NOTICE OF THE CHINA SECURITIES REGULATORY COMMISSION ON ABOLISHING SOME OF THE SECURITIES AND FUTURES RULES (IV)

China Securities Regulatory Commission

Notice of the China Securities Regulatory Commission on Abolishing Some of the Securities and Futures Rules (IV)

ZhengJianFaLvZi [2003] No. 15

November 20th, 2003

All the securities regulatory offices, agencies, special offices, all the securities or futures exchanges, China Securities Registration
and Settlement Company, and all the departments under the China Securities Regulatory Commission:

In accordance with the provisions of the Regulations on Procedures for Formulation of Rules, this Commission has made cleanup once
more on departmental rules on securities and futures promulgated from the establishment of this Commission up to June 30th, 2003,
on the basis of abolishing the first three batches of rules and normative documents (hereinafter referred to in general as “rules”),
of which there are 30 securities rules that shall be repealed, have been repealed through public proclamation, or are automatically
invalidated, and 16 futures rules. We hereby have the lists of the two parts of 46 rules publicized in order to terminate the implementation
thereof.

Attachment: List of Departmental Rules Abolished by the China Securities Regulatory Commission (IV)

Attachment:List of Departmental Rules Abolished by the China Securities Regulatory Commission (IV)htm/e03303.htmNO

NO.	Regulations	File NO.	Issued by	Date of Issue
1	Notice concerning Approval of the Experimental Futures Exchanges	ZHENGJIANFA [1994] NO.150	China Securities Regulatory Commission	October 10^th, 1994
2	Provisions on State-owned Enterprises and Institutions Participating in Futures Exchange	ZHENGJIANFAZI [1994] NO.179	China Securities Regulatory Commission, the State Economic and Trade Commission, the Ministry of Domestic Trade	December 5^th, 1994
3	Urgent Circular concerning Enhancing Risk Control on Treasury Bonds and Futures Transaction	ZHENGJIANFAZI [1995] NO.23	China Securities Regulatory Commission	February 26^th, 1995
4	Urgent Circular concerning the Implementation of Provisions on Bail for Treasury Bonds and Futures Dealings	ZHENGJIANFAZI [1995] NO.47	China Securities Regulatory Commission	March 30^th, 1995
5	Interim Measures for the Administration of the Qualifications of Securities Practitioners	ZHENGWEIFAZI [1995] NO.6	The Securities Commission of the State Council	April 18^th, 1995
6	Notice concerning Requiring All the Treasury Bonds and Futures Exchanges to Further Enhance Risk Control	ZHENGJIANFAZI [1995] NO.60	China Securities Regulatory Commission	May 15^th, 1995
7	Notice concerning the Cleaning Up B-Share Accounts	ZHENGJIANFAZI [1996] NO.76	China Securities Regulatory Commission	June 28^th, 1996
8	Notice concerning Issues on the Strict Administration of the Opening of B-Share Accounts	ZHENGJIANJIAOZI [1996] NO.2	China Securities Regulatory Commission	September 20^th, 1996
9	Notice concerning Several Issues on Regulating the Acceptance of Capital Contribution by Futures Brokering Corporations	ZHENGJIANQIZI [1996] NO.16	China Securities Regulatory Commission	December 23^rd, 1996
10	Notice concerning Stoutly Forbidding Illegal Fund-raising in the Name of Futures Transaction	ZHENGJIANQIZI [1997] NO.41	China Securities Regulatory Commission	November 12^th, 1997
State Administration of Radio, Film and Television 2003-11-25

CIRCULAR OF THE GENERAL OFFICE OF THE MINISTRY OF COMMERCE ON SETTING UP AN INFORMATION DATABASE OF FOREIGN INVESTMENT INTENTION OF ENTERPRISES

General Office of the Ministry of Commerce

Circular of the General Office of the Ministry of Commerce on Setting up An Information Database of Foreign Investment Intention of
Enterprises

Shang He Zi [2003] No. 39

November 28, 2003

The foreign trade offices (commissions or bureaus) and business affairs offices or bureaus of all provinces, autonomous regions, municipalities
directly under the jurisdiction of the Central Governments, and cities directly under the state planning, as well as Xinjiang Production
and Construction Corps, and all the enterprises directly under the jurisdiction of the Central Government:

In order to facilitate the implementation of the “Going out” strategy, strengthen services on foreign investment information, and
find out the trends of foreign investment of Chinese enterprises in time, as well as better direct and coordinate relevant work,
this Ministry has hereby decided, upon approval, to establish an information database of foreign investment intention of enterprises
(hereinafter referred to as the “Information Database”) on the sub-website of the Department of Foreign Economic Cooperation subject
to the government website of the Ministry of Commerce, and hereby make the following notice on relevant matters concerned:

