OPINIONS OF MINISTRY OF LAND AND RESOURCES, MINISTRY OF AGRICULTURE, NATIONAL DEVELOPMENT AND REFORM COMMISSION, MINISTRY OF FINANCE, MINISTRY OF CONSTRUCTION, MINISTRY OF WATER RESOURCES, AND STATE FORESTRY BUREAU CONCERNING IMPROVING THE PROTECTION OF BASIC FARMLAND

Opinions of Ministry of Land and Resources, Ministry of Agriculture, National Development and Reform Commission, Ministry of Finance,
Ministry of Construction, Ministry of Water Resources, and State Forestry Bureau concerning Improving the Protection of Basic Farmland Guo Tu Zi Fa [2005] No.196

All provinces, autonomous regions, municipalities, Xinjiang Production and Construction Corps, Departments(Bureaus)of Land Resources,
Departments(Bureaus) of Agriculture, National Development and Reform Commission, Departments(Bureaus) of Finances, Departments(Bureaus)
of Construction, Departments(Bureaus) of Water Resources, Departments(Bureaus) of Forestry:

Whereas the basic farmland serves as the fundamental basis of grain production, the protection of basic farmland is of top priority
to the protection of arable land and of profound significance to guarantee the safety of national grain production, to maintain social
stability and promote the all-around, coordinated and sustainable development. Therefore, the Central Committee of the Communist
Party of China and the State Council have been attaching great importance to the protection of farmland, requiring particularly that
great efforts should be made to prevent the total amount of basic farmland from decreasing, its usage from being altered and its
quality from degrading. In order to implement Opinions on Policies of the Central Committee of the Communist Party of China and the
State Council concerning Further Doing Well the Work in Rural Area and Promoting Agricultural Comprehensive Production ( Zhong Fa
[2005] No.1) and Decision of the State Council on Deepening Reform and Strengthening the Regulation of Land Control (Guo Fa [2004]
No. 28) and put into practice the protection of basic farmland, the opinions are hereby given as follows: I. To strictly formulate and implemented the program to prevent the current amount of farmland from decreasing

In the process of formulating and implementing the overall program of land utilization as well as that in respect of land utilization,
the protection of farmland, in particular basic farmland shall be taken as an important principle. Any unit or individual shall not
unlawfully alter or expropriate the basic farmland protection zone delimited in accordance with the total program of land utilization.
It shall be forbidden to alter the location of basic farmland and to adjust the basic farmland around the towns and along the communication
line to other areas by means of modifying the overall county or town-level program of land use without authorization. The various
types of land for non-agricultural construction shall be strictly limited to the construction area as designated in the overall program
for land utilization and the whole urban program; the site and line of single project shall not be selected in the basic farmland
as much as possible. The layout of land for agricultural use shall accord with the overall program for land use. The basic amount
and the layout of land for agricultural use shall not be adjusted in the name of agricultural restructuring. The alteration or adjustment
in relation to the overall layout program of basic farmland shall be submitted to the State Council or the provincial people’s government
for examination and approval.

Grain for Green program shall be carried out in accordance with the Ordinance of Returning Cultivated Land to Original Forest. Such
farmland in the basic farmland protection zone as enjoys sound farming condition and will not cause serious water and soil erosion
shall not be brought into the scope of returning farmland to forest. The target of basic farmland protection determined in the overall
program of land use shall be put into practice. Where some regions fail to implement the program completely due to a large amount
of slope farmland that needs to be returned to forest, the program shall be strictly implemented in the early period of the overall
program for land use and adjustment and makeup program shall be studied and raised. The additional land shall be designated in accordance
with the target set in the overall program after the makeup program has been approved by the State Council.

The revision of the overall program for farmland use shall give priority to strict farmland protection, especially basic farmland,
so as to ensure that the total amount of farmland does not decrease. The scale of land for construction shall not be enlarged arbitrarily
and the target for protection of basic farmland shall not be reduced by taking advantage of the total program of land utilization.
Where the rate of slope of basic farmland is more than 25 degree and the farmland suffers from serious desertification and water
and soil loss so that it needs to be returned to forest, it may be adjusted as a whole in the whole program of land use. where the
rate of slope of the farmland is less than 25 degree or the farmland below the farming-cultivation degree set by provincial people’s
government, the process of returning to forest for such farmland shall be strictly controlled; in case such farmland does need to
be returned to forest in accordance with the grain for green program and sand prevention and control program approved by the national
government, it shall be carried out by means of adjusting layout. As regards the flat slope and the sound-cultivated basic farmland
that needs to be returned to farmland, the basic farmland occupied for the construction of green channel beyond the prescribed scope
as well as those illegally occupied for the construction of non-agricultural project, they shall be not reduced by the revision of
overall program of land utilization. II. To strengthen the examination of land for non-agricultural use and prohibit the occupation of basic farmland unlawfully

The relevant provisions relating to the Land Administration Law and Regulations on the Ordinance on the Protection of Basic Farmland
shall be strictly implemented. Other non-agricultural construction projects shall, except for the key construction items such as
national energy, communication, water conservancy and military installations, not occupy basic farmland; where the non-agricultural
construction items needs occupying basic farmland accord with law, the transfer of farmland and land collection shall be submitted
to the State Council for approval subject to legal procedures.

