presented by law firms in China qualified for securities-related businesses.

Article 13

The CSRC shall, according to relevant laws, administrative regulations and the Rules, examine the application materials as provided
for in the preceding paragraph, and shall decide on whether to approve the application within 45 working days upon receipt of valid
application materials, and shall notify the applicant in writing. For those unapproved applications, reasons shall be explained to
the applicants in writing.

Article 14

The shareholders shall contribute the capital in full or provide the cooperative conditions as agreed upon, elect the board of directors,
decide on members of the senior management, and apply to competent administrations for industry and commerce for registration of
establishment and claim the business license within 6 months as of the issuance of approval by the CSRC.

Article 15

The board chairman or authorized representatives of a foreign-shared securities company shall, within 15 working days as o the issuance
of the business license, submit the following documents to the CSRC and apply for the License for Securities Business:

1)

A copy of the business license;

2)

The company statute;

3)

A capital verification report produced by an accounting firm in China qualified for securities-related businesses;

4)

A name list and resumes of the directors, supervisors and other members of the senior management, a name list of the main business
personnel and copies of their credentials for securities business;

5)

A written version of the internal control system regulations;

6)

Descriptions of the operating place and transaction facilities.

Article 16

The CSRC shall, according to related laws, administrative regulations and the Rules, examine the application materials as provided
for in the preceding paragraph, and shall decide within 15 working days upon receipt of valid application materials. For those that
meet the requirements, the License for Securities Business shall be granted; for those that fail to meet the requirements, the license
shall not be granted and reasons shall be explained in writing.

Article 17

A foreign-shared securities company is not allowed to operate in the securities business without the License for Securities Business
issued by the CSRC.

Article 18

Domestically funded securities companies applying to be changed into foreign-shared securities companies should meet the requirements
provided for in Article 6 of the Rules. Foreign shareholders purchasing or holding shares of domestic-funded securities companies
shall meet the requirements provided for in Article 7 of the Rules, and the proportion of the purchased shares or the capital contribution
thereof shall conform to the provisions of Article 10 of the Rules.

Article 19

Domestically funded securities companies applying for a change to foreign-shared securities companies shall submit the following documents
to the CSRC:

1)

An application form signed by the legal representative;

2)

Decision of the shareholders’ meeting on changing the company into a foreign-shared securities company;

3)

Draft company statute

4)

Agreement on share transfer or capital contribution (agreement on share purchase);

5)

A name list and resumes of the personnel appointed by the foreign investors to take post in that securities company;

6)

The business license or registration certificates of the foreign shareholders and copies of their credentials for the securities business;

7)

Audited financial statements of the foreign shareholders of the year prior to the application;

8)

Statements issued by the securities regulatory bodies of the home countries of the foreign shareholders on whether those shareholders
possess the qualifications as provided for in Items 2) and 3) of Article 7 of the Rules;

9)

Plans for eliminating businesses that are prohibited from a foreign-shared securities company by related laws;

10)

Legal opinions issued by a law firm in China qualified for securities-related businesses.

Article 20

The CSRC shall, according to related laws, administrative regulations and the Rules, examine the application materials as provided
for in the preceding paragraph, and shall decide within 30 working days upon receipt of valid application materials, and shall notify
the applying securities companies in writing, for those that fail to get the approval, reasons shall be explained in writing.

Article 21

Securities companies approved for the change shall, within 6 months as of the issuance of the approval by the CSRC, complete the transfer
of shares or added investment, eliminate the businesses banned from a foreign-shared securities company by related laws, and shall
apply to competent administrations for industry and commerce for alteration registration and claim the new business license by returning
the original one.

Article 22

A securities company approved for the change shall, within 15 working days as of the alteration registration, submit the following
documents to the CSRC, and apply for the new License for Securities Business:

1)

A copy of the business license;

2)

Corporate statute of the foreign-shared company;

3)

Original license for securities business and copies thereof of the company;

4)

A capital verification report presented by an accounting firm in China qualified for the securities business;

5)

Work report on the elimination of the businesses that are banned from a foreign-shared securities company by related laws;

6)

Legal opinions and verification report on the above-mentioned elimination issued by a law firm and an accounting firm qualified for
securities-related businesses.

Article 23

The CSRC shall, according to related laws, administrative regulations and the Rules, examine the application materials as provided
for in the preceding paragraph, and shall decide on whether to approve it within 45 working days upon receipt of valid application
materials, for those that meet the requirements, the new License for Securities Business shall be granted, and for those that fail
to meet the requirements, the new license shall not be granted, and reasons shall be explained to them in writing.

Article 24

A securities company newly established or continuing to exist after the merger of foreign-shared securities companies or the merger
between a foreign-shared securities company and a domestically funded one shall meet the requirements for the establishment of a
foreign-shared securities company as provided for by the Rules; its business scope and the proportion of the shares or equity held
by the foreign shareholders shall conform to the provisions of the Rules. If the securities companies established as a result of
the split of a foreign-shared securities company still have foreign shareholders, their business scope and the proportion of the
shares or equity held by the foreign shareholders shall be in accordance with the provisions of the Rules.

Article 25

The application materials and documents submitted to the CSRC as provided for in the Rules shall be in Chinese. If the documents
and materials of the foreign shareholders and those issued by the securities regulatory bodies of their home countries are in foreign
languages, the Chinese versions consistent with the original documents shall also be submitted. If the documents and materials submitted
fail to fully describe the circumstances of the applicant, the CSRC may require the applicant to make supplementary statements.

Article 26

The Rules should be equally applicable to investors from the Hong Kong Special Administration Region, the Macao Special Administration
Region and the Taiwan area holding shares in securities companies.

Article 27

Other related provisions not covered by the Rules should be applicable for the establishment, alteration, termination and business
activities of foreign-shared securities companies and the supervision and management thereon.

Article 28

The Rules shall enter into force as of July 1, 2002.



 
The China Securities Regulatory Commission
2002-06-01

 







AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE’S REPUBLIC OF CHINA AND THE GOVERNMENT OF THE REPUBLIC OF TRINIDAD AND TOBAGO ON THE RECIPROCAL PROMOTION AND PROTECTION OF INVESTMENTS

AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE’S REPUBLIC OF CHINA AND THE GOVERNMENT OF THE REPUBLIC OF TRINIDAD AND TOBAGO ON THE
RECIPROCAL PROMOTION AND PROTECTION OF INVESTMENTS

The Government of the People’s Republic of China and the Government of the Republic of Trinidad and Tobago, hereinafter referred to
as the Contracting Parties;

Desiring to intensify economic cooperation between both States on the basis of equality and mutual benefits;

Recognizing that the reciprocal encouragement, promotion and protection of investments will be conducive to stimulating business initiatives
of investors and the economic development of both States;

Intending to create favourable conditions for investment by investors of one Contracting Party in the territory of the other Contacting
Party;

Agreeing that these objectives can be achieved without relaxing health, safety and environmental measures of general application;

Respecting the sovereignty and laws of the Contracting Party within whose jurisdiction the investment falls;

Have agreed as follows:

Article 1

Definitions

For the purpose of this Agreement:

1.

“investment” means every kind of asset invested by investors of one Contracting Party in accordance with the laws and regulations
of the other Contracting Party in the territory of the latter and in particular, though not exclusively, includes:

(a)

movable and immovable property as well as any other property rights such as mortgages, liens and pledges;

(b)

shares, stock, debentures and any other form of participation in a company;

(c)

claims to money, or to any performance under contract having an economic value associated with an investment, loans only being included
when they are directly related to an investment;

(d)

intellectual property rights including copyrights, patents, industrial designs, trademarks, trade names, technical processes, know-how
and goodwill;

(e)

business concessions conferred by law or under contract permitted by law, including concessions to search for, cultivate, extract
or exploit natural resources;

Any change in the form in which assets are invested shall not affect the character of the assets as investments, provided that such
change is done in conformity with laws and regulations of the Contracting Party in which the assets are invested.

2.

“investors” means:

(a)

natural persons who have nationality of either Contracting Party in accordance with the laws of that Contracting Party;

(b)

economic entities, including companies, corporations, associations, partnerships and other organizations, incorporated and constituted
under the laws and regulations of either Contracting Party and which have their seats in that Contracting Party.

3.

“nationals” means those persons referred to in 2 (a) above.

4.

“returns ” means the amounts yielded from an investment and in particular, though not exclusively, includes profits, interests, capital
gains, dividends, royalties and fees;

5.

“territory” means:

(a)

in respect of the People’s Republic of China, the territory of the People’s Republic of China, (including the land area, internal
waters, territorial sea and airspace above them), as well as any marine area beyond its territorial sea in which the People’s Republic
of China has sovereign rights or jurisdiction in accordance with the law of the People’s Republic of China and international law;

(b)

in respect of the Republic of Trinidad and Tobago: the Archipelagic State of Trinidad and Tobago, comprising the several islands of
the Republic of Trinidad and Tobago, its archipelagic waters, territorial sea and airspace thereof, together with the adjacent submarine
areas of the Exclusive Economic Zone and the continental shelf beyond the territorial sea over which Trinidad and Tobago exercises
sovereign rights or jurisdiction in accordance with the laws of Trinidad and Tobago and with international law.

Article 2

Application of Agreement

This Agreement shall apply to all investments, which are made prior to or after its entry into force by investors of either Contracting
Party in accordance with the laws and regulations of the other Contracting Party in the territory of the latter, but the provisions
of this Agreement shall not apply to any dispute, claim or difference which arose before its entry into force.

Article 3

Promotion and Protection of Investments

1.

Each Contracting Party shall encourage and create favourable conditions for investors of the other Contracting Party to invest in
its territory and shall admit such investments in accordance with its laws and regulations.

2.

Investments of the investors of each Contracting Party shall be accorded fair and equitable treatment and shall enjoy full protection
and security in the territory of the other Contracting Party.

3.

Without prejudice to its laws and regulations, neither Contracting Party shall in any way impair by unreasonable or discriminatory
measures the management, maintenance, use, enjoyment or disposal of investments in its territory by the investors of the other Contracting
Party.

4.

Returns from investments and in the event of their re-investment, the returns wherefrom shall enjoy the same protection as the investments.

Article 4

National and Most-Favoured-Nation Treatment

1.

For the purposes of this Article, “activities associated with the investments” means the operation, management, maintenance, use,
enjoyment or disposal of those investments by the investor.

2.

Without prejudice to its laws and regulations, each Contracting Party shall accord to investments or returns and activities associated
with the investments by investors of the other Contracting Party treatment not less favorable than that accorded to the investments
or returns and associated activities of its own investors.

3.

Neither Contracting Party shall subject investments or returns and activities associated with the investments by the investors of
the other Contracting Party to treatment less favorable than that accorded to the investments or returns and associated activities
by the investors of investors of any third State.

4.

The treatment granted under this Article shall not relate to privileges which either Contracting Party accords to investors of third
States on account of its membership in, or association with, a customs or economic union, a common market or a free trade area.

5.

The treatment granted under this Article shall not relate to advantages which either Contracting Party accords to investors of third
States by virtue of a double taxation agreement or other international agreement regarding matters of taxation.

Article 5

Compensation for Losses

Investors of one Contracting Party whose investments in the territory of the other Contracting Party suffer losses owing to war or
other armed conflict, a state of national emergency, revolt, insurrection or riot or other similar event in the territory of the
latter Contracting Party shall be accorded by the latter Contracting Party treatment, as regards restitution, indemnification, compensation
or other settlement, no less favourable than that which the latter Contracting Party accords to its own investors or to investors
of any third State. Resulting payments shall be freely transferable.

Article 6

Expropriation

1.

Neither Contracting Party shall expropriate, nationalize or take other similar measures (hereinafter referred to as “expropriation”)
against the investments of the investors of the other Contracting Party in its territory, except:

(a)

for the public purpose;

(b)

under domestic law;

(c)

without discrimination;

(d)

against compensation.

2.

The compensation mentioned in Paragraph 1 of this Article shall be equivalent to the market value of the expropriated investments
immediately before the expropriation is taken or before the impending expropriation becomes public knowledge, whichever is the earlier.
The value shall be determined in accordance with generally recognized principles of valuation. The compensation shall include interest
at a normal commercial rate from the date of expropriation until the date of payment. The compensation shall be made without delay,
be effectively realizable and be freely transferable.

3.

The investor affected shall have a right, under the law of the Contracting Party making the expropriation, to prompt review, by a
judicial or other independent authority of that Contracting Party, of his or its case and of the valuation of his or its investment
in accordance with the principles set out in this Article.

Article 7

Transfers

1.

Each Contracting Party shall, subject to its laws and regulations, grant to the investors of the other Contracting Party the unrestricted
transfer of their investments and returns held in its territory, including:

(a)

profits, dividends, interest and other current income;

(b)

proceeds obtained from the total or partial sale or liquidation of investments;

(c)

payments pursuant to loans referred to in Article 1 (c);

(d)

royalties and fees;

(e)

earnings of nationals of the other Contracting Party who are allowed to work in connection with an investment in the territory of
the former Contracting Party.

(f)

capital and additional sums necessary for the maintenance and development of the investments;

(g)

compensation provided for in Article 5 .

2.

Nothing in Paragraph 1 of this Article shall affect the free transfer of compensation paid under Article 6 of this Agreement.

3.

Transfers shall be made in a freely convertible currency and at the applicable prevailing market rate of exchange in the territory
of the Contracting Party accepting the investment and on the date of transfer.

Article 8

Entry, Sojourn and Employment

Within the framework of their national law the Contracting Parties shall permit the entry, sojourn and employment of nationals of
one Contracting Party in connection with an investment made in the territory of the other Contracting Party and shall provide assistance
in and facilitate the obtaining of visas and work permits for such nationals.

Article 9

Subrogation

If one Contracting Party or its designated agency makes a payment to its investor under an indemnity given in respect of an investment
made in the territory of the other Contracting Party, the latter Contracting Party shall recognize the assignment of all the rights
and claims of the indemnified investor to the former Contracting Party or its designated agency, by law and the right of the former
Contracting Party or its designated agency to exercise by virtue of subrogation any such right to the same extent as the investor.

Article 10

Settlement of Disputes Between One Contracting Party and an Investor of the Other Contracting Party

1.

For purposes of this Agreement, an “investment dispute” is a dispute between a Contracting Party and an investor of the other Contracting
Party, concerning an obligation of the former under this Agreement in relation to an investment of the latter.

2.