The major role of the Information Database to be established shall include: publicizing information on the foreign investment intention
of the Chinese enterprises, and providing an information platform for various domestic and foreign institutions and enterprises to
know each other and communicate with each other, with a view of promoting investment information exchange between the Chinese enterprises
and foreign enterprises, and facilitating the development of foreign trade and economic cooperation business of our country. Enterprises
applying for participating in the Information Database may download the “Registration Form of Overseas Investment Intention of Enterprises”(see
Attachment) from the sub-website of the Department of Foreign Economic Cooperation subject to the government website of the Ministry
of Commerce (https://www.mofcom.gov.cn), and send it to the departments in charge of foreign trade and economy of the corresponding
province or municipality after having it filled out in accordance with facts, annexed seal of the enterprise, and attached necessary
materials.

II.

Requirements for an enterprise filing an application

Economic entities registered within the territory of China (excluding Hong Kong, Macao, and Taiwan Province) according to law, which
have the qualifications of a legal entity;

The registered capital of the enterprise is not less than 10 million Yuan (RMB) and the enterprise has made profits in three consecutive
years; and

The amount of foreign intention investment of a single project is more than one million US dollars.

III.

The documents required for the application

Photocopy of the business license of an enterprise;

The financial statement of an enterprise in three consecutive years; and

Registration Form of Foreign Investment Intention of Enterprises.

IV.

Information Examination and Verification and Release All the local departments in charge of foreign trade and economy shall pay great
attention to the work from the high prospective of facilitating the implementation of the “Going out” strategy, actively diffuse
and disseminate to the enterprises the functions and effect of the Information Database on their own initiatives, and earnestly organize
the work for application and report, examination and approval, statistics and report of the information on local foreign investment
intention. For those information reported by the enterprises, which comply with the requirements after examination and verification
in accordance with prescribed requirements, the departments shall have them collected and classified according to industries, and
sent them to the division of research & development on foreign processing under the Department of Foreign Economic Cooperation of
the Ministry of Commerce by both email and post, the email addresses are:

hzjg@mofcom.gov.cn, chenwenlin@mofcom.gov.cn

The Ministry of Commerce shall be in charge of publicizing the above-mentioned information in the “Information Database of Foreign
Investment Intention of Enterprises”. In principle, the time for reporting and sending the information shall be the last ten-day
of May up to the last ten-day of November every year, and the time for publicizing the information shall be the last ten-day of June
up to the last ten-day of December every year. Whenever necessary, the information may be supplemented or modified irregularly.

The follow-up and statistical work for the investment intention information publicized by each region shall be properly done, and
the information shall be verified and updated in time in accordance with the progress of foreign investment of enterprises, so as
to secure the accuracy and effectiveness of the information.

All the enterprises directly under the jurisdiction of the Central Government shall report and send their information directly to
the Ministry of Commerce by the ways mentioned above.

The Department of Foreign Economic Cooperation of the Ministry of Commerce shall be in charge of the construction of and supervision
over the above-mentioned Information Database. It may, in addition to releasing the above-mentioned information through the government
public websites, upon the need of the work, provide such services as the relevant information of different countries on attracting
foreign investment, opportunities for enterprise investment negotiation, and training of policies of different countries on foreign
investment, as well as providing special knowledge training, etc., and promote the implementation of investment cooperation projects
through organizing enterprises to make overseas investigation.

The Ministry of Commerce welcomes all kinds of domestic and foreign organizations, institutions, enterprises and individuals to provide
opportunities and assistance to the Chinese and foreign enterprises, and provide investment cooperation information and consultation
services.

Attachment: Registration Form of Foreign Investment Intention of Enterprises.

htm/e03289.htmAttachment

Attachment:

Registration Form of Overseas Investment Intention of Enterprises

Name of Enterprises Date of Filling in the FormDateMonthYear
Contact Person for the Project Telephone Fax Email Address
Investment Industry	Continent of Investment	Country of Investment
Total Investment	Investment of the Chinese Party	Ways of Investment
Name of Products Production Scale
Brief Introduction to the Project (including requirements to the cooperation partners)
Brief Introduction to the Strengthen of the Chinese Enterprise
Seal and Endorsement of the foreign trade and economic offices, commissions, bureaus, and business affairs offices after examination and approval DateMonthYear

Remarks:

1. The Investment Industry shall be filled
in with: import and export trade, transportation, tourism, engineering contracting, research & development, consultation, machinery
manufacture, electronic and home appliances, light industry, textile, garment processing, agriculture development, development
of petrol and natural gas resources, development of mineral resources, smelting, fishery, real estate development, investment
and shareholding, and others.