In the event of an investment dispute, the Parties to the investment dispute should initially seek a resolution through consultation
and negotiation. If the investment dispute cannot be settled amicably within six months from the date of written notification of
a claim, the investor that is a Party to an investment dispute may submit the investment dispute for resolution under one of the
following alternatives:

(a)

to the courts or administrative tribunals of the Contracting Party that is a Contracting Party to the investment dispute; or

(b)

to international arbitration in accordance with paragraph 3 below, provided that the Contracting Party involved in the dispute may
require the investor concerned to exhaust the domestic administrative review procedures specified by the laws and regulations of
that Contracting Party before submission of the dispute to the aforementioned arbitration procedure;

3.

Where the dispute is referred to international arbitration, the investor concerned may submit the dispute either to:

(a)

the International Center for the Settlement of Investment Disputes (having regard to the provisions, where applicable, of the Convention
on the Settlement of Investment Disputes between States and Nationals of Other States, opened for signature at Washington D. C on
18th March 1965; or

(b)

an ad hoc arbitral tribunal to be appointed by a special agreement or established under the Arbitration Rules of the United Nations
Commission on International Trade law;

(c)

an international arbitrator to be appointed by a special agreement of the parties to the investment dispute.

4.

The tribunal referred to in Paragraph 3 (a), (b) and (c) of this Article shall adjudicate in accordance with the law of the Contracting
Party to the dispute accepting the investment including its rules on the conflict of laws, the provisions of this agreement as well
as the applicable principles of international law.

5.

Any arbitral award rendered pursuant to this Article shall be final and binding on the parties to the investment dispute. Each Contracting
Party shall carry out without delay the provisions of any such award.

6.

In any proceeding involving an investment dispute, a Contracting Party shall not assert, as a defense, counterclaim, right of set-off
or for any other reason, that indemnification or other compensation for all or part of the alleged damages has been received or will
be received by the investor concerned pursuant to a commercial insurance or guarantee contract. This provision shall not apply to
any payments made under Article 9 .

Article 11

Settlement of Disputes Between the Contracting Parties

1.

Any dispute between the Contracting Parties concerning the interpretation or application of this Agreement shall, if possible, be
settled through diplomatic channels.

2.

If the dispute has not been settled within a period of six months from the date on which the matter was raised by either Contracting
Party, it may be submitted at the request of either Contracting Party to an Arbitral Tribunal.

3.

Such an Arbitral Tribunal shall be constituted ad hoc as follows: each Contracting Party shall appoint one member, and these two members
shall agree upon a national of a third State having diplomatic relations with both Contracting Parties, as the chairman to be appointed
by the two Contracting Parties. Such members shall be appointed within two months, and such chairman within four months from the
date on which either Contracting Party has informed the other Contracting Party that it intends to submit the dispute to an Arbitral
Tribunal.

4.

If within the periods specified in paragraph 3 above the necessary appointments have not been made, either Contracting Party shall,
in the absence of any other arrangement, invite the President of the International Court of Justice to make the necessary appointments.
If the President is a national of either Contracting Party or if he is otherwise prevented from discharging the said function, the
Vice-President shall be invited to make the necessary appointments. If the Vice-President is a national of either Contracting Party
or if he, too, is prevented from discharging the said function, the member of the Court next in seniority who is not a national of
either Contracting Party or is not otherwise prevented from discharging the said functions, shall be invited to make the necessary
appointments.

5.

Unless otherwise agreed, all submissions shall be made and all hearings shall be completed within six months of the date of selection
of the chairman. The Arbitral Tribunal panel shall reach its decision by a majority of votes, and it shall render its decisions within
two months of the date of final submissions or date of the closing of the hearing whichever is later. The Arbitral Tribunal shall
reach its award in accordance with the provisions of this Agreement and the principles of international law recognized by both Contracting
Parties. The Arbitral Tribunal shall, upon the request of either Contracting Party, explain reasons for its award. Such decisions
shall be binding on both Contracting Parties. Each Contracting Party shall bear the cost of its own member of the Tribunal and of
its representation in the arbitral proceedings; the cost of the Chairman and the remaining costs shall be borne in equal parts by
the Contracting Parties. The Tribunal may, however, in its decision direct that a higher proportion of costs shall be borne by one
of the two Contracting Parties, and this award shall be binding on both Contracting Parties. The Tribunal shall determine its own
procedure.

Article 12

Relations Between Contracting Parties

The provisions of the present Agreement shall apply irrespective of the existence of diplomatic or consular relations between the
Contracting Parties.

Article 13

Application of Other Rules

1.

If the law of either Contracting Party or obligations under international law existing at present or established hereafter between
the Contracting Parties in addition to the present Agreement contain rules, whether general or specific, entitling investments by
investors of the other Contracting Party to treatment more favourable than is provided for by the present Agreement, such rules shall,
to the extent that they are more favourable, prevail over the present Agreement.

2.

Each Contracting Party shall observe any commitments it may have entered into with the investors of the other Contracting Party as
regards their investments.

Article 14

Consultation

1.

The representatives of the Contracting Parties shall hold meetings from time to time for the purpose of:

(a)

reviewing the implementation of and proposals for amendment of this Agreement;

(b)

exchanging legal information and investment opportunities;

(c)

resolving disputes arising out of investments;

(d)

forwarding proposals on promotion of investments;

(e)

studying other issues in connection with investments.

2.

Where either Contracting Party requests consultation on any matter of Paragraph 1 of this Article, the other Contracting Party shall
give prompt response and the consultation shall be held alternatively in Beijing and Port of Spain.

Article 15

Amendment

Any provision of this Agreement may be amended by mutual agreement between the Contracting Parties. Any such amendment shall be confirmed
by an Exchange of Diplomatic Notes.

Article 16

Entry into Force, Duration and Termination

1.

Each Contracting Party shall notify the other in writing of the completion of the domestic legal procedures required in its territory
for the entry into force of this Agreement. This Agreement shall enter into force on the date of the latter of the two notifications.

2.

This Agreement shall remain in force for a period of ten years. Thereafter it shall continue in force until the expiration of twelve
months from the date on which either Contracting Party shall have given written notice of termination to the other Contracting Party.

3.

With respect to investments made whilst the Agreement is in force, its provisions shall continue in effect with respect to such investments
for a period of ten years after the date of termination.

In witness whereof the undersigned, duly authorized thereto by their respective Governments, have signed this Agreement.

Done in duplicate at Port of Spain on the date of 22nd July, 2002 in the Chinese and English languages, both texts being equally authentic.

For the Government of the￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿For the Government of the

People’s Republic of China￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿￿Republic of Trinidad and Tobago



 
The Government of the People’s Republic of China
2002-07-22

 







ELECTORAL LAW OF THE NATIONAL PEOPLE’S CONGRESS AND LOCAL PEOPLE’S CONGRESS

Electoral Law of the National People’s Congress and Local People’s Congress of the PRC

    

CHAPTER I GENERAL PROVISIONS

CHAPTER II NUMBER OF DEPUTIES TO THE LOCAL PEOPLE’S CONGRESSES AT VARIOUS LEVELS

CHAPTER III NUMBER OF DEPUTIES TO THE NATIONAL PEOPLE’S CONGRESS CHAPTER IV ELECTIONS AMONG MINORITY NATIONALITIES

CHAPTER V ZONING OF ELECTORAL DISTRICTS

CHAPTER VI REGISTRATION OF VOTERS

CHAPTER VII NOMINATION OF CANDIDATES FOR DEPUTIES

CHAPTER VIII ELECTION PROCEDURE

CHAPTER IX SUPERVISION, RECALL AND BY-ELECTIONS HELD TO FILL VACANCIES

CHAPTER X SANCTIONS AGAINST DISRUPTION OF ELECTIONS

CHAPTER XI SUPPLEMENTARY PROVISIONS

   Article 1 The Electoral Law of the National People’s Congress and Local People’s Congresses is formulated in accordance with the Constitution
of the People’s Republic of China.

   Article 2 Deputies to the National People’s Congress and to the People’s Congresses of provinces, autonomous regions, municipalities directly
under the Central Government, cities divided into districts, and autonomous prefectures shall be elected by the people’s congresses
at the next lower level.

Deputies to the people’s congresses of cities not divided into districts, municipal districts, counties, autonomous counties, townships,
nationality townships, and towns shall be elected directly by their constituencies.

   Article 3 All citizens of the People’s Republic of China who have reached the age of 18 shall have the right to vote and stand for election,
regardless of ethnic status, race, sex, occupation, family background, religious belief, education, property status or length of
residence.

Persons who have been deprived of political rights according to the law shall not have the right to vote and stand for election.

   Article 4 Each voter shall have the right to vote only once in an election.

   Article 5 Elections shall be conducted separately in the People’s Liberation Army, and the procedures for such elections shall be formulated
separately.

   Article 6 Among deputies to the National People’s Congress and local people’s congresses at various levels, there shall be an appropriate number
of women deputies, and the proportion thereof shall be raised gradually.

The National People’s Congress and the local people’s congresses of the areas with a relatively large number of returned overseas
Chinese shall have an appropriate number of deputies who are returned overseas Chinese.

Citizens of the People’s Republic of China who reside abroad but who are in China during the election of deputies to people’s congresses
at or below the county level may take part in such elections conducted in their ancestral home town or place of domicile before they
went abroad.

   Article 7 The Standing Committee of the National People’s Congress shall conduct the election of deputies to the National People’s Congress.
The standing committees of the people’s congresses of provinces, autonomous regions, municipalities directly under the Central Government,
cities divided into districts, and autonomous prefectures shall conduct the elections of deputies to the people’s congresses at the
corresponding levels.

In cities divided into districts, municipal districts, counties, autonomous counties, townships, nationality townships, and towns,
election committees shall be established to conduct the election of deputies to the people’s congresses at the corresponding levels.
The election committees of cities not divided into districts, municipal districts, counties and autonomous counties shall be under
the leadership of the standing committees of the people’s congresses at the corresponding levels. The election committees of townships,
nationality townships, and towns shall be under the leadership of the standing committees of the people’s congresses of cities not
divided into districts, municipal districts, counties and autonomous counties.

The standing committees of the people’s congresses of provinces, autonomous regions, municipalities directly under the Central Government,
cities divided into districts, and autonomous prefectures shall direct the work of electing deputies to the people’s congresses at
or below the county level in their administrative areas.

   Article 8 Election funds for the National People’s Congress and the local people’s congresses at various levels shall be disbursed by the State
Treasury.

CHAPTER II NUMBER OF DEPUTIES TO THE LOCAL PEOPLE’S CONGRESSES AT

   Article 9 The number of deputies to the local people’s congresses at various levels shall be determined in accordance with the following provisions:

(1) The base number of deputies to the people’s congress of a province, an autonomous region or a municipality directly under the
Central Government is 350. For a province or an autonomous region, one more deputy may be added for every one hundred fifty thousand
people, and for a municipality directly under the Central Government, one more deputy may be added for every twenty-five thousand
people, however, if the population of a province exceeds one hundred million, the total number of its deputies shall not exceed 1,000;

(2) The base number of deputies to the people’s congresses of a city divided into districts or an autonomous prefecture is 240. One
more deputy may be determined for every twenty-five thousand people; however, if the population of the city or autonomous prefecture
exceeds ten million, the total number of its deputies shall not exceed 650;

(3) The base number of deputies to the people’s congresses of a county, an autonomous county, a city not divided into districts or
a municipal district is 120. One more deputy may be added for every five thousand people; however, if the population there exceeds
one million six hundred fifty thousand, the total number of deputies shall not exceed 450; if the population is less than fifty thousand
people, the total number of deputies may be less than 120;

(4) The base number of deputies to the people’s congress of a township, a nationality township or a town is 40. One more deputy may
be added for every one thousand five hundred people; however, if the population of a township or a nationality township exceeds ninety
thousand, the total number of its deputies shall not exceed 100; if the population of a town exceeds one hundred thirty thousand,
its total number of its deputies shall not exceed 130; if the population of a township, a nationality township or a town is less
than two thousand, the total number of its deputies may be less than 40.

The base number of deputies to a local people’s congress plus the number of deputies added according to the size of the local population
as stipulated in the preceding paragraph shall be the total number of deputies to the local people’s congress.

The number of deputies to the people’s congresses of an autonomous region or a province where many minority nationalities live in
concentrated community may, upon decision of the Standing Committee of the National People’s Congress, be added by five percent.
The number of deputies to the people’s congress of a county, an autonomous county, a township or a nationality township where many
minority nationalities live in concentrated communities or people live in scattered groups may, upon decision of the standing committee
of the people’s congress of a province, an autonomous region or a municipality directly under the Central Government, be added by
five percent of the total.

   Article 10 The specific number of deputies to the people’s congress of a province, an autonomous region or a municipality directly under the
Central Government shall be determined by the Standing Committee of the National People’s Congress according to this Law. The specific
number of deputies to the people’s congress of a city divided into districts, an autonomous prefecture, or a county shall be determined
by the standing committee of the people’s congress of a province, an autonomous region or a municipality directly under the Central
Government according to this Law and reported to the Standing Committee of the National People’s Congress for the record. The specific
number of deputies to the people’s congress at the township level shall be determined by the Standing Committee of the people’s congress
at the county level according to this Law and reported to the standing committee of the people’s congress at the next higher level
for the record.

   Article 11 Once the total number of deputies to a local people’s congress at any level is determined, it shall no longer be changed. If the
size of the population is changed considerably due to the change of the division in the administrative regions or the construction
of major projects or other reasons, the total number of deputies to the people’s congress at the corresponding level shall be re-determined
according to this Law.

   Article 12 The number of deputies to the people’s congresses of autonomous prefectures, counties and autonomous counties shall be allocated
by the standing committees of the people’s congresses at the corresponding levels, in accordance with the principle that the number
of people represented by each rural deputy is four times the number of people represented by each town deputy. Townships, nationality
townships, and towns with exceptionally small populations shall have at least one deputy in the people’s congresses of their respective
counties and autonomous counties.

In the administrative areas of counties or autonomous counties which have towns with exceptionally large populations, or have enterprises
and institutions not under the leadership of the people’s governments at or below the county level whose workers and staff account
for a relatively large portion of the county’s total population, the ratio between the number of people represented by a rural deputy
and the number of people represented by a town deputy or a deputy of an enterprise or institution may, upon a decision made by the
standing committee of the people’s congress of the province, autonomous region, or municipality directly under the Central Government,
be smaller than four to one, even to the extent of one to one.

   Article 13 In municipalities directly under the Central Government, cities and municipal districts, the number of people represented by a rural
deputy shall be greater than the number of people represented by an urban deputy.

   Article 14 The number of deputies to the people’s congresses of provinces or autonomous regions shall be allocated by the standing committees
of the people’s congresses at the corresponding levels, in accordance with the principle that the number of people represented by
each rural deputy is four times the number of people represented by each urban deputy.

CHAPTER III NUMBER OF DEPUTIES TO THE NATIONAL PEOPLE’S CONGRESS

   Article 15 Deputies to the National People’s Congress shall be elected by the people’s congresses of the provinces, autonomous regions, and
municipalities directly under the Central Government and by the People’s Liberation Army.

The number of deputies to the National People’s Congress shall not exceed 3,000. The allocation of the number of deputies shall be
decided by the Standing Committee of the National People’s Congress in accordance with existing conditions.

The number of deputies to the National People’s Congress to be elected by the Hong Kong Special Administrative Region and the Macao
Special Administrative Region and the methods for their elections shall be prescribed separately by the National People’s Congress.

   Article 16 The number of deputies to the National People’s Congress to be elected by the provinces, autonomous regions, and municipalities directly
under the Central Government shall be allocated by the Standing Committee of the National People’s Congress in accordance with the
principle that the number of people represented by each rural deputy is four times the number of people represented by each urban
deputy.

   Article 17 The number of deputies to the National People’s Congress to be elected by minority nationalities shall be allocated by the Standing
Committee of the National People’s Congress, in the light of the population and distribution of each minority nationality, to the
people’s congresses of the various provinces, autonomous regions, and municipalities directly under the Central Government, which
shall elect them accordingly. Nationalities with exceptionally small populations shall each have at least one deputy.

CHAPTER IV ELECTIONS AMONG MINORITY NATIONALITIES

   Article 18 In areas where minority nationalities live in concentrated communities, each minority nationality shall have its deputy or deputies
sit in the local people’s congress.

Where the total population of a minority nationality in such an area exceeds 30 percent of the total local population, the number
of people represented by each deputy of that minority nationality shall be equal to the number of people represented by each of the
other deputies to the local people’s congress.

Where the total population of a minority nationality in such an area is less than 15 percent of the total local population, the number
of people represented by each deputy of that minority nationality may be appropriately smaller, but shall not be less than half the
number of people represented by each of the other deputies to the local people’s congress. In autonomous counties where the population
of the minority nationality practising regional autonomy is exceptionally small, the number of people represented by each deputy
of this minority nationality may, upon a decision made by the standing committee of the people’s congress of the province or autonomous
region, be less than half the number of people represented by each of the other deputies. Other nationalities with exceptionally
small populations living in concentrated communities shall each have at least one deputy.

Where the total population of a minority nationality in such an area accounts for not less than 15 percent and not more than 30 percent
of the total local population, the number of people represented by each deputy of that minority nationality may be appropriately
smaller than the number of people represented by each of the other deputies to the local people’s congress, but the allocated number
of deputies to be elected by that minority nationality shall not exceed 30 percent of the total number of deputies.

   Article 19 In autonomous regions, autonomous prefectures and autonomous counties, and in townships, nationality townships, and towns where a
certain minority nationality lives in a concentrated community, the provisions of Article 18 of this Law shall apply to the election
to the local people’s congresses of deputies of other minority nationalities and the Han nationality also living in concentrated
communities in such areas.

   Article 20 With respect to minority nationalities living in scattered groups, the number of people represented by each of their deputies to
the local people’s congresses may be less than the number of people represented by each of the other deputies to such congresses.

In autonomous regions, autonomous prefectures and autonomous counties, and in townships, nationality townships, and towns where a
certain minority nationality lives in a concentrated community, the provisions of the preceding paragraph shall apply to the election
to the local people’s congresses of deputies of other minority nationalities and the Han nationality living in scattered groups in
such areas.

   Article 21 In cities not divided into districts, municipal districts, counties, townships, nationality townships, and towns where various minority
nationalities live in concentrated communities, the minority nationality electorates may vote separately or jointly in the election
of deputies to the local people’s congress, depending on the relations between the nationalities, and their residential situation
in such areas.

In autonomous counties and in townships, nationality townships, and towns where a certain minority nationality lives in a concentrated
community, the provisions of the preceding paragraph shall apply to the election to the respective people’s congresses of deputies
of other minority nationalities and the Han nationality living in such areas.

   Article 22 The electoral documents, roll of voters, voter registration cards, list of candidates for deputies, deputies’ election certificates
and election committee seals made or published by autonomous regions, autonomous prefectures and autonomous counties shall be in
the written languages of the nationalities commonly used in the locality.

   Article 23 Other matters concerning elections among minority nationalities shall be handled with reference to the provisions of the relevant
articles of this Law.

CHAPTER V ZONING OF ELECTORAL DISTRICTS

   Article 24 The number of deputies to the people’s congresses in cities not divided into districts, municipal districts, counties, autonomous
counties, townships, nationality townships, and towns shall be allocated to the electoral districts, and elections shall be held
in the electoral districts. The zoning of electoral districts may be decided according to the voters’ residence or on the basis of
production units, institutions and work units.

The zoning of electoral districts shall be decided on the basis of one to three deputies to be elected from each electoral district.

   Article 25 The number of people represented by each deputy from an urban electoral district shall be generally the same. The number of people
represented by each deputy from a rural electoral district shall be generally the same.

CHAPTER VI REGISTRATION OF VOTERS

   Article 26 The registration of voters shall be conducted on the basis of electoral districts, and the voters’ qualifications confirmed through
registration shall have long-term validity. Prior to each election, voters who have reached the age of 18 since the last registration
of voters or who have had their political rights restored after a period of deprivation of political rights has expired, shall be
registered. Voters who have moved out of the electoral districts where they originally registered shall be included in the roll of
voters in the electoral districts to which they have newly moved; those who are deceased or have been deprived of political rights
according to law shall be removed from the roll.

Citizens who suffer from mental illness and are incapable of exercising their electoral rights shall, upon determination by the election
committee, not be included in the roll of voters.

   Article 27 The roll of voters shall be made public 20 days prior to the date of election. and voter registration cards shall be issued. Where
voters take part in elections and cast their votes on the strength of their voter registration cards, they shall be issued voter
registration cards.

   Article 28 Anyone who has an objection to the roll of voters may appeal to the election committee. The election committee shall make a decision
on the appeal within three days. If the appellant is not satisfied with the decision, he may bring a suit in the people’s court at
least five days prior to the date of election, and the people’s court shall make a judgment before the date of election. The judgment
of the people’s court shall be final.

CHAPTER VII NOMINATION OF CANDIDATES FOR DEPUTIES

   Article 29 Candidates for deputies to the national and local people’s congresses shall be nominated on the basis of electoral districts or electoral
units.

Political parties and people’s organizations may either jointly or separately recommend candidates for deputies. A joint group of
at least ten voters or deputies may also recommend candidates. Those who submit recommendations shall inform the election committee
or the presidium of the congress of their candidates’ backgrounds.

   Article 30 The number of candidates for deputies to the national and local people’s congresses shall be greater than the number of deputies
to be elected.

The number of candidates for deputies to be directly elected by the voters shall be from one third to 100 percent greater than the
number of deputies to be elected; the number of candidates for deputies to be elected by various local people’s congresses to the
people’s congresses at the next higher level shall be 20 to 50 percent greater than the number of deputies to be elected.

   Article 31 Candidates for deputies to the people’s congresses to be directly elected by the voters shall be nominated by the voters in the various
electoral districts and by the various political parties and people’s organizations. The election committee shall collect and publish,
15 days prior to the date of election, the list of nominees for deputies for repeated deliberation, discussion and consultation by
voter groups in the respective electoral districts and shall decide, in accordance with the opinion of the majority of voters, upon
a formal list of candidates to be made public five days prior to the date of election.

When a local people’s congress at or above the county level is to elect deputies to a people’s congress at the next higher level,
the time for nominating and deliberating candidates for such deputies shall not be less than two days. The presidium of the people’s
congress at the said level shall print and distribute the list of the candidates nominated according to law to all the deputies for
deliberation and discussion. If the number of the nominees conforms to the proportion for competitive election as provided in Article
30 of this Law, balloting competitive election shall be held directly. If the number of the nominees exceeds the maximum proportion
for competitive election as provided by Article 30 of this Law, preliminary election shall be held. By the order of the number of
votes that the nominees have obtained in the preliminary election, a formal list of candidates shall be determined in agreement with
the specific proportion for competitive election as it contained in the measures of election adopted by the people’s congress at
that level in accordance with this Law, and then balloting shall be held.

   Article 32 When a local people’s congress at or above the county level is to elect deputies to the people’s congress at the next higher level,
the nominees for deputies shall not be limited to the current deputies to the lower people’s congress.

   Article 33 The election committee or the presidium of the people’s congress shall brief voters or deputies on the candidates for deputies.
Political parties, people’s organizations, voters and deputies that have nominated candidates for deputies may brief voters on those
candidates at group meetings of voters or deputies. However, such briefings must stop on the day of election.

   Article 34 Where voters directly elect deputies to a people’s congress, they shall, as prescribed by the election committee, be issued ballots
on the strength of their identification cards or voter registration cards. In each electoral district, polling stations shall be
set up, mobile polling boxes provided or election meetings held for the election. Balloting shall be presided over by the election
committee.

   Article 35 Where a local people’s congress at or above the county level is to elect deputies to the people’s congress at the next higher level,
the election shall be presided over by the presidium of the lower people’s congress.

   Article 36 The election of deputies to the national and local people’s congresses shall be by secret ballot.

If a voter is illiterate or handicapped and is therefore unable to write his ballot, he may entrust another person to write it for
him.

   Article 37 A voter may vote for or against a candidate for deputy and may vote instead for any other voter or abstain.

   Article 38 A voter who is absent from his electoral district during the time of an election may, with the approval of the election committee
and by written authorization, entrust another voter with a proxy vote. A voter shall not stand proxy for more than three persons.

   Article 39 When balloting has been concluded, scrutineers and votecounters elected by the voters or deputies, and members of the election committee
or members of the presidium of the people’s congress shall check the number of people who voted against the number of votes cast
and make a record of it; the record shall be signed by the scrutineers.

   Article 40 An election shall be null and void if the number of votes cast is greater than the number of people who voted, and it shall be valid
if the number of votes cast is less than the number of people who voted.

A ballot shall be null and void if more candidates are voted for than the number of deputies to be elected, and it shall be valid
if fewer candidates are voted for than the number of deputies to be elected.

   Article 41 In a direct election of deputies to the people’s congresses, the election shall be valid, if more than half of all the voters in
an electoral district cast their votes. Candidates for deputies shall be elected only if they have obtained more than half of the
votes cast by the voters that take part in the election.

When a local people’s congress at or above the county level is to elect deputies to a people’s congress at the next higher level,
candidates for deputies shall be elected only if they have obtained more than half of the votes of all the deputies.

Where the number of candidates who have obtained more than half of the votes exceeds the number of deputies to be elected, the ones
who have obtained more votes shall be elected. Where the number of votes for some candidates is tied, making it impossible to determine
the ones to be elected, another balloting shall be conducted for these candidates to resolve the tie, and the ones who have obtained
more votes shall be elected.

If the number of elected deputies who have obtained more than half of the votes is less than the number of deputies to be elected,
another election shall be held to make up the difference. When another election is held, the name list of candidates shall, by order
of the number of votes they have obtained in the first balloting, be determined in accordance with the proportion for competitive
election as provided in Article 30 of this Law. If only one deputy is to be elected, the number of candidates shall be two.

When another election is held to elect deputies to the people’s congress at the county or township level in accordance with the provisions
in the preceding paragraph, the candidates who have obtained more votes than the others shall be elected; however, the number of
the votes they have obtained shall not be less than one-third of the votes cast. When another election is held by the local people’s
congress at or above the county level to elect deputies to the people’s congress at the next higher level, the candidates shall be
elected only when they have obtained a majority vote of all the deputies.

   Article 42 The election committee or the presidium of the people’s congress shall determine, in accordance with this Law, whether or not the
result of an election is valid and shall announce it accordingly.

CHAPTER IX SUPERVISION, RECALL AND BY-ELECTIONS HELD TO FILL VACANCIES

   Article 43 All deputies to the national and local people’s congresses shall be subject to the supervision of the voters and the electoral units
which elect them. Both the voters and electoral units shall have the right to recall the deputies they elect.

   Article 44 With respect to deputies to the people’s congress at the county or township level, a group of thirty or more voters in the electoral
district may submit a demand in writing to the standing committee of the people’s congress at the county level for the recall of
a deputy they elected.

In a demand for the recall of a deputy, the reasons for the recall shall be clearly stated. The deputy proposed to be recalled shall
have the right to defend himself at the voters’ meetings or may present a written statement in his own defence.

The standing committee of the people’s congress at the county level shall print and distribute the demand for the recall of a deputy
and the written defence of the deputy proposed to be recalled to the voters in the electoral district from which he was elected.

When the demand for the recall of a deputy is put to vote, the standing committee of the people’s congress at the county level shall
dispatch a relevant leading member to preside over it.”

   Article 45 When a local people’s congress at or above the county level is in session, the presidium or a group of at least one-tenth of the
deputies may submit a proposal for the recall of a deputy to the people’s congress at the next higher level who was elected by the
people’s congress at or above the county level. When the people’s congress is not in session, the council of chairmen of the standing
committee of the local people’s congress at or above the county level or a group of at least one-fifth of the component members of
the standing committee may submit a proposal for the recall of a deputy to the people’s congress at the next higher level who was
elected by the people’s congress at or above the county level. In the proposal for the recall of a deputy, the reasons for the recall
shall be clearly stated.

When a local people’s congress at or above the county level is in session, the deputy proposed to be recalled shall have the right
to defend himself or to submit a written defence at the meeting of the presidium or at the plenary meeting of the congress; the presidium
shall have the written defence printed and distributed to the deputies. After the proposal for the recall of the deputy is deliberated
by the deputies at the meeting, it shall be submitted by the presidium to the plenary for voting.

When the standing committee of a local people’s congress at or above the county level meets, the deputy proposed to be recalled shall
have the right to defend himself or submit a written defence at the council of chairmen or the plenary meeting of the standing committee;
the council of chairmen shall have the written defence printed and distributed to the members of the standing committee. After the
proposal for the recall of the deputy is deliberated by the members of the standing committee, it shall be submitted by the council
of chairmen to the plenary meeting for voting.”