2. The present Form may be downloaded from
the internet and copied, the part of the brief introductions to projects and enterprises may be added Attachment pages.

3. The ways of investment may be divided into:
newly established, merger and share holding; the unit of the amount of investment shall be: Ten Thousand Dollars.

DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON REVISING THE LAW OF THE PEOPLE’S REPUBLIC OF CHINA ON THE PEOPLE’S BANK OF CHINA

Order of the President of the People’s Republic of China

No. 12

The Decision of the Standing Committee of the National People’s Congress on Revising the Law of the People’s Republic of China on
the People’s Bank of China, which has been adopted by the sixth session of the Standing Committee of the Tenth National People’s
Congress of the People’s Republic of China on December 27, 2003, is hereby promulgated, and shall enter into force as of February
1, 2004.
President of the People’s Republic of China Hu Jintao

December 27, 2003

Decision of the Standing Committee of the National People’s Congress on Revising the Law of the People’s Republic of China on the
People’s Bank of China

(Adopted at the Sixth Session of Standing Committee of the Tenth National People’s Congress on December 27, 2003)

It has been decided at the sixth session of the Standing Committee of the Tenth National People’s Congress to make alterations on
the Law of the People’s Republic of China on the People’s Bank of China as follows:

Article 1 shall be revised as “This Law is hereby constituted in order to establish the status of the People’s Bank of China (PBC),
clarify its functions, ensure the correct enactment and implementation of the state monetary policies, and set up and improve a macro-control
system through the central bank, as well as safeguard the stability of the banking industry.”

Paragraph 2 of Article 2 shall be revised as “The People’s Bank of China shall constitute and implement monetary policies, prevent
and dissolve financial risks, and safeguard the stability of the banking industry in the country, upon the guidance of the State
Council.”

Paragraph 1 of Article 4 shall be revised as “The People’s Bank of China shall implement the following responsibilities:

(1)

.Releasing and performing orders and regulations regarding its functions;

(2)

Constituting and carrying out monetary policies according to related laws;

(3)

Issuing Renminbi (RMB) and being in charge of its circulation;

(4)

Surveilling the inter-bank borrowing or lending markets and inter-bank bonds markets;

(5)

Performing administration on foreign exchange, and surveilling inter-bank foreign exchange market;

(6)

Surveilling gold market;

(7)

Holding, supervising and managing the state foreign exchange reserve and gold reserve;

(8)

Managing the state treasury;

(9)

Maintaining the regular operation of the systems for payments and settlements of accounts;

(10)

Guiding and arranging the anti-money-laundering work of the financial industry, taking charge in capital surveillance and measurement
over anti-money-laundering;

(11)

Being in charge of the statistics, investigation, analysis, and forecasting of the financial industry;

(12)

Engaging in related international banking operations as the central bank of the state; and

(13)

Other functions as prescribed by the State Council. ”

Article 6 shall be revised as “The People’s Bank of China shall submit a working report regarding monetary policies and operation
of the financial industry to the Standing Committee of the National People’s Congress”.

One Article shall be added as Article 9 , that is, “The State Council shall set up a financial surveillance and administration coordination
mechanism, and the specific measures shall be constituted accordingly.”

Article 11 shall be changed as Article 12 , and one Paragraph shall be added as Paragraph 2, that is, “the monetary policy committee
of the PBC shall play its part in the state macro-control, and in the constitution and adjustment of monetary policies.”

Article 12 shall be changed as Article 13 , and it shall be revised as “The PBC shall set up branches as its representative organs
as required in performing its functions, and practice uniformly leading and control over these branches.”

“The branches of the PBC shall maintain the stability of financial industry and handle related business operations in the areas under
their respective jurisdictions under the authorization of the PBC.”

Article 14 shall be changed as Article 15 , and it shall be revised as “The governor, deputy governors and other staff of the PBC
shall keep state secrets in accordance with related laws and be responsible for keeping secrets of the banking institutions and the
clients regarding their performance of functions.”

Article 22 shall be changed as Article 23 , of which Subparagraph (1) of Paragraph one shall be revised as demanding that the banking
institutions deposit the reserve fund at a prescribed ratio; and Subparagraph (3) thereof shall be revised as handling rediscounting
for the banking institutions, which have opened accounts in the PBC; and Subparagraph (5) thereof shall be revised as dealing in
treasury bonds, other government bonds, financial bonds and foreign exchange on the open market.

10.

Article 25 shall be changed as Article 26 , and it shall be revised as “The PBC may open accounts for banking institutions as required,
but may not overdraw the accounts of the banking institutions.”

11.