   Article 46 The proposal for the recall of a deputy shall be voted by secret ballot.”

   Article 47 The recall of a deputy to the people’s congress at the county or township level shall be adopted by a majority vote of all the voters
in the electoral district from which the deputy was elected.

The recall of

STATE SECURITY LAW

State Security Law of the People’s Republic of China

    

CHAPTER I GENERAL PROVISIONS

CHAPTER II FUNCTIONS AND POWERS OF THE STATE SECURITY ORGANS IN THE WORK OF STATE SECURITY

CHAPTER III DUTIES AND RIGHTS OF CITIZENS AND ORGANIZATIONS IN SAFEGUARDING STATE SECURITY

CHAPTER IV LEGAL LIABILITY

CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 1 This Law is formulated in accordance with the Constitution of the People’s Republic of China for the purpose of safeguarding State
security, protecting the State power of the people’s democratic dictatorship and the socialist system, and ensuring the smooth progress
of reform, opening-up, and the socialist modernization drive.

   Article 2 The State security organs, as stipulated by this Law, are the competent authorities in charge of State security.

The State security organs and the public security organs shall, in accordance with the division of functions and powers as prescribed
by the State, attend to their respective duties, and closely cooperate with each other so as to safeguard State security.

   Article 3 Citizens of the People’s Republic of China shall have the duty to safeguard the security, honour and interests of the State, and
must not commit any act endangering the security, honour or interests of the State.

All State organs, armed forces, political parties, public organizations, enterprises and institutions shall have the duty to safeguard
the security of the State.

The State security organs, in the work of State security, must rely on the people’s support, and shall mobilize and organize the people
to prevent and check any act endangering the security of the State.

   Article 4 Any organization or individual that has committed any act endangering the State security of the People’s Republic of China shall
be prosecuted according to law.

“Act endangering State security” as referred to in this Law means any of the following acts endangering the State security of the
People’s Republic of China committed by institutions, organizations or individuals outside the territory of the People’s Republic
of China, or, by other persons under the instigation or financial support of the afore-mentioned institutions, organizations or individuals,
or, by organizations or individuals within the territory in collusion with institutions, organizations or individuals outside the
territory:

(1) plotting to subvert the government, dismember the State or overthrow the socialist system;

(2) joining an espionage organization or accepting a mission assigned by an espionage organization or by its agent;

(3) stealing, secretly gathering, buying, or unlawfully providing State secrets;

(4) instigating, luring or bribing a State functionary to turn traitor; or

(5) committing any other act of sabotage endangering State security.

   Article 5 The State shall protect organizations and individuals that have rendered support or assistance in safeguarding State security, and
reward those who have made significant contributions to the maintenance of State security.

CHAPTER II FUNCTIONS AND POWERS OF THE STATE SECURITY ORGANS IN THE WORK OF STATE SECURITY

   Article 6 The State security organs shall exercise, in the work of State security, the functions and powers of investigation, detention, preliminary
examination and execution of arrest according to law and other functions and powers as stipulated by the law.

   Article 7 Any functionary of a State security organ, when carrying out according to law a task for State security and upon producing an appropriate
certificate, shall have the right to examine the identification certificate of any Chinese citizen or any person from outside the
territory of the People’s Republic of China; and shall have the right to investigate or inquire about relevant matters from any organization
or individual concerned.

   Article 8 Any functionary of a State security organ may, when carrying out a task for State security, enter any interested site upon producing
an appropriate certificate, and may, in accordance with the relevant provisions of the State, with approval and upon producing an
appropriate certificate, enter interested restricted areas, sites or units; and may have access to related files, materials and articles
for examination.

   Article 9 Any functionary of a State security organ may, when carrying out an urgent task according to law, have the priority in taking means
of public transport upon producing an appropriate certificate, and have the right of way in case of a traffic block.

As necessitated by the maintenance of State security, a State security organ may, when necessary and in accordance with the relevant
provisions of the State, have priority in use of any means of transport or communication, site or building belonging to any organ,
organization, enterprise, institution or individual, and shall make a timely return after the use and pay an appropriate fee, and,
in case of any damage or loss, shall make compensation therefor.

   Article 10 Where the reconnaissance of an act endangering State security requires, a State security organ may, in accordance with the relevant
provisions of the State and after going through strict approval procedures, employ technological means of reconnaissance.

   Article 11 Where State security requires, a State security organ may inspect the electronic communication instruments and appliances and other
similar equipment and installations belonging to any organization or individual.

   Article 12 Where State security requires, a State security organ may, in accordance with the relevant provisions of the State, request such
inspecting organs as the Customs and the frontier inspection stations to exempt the personnel, materials and equipment concerned
from inspection. The relevant inspecting organs shall give assistance thereto.

   Article 13 State security organs and their functionaries, in their work of State security, shall act strictly according to law, and refrain
from overstepping or abusing their powers and infringing upon the lawful rights and interests of any organization or individual.

   Article 14 The performance of duty according to law by functionaries of the State security organs shall be protected by law.

CHAPTER III DUTIES AND RIGHTS OF CITIZENS AND ORGANIZATIONS IN SAFEGUARDING STATE SECURITY

   Article 15 State organs, organizations and other institutions shall educate their personnel with regard to the maintenance of State security,
mobilize and organize them to prevent and check acts endangering State security.

   Article 16 Citizens and organizations shall provide convenience or other assistance for the work of State security.

   Article 17 Any citizen who finds any act endangering State security shall without delay report it directly or through his work unit to a State
security organ or a public security organ.

   Article 18 When a State security organ investigates and finds out any circumstances endangering State security and gathers related evidence,
citizens and organizations concerned shall faithfully furnish it with relevant information and may not refuse to do so.

   Article 19 Any citizen or organization shall keep confidential the State secrets that have come to his knowledge or its possession regarding
State security.

   Article 20 No individual or organization may unlawfully hold any document, material or other articles classified as State secrets.

   Article 21 No individual or organization may unlawfully hold or use any specialized espionage equipment or devices such as those for eavesdropping
or secret photographing.

   Article 22 Any citizen or organization shall have the right to make to the State security organ at a higher level or to a relevant department
exposure of or charge against the excess or abuse of power or other unlawful acts committed by a State security organ or its functionaries.
The State security organ at the higher level or the relevant department shall ascertain the facts without delay and be responsible
for the handling thereof.

No one may suppress or retaliate against any citizen or organization that has assisted a State security organ in its work or made
reports or charges according to law.

   Article 23 Where the acts endangering State security committed by institutions, organizations or individuals outside the territory of the People’s
Republic of China or committed by other persons under the instigation or financial support of the said institutions, organizations
or individuals, or committed by institutions or individuals within the territory of the People’s Republic of China in collusion with
institutions, organizations or individuals outside the territory constitute crimes, such institutions, organizations or individuals
shall be investigated for criminal responsibility according to law.

   Article 24 Anyone who, guilty of a crime of espionage, voluntarily surrenders himself or has performed meritorious service may be given a lighter
or a mitigated punishment or be exempted from punishment; and any such person who has performed significant meritorious service may
be awarded.

   Article 25 Anyone who is compelled or induced to join a hostile organization and engaged in activities outside the territory endangering the
State security of the People’s Republic of China has made a faithful and timely report about the situation to an organ of the People’s
Republic of China stationed abroad, or after returning to the country, has made a faithful and timely report about the situation
directly or through his unit to a State security organ or a public security organ shall not be prosecuted.

   Article 26 Whoever, well aware of other persons’ criminal acts of espionage, refuses to provide information while a State security organ investigates
the circumstances or collects evidence from him shall be punished with administrative sanctions by his unit or the competent department
at a higher level, or given a detention of not more than 15 days by the State security organ; in case the circumstances are serious,
the offender shall be punished by applying mutatis mutandis the provisions of Article 162 of the Criminal Law.

   Article 27 Whoever, by means of violence or threat, obstructs a State security organ from carrying out an assignment of State security according
to law shall be punished in accordance with the provisions of Article 157 of the Criminal Law.

Whoever intentionally obstructs a State security organ from carrying out an assignment of State security according to law, without
resort to violence or threat, but have caused serious consequences shall be punished by applying mutatis mutandis the provisions
of Article 157 of the Criminal Law; in case the circumstances are not serious, the offender shall be given a detention of not more
than 15 days by the State security organ.

   Article 28 Whoever intentionally or negligently divulges State secrets concerning State security shall be given a detention of not more than
15 days by the State security organ; in case the offence constitutes a crime, the offender shall be investigated for criminal responsibility
according to law.

   Article 29 A State security organ may search the body, articles, residence and other related places of anyone who unlawfully holds documents,
materials or other articles classified as State secrets, or who unlawfully holds or uses equipment and materials specially for espionage
purposes, and may confiscate such documents, materials and other articles, as well as such equipment and materials.

Anyone, who unlawfully holds documents, materials or other articles classified as State secrets, if the case constitutes the crime
of divulging State secrets, shall be investigated for criminal responsibility according to law.

   Article 30 If the violators of this Law are from outside the territory of the People’s Republic of China, they may be ordered to leave the country
within a specified time limit or be deported.

   Article 31 Any party concerned, if not satisfied with the detention decision, may apply for reconsideration within 15 days after receipt of
the decision to the organ at the next higher level over the one that has made the decision; and if still not satisfied with the reconsideration
decision, the party concerned may bring a suit in a people’s court within 15 days after receipt of the reconsideration decision.

   Article 32 Any State security functionary who neglects his duty or engages in malpractices for personal interests, if the offence constitutes
a crime, shall be punished in accordance with the provisions of Article 187 or Article 188 of the Criminal Law; Any such person who
practises unlawful detention or extorts a confession by torture, if the offence constitutes a crime, shall be punished respectively
in accordance with the provisions of Article 143 or Article 136 of the Criminal Law.

CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 33 Any public security organ that carries out an assignment of State security according to the provisions of Paragraph 2, Article 2
of this Law shall be governed by the relevant provisions of this Law.

   Article 34 This Law shall enter into force as of the date of promulgation.

    






RULES ON THE ESTABLISHMENT OF FOREIGN-SHARED FUND MANAGEMENT COMPANIES

20041001

The China Securities Regulatory Commission

Decree of the China Securities Regulatory Commission

No.9

The Rules on the Establishment of Foreign-shared Fund Management Companies are hereby promulgated, and shall come into force on July
1, 2002.

Chairman of the China Securities Regulatory Commission Zhou Xiaochuan

June 1, 2002

Rules on the Establishment of Foreign-shared Fund Management Companies

Article 1

To meet the demand of opening the securities market, to strengthen and improve the supervision and administration of foreign-shared
fund management companies and to clarify the preconditions and procedures for the establishment of foreign-shared fund management
companies, the Rules is therefore formulated in accordance with relevant provisions of the Company Law and the Interim Measures for
the Administration of Securities Investment Fund (hereinafter referred to as the Interim Measures).

Article 2

The foreign-shared fund management companies as referred to in the Rules shall include domestic fund management companies whose shares
are transferred to or purchased by foreign shareholders or those that are co-funded by foreign and domestic shareholders.

Article 3

The China Securities Regulatory Commission (hereinafter referred to as the CSRC) shall be responsible for the examination, approval,
supervision and administration of foreign-shared fund management companies.

Article 4

The organizational structure of a foreign-shared fund management company shall be that of limited liability. The name, registered
capital, founding and functions of the departments of a foreign-shared fund management company shall be compliant with relevant provisions
of the Company Law, the Interim Measures and the CSRC.

Article 5

Foreign-shared fund management companies shall meet the requirements as provided for in the Interim Measures and those of the CSRC.

Article 6

The foreign shareholders of a foreign-shared fund management company shall possess the following qualifications:

1)

Financial institutions established in accordance with the laws of their home countries and continuing to exist legitimately without
severe punishment by securities regulatory bodies or judicial organs within the past 3 years;

2)

Their home countries shall have a sound legal and regulatory system on securities, and the securities regulatory bodies shall have
signed the memorandum of understanding on securities regulation with CSRC and have maintained effective cooperation with the latter;

3)

The actual realized capital shall be free convertible currency equivalent of no less than RMB 300,000,000 yuan;

4)

Other prudential conditions as provided for by the CSRC.

Article 7

The domestic shareholders of a foreign-shared fund management company shall have the qualifications as shareholders of fund management
companies as provided for by the CSRC.

Article 8

The shares held by foreign shareholders or the equity possessed by them (both directly and indirectly) in a foreign-shared fund management
company may not exceed one third of the total in the aggregate, and the percentage may not exceed 49% within 3 years after China’s
accession to the WTO. Foreign shareholders shall invest with free convertible currencies.

Article 9

The board chairman, general manager, and deputy general manager of a foreign-shared fund management company shall possess the qualifications
as senior management of securities companies as provided for by the CSRC.

Article 10

The domestic and foreign applicants of a foreign-shared fund management company shall submit the application materials to the CSRC
in compliance with the contents and format prescribed by the CSRC. The application materials submitted by the domestic and foreign
applicants to the CSRC must be in Chinese. Documents and materials in foreign languages provided by the foreign shareholders and
the securities bodies of their home countries shall be accompanied by their Chinese versions consistent with the original contents.

Article 11

The establishment of a foreign-shared fund management company by foreign shareholders and domestic shareholders shall follow two phases,
namely the preparation and the commencement of business.

Article 12

The CSRC shall decide on whether to approve the application for establishment preparation or otherwise within 60 working days upon
formal acceptance of the application. If the approval is granted, the reply document should be issued. If the approval is not granted,
the applicant should be notified in writing of the reasons.

Article 13

As for foreign-shared fund management companies that have already obtained the approval documents for preparation from the CSRC but
are yet to open to business, if there are substantial changes in the basic conditions of their foreign shareholders, or their foreign
shareholders have been punished or tightly controlled and supervised by the regulatory bodies of relevant countries and regions for
violation of related rules and regulations, then these foreign shareholders shall motion for a founders’ meeting within the company
without delay and shall clarify the situation. If the foreign shareholders no longer meet the requirements of the Rules, the founders’
meeting shall reach a treatment decision and the preparatory group of the company shall report to the CSRC and complete relevant
formalities as required.

Article 14

The domestic and foreign applicants shall, after the preparation for establishment of the fund management company has been accomplished,
submit the application materials for business operation to the CSRC. The CSRC shall decide on whether to approve, postpone the approval
or disapprove the business operation within 30 working days upon formal acceptance of the application. If the approval is granted,
the approval documents shall be issued; if the approval is a deferred one or not granted, the applicant shall be notified in writing
of the reasons.