Article 26 shall be changed as Article 27 , and shall be revised as “The PBC shall perform in organizing or assisting in setting
up banking institutions in settling inter-institutional accounts, coordinating the activities and providing services thereof. The
specific procedures for such operation shall be constituted by the PBC.

The PBC shall, in collaboration with the banking regulatory organ of the State Council, constitute rules for settlement of payment.”

12.

Article 30 shall be changed as Article 31 , and shall be revised as “The PBC shall make surveillance and inspection over the operation
of financial market, and perform macro-control on financial market in order to advance its harmonious progress.”

13.

Article 31 shall be deleted.

14.

Article 32 shall be revised as “The PBC shall reserve the right to conduct inspection and surveillance over the acts of the financial
institutions, other entities or individuals as follows:

(1)

Acts of implementing related provisions regarding the management of reserve against deposit;

(2)

Acts relating to the special loans of the PBC;

(3)

Acts of performing the provisions regarding Renminbi control;

(4)

Acts of performing related provisions regarding the management of the inter-bank borrowing or lending markets and the inter-bank bonds
markets;

(5)

Acts of performing related provisions regarding foreign exchange control;

(6)

Acts of performing related provisions regarding gold management;

(7)

Acts on behalf of the PBC of managing the state treasury;

(8)

Acts of performing related provisions regarding settlement management; and

(9)

Acts of performing related provisions regarding anti-money-laundering.

The special loans hereof referred to in the preceding Paragraph are the loans used exclusively, which are decided by the State Council
and issued to financial institutions by the PBC”.

15.

One Article shall be added as Article 33 , that is, “The PBC may make suggestion that the banking regulatory organ of the State Council
conduct inspection and surveillance over banking institutions according to the needs of implementing the monetary policy and maintaining
the stability of the finance. And the banking regulatory organ of the State Council shall issue a reply within 30 days as of the
receipt of the suggestion.”

16.

One Article shall be added as Article 34 , that is, “The PBC may, upon the approval of the State Council, reserve the right to conduct
inspection and surveillance over the banking institution for the purpose of maintaining financial stability when a banking institution
has difficulty in payment which may lead to financial risks.”

17.

Article 33 shall be changed as Article 35 , and shall be revised as “The PBC may reserve the right to require the banking institutions
to submit the necessary balance sheet, statements of profits and other financial and statistical reports and materials as required
by its functions.

The PBC shall, in collaboration with the banking regulatory organ of the State Council and other financial surveillance and administration
organs of the State Council, set up the surveillance and administration information sharing mechanism.”

18.

Article 35 shall be deleted.

19.

Article 39 shall be altered as Article 40 , and shall be revised as “The PBC shall manage its revenues and expenditures and accounting
affairs according to related laws, administrative regulations, and the uniform financial and accounting systems of the state, and
shall be subject to the auditing and surveillance of the audit organs and the financial departments of the State Council separately
according to related laws.”

20.

Article 41 shall be changed as Article 42 , and it shall be revised as “Where anyone who illicitly prints or mints Renminbi, sells
counterfeit or illicitly printed or minted Renminbi, or knowingly transports counterfeit money or illicitly printed or minted money,
if a crime is constituted, it/he shall be investigated for criminal liabilities in accordance with related laws; if no crime is constituted,
a detention of no more than 15 days and a fine of no more than RMB 10,000 shall be imposed upon it/him by the public security organs.”

21.

Article 42 shall be changed as Article 43 , and shall be revised as “Where anyone who buys counterfeit or altered Renminbi or knowingly
holds or uses counterfeit or altered or illegally printed or minted Renminbi, if a crime is constituted, criminal liabilities shall
be investigated; if no crime is constituted, a detention of no more than 15 days and a fine of no more than RMB 10,000 shall be imposed
by the public security organs.”

22.

Article 45 shall be changed as Article 46 , and shall be revised as “In case any act listed in Article 32 of this Law violates related
provisions, punishment shall be imposed in accordance with the provisions regarding punishment in the related laws and administrative
regulations if any. In case of no provisions regarding punishment, the PBC shall give warnings, confiscate illegal gains if any subject
to different circumstances, and a fine of one time up to five times of the illegal gains in case the illegal gains are more than
RMB 500,000 shall be imposed; and a fine of RMB 500,000 up to RMB 2 million shall be imposed, if there are no illegal gains or the
illegal gains are no more than RMB 500,000. A warning, or a fine of RMB 50,000 Yuan up to RMB 500,000 Yuan shall be imposed upon
the directors and senior management personnel directly responsible and other persons directly liable. If it constitutes a crime,
the criminal liability shall be investigated in accordance with related laws.”

23.