Article 15

When the shares of a foreign-shared fund management company are transferred to or purchased by foreign shareholders, the fund management
company shall submit the application materials to the CSRC. The CSRC shall decide on whether to grant the approval within 60 working
days upon formal acceptance of the application. If the approval is granted, the reply documents shall be issued; if the approval
is not granted, the applicant shall be notified in writing of the reasons. With regard to the review of applications involving new
shareholders and the change of the largest shareholders who have the highest proportion of capital contribution and nominate the
most directors, the CSRC shall follow the procedures for reviewing preparation applications of fund management companies.

Article 16

As for some foreign shareholders of a foreign-shared fund management company, the authorities in where the company is registered or
its main business activities take place may require for records of overseas foreign investment. If these foreign shareholders, after
legitimately obtaining the approval documents from the CSRC, should need to submit the relevant materials to the above-mentioned
authorities for record-keeping purpose, they shall also submit copies of those materials to the CSRC.

Article 17

The shareholders of a foreign-shared fund management company shall, within 30 working days after obtaining the approval documents
from the CSRC, apply to competent administrations for industry and commerce for alteration or establishment.

Article 18

The Rules is applicable to investors from Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan
Area holding shares of domestically-funded fund management companies.

Article 19

As for the establishment, alteration, termination, business activities, supervision and administration of foreign-shared fund management
companies, other relevant provisions of the CSRC shall be applicable if there are no corresponding provisions in the Rules.

Article 20

The Rules shall enter into force as of July 1, 2002.



 
The China Securities Regulatory Commission
2002-06-01

 







CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE (SAFE) ON THE ADMINISTRATION OF FOREIGN EXCHANGE ACCOUNT OF NVOCC

The State Administration of Foreign Exchange

Circular of the State Administration of Foreign Exchange (SAFE) on the Administration of Foreign Exchange Account of NVOCC

HuiFa [2002] No.75

July 25, 2002

SAFE branches in all provinces, autonomous regions and municipalities directly under the Central Government, exchange administration
offices, and SAFE branches in the cities of Shenzhen, Dalian, Qingdao, Xiamen, and Ningbo; headquarters of all designated Chinese-funded
foreign exchange banks:

In order to normalize the foreign exchange administration related to ocean shipping, and ensure the normal foreign exchange income
and outlay of NVOCCs (non-vessel operating common carriers), a circular on issues related to the administration of foreign exchange
accounts of NVOCCs is given hereunder according to Regulations of the People’s Republic of China on International Ocean Shipping
(Decree [2001] No.335 of the State Council), Rules on the Administration of Domestic Foreign Exchange Account (promulgated by the
People’s Bank of China on October 7, 1997), and Circular on Issues Related to the Administration of Foreign Exchange Income and Outlay
Related to International Ocean Shipping (HuiFa [2001] No.058):

1.

An authorized NVOCC may apply to a local branch or sub-branch of the State Administration of Foreign Exchange (hereafter referred
to as the SAFE office) for opening a foreign exchange account under current account (hereinafter referred to as “foreign exchange
account”) upon the Certificate of Qualification of NVOCC issued by the Ministry of Transportation.

2.

Income items of the foreign exchange account are limited to freight and related fees for international ocean shipping paid by domestic
shipper, forwarder, shipping agency, and NVOCC, or remitted in from abroad; while its outlay items are confined to freight and related
fees remitted abroad for international ocean shipping, or paid to domestic forwarder, shipping agency, shipping company, NVOCC, and
wholly foreign-funded shipping company.

3.

When approving an NVOCC to open a foreign exchange account, the SAFE office shall set a balance ceiling for the account equal to 10
percent of the NVOCC’s foreign exchange income from current account transactions in the previous year. For a newly established NVOCC,
the initial balance ceiling may be set in principle at an equivalent of USD100,000. The SAFE office may adjust the initial balance
ceiling according to the grand total of the balance ceilings in the locality and adjust annually the balance ceiling of the account.
If the actual balance exceeds the ceiling, the surplus shall be sold to the bank in 5 working days.

4.

If the regulations on the administration of foreign exchange account is amended in the future, the amended will prevail.

On receiving this Circular, SAFE branches shall promptly transmit it to the sub-branches and foreign-funded banks and entities concerned
under their respective jurisdiction. The designated Chinese-funded foreign exchange banks shall transmit it to their branch offices
as soon as possible. Any problem encountered during the implementation shall be reported in time to the Current Account Department
of the State Administration of Foreign Exchange.



 
The State Administration of Foreign Exchange
2002-07-25

 







FOOD HYGIENE LAW

Food Hygiene Law of the People’s Republic of China

    

CHAPTER I GENERAL PROVISIONS

CHAPTER II FOOD HYGIENE

CHAPTER III HYGIENE OF FOOD ADDITIVES

CHAPTER IV HYGIENE OF CONTAINERS, PACKAGINGS, UTENSILS AND EQUIPMENT USED FOR FOOD

CHAPTER V FORMULATION OF FOOD HYGIENE STANDARDS AND MEASURES FOR FOOD HYGIENE CONTROL

CHAPTER VI FOOD HYGIENE CONTROL

CHAPTER VII FOOD HYGIENE SUPERVISION

CHAPTER VIII LEGAL RESPONSIBILITY

CHAPTER IX SUPPLEMENTARY PROVISIONS

   Article 1 This Law is enacted for the purpose of ensuring food hygiene, preventing food contamination and harmful substances from injuring
human health, safeguarding the health of the people and improving their physical fitness.

   Article 2 The State institutes a system of food hygiene supervision.

   Article 3 The administrative department of public health under the State Council shall be in charge of supervision and control of food
hygiene throughout the country.

Other relevant departments under the State Council shall, within the scope of their respective functions and duties, be
responsible for control of food hygiene.

   Article 4 Whoever engages in food production or marketing within the territory of the People’s Republic of China must observe this Law.

This Law applies to all foods and food additives as well as containers, packagings, utensils and equipment used for food,
detergents and disinfectants; it also applies to the premises, facilities and environment associated with food production
or marketing.

   Article 5 The State encourages and protects the social supervision exercised by public organizations and individuals over food hygiene.

Any person shall have the right to inform the authorities and lodge a complaint about any violation of this Law.

   Article 6 Food shall be nontoxic and harmless, conform to proper nutritive requirements and have appropriate sensory properties such
as colour, fragrance and taste.

   Article 7 Principal and supplementary foods intended specially for infants and preschool children shall conform to the nutritive
and hygienic standards promulgated by the administrative department of public health under the State Council.

   Article 8 In the process of food production or marketing, the requirements for hygiene stated below shall be conformed to:

(1) The environment inside and outside any food production or marketing establishment shall be kept clean and tidy; measures shall
be taken to eliminate flies, rodents, cockroaches and other harmful insects and to remove conditions for their propagation;
and a prescribed distance shall be kept from any toxic or harmful site;

(2) An enterprise engaged in food production or marketing shall have workshops or other premises for the preparation of raw
materials and for processing, packing and storage that are commensurate with the varieties and quantities of the products handled;

(3) Appropriate facilities shall be made available for disinfection, changing clothes, toilet, natural and artificial light,
ventilation, prevention of spoilage, protection against dust, elimination of flies and rodents, washing of equipment, sewage
discharge and the containment of garbage and other wastes;

(4) The layout of installations and the application of technological processes shall be rational in order to prevent contamination
between foods to be processed and ready-to-eat foods, and between raw materials and finished products; food must not be placed
in contact with any toxic substance or filth;

(5) Tableware, kitchenware and containers for ready-to-eat foods must be cleaned and disinfected prior to use; cooking utensils
and other utensils must be washed after use and kept clean;

(6) Any containers, packagings, utensils and equipment used for the storage, transportation, loading and unloading of food
as well as the conditions under which these operations are carried out must be safe, harmless and kept clean in order to
prevent food contamination;

(7) Ready-to-eat foods shall be kept in small packets or in nontoxic, clean packaging materials;

(8) All persons involved in food production or marketing shall maintain a constant standard of personal hygiene, taking care to
wash their hands thoroughly and wear clean work clothes and headgear while preparing or selling food; also, proper utensils
must be used when selling ready-to- eat foods;

(9) Any water used must conform to the national hygiene standards for drinking-water in urban and rural areas;

(10) The detergents and disinfectants used shall be safe and harmless to human health.

The hygienic requirements for food production or marketing undertaken by food vendors and persons engaged in the food business in
urban and rural markets shall be formulated specifically according to this Law by the standing committees of the people’s
congresses in the provinces, autonomous regions, or municipalities directly under the Central Government.

   Article 9 The production and marketing of foods in the following categories shall be prohibited:

(1) foods that can be injurious to human health because they are putrid or deteriorated, spoiled by rancid oil or fat, moulded,
infested with insects or worms, contaminated, contain foreign matter or manifest other abnormalities in sensory properties;

(2) foods that contain or are contaminated by toxic or deleterious substances and can thus be injurious to human health;

(3) foods that contain pathogenic parasites, microorganisms or an amount of microbial toxin exceeding the tolerance prescribed by
the State;

(4) meat and meat products that have not been inspected by the veterinary health service or have failed to pass such inspection;

(5) poultry, livestock, game and aquatic animals that have died from disease, poisoning or some unknown cause, as well as products
made from them;

(6) foods contaminated by use of filthy or seriously damaged containers or packages, or filthy means of conveyance;

(7) foods that impair nutrition or health because they are adulterated or misbranded;

(8) foods processed with non-food raw materials; foods mixed with non- food chemical substances, or non-food stuffs used as food;

(9) foods that has expired the date for guaranteed quality;

(10) foods of which the sale has been specifically prohibited, for the prevention of diseases or other special reasons, by the
administrative department of public health under the State Council or by the people’s governments of the provinces, autonomous
regions, or municipalities directly under the Central Government;

(11) foods that contain additives not approved for use by the administrative department of public health under the State
Council or residues of pesticides exceeding the tolerance prescribed by the State; and

(12) other foods that do not conform to the standards and requirements for food hygiene.

   Article 10 Food must not contain medicinal substances, with the exception of those materials that have traditionally served as both
food and medicaments and are used as raw materials, condiments or nutrition fortifiers.

CHAPTER III HYGIENE OF FOOD ADDITIVES

   Article 11 The production, marketing and use of food additives must conform to the hygiene standards for use of food additives and
the hygiene control regulations; the food additives that do not conform to the hygiene standards and the hygiene control
regulations may not be marketed and used.

CHAPTER IV HYGIENE OF CONTAINERS, PACKAGINGS, UTENSILS AND EQUIPMENT

   Article 12 Containers, packagings, utensils and equipment used for food must conform to the hygiene standards and the hygiene
control regulations.

   Article 13 The raw materials for making containers, packagings, utensils and equipment used for food must meet hygiene requirements. The finished
products should be easy to clean and disinfect.

CHAPTER V FORMULATION OF FOOD HYGIENE STANDARDS AND MEASURES FOR FOOD

   Article 14 The administrative department of public health under the State Council shall formulate or approve and promulgate the national
hygiene standards, hygiene control regulations and inspection procedures for food, food additives, the containers, packagings,
utensils and equipment used for food, the detergents and disinfectants used for washing food or utensils and equipment
used for food, and the tolerances for contaminants and radioactive substances in food.

   Article 15 If the State has not formulated hygiene standards for a certain food, the people’s governments of the provinces, autonomous
regions, or municipalities directly under the Central Government may establish local hygiene standards for that food and
report them to the administrative department of public health under the State Council and the competent standardization administration
department under the State Council for the record.

   Article 16 Norms of significance to the science of health to be included in the national quality standards for food additives must be examined
and approved by the administrative department of public health under the State Council.

Appraisals on the safety for use of agricultural chemicals, such as pesticides and chemical fertilizers, shall be examined
and approved by the administrative department of public health under the State Council.

Veterinary hygiene inspection procedures for slaughtered livestock and poultry shall be formulated jointly by the relevant
administrative departments under the State Council and the administrative department of public health under the State Council.

   Article 17 The departments in charge of control of food production or marketing of the people’s governments at various levels shall strengthen
control of food hygiene and oversee the implementation of this Law.

The people’s governments at various levels shall encourage and support efforts to improve food processing technology so as
to promote the improvement of hygienic quality of food.

   Article 18 Enterprises engaged in food production or marketing shall improve their own system for food hygiene control, appoint full-time
or part-time workers to control food hygiene and strengthen inspection of the foods they produce or market.

   Article 19 The selection of sites and the designs for construction, extension or renovation projects of enterprises engaged in
food production or marketing shall meet hygiene requirements, and the administrative department of public health
must participate in the examination of those designs and in the inspection and acceptance of finished projects.

   Article 20 Before starting production of new varieties of food or food additives with new resources, the enterprises engaged in
their production or marketing must submit the data required for evaluation of the hygiene and nutrition of such products; before
starting production of new varieties of containers, packagings, utensils or equipment used for foods, with new raw or processed
materials, the enterprises engaged in their production or marketing must submit the data required for evaluation of
the hygiene of such products. Before the new varieties mentioned above are put into production, it shall also be necessary
to provide samples of the varieties and the matter shall be reported for examination and approval in accordance with the
specified procedures for examining and approving food hygiene standards.

   Article 21 Any standardized packaged food or food additive must, according to the requirements for different products, have the name
of the product, the place of manufacture, the name of the factory, the date of manufacture, the batch number (or code number),
the specifications, the formula or principal ingredients, the date of expiration for guaranteed quality, the method
of consumption or use, and other such information indicated in the label of the package or the product description.
The product description for any food or food additive shall not contain exaggerated or false advertising.

The label of the food package must be clearly printed and easy to read. Foods sold on domestic markets must have labels in the
Chinese language.

   Article 22 With regard to the food indicated to have specific health functions, the products and its description must be submitted to
the administrative department of public health under the State Council for examination and approval; its hygiene standards
and the measures for control of its production and marketing shall be formulated by the administrative department of
public health under the State Council.

   Article 23 The food indicated to have specific health functions may not be harmful for human health; the content of the product description
shall be true, and the functions and ingredients of the product shall be identical with the information given in the product
description and there shall be no false information.

   Article 24 Food, food additives and containers, packagings and other utensils used specially for food may be dispatched from factory or
sold only after their producers have carried out inspection and found them to be up to the standards according to the hygiene
standards and the hygiene control regulations.