Article 49 shall be changed as Article 50 , and shall be revised as “Where any functionary of the PBC divulges any state or commercial
secret he acquires, if a crime is constituted, criminal liabilities shall be investigated in accordance with related laws. If no
crime is constituted, he shall be subject to administrative sanctions in accordance with related laws.”

24.

Article 50 shall be changed as Article 51 , and it shall be revised as “Where any functionary of the PBC commits embezzlement, accepts
bribery, commits irregularities for personal interests, abuse their official capacities, or neglect their duties, if a crime is constituted,
criminal liabilities shall be investigated in accordance with law; if no crime is constituted, he shall be subject to administrative
sanctions in accordance with law”.

25.

One Article shall be added as Article 52 , that is, “The banking institutions as mentioned in this Law mean the commercial banks,
urban credit cooperatives, rural credit cooperatives, and other financial institutions and policy banks that absorb public deposits.

The provisions of this Law on banking institutions apply to the financial capital management companies, trust and investment companies,
finance companies, and financial leasing companies, which are set up within the territory of China, and other financial institutions
set up upon the approval of the banking regulatory organ of the State Council”.

The present Decision shall enter into force as of February 1, 2004.

The Law of the People’s Republic of China on the People’s Bank of China shall be revised pursuant to the present Decision, and the
order of the clauses thereof shall be adjusted accordingly, and this revised Law shall be publicized again.

The Standing Committee of the National People’s Congress
2003-12-27

ADMINISTRATIVE MEASURES OF THE MINISTRY OF COMMERCE, THE GENERAL ADMINISTRATION OF CUSTOMS, THE STATE ADMINISTRATION OF TAXATION, AND THE STATE ADMINISTRATION OF FOREIGN EXCHANGE FOR THE ESTABLISHMENT OF FOREIGN FUNDED EXPORT PROCUREMENT CENTERS

Ministry of Commerce, General Administration of Customs, State Administration of Taxation, State Administration of Foreign Exchange

Order of the Ministry of Commerce, the General Administration of Customs, the State Administration of Taxation, and the State Administration
of Foreign Exchange

No. 3

The “Administrative Measures for the Establishment of Foreign Funded Export Procurement Centers”, which were examined and passed at
the 5th executive meeting of the Ministry of Commerce of the People’s Republic of China on September 29, 2003, are hereby promulgated
and shall come into force after 30 days as of the date of promulgation.

Minister of Commerce, Lv Fuyuan

Director General of the General Administration of Customs, Mu Xinsheng

Director General of the State Administration of Taxation, Xie Xuren

Director General of State Administration of Foreign Exchange, Guo Shuqing

November 17, 2003

Administrative Measures of the Ministry of Commerce, the General Administration of Customs, the State Administration of Taxation,
and the State Administration of Foreign Exchange for the Establishment of Foreign Funded Export Procurement Centers

Article 1

The present Measures are developed in the light with the laws and regulations of the People’s Republic of China on overseas investments
and foreign trade administration in order to further facilitate the expansion of foreign trade, to enhance the opening to the outside
world and to attract overseas investments. Foreign investors who invest to establish foreign-funded export procurement centers in
China shall abide by the present Measures.

Article 2

A foreign-funded export procurement center mentioned in the present Measures refers to a foreign-funded enterprise engaging in export
procurement, which is established by a foreign investor in China either in the form of a wholly owned enterprise or a joint venture
with a Chinese investor. The export procurement center shall be a limited liability company.

Article 3

A foreign investor who applies to establish a foreign-funded export procurement center shall have a transnational sales network and
the capacity of export procurement.

The Chinese investor who engaged in a joint venture foreign-funded export procurement center shall have good credit standing, and
necessary economic strength for the establishment of the procurement center.

Article 4

The registered capital of a foreign-funded export procurement center shall be no less than 30 million Yuan (RMB). Chinese and foreign
investors shall contribute their investments according to the relevant existing regulations.

Article 5

A foreign investor may invest to establish an export procurement center in the name of the investment company it has established in
China.

Article 6

Those who intends to establish a foreign-funded export procurement center shall submit the following documents to the Ministry of
Commerce for approval, before which they have to undergo preliminary examination and get permission from the competent authority
of commerce of the province, autonomous region, municipality directly under the jurisdiction of the Central Government, or city directly
under state planning where the foreign-funded export procurement center is to be established:

(1)

The application;

(2)

Registration document (photocopy) of each investor, the proof documents of their legal representative (photocopy), and the proof documents
of qualifications;

(3)

The feasibility study report, and the articles of association (For a joint venture export procurement center, the joint venture contract
shall be submitted at the same time);

(4)

A name list of the board of directors and their resumes;

(5)

A notice on pre-approval of the enterprise’s name, which was issued by the administration for industry and commerce.

The Ministry of Commerce shall, within 30 working days after all the application documents are received, make a written official reply
on whether the application will be approved.

Article 7

A foreign-funded export procurement center may operate businesses as follows:

(1)

Procuring domestic goods for export, and providing warehousing, information consulting and providing technical services related to
export;

(2)

Importing raw and auxiliary materials, and entrusting other enterprises to carry out processing and re-export;

(3)

Importing and procuring samples which are essential in export. The quantity and the value of the imported samples should comply with
the relevant regulations of the customs on import of samples.

Article 8

As for the export commodities under the state’s quota or permit administration, the quota or permit must be applied for and obtained
in the light with the relevant regulations of the state. The commodities under bid invitation administration of the state upon quota
must, prior to the procurement or export, be subject to bid invitation of commodities for export according to the relevant regulations
on bid invitation of commodities for export.

Article 9

A foreign-funded export procurement center shall abide by the existing regulations administration of foreign exchanges when it opens
a foreign exchange account or makes collections or payments of foreign exchanges,.

Article 10

The tax refund of a foreign-funded export procurement center which is located out of a bonded zone shall refer to the relevant regulations
for overseas investment companies to export domestic products. A foreign-funded export procurement center located within a bonded
zone shall apply for tax refund according to the relevant existing provisions for intra-bonded zone enterprises to export products.

Article 11

A foreign-funded export procurement center shall run the business of import, processing and re-export by referring to the relevant
regulations concerning the same kind of business operated by joint venture companies engaged in foreign trade. In this case, all
products must be exported, and shall generally not be sold in domestic market. In the case that the goods are unable to be exported
and need to be sold in domestic market under any particular circumstance, the said center shall go through the procedures for transforming
export into domestic sale according to the related regulations on processing trade, submit related documents to the local department
of commerce at the provincial level for approval and issuance of approval document for domestic sale; and shall meanwhile, report
to the Ministry of Commerce for archival purposes. In the case that an import permit is involved, the said center shall apply for
the import permit according to the regulations; If the import permit needs to be submitted to the Ministry of Commerce for verification
and approval, the procedures shall be carried out in the accordance with the existing provisions.

The customs shall be in charge of the matters of domestic sale with duties duly paid and release upon verification involving the above
mentioned domestically sold products upon strength of the corresponding approval document for domestic sale and the effective import
permit.

Article 12

Unless otherwise prescribed, the investors from Hong Kong Special Administrative Region, Macao Special Administrative Region, and
Taiwan Region who intend to invest to establish export procurement centers in other regions of China may refer to the present Measures.

Article 13

The authority to interpret the present Measures shall remain with the Ministry of Commerce, the General Administration of Customs,
the State Administration of Taxation, and the State Administration of Foreign Exchange.

Article 14

The present Measures shall go into effect after 30 days as of the date of promulgation.

Ministry of Commerce, General Administration of Customs, State Administration of Taxation, State Administration of
Foreign Exchange
2003-11-17

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON SOME ISSUES CONCERNING TAX REFUND OR EXEMPTION ON EXPORT GOODS

State Administration of Taxation

Circular of the State Administration of Taxation on Some Issues concerning Tax Refund or Exemption on Export Goods

GuoShuiFa [2003] No. 139

November 18, 2003

The administrations of state taxation of all provinces, autonomous regions, municipalities directly under the Central Government,
cities directly under state planning, and all entities under the State Administration of Taxation:

With a view to solving the issues feedback from the regions concerning the enforcement of export tax refund policies, upon deliberation,
we hereby make the following notice:

The following formula shall be applicable for calculating and deducting the output tax payable on the taxable goods regarded as sold
in domestic market according to the Measures for Tax Exemption, Deduction or Refund:

Output tax payable = Offshore price of export goods regarded as taxable goods sold in domestic market oreign exchange quotation
of Renminbi VAT rate Where the export enterprises have made calculation on the amount of taxes prohibited from exemption or deduction
in the tax exemption, deduction or refund as prescribed on the aforesaid taxable goods, which are regarded as goods sold in domestic
market and have been changed into cost, they shall be changed from the cost item into the income item of amount of tax.