   Article 25 Whenever producers or marketers of food procure supplies, they shall, in accordance with the relevant State regulations, request
inspection certificates or laboratory test reports and the supplier must provide these. The scopes and types of food that requires
certificates shall be specified by the administrative department of public health of the people’s governments of the provinces,
autonomous regions, or municipalities directly under the Central Government.

   Article 26 All persons engaged in food production or marketing must undergo an annual medical examination; persons newly employed or serving
temporarily in this field must also undergo a medical examination and may not start work until they have obtained health certificates.

No persons suffering from dysentery, typhoid, viral hepatitis or other infectious diseases of the digestive tract (including
pathogen carriers), active tuberculosis, suppurative or exudative dermatosis or any other disease incompatible with food
hygiene, may be engaged in any work involving contact with ready-to-eat foods.

   Article 27 Enterprises engaged in food production or marketing as well as food vendors must obtain a hygiene licence issued by
the administrative department of public health before they shall be permitted to apply for registration with the
administrative departments of industry and commerce. No person who has not obtained a hygiene licence may engage in food
production or marketing.

Food producers or marketers may not forge, alter or lend the hygiene licence.

The measures for the issuance and control of hygiene licences shall be worked out by the administrative departments of public
health of the people’s governments of the provinces, autonomous regions, or municipalities directly under the Central
Government.

   Article 28 Persons who run a food market of any type shall be responsible for the food hygiene control of the market, set up necessary
public sanitary facilities in the market and maintain a good sanitary environment.

   Article 29 The administrative departments of industry and commerce shall be responsible for the control of food hygiene on urban and
rural markets; the administrative departments of public health shall be responsible for the supervision and inspection
of food hygiene.

   Article 30 Imported foods, food additives and containers, packagings, utensils and equipment used for food must comply with the national
hygiene standards and the hygiene control regulations.

The above-mentioned imports shall be subject to hygiene supervision and inspection by the frontier agencies for hygiene
supervision and inspection of imported food. Only those proved to be up to the standards through inspection shall be allowed
to enter the territory. The Customs authorities shall grant clearance of goods on the strength of the inspection certificate.

When declaring such products for inspection, the importer shall submit the relevant data and inspection reports on the pesticides,
additives, fumigants and other such substances used by the exporting country (region).

The imports mentioned in the first paragraph shall be subject to inspection in accordance with the national hygiene standards.
In the absence of the national hygiene standards for such imports, the importer must provide the hygiene evaluation data
prepared by the health authorities or organization of the exporting country (region) to the frontier agencies for hygiene
supervision and inspection of imported food for examination and inspection and such data shall also be reported to the
administrative department of public health under the State Council for approval.

   Article 31 Foods for export shall be subject to hygiene supervision and inspection by the national inspection agency for import and
export commodities.

The Customs authorities shall grant clearance of export commodities on the basis of the certificates issued by the national inspection
agency for import and export commodities.

CHAPTER VII FOOD HYGIENE SUPERVISION

   Article 32 The administrative departments of public health of the local people’s governments at or above the county level shall exercise
their functions and duties for food hygiene supervision within the scope of their jurisdiction.

The agencies for food hygiene supervision set up by the administrative departments of railways and communications shall
exercise their functions and duties for food hygiene supervision jointly prescribed by the administrative departments of
public health under the State Council and other relevant departments under the State Council.

   Article 33 The duties for food hygiene supervision shall be as follows:

(1) to provide monitoring, inspection and technical guidance for food hygiene;

(2) to contribute to the training of personnel for food production and marketing and to supervise the medical examination of such
personnel;

(3) to disseminate knowledge of food hygiene and nutrition, provide appraisals of food hygiene and publicize the existing situation
in food hygiene;

(4) to conduct hygiene inspection of sites selected or designs made for construction, extension or renovation projects of enterprises
engaged in food production or marketing and participate in the inspection and acceptance of finished projects;

(5) to undertake investigation of accidents involving food poisoning or food contamination and take measures of control;

(6) to make supervision and inspection rounds to see whether any act is committed against this Law;

(7) to pursue investigation of the responsibility of persons who violate this Law and impose administrative punishment on them according
to law; and

(8) to take charge of other matters that concern food hygiene supervision.

   Article 34 The administrative departments of public health of the people’s governments at or above the county level shall be manned
with food hygiene supervisors. Such supervisors shall be qualified professionals and issued with such certificates
by the administrative departments of public health at the corresponding levels.

The food hygiene supervisors appointed by departments in charge of railways and communications agencies shall be issued
with the certificates by the competent authorities at a higher level.

   Article 35 Food hygiene supervisors shall carry out the tasks assigned to them by the administrative department of public health.

Food hygiene supervisors shall enforce laws impartially, be loyal to their duties and may not seek personal gain by taking advantage
of their office.

While carrying out their tasks, food hygiene supervisors may obtain information from the food producers or marketers, request
necessary data, enter production or marketing premises to inspect them, and get free samples in accordance with regulations.
The producers or marketers may not turn down such requests or hold back any information.

Food hygiene supervisors shall be obliged to keep confidential any technical data provided by the producers or marketers.

   Article 36 The administrative department of public health under the State Council and those of the people’s governments of the provinces,
autonomous regions, or municipalities directly under the Central Government may, if the need arises, assign qualified
units as units for food hygiene inspection; these units shall undertake food hygiene inspection and provide inspection
reports.

   Article 37 The administrative department of public health of the local people’s governments at or above the county level may adopt
the following temporary measures of control over the food producer or marketer when a food poisoning accident has occurred
or when there is evidence of a potential food poisoning accident:

(1) to seal up the food and its raw materials that have caused food poisoning or that are likely to cause food poisoning;

(2) to seal up the contaminated utensils used for food and order the food producer or marketer to have them cleaned and disinfected.

The food that is found to be contaminated after inspection shall be destroyed, while the food that is found not contaminated
shall be unsealed.

   Article 38 The units where food poisoning accidents have occurred and the units that have admitted the victims for medical treatment shall,
in addition to taking rescue measures, submit prompt reports to the local administrative departments of public health in accordance
with relevant State regulations.

The administrative department of public health of a local people’s government at or above the county level shall, upon
receipt of such report, conduct prompt investigation and handle the matter and adopt control measures.

CHAPTER VIII LEGAL RESPONSIBILITY

   Article 39 Whoever, in violation of this Law, produces or markets food which is not up to the hygiene standards, thus causing an accident
of food poisoning or resulting in a disease caused by food-borne bacteria, shall be ordered to stop such production or marketing;
the food causing such food poisoning or disease shall be destroyed; the illegal gains shall be confiscated and a penalty
of not less than one time and not more than five times the illegal gains shall concurrently be imposed; if there are no illegal
gains, a penalty of not less than 1,000 yuan and not more than 50,000 yuan shall be imposed.

Whoever, in violation of this Law, produces or markets food which is not up to the hygiene standards, thus causing a serious accident
of food poisoning or resulting in a disease caused by food-borne bacteria, and seriously harming human health, or adulterates
food he produces or markets with toxic or harmful non-food raw materials, shall be investigated for criminal responsibility
according to law.

If a person commits any of the acts mentioned in this Article, his hygiene licence shall be revoked.

   Article 40 If anyone, in violation of this Law, engages in food production or marketing without obtaining a hygiene licence or with
a forged hygiene licence, such production or marketing shall be banned; the illegal gains shall be confiscated and a penalty
of not less than one time and not more than five times the illegal income shall concurrently be imposed; if there
are no illegal gains, a penalty of not less than 500 yuan and not more than 30,000 yuan shall be imposed. If anyone alters
or lends his hygiene licence, his hygiene licence and the illegal gains shall be confiscated; and a penalty of not less than
one time and not more than three times the illegal gains shall concurrently be imposed; if there are no illegal gains, a penalty
of not less than 500 yuan and not more than 10,000 yuan shall be imposed.

   Article 41 If, in violation of this Law, any food producer or marketer does not comply with the hygiene requirements, he shall be ordered
to set it right and given a disciplinary warning, and a penalty of not more then 5,000 yuan may be imposed; if he refuses to
set it right or other serious circumstances are involved, his hygiene licence shall be revoked.

   Article 42 If anyone, in violation of this Law, produces or markets food the production and marketing of which is prohibited, he shall be
ordered to stop producing or marketing such food, a public announcement shall be made immediately to recall the sold food
and the food shall be destroyed; the illegal gains shall be confiscated and a penalty of not less than one time and not
more than five times the illegal gains shall concurrently be imposed; if there are no illegal gains, a penalty of not less than
1,000 yuan and not more than 50,000 yuan shall be imposed; if the offence is serious, the offender’s hygiene licence shall be
revoked.

   Article 43 If anyone, in violation of this Law, produces or markets the principal and supplementary foods intended specially for infants
and preschool children which do not conform to the nutritive and hygiene standards, he shall be ordered to stop producing
and marketing such foods, a public announcement shall be made immediately to recall the sold foods and the foods shall
be destroyed; the illegal gains shall be confiscated and a penalty of not less than one time and not more than five times
the illegal gains shall concurrently be imposed; if there are no illegal gains, a penalty of not less than 1,000 yuan and not
more than 50,000 yuan shall be imposed; if the offence is serious, the offender’s hygiene licence shall be revoked.

   Article 44 If anyone, in violation of this Law, produces, markets or uses the food additives, food containers, packagings, utensils
and equipment used for food as well as the detergents and disinfectants which do not conform to the hygiene standards
and the hygiene control regulations, he shall be ordered to stop producing and using them; the illegal gains shall be confiscated
and a penalty of not less than one time and not more than three times the illegal gains shall concurrently be imposed; if
there are no illegal gains, a penalty of not more than 5,000 yuan shall be imposed.

   Article 45 If anyone, in violation of this Law, produces or markets the food indicated to have specific health functions without examination
and approval by the administrative department of public health under the State Council, or if the product description of
such food provides false information, he shall be ordered to stop producing or marketing such food, the illegal gains shall
be confiscated and a penalty of not less than one time and not more than five times the illegal gains shall concurrently
be imposed; if there are no illegal gains, a penalty of not less than 1,000 yuan and not more than 50,000 yuan shall be imposed;
if the offence is serious, the offender’s hygiene licence shall be revoked.

   Article 46 If anyone, in violation of this Law, does not indicate or falsely indicates specified matters such as the date of manufacture
and the date of expiration for guaranteed quality in the labels of packages of the standardized packaged food or food additives
or in the product descriptions, or in violation of the regulations, does not have labels in the Chinese language, he shall
be ordered to set it right and a penalty of not less than 500 yuan and not more than 10,000 yuan may concurrently be
imposed.

   Article 47 If a food producer or marketer, in violation of this Law, engages in food production or marketing without obtaining a
health certificate, or if the producers or marketers who suffer from diseases and may not contact with ready-to-eat foods are
not transferred to other posts according to relevant regulations, they shall be ordered to set it right and a penalty of not
more than 5,000 yuan may be imposed.

   Article 48 If anyone, in violation of this Law, causes an accident of food poisoning or a disease engendered by food-borne bacteria or
causes harm to another person by other acts against this Law, he shall bear the civil liability for compensation according to
law.

   Article 49 The administrative punishment provided in this Law shall be decided by the administrative department of public health of a
local people’s government at or above the county level. Other authorities exercising the power of food hygiene supervision
as provided by this Law shall, within the stipulated scope of functions and duties, make decisions on administrative
punishment in accordance with the provisions of this Law.

   Article 50 If a party is not satisfied with the decision on administrative punishment, he may, within 15 days from receipt of
the notice of punishment, apply for reconsideration to the organ at the next higher level over the one that has made the decision.
The party may also directly bring a suit in a People’s Court within 15 days from receipt of the said notice.

The reconsideration organ shall, withi

SUPPLEMENTARY PROVISIONS OF THE STANDING COMMITTEE OF NPC REGARDING THE PUNISHMENT OF THE CRIME OF EXCAVATING AND ROBBING SITES OF ANCIENT CULTURE OR ANCIENT TOMBS

Supplementary Provisions of the Standing Committee of NPC Regarding the Punishment of the Crime of Excavating and Robbing Sites of
Ancient Culture or Ancient Tombs

     The 20th Meeting of the Standing Committee of the Seventh National People’s Congress decides to make the following provisions supplementary
to the Criminal Law:

Whoever excavates and robs a site of ancient culture or ancient tomb of historical, artistic or scientific value shall be sentenced
to fixed- term imprisonment of not less than three years but not more than ten years, and may concurrently be punished with a fine;
if the circumstances are relatively minor, the offender shall be sentenced to fixed-term imprisonment of not more than three years
or criminal detention, and may concurrently be punished with a fine; and, under any of the following circumstances, the offender
shall be sentenced to fixed-term imprisonment of not less than ten years, or life imprisonment or death, and shall concurrently be
punished with a fine or confiscation of property:

(1) Excavating and robbing a site of ancient culture or ancient tomb which is designated as major sites to be protected for their
historical and cultural value at the national level or at the provincial level;

(2) Being the ringleader of a gang engaged in excavating and robbing sites of ancient culture or ancient tombs;

(3) Excavating and robbing sites of ancient culture or ancient tombs for many times;

(4) Excavating a site of ancient culture or ancient tomb, and robbing valuable cultural relics therein, or causing serious damage
to valuable cultural relics therein.

All cultural relics seized from excavating and robbing sites of ancient culture or ancient tombs shall be recovered.

    

MOFTEC P.R.C.

EDITOR:Victor






CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE (SAFE) ON THE PRINCIPLES FOR THE DISPOSAL OF FOREIGN EXCHANGE L/C ADVANCE OF DESIGNATED CHINESE-FUNDED FOREIGN EXCHANGE BANKS

The State Administration of Foreign Exchange

Circular of the State Administration of Foreign Exchange (SAFE) on the Principles for the Disposal of Foreign Exchange L/C Advance
of Designated Chinese-funded Foreign Exchange Banks

HuiFa [2002] No.56

June 6, 2002

SAFE branches in all provinces, autonomous regions, and municipalities directly under the Central Government, exchange administration
offices, and SAFE branches in the cities of Shenzhen, Dalian, Qingdao, Xiamen and Ningbo; all designated Chinese-funded foreign exchange
banks:

In order to normalize the L/C business of Chinese-funded banks (including wholly state-owned commercial banks, joint-stock commercial
banks, policy banks, city commercial banks, rural commercial banks and rural credit cooperatives, hereinafter referred to as bank
for all), urge the banks to control L/C risks and improve the quality of foreign exchange assets, with the approval of the People’s
Bank of China, a circular on the principles for the disposal of foreign exchange L/C advance and related charges is given hereunder:

1.

Scope of Application

This circular applies to L/C advance paid by banks before September 30, 2001. It does not apply to foreign exchange L/C advance paid
by financial institutions in bonded areas after September 10, 1998.

2.

Repayment of foreign exchange L/C advance

2.1

In case an L/C applicant can submit the Verification Paper of Import Payment and Goods Delivery sealed “verified” by the verification
administration department of the SAFE or its branch/sub-branch (hereinafter referred to as SAFE office), the applicant or its guarantor
may apply at the SAFE office in the place of registration for purchasing foreign exchange on the strength of the evidential documents
related to the foreign exchange advance, and then purchase foreign exchange at a bank on the strength of the approval of the SAFE
office.

2.1.1

In case the L/C applicant purchases foreign exchange for repayment, the applicant shall submit to the SAFE office a valid Verification
Paper of Import Payment and Goods Delivery and evidential documents verifying the foreign exchange L/C advance paid by the bank.

2.1.2

In case the guarantor purchases foreign exchange for repayment on behalf of the L/C applicant, the guarantor shall submit to the SAFE
office the guarantee contract as well as the documents prescribed in the previous clause.

After the guarantor’s purchase of foreign exchange for repaying L/C advance, the L/C applicant shall not purchase foreign exchange
in the name of the same advance, and shall only repay equivalent amount of renminbi to the guarantor. In case the guarantor has used
its own foreign exchange to repay the L/C advance, the L/C applicant may still apply at the SAFE office for purchasing foreign exchange
by presenting the certificate testifying the repayment by the guarantor, and purchase foreign exchange at the bank on the strength
of the approval of the SAFE office to repay the guarantor.

2.2

In case the L/C applicant can not provide the Verification Paper of Import Payment and Goods Delivery sealed “verified” by the verification
administration department of the SAFE office, if the applicant or/and its guarantor has repaid renminbi to the bank forwardly, or
the bank has demanded repayment from the applicant or its guarantor in renminbi with the help of the judicial department or an arbitrator,
or the bank has got renminbi by selling off the assets of the debtor or/and the guarantor with the help of the judicial department,
or the applicant has repaid the bank with renminbi after liquidation, the bank as the purchasing subject may apply at the SAFE office
for purchasing foreign exchange.

3.

In case banks as purchasing subjects apply for purchasing foreign exchange to recover L/C advance, they shall follow the following
procedures:

3.1

Branches and sub-branches of banks shall apply at local SAFE offices and submit to the latter detailed lists of subject foreign exchange
L/C advances sum by sum in the form of attachment 1. The local SAFE offices shall verify the authenticity and legitimacy of each
sum of the listed foreign exchange advances.

3.2

Branches and sub-branches of banks shall submit the data of foreign exchange L/C advances and the detailed list verified by local
SAFE offices to their superior level or their headquarters, and shall not purchase foreign exchange of their own accord, nor recover
the advances with their revolving position for foreign exchange purchases and sales.

3.3

Headquarters of all banks are responsible for collecting the data of foreign exchange L/C advances of all respective branches and
sub-branches which have been verified by SAFE branches, submit breakdown of data province-by-province to the SAFE, and apply for
purchasing foreign exchange in a unified manner.

4.

When examining banks’ application for purchasing foreign exchange, SAFE offices shall follow the following procedures:

4.1

SAFE offices shall examine carefully all the documents related to the foreign exchange L/C advances submitted by the banks under their
jurisdiction, issue to banks written comments and detailed lists of foreign exchange L/C advances for which purchase of foreign exchange
has been certified, and send copies of the written comments and detailed lists to the supervisory departments of the local branches
of the People’s Bank of China and the SAFE offices of higher level respectively. In case endorsement for purchase of foreign exchange
to cover an L/C advance has been given to a bank, the SAFE office shall notify the banks under its jurisdiction not to sell foreign
exchange to the L/C applicant in the name of the same L/C advance, and shift the data of subject foreign exchange payment from a
status of overdue for verification to a status of for future reference. For L/C advance of an L/C applicant whose business license
has been nullified or who does not exist, the SAFE office shall not approve any bank’s application for the purchase of foreign exchange
thereto related.

4.2

SAFE branches are responsible for collecting the data of foreign exchange L/C advances of banks certified by sub-branches under their
jurisdiction, and submitting detailed lists of data (with breakdown for each bank) to the Balance of Payments Department of the SAFE
on a monthly basis.

4.3

The SAFE is in charge of examining the applications of the headquarters of commercial banks for purchasing foreign exchange, and schedule
their purchase in accordance with supply and demand of the inter-bank foreign exchange market. A list of foreign exchange L/C advances
for which purchase of foreign exchange by banks has been approved will be sent back to the SAFE branches concerned through the technical
supporting web-site of the SAFE Information Center.

The SAEF branches shall check carefully the feedback list sent by the SAFE with the list of L/C advances certified by themselves or
by sub-branches under their jurisdiction. Any inconsistency shall be reported to the Balance of Payments Department of the SAFE in
good time.

5.

A bank that fails in reclaiming a foreign exchange L/C advance after taking whatever measures, shall account the advance as a non-performing
loan dating from the payment of the advance in accordance with relevant provisions in the Provisional Rules on the Determination
of Non-performing Loans promulgated by the People’s Bank of China.

6.

Normal L/C settlement of foreign trade shall be conducted in accordance with relevant current foreign exchange regulations.

7.

This circular will go into effect as of the day of promulgation. Any contradictory stipulation in previous regulations will be nullified
at the same time.

Upon receiving this circular, all branches shall promptly transmit it to the sub-branches, banks and enterprises under their jurisdiction.
Any problems encountered in implementation shall be reported in good time to the Balance of Payments Department of the SAFE (by calling
010-68402310, 68402313, or faxing 010-68402315).

Attachment:

1. Application Form of Foreign Exchange Purchase by the Banks for Recovering L/C Advance (Omitted)

2. Examination Form of Foreign Exchange Purchase by the Banks for Recovering L/C Advance (Omitted)



 
The State Administration of Foreign Exchange
2002-06-06

 







CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE (SAFE) ON THE DISTRIBUTION OF RULES ON FOREIGN EXCHANGE ADMINISTRATION IN BONDED AREAS

e01700

The State Administration of Foreign Exchange

Circular of the State Administration of Foreign Exchange (SAFE) on the Distribution of Rules on Foreign Exchange Administration in
Bonded Areas

HuiFa [2002] No.74

July 25,2002

SAFE branches in all provinces , autonomous regions and municipalities directly under the Central Government, exchange administration
offices, and SAFE branches in the cities of Shenzhen, Dalian, Qingdao, Xiamen, and Ningbo:

To meet the new situation of exchange administration in bonded areas, the SAFE has revised the Rules on Foreign Exchange Administration
in Bonded Areas promulgated on December 18, 1995 and put into force on January 1, 1996. The revised Rules on Foreign Exchange Administration
in Bonded Areas is hereby promulgated for implementation.

1.

According to Rules on Foreign Exchange Administration in Bonded Areas, an inside-area enterprise, whether Chinese or foreign-funded,
shall go through formalities of foreign exchange registration and apply for Foreign Exchange Registration Certificate in Bonded Areas.
Therefore, as from the day when Rules on Foreign Exchange Administration in Bonded Areas is officially implemented, branches and
sub-branches of the State Administration of Foreign Exchange (hereinafter referred to as SAFE offices) shall no longer issue Foreign
Exchange Registration Certificate of enterprise with foreign investment to an inside-area enterprise with foreign investment any
longer. Instead, they shall only issue Foreign Exchange Registration Certificate in Bonded Areas to such enterprise.

2.

As of promulgation of this circular, SAFE branches and exchange administration offices are required to reissue Foreign Exchange Registration
Certificate in Bonded Areas to inside-area enterprises, and collect from them the old Foreign Exchange Registration Certificate in
Bonded Areas and Foreign Exchange Registration Certificate of Enterprise with Foreign Investment. The changeover shall be finished
before January 1, 2003.

3.

During the changeover period, both old and new Foreign Exchange Registration Certificates in Bonded Areas are valid. If an inside-area
enterprise cannot acquire the new Foreign Exchange Registration Certificates in Bonded Areas in time to make foreign exchange payment
or collection due to reasons on the SAFE office’s side, according to Rules on Foreign Exchange Administration in Bonded Areas, its’
foreign exchange payment or collection may be made by a bank upon SAFE office’s approval on a temporary basis. As of January 1, 2003,
the old Foreign Exchange Registration Certificate in Bonded Areas and Foreign Exchange Registration Certificate of enterprise with
foreign investment shall become invalid without exception.

On receiving this circular, SAFE branches and exchange administration offices shall transmit it promptly to sub-branches and banks
under their jurisdiction, administrative organs of bonded areas, and inside-area enterprises, give publicity to the Rules and make
preparations to ensure timely issuance of the new Foreign Exchange Registration Certificate in Bonded Areas to the inside-area enterprises.
Any problem encountered during implementation shall be reported to the General Affairs Department of the State Administration of
Foreign Exchange in good time.

Attachment: Rules on Foreign Exchange Administration in Bonded Areas

Attachment:Rules on Foreign Exchange Administration in Bonded Areas

Chapter I General Provisions

Article 1

Pursuant to Regulations on the Exchange System of the People’s Republic of China and relevant laws and regulations, this Rules is
formulated with a view to improving foreign exchange administration in bonded areas and facilitating sound economic development.

Article 2

Bonded areas in this Rules refers to the special areas inside the People’s Republic of China (hereinafter referred to as inside China)
under closed supervision of the customs established with the approval of the State Council.

Article 3

Outside areas in this Rules refers to the areas inside China other than the bonded areas.

Article 4

Inside-area entities in this Rules referred to the administrative organs, enterprises, institutions, and other economic organizations
inside the bonded areas.

Inside-area Enterprises in the precious paragraph refer to both Chinese-funded and foreign-funded enterprises registered in the bonded
areas.

Article 5

The organ responsible for foreign exchange administration in the bonded areas is the State Administration of Foreign Exchange (SAFE),
its branches and sub-branches (hereinafter referred to as SAFE offices).

Article 6

Foreign exchange operational activities related to the bonded areas shall be conducted according to this Rules.

Article 7

Overseas economic transactions of the bonded areas shall be priced and settled in foreign exchange instead of in renminbi.

Bonded goods flowing between the bonded areas and outside areas shall be priced and settled in foreign exchange instead of in renminbi.
Goods other than bonded ones flowing between the bonded areas and outside areas may be priced and settled either in renminbi or in
foreign exchange. Non-trade transactions such as services shall be priced and settled in renminbi.

Transactions between inside-area enterprises in the same bonded area or between different bonded areas may be priced and settled either
in renminbi or in foreign exchange. Fees of administrative organs inside the bonded areas shall be priced and settled in renminbi.
Economic transactions between the bonded areas and other special areas under closed supervision of the customs, such as the processing
areas for export and the Shanghai Diamond Exchange are regarded as transactions between bonded areas.

Article 8

Banks shall abide by this Rules and other relevant foreign exchange administration regulations when opening or closing a foreign exchange
accounts for, purchasing foreign exchange from or selling foreign exchange to, and making payment or collection in foreign exchange
for inside-area enterprises. They shall verify and keep related certificates and vouchers and submit statistic statements and other
information to SAFE offices as required.

Article 9

All foreign exchange revenues earned by inside-area entities shall be repatriated in time and shall not be deposited overseas without
approval of SAFE offices.

Article 10

For economic transactions with overseas enterprises, inside-area entities shall go through formalities of balance of payment statistical
reporting as required. For economic transactions between inside-area and outside-area entities balance of payment statistical reporting
is not required of the entities concerned.

Chapter II Foreign Exchange Registration and Annual Inspection

Article 11

Within 30 days after acquiring the industrial and commercial business license, the inside-area enterprise shall go through formalities
of foreign exchange registration at a relevant SAFE office by presenting the industrial and commercial business license and its copy,
the approved contract and its articles of association, and the certificate of organizational code (in the case of an enterprise with
foreign investment, the approval document for its establishment is also required), and fill out the Registration Form of Basic Information
accurately.

After verifying the submitted documents, the SAFE office shall issue a Foreign Exchange Registration Certificate in Bonded Areas (hereinafter
referred to as registration certificate) to the inside-area enterprise. The registration certificate shall be designed by the SAFE
and printed by its branches. The registration certificate shall not be forged, altered, rented, lent, transferred, or sold to other
entities.

Article 12

In case of change of name, address, business scope, stock equity transfer, increase of capital, merger and split after foreign exchange
registration, the inside-area enterprise shall report to relevant SAFE office for record and go through formalities of altering foreign
exchange registration upon relevant materials within 30 days after acquiring altered industrial and commercial business license.

Article 13

In the case of liquidation due to expiration of business term or casual termination of business, the inside-area enterprise shall
hand in its registration certificate to the SAFE office and go through formalities of nullifying foreign exchange registration within
30 working days after liquidation is approved by the examining and approving body. Outward remittance of liquidated fund shall be
made upon presentation of “approval for foreign exchange business under capital account” issued by the SAFE office. The inside-area
enterprise shall hand in its registration certificate to the SAFE office and go through formalities of nullifying foreign exchange
registration when it applies for such remittance.

Article 14

If the inside-area enterprise loses its registration certificate, it shall make a statement in the newspaper and report to the SAFE
office within 5 days after the statement. The SAFE office shall re-issue a registration certificate upon the statement.

Article 15

The SAFE office shall inspect annually the inside-area enterprise’s foreign exchange income and expenditure as well as business operations
in the first quarter of each year. After the annual inspection, the SAFE office shall record the result in the registration certificate.

Article 16

An inside-area enterprise’s income and expenditure in foreign exchange shall only be handled upon inspected and required valid registration
certificate and prescribed valid certificates and commercial vouchers. The bank shall not immediately go through formalities of foreign
exchange sale, purchase, payment and receipt for an enterprise that cannot present a valid registration certificate.

If an inside-area enterprise has not taken or passed the annual inspection, or fails to provide valid registration certificate, the
SAFE office shall instruct it to rectify within a stated time. During the period of rectification, each of its receipt or payment
in foreign exchange shall be handled by the bank upon the SAFE office’s approval.