The taxable goods regarded as goods sold in domestic market shall include: Goods for which the relevant certificates of tax refund
or exemption on their export haven’t been fully collected by the production enterprises within 6 months from the date of applying
to customs for export or for which the formalities of tax exemption, deduction, or refund haven’t been handled at the tax authorities
in charge as prescribed in the “Circular of the Ministry of Finance and the State Administration of Taxation on Further Advancing
the Implementation of Measures for Tax Exemption, Deduction and Refund on Export Goods” (CaiShui [2002] No. 7); and the export goods
enjoying the tax exemption, deduction, or refund and with no electronic data (excluding the paper-made customs declaration) declared
by the production enterprises, or the export goods with electronic data but haven’t been declared at the current month by the enterprises
as prescribed in the “Circular of the State Administration of Taxation on Examination and Verification of the Export Volume of the
Production Enterprises Enjoying Tax Exemption, Deduction or Refund by Using the Export Data in the “Port Electronic Law Enforcement
System” (GuoShuiHan [2003] No. 95). The export volumes, for which taxes unpaid shall be paid in the following month as prescribed
in Document GuoShuiHan [2003] No. 95, shall not include the export volume of the business of commission, agency factor, or consignment.

The amount of taxes prohibited from exemption or deduction in the tax exemption, deduction or refund, shall be calculated according
to the formula as prescribed in Document CaiShui [2002] No.7

III.

Where a production-oriented enterprise group corporation (or parent plant) exports goods for its member enterprises (or branches)
as an agent, the enterprise group (or parent plant) may file an application to the competent taxation authorities for issuance of
the “Certificate of Export as an Agent”, and the member enterprises (or branches) shall implement the methods of tax “Exemption,
Deduction, or Refund”.

IV.

Where a foreign contracting engineering company, who has the management right for foreign economic cooperation upon approval by the
relevant departments, and who is not an ordinary VAT taxpayer, purchases export goods in relation to a foreign contracting project,
the production enterprises supplying goods for it may file an application to the tax authorities for issuance of Tax Payment Notice
(used specially for export goods) upon the strength of the certificates (copies) such as the certificate of approval for the management
right of foreign economic cooperation, etc., as provided by the foreign contracting engineering company. The foreign contracting
engineering company may then, upon the strength of the Tax Payment Notice (used specially for export goods), common invoices or special
VAT invoices, and other prescribed certificates, apply for handling tax refund on export goods in relation to the foreign contracting
project to the competent tax authorities.

Where a production enterprise within the bonded zones purchases raw materials, components and parts, etc. from the enterprises outside
the bonded areas, who have the management right of import and export, and exports them after having processed them into products,
it shall file an application to the competent taxation authorities for handling tax exemption, deduction or refund upon the strength
of the file bill on exit issued by the customs in the bonded zones and other prescribed certificates.

Where an enterprise engaging in the processing of the imported materials in the bonded zones imports raw materials and components
and parts from abroad, it may, upon the strength of the “Bill for Filing the Imported Goods in the Customs Bonded Zones”, go through
the formalities for obtaining the “Certificates of Tax Exemption on Trade of Processing Imported Materials by Production Enterprises”,
etc.

VI.

Tax refund or exemption on goods exported through storehouse, which is supervised by the customs, shall be handled according to the
existing provisions upon the strength of the customs declaration for export goods (used specially for export tax refund) signed and
issued by the customs or other prescribed certificates.

VII.

As to the provisions of Article 3 of the Document CaiShui [2002] No. 7, that is, “the purchase of raw materials enjoying tax exemption
shall include the purchase of raw materials enjoying tax exemption from within the country and the import of materials and components
and parts enjoying tax exemption for processing the imported material”, the purchase of raw materials enjoying tax exemption from
within the country refers to the goods enjoying tax exemption, whose names are listed in the “Interim Regulations of the People’s
Republic of China on Value-added Taxes” and the “Detailed Rules for the Implementation of the Interim Regulations of the People’s
Republic of China on Value-added Taxes”, and other relevant provisions, and for which the input tax payable cannot be calculated
and deducted as prescribed.

VIII.

Where an enterprise is doing a new export business other than those prescribed in paragraph 2, and paragraph 3 of the present Article,
the method of refunding taxes on monthly basis shall not be applicable to the amount of tax refundable occurred within 12 months
from the date of occurrence of the first of the export business. That amount of tax refundable shall be carried forward to the next
term to offset for goods sold in domestic market. After the 12 months, the provisions of Article 9 of the present Circular on small
export enterprises shall be applied, if it is a small export enterprise. Where the enterprises do not fall within the scope of small
export enterprises, the tax exemption, deduction or refund thereof shall be handled uniformly by way of calculation on monthly basis.

In case an enterprise has registered and opened business for over one year (excluding small export enterprises) and does have the
production capability and has no illegal acts such as tax evasion, smuggling, or evading or illegally trading in foreign exchange
upon verification by local or municipal tax authorities, the tax exemption, deduction or refund of its newly occurred business may
be calculated on monthly basis uniformly.

Where a newly established enterprise whose total sales volume of internal distribution is 5 million Yuan or more, and whose overseas
sales volume accounts for 50% or more of its total sales volume, and it will face difficulty in case its tax refund is not to be
handled within 12 months from the date of establishment, the tax exemption, deduction or refund thereof shall be handled by way of
calculation on monthly basis uniformly on the basis of tight control upon the approval of the administrations of state taxation of
provinces, autonomous regions, and municipalities directly under the Central Government.

IX.

The amount of tax refundable of a small export enterprise, which is occurred in the middle of the year, and on which the term for
examination and verification of the tax refund is 12 months under Article 8 of Document CaiShui [2002] No. 7, shall not be handled
by way of refunding taxes on monthly basis, but shall be handled by way of carrying it forward to the next term to offset for goods
sold in domestic markets. For the part failing to be offset, the tax refund shall be handled once for all at the end of the year.
The standard for determining the small export enterprises shall be made uniformly by the administrations of state taxation of all
provinces (autonomous regions, and municipalities directly under the Central Government) according to the reality of the whole provinces
(autonomous regions, and municipalities directly under the Central Government), and within the range of 2 million Yuan or more up
to 5 million Yuan of the total sales volume of the enterprise in domestic markets and overseas markets in the previous taxpaying
year.

The VAT shall be exempted for the export goods of the production enterprises taxed by simple method. And other goods exported shall
apply the Methods of Tax Exemption, Deduction and Refund.

XI.

A small-scale taxpayer, who entrusts other processing enterprises to undertake the business of processing with materials provided,
may file an application to the tax authorities for issuance of “Certificate of Tax Exemption on Processing with Materials Provided”
according to the relevant provisions in existence. And the processing enterprises may go through the formalities for tax refund on
processing fees upon the strength of the “Certificate of Tax Exemption on Processing with Materials Provided”.

XII.

Where an enterprise with foreign investment who is not a VAT taxpayer, or who is a small scale taxpayer, or who is established in
the bonded zones, purchases home-made equipment, which is in conformity with the relevant provisions under the “Circular of the State
Administration of Taxation concerning Printing and Distributing the ‘Trial Measures for the Administration of Tax Refund on Home-Made
Equipment Purchased by Enterprises with Foreign Investment'” (No. GuoShuiFa [1999] No. 171), its tax refund may be handled in accordance
with the relevant provisions.

XIII.

Where an enterprise with foreign investment entrusts other enterprises to undertake the construction of a project by way of contracting
for labor and materials, it may sign an agreement with the enterprise engaging in the construction and entrusts it to purchase the
kinds of home-made equipment in conformity with the relevant provisions of Document GuoShuiFa [1999] No. 171. The enterprise engaging
in the construction shall then, upon the strength of the entrustment agreement for purchase of the home-made equipment and the “Handbook
for Registration of Home-Made Equipment Purchased by Enterprises with Foreign Investment”, purchase the home-made equipment, and
obtain the special VAT invoices and the Tax Payment Notice (used specially for export goods) for value-added taxes, and hand them
over to the enterprise with foreign investment to handle tax refund pursuant to relevant provisions.

XIV.

The present Circular shall enter into force as of January 1, 2003.

State Administration of Taxation
2003-11-18

Employment Discrimination

MEASURES OF THE PEOPLE’S REPUBLIC OF CHINA FOR THE CUSTOMS’ SUPERVISION OVER INWARD AND OUTWARD EXPRESS CONSIGNMENTS

NOTICE OF THE STATE FOOD AND DRUG ADMINISTRATION ON THE ISSUES CONCERNING THE IMPLEMENTATION OF THE ADMINISTRATIVE MEASURES FOR...

NOTICE OF THE CHINA SECURITIES REGULATORY COMMISSION ON ABOLISHING SOME OF THE SECURITIES AND FUTURES RULES (IV)

CIRCULAR OF THE GENERAL OFFICE OF THE MINISTRY OF COMMERCE ON SETTING UP AN INFORMATION DATABASE OF FOREIGN INVESTMENT INTENTION OF ENTERPRISES

DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON REVISING THE LAW OF THE PEOPLE’S REPUBLIC OF CHINA ON THE PEOPLE’S BANK OF CHINA

ADMINISTRATIVE MEASURES OF THE MINISTRY OF COMMERCE, THE GENERAL ADMINISTRATION OF CUSTOMS, THE STATE ADMINISTRATION OF TAXATION, AND THE STATE ADMINISTRATION OF FOREIGN EXCHANGE FOR THE ESTABLISHMENT OF FOREIGN FUNDED EXPORT PROCUREMENT CENTERS

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON SOME ISSUES CONCERNING TAX REFUND OR EXEMPTION ON EXPORT GOODS

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