Chapter III Open, Use, and Administration of Foreign Exchange Accounts

Article 17

An inside-area enterprise, before opening a foreign exchange account, shall apply at the SAFE office in the locality where the enterprise
is registered by presenting its registration certificate and materials required by relevant regulations on foreign exchange account.
Foreign exchange account for current account transactions shall be opened on the presentation of the “Account-opening Notice” issued
by the SAFE office and the registration certificate. Special foreign exchange account for capital account transactions shall be opened
on the presentation of the “approval for foreign exchange business under capital account” issued by the SAFE office and the registration
certificate.

Foreign exchange account for current account transactions shall be opened at a bank in the locality where the enterprise is registered.
And in principle, only one such account can be opened.

Special foreign exchange account for capital account transactions may be opened at a bank inside or outside the locality where the
inside-area enterprise in registered. Before opening a special foreign exchange account for capital account transactions at a bank
outside the locality of its registration, the inside-area enterprise shall apply to the SAFE office in the locality where the account
is to be opened, and go through the formalities of account opening at a bank in the locality where the account is to be opened by
presenting the “approval for foreign exchange business under capital account” issued by the SAFE office and the registration certificate.

Article 18

When approving an inside-area enterprise to open a foreign exchange account, the SAFE office shall check and ratify the receipt and
payment scope and lifetime of the account according to the nature and purpose of the account in the “Account-opening Notice” or the
“approval for foreign exchange business under capital account”. But the SAFE office shall not set a balance ceiling for the foreign
exchange account for current account transactions of the inside-area enterprise.

Article 19

The bank shall open foreign exchange account for an inside-area enterprise upon the “Account-opening Notice” or the “approval for
foreign exchange business under capital account” issued by the SAFE office, indicate clearly in the relevant column of the enterprise’s
registration certificate the bank’s name, account number, currency denomination and date of opening, and affix its seal to the certificate.
The bank shall supervise the use by the inside-area enterprise of the foreign exchange account according to the scope of receipt
and payment and lifetime of account.

Article 20

The inside-area enterprise shall use its foreign exchange account according to the scope of receipt and payment and lifetime ratified
by the SAFE office.

Article 21

When an inside-area enterprise wants to close its foreign exchange account, it shall go through formalities of closing the account
at the SAFE office presenting the registration certificate and the account-closed certificate issued by the account-opening financial
institution within 10 working days after the account is cleared.

After the foreign exchange account of an inside-area enterprise is closed, the foreign exchange balance in it may be transferred into
its new foreign exchange account opened upon approval of SAFE office. In the case of terminating business operation, Article 35
of this Rules shall be acted upon.

Article 22

If an inside-area enterprise wants to open a foreign exchange account overseas, it shall apply for the approval of the SAFE office
concerned, according to regulations on overseas foreign exchange account; and open, use and close such account in accordance with
rules.

Chapter IV Administration of Foreign Exchange Receipt and Payment, Sale and Purchase

Article 23

Foreign exchange revenues of an inside-area enterprise from current account transactions shall be deposited in its foreign exchange
account for current account transactions. Sale of foreign exchange shall be made at the bank in the locality where the enterprise
is registered by presenting the registration certificate and relevant certificates.

After buying foreign exchange from an inside-area enterprise, the bank shall make a record in the registration certificate, copy it
after affixing its seal to the certificate. The copy, together with other relevant certificates, shall be kept for 5 years for future
check.

Article 24

Overseas payment by an inside-area enterprise for current account transactions shall be made from its foreign exchange account upon
the registration certificate, verification certificate of import payment in foreign exchange (acting reporting form), other valid

certificates and commercial vouchers required by rules on the administration of sale, purchase of, and receipt and payment in foreign
exchange. If the original of customs declaration form is required according to such rules, while the inside-area enterprise can not
get the original customs declaration form because the import is only subject to customs recording, the original detailed list of
customs recording shall be presented. Unless this Rules provides otherwise, purchase of foreign exchange for payment is prohibited.

Article 25

Overseas remittance of a foreign investor’s profit, dividend, and bonus from an inside-area enterprise shall be made from the enterprise’s
foreign exchange account upon the presentation of the registration certificate, profit distribution resolutions by the board of directors,
tax payment certificates, paid-in capital verification report and auditing report on profits, dividend and bonus prepared by an accountant
firm. If the account balance is not enough to cover the payment, the enterprise may purchase the shortfall at the bank upon the above-mentioned
documents and all the statements of the bank where its foreign exchange accounts are opened.

Article 26

In case an outside-area enterprise sells goods to an inside-area enterprise in the mode of pricing and settlement in foreign exchange,
the inside-area enterprise shall make the payment from its foreign exchange account upon the contract or agreement, invoice, the
original of customs declaration form, the registration certificate, and shall not purchase foreign exchange for that purpose. The
bank shall purchase foreign exchange from the outside-area enterprise or put the foreign exchange to its credit according to relevant
rules.

Article 27

In case an inside-area enterprise sells imported goods that have entered the bonded area to an outside-area enterprise, the outside-area
enterprise shall pay the inside-area enterprise with foreign exchange in its account or purchased foreign exchange upon a copy of
the inside-area enterprise’s registration certificate and valid certificates and commercial vouchers required by Rules on Foreign
Exchange Purchase, Sale and Payment. Unless the outside-area enterprise can provide the original detailed list of customs recording
of the inside-area enterprise, direct overseas payment is not permitted.

In case an inside-area enterprise sells to an outside-area enterprise imported goods that have not entered the bonded area and have
been declared outside, the out-side enterprise shall make the payment either overseas or to the inside-area enterprise with foreign
exchange in its account or purchased foreign exchange upon a copy of the inside-area enterprise’s registration certificate and valid
certificates and commercial vouchers prescribed by Rules on Foreign Exchange Purchase, Sale and Payment.If the inside-area enterprise
makes overseas payment after being paid by the out-side enterprise, the inside-area enterprise shall present its registration certificate,
certificate of the verification of the electronic account of the declaration form of the outside-area enterprise, and valid certificates
and commercial vouchers prescribed by Rules on Foreign Exchange Purchase, Sale and Payment.

Article 28

The outside-area enterprise shall handle the formalities of export proceeds verification and verification of import payment in foreign
exchange for bonded goods coming from the outside area to the bonded area or the other way around. For goods going from the bonded
area to overseas or vice versa, the inside-area enterprise need not go through such formalities.

Article 29

If an inside-area enterprise’s registered capital is paid in renminbi, its payment in foreign exchange to overseas or outside area
shall be made firstly with the foreign exchange balance in its account. If the balance is not sufficient for the payment, it may
apply to the SAFE office in its locality of registration for purchasing the shortfall upon its registration certificate, paid-in
capital verification report issued by an accountant firm, certificate of foreign exchange balance in its account issued by the bank,
and valid commercial vouchers and certificates listed below. Purchase of and payment in foreign exchange shall be made upon its registration
certificate and the SAFE office’s approval. Total purchase shall not exceed the equivalent of its renminbi paid-in capital.

(1)

In the case of import of goods, the contract of import, the verification paper of import payment (acting reporting form), the original
of customs declaration form (verifying copy) or the detailed list of customs recording shall be presented;

(2)

In the case of debt service or performance of external guarantee, the contract of external debt or external guarantee, the registration
certificate of external debt or guarantee, the notice of payment sent by overseas creditor shall be presented;

(3)

In the case of repayment of a domestic foreign exchange loan, the contract of loan, the registration certificate of domestic foreign
exchange loan, and the notice of repayment sent by the creditor shall be presented.

Article 30

Payment in foreign exchange to overseas by an inside-area enterprise authorized by the bonded area administrative committee and customs
to redistribute goods shall be made firstly with the balance in the enterprise’s foreign exchange account. If the balance is not
sufficient for the payment, in the case of goods import, the redistributing enterprise may apply to a bank in its locality of registration
for purchasing the shortfall by presenting its registration certificate, a certificate of the balance of its foreign exchange account
issued by the account-opening bank, the original of customs declaration form (verifying copy), invoice in renminbi, tariff clearance
certificate, the original of detailed list of customs recording, the contract of import, the verification paper of import payment
in foreign exchange (acting reporting form) and other valid commercial vouchers and certificates

In the case of debt service, performance of external guarantee and repayment of a domestic foreign exchange loan, the redistributing
enterprise shall apply to the SAFE office in the locality of its registration for purchasing the shortfall upon its registration
certificate, a certificate of the balance of its foreign exchange account issued by the account-opening bank, the original of customs
declaration form (verifying copy), invoice in renminbi, tariff clearance certificate, the contract and registration certificate of
external debt, domestic foreign exchange loan, or external guarantee, the notice of repayment sent by the creditor, and other valid
commercial vouchers and certificates. Purchase of and payment in foreign exchange shall be made upon its registration certificate
and the SAFE office’s approval.

Annual total purchase of foreign exchange by an inside-area redistributing enterprise shall not exceed its total import in the same
year.

Article 31

Foreign exchange payment to overseas by an inside-area processing enterprise that has been authorized by the bonded area administrative
committee to sell a portion of its products in the domestic market shall be made firstly with the balance in the enterprise’s foreign
exchange account. If the balance is not sufficient for the payment, in the case of goods import, the enterprise may apply to a bank
in the locality of its registration for purchasing the shortfall by presenting its registration certificate, a certificate of the
balance of its foreign exchange account issued by the account-opening bank, approval document on domestic sale, the contract of domestic
sale, the original of customs declaration form (verifying copy), invoice in renminbi, tariff clearance certificate and the original
of detailed list of customs recording, contract of import, verification paper of import payment in foreign exchange (acting reporting
form) and other valid commercial vouchers and certificates.

In the case of debt service, performance of external guarantee and repayment of domestic foreign exchange loan, the enterprise shall
apply to the SAFE office in the locality of its registration for purchasing the shortfall by presenting its registration certificate,
a certificate of the balance of its foreign exchange account issued by the account-opening bank, approval document on domestic sale,
contract of domestic sale, the original of customs declaration form (verifying copy), invoice in renminbi, tariff clearance certificate,
contract and registration certificate of external debt, domestic foreign exchange loan, or external guarantee, notice of repayment
sent by the creditor, and other valid commercial vouchers and certificates. Purchase of and payment in foreign exchange shall be
made upon its registration certificate and the SAFE office’s approval.

Total purchase of foreign exchange by a processing enterprise shall not exceed its total authorized sales in the domestic market.

Article 32

When selling foreign exchange to an inside-area enterprise, the bank shall examine submitted valid certificates and commercial vouchers
strictly according to this Rules, check previous purchases recorded in its registration certificate, affix a seal of “foreign exchange
provided” to the original of customs declaration form, and verify the original electronic account of the declaration form from the
verification network system for import customs declaration form and wind up the case. A customs declaration form with the seal of
“foreign exchange provided” shall not be used as a supporting document for foreign exchange purchase and payment.

Article 33

After selling foreign exchange to an inside-area enterprise, the bank shall record the date of purchase, source of renminbi, amount
and nature of the purchase in the registration certificate, copy the registration certificate after affixing the bank’s business
seal to it. The copy, together with other commercial vouchers and certificates submitted by the enterprise for the purchase, shall
be kept for 5 years for future check.

Article 34

An inside-area enterprise’s receipt or payment in foreign exchange and foreign exchange transactions under capital and financial accounts,
such as borrowing international commercial loan, foreign exchange on-lending loan, providing external guarantee, overseas bond issuance,
overseas investment, domestic increase of capital or re-investment with foreign investor’s profit, and so on, shall be handled upon
its registration certificate and other required documents according to relevant regulations effective in outside areas. Overseas
payment under capital and financial accounts shall be made from the enterprise’s foreign exchange account; and shall not be made
with purchased foreign exchange except where this Rules clearly provides for otherwise.

Guarantee provided by an outside-area enterprise to an inside-area enterprise for its borrowing of domestic foreign exchange loan
shall be regarded as external guarantee.

Article 35

An inside-area enterprise that is going to terminate its operations shall liquidate all its assets according to relevant regulations
effective in outside areas. Liquidated assets belonging to foreign investor may, with the SAFE office’s approval, be remitted abroad
from the enterprise’s foreign exchange account or with purchased foreign exchange or reinvested domestically. Those belonging to
the Chinese party, both in foreign exchange and in renminbi, shall be transferred to an outside area and disposed of according to
relevant regulations.

Chapter V Supplementary Provisions

Article 36

The bank shall report to the local SAFE office within the first 5 working days of each month the purchase of foreign exchange by inside-area
enterprises in the previous month, including their names, sources of renminbi, amounts purchased and purposes of the purchases.

Article 37

SAFE offices shall supervise and inspect the foreign exchange receipt and payment and foreign exchange business operations of banks
and inside-area enterprises periodically or occasionally; and punish violators of this Rules according to the Regulations on the
Exchange System of the People’s Republic of China and other foreign exchange regulations; and for offences not specified in Regulations
on the Exchange System of the People’s Republic of China and other foreign exchange regulations, may give warning to, circulate a
notice of criticism of, or impose fine up to RMB30000 on the violator. If an inside-area enterprise’s purchase of foreign exchange
with renminbi is not made according to this Rules, the SAFE office concerned may suspend or nullify its right to purchase foreign
exchange with renminbi.

Article 38

This Rules shall enter into force as of October 1, 2002. The SAFE is responsible for its interpretation. Rules on Foreign Exchange
Administration in Bonded Areas promulgated by the SAFE on December 16, 1995, Circular on the Implementation of Rules on Foreign Exchange
Adminstration in Bonded Areas promulgated by the SAFE on January 24, 1996, Official Reply of the SAFE to SAFE Zhejiang Branch’s Inquiry
on the Classification of Foreign Exchange Sale to and Payment for the Inside-area Enterprises by the Outside-area Banks promulgated
by the SAFE on July 27, 1998, Circular on Issues Related to Foreign Exchange Administration in Bonded Areas promulgated by the SAFE
on July 26, 2000, and Circular on Transmitting Circular on Issues Related to the Establishment of Subsidiaries by enterprise with
foreign investment in Bonded Areas promulgated by the General Affairs Department of the SAFE on January 29, 2002, and other supporting
rules and normative documents shall be nullified at the same time.



 
The State Administration of Foreign Exchange
2002-07-25

 







CONSTITUTION ACT, 1982 – page 22

NOTES (1) The enacting clause was repealed by the Statute Law Revision Act, 1893, 56-57 Vict., c. 14 (U.K.). It read as...