The examination concerning the occupation and use of basic farmland shall be strengthened. The basic farmland occupied by construction
projects beyond the prescription of law and various non-agricultural project by adjusting the overall program for land utilization
in violation of law and the relevant provisions shall not be submitted for approval. Such interim projects as may bring about perpetual
damage to the plow layer of basic farmland shall not be approved. The approval hearing and announcement system for the occupation
of basic farmland shall be implemented strictly, and the social supervision upon basic farmland shall be strengthened. Where the
basic farmland is occupied with the approval under law or by means of adjustment program through legal procedures, the compensation
for land expropriation shall be implemented in accordance with the legal maximum standard; where the farmland is compensated by means
of paying land farming fee, the paying standard shall be implemented in accordance with the local maximum standard.

The additional farmland designation shall be standardized. Where a non-agricultural project really needs to occupy basic farmland
in accordance with law, the additional farmland shall be designated before it is submitted to the upper authority for approval. The
provincial land and resources authorities and agricultural authorities shall examine the additionally designated farmland to ensure
its detailed implementation, the balance between the quantity and quality of farmland and to prevent from compensating inferior farmland
for superior one. The plow layer shall, before the farmland is expropriated, be peeled off to be used in newly-plowed farmland or
for the soil improvement of other farmland, and the requirement of water and soil preservation shall be implemented. III. The supervision and administration upon basic farmland shall be strengthened and the usage of basic farmland shall not be altered
without authorization.

The Urgent Notice of the State Council on Prohibiting Such Acts as the Occupation of Basic Farmland to Plant Trees (Guo Fa Ming Dian
[2004] No.1, hereinafter referred to Urgent Notice) shall be implemented to protect the basic farmland in accordance with Five
Forbidden (First, it is forbidden to occupy basic farmland to plant trees, develop forest and fruit industry and cross plantation
of grain and forest as well as to build the net of farmland and forest. Second, it is forbidden to dig pond to raise fish, building
the constructions which may cause serious damage to plow layer beyond the standard in basic farmland in the name of agricultural
restructuring. Third, it is forbidden to expropriate basic farmland unlawfully to undertake the construction of green channel and
urban green belt. Fourth, it is forbidden to violate the overall program of land use in name of returning farmland to forest to bring
basic farmland into the farming returning scope. Fifth, the non-agricultural projects are forbidden, except key national projects
as prescribed by law, to occupy basic farmland.) to ensure the basic usage of farmland from changing. The construction of green belt
shall not exceed the scope as prescribed by the Urgent Notice. The agricultural restructuring of basic farmland shall be undertaken
within the scope of farming. Any unit or individual shall not sign contracts concerning forestation in the farmland; not dig pond
to raise fish and undertake animal and poultry raising as well as other production and operating activities which may destroy the
plow layer. Where the agricultural restructuring has been carried out on basic farmland, it shall still be protected in accordance
with the requirement for basic farmland; where the plow layer and farmland infrastructure has been damaged, it shall be recovered
within the limited period to ensure that the quantity and quality of farmland do not reduce because of agricultural restructuring.

Law enforcement shall be strengthened concerning such acts as gaining the approval by cheating, occupying and destroying basic farmland
in violation of law. As for such acts as disobeying orders and defying prohibitions, they shall be firmly prohibited and ordered
to be rectified. Where the circumstances are serious, the doer shall be severely punished and held to assume liabilities on the merit
of the seriousness of the case in accordance with the relevant provisions of Land Administration Law and Regulations on the Protection
of Basic Farmland; and it a crime is constituted, he shall be subject to criminal liabilities IV. To strengthen the construction of basic farmland and to improve its quality

The basic farmland rectification shall be vigorously carried out. The land rectification items invested by all levels of government
shall favor to protect basic farmland, especially the protection zone of basic farmland in the national grain production area (county)
and commodity gain base, to implement the land rectification of basic farmland. The farmland newly rectified and added in the basic
farmland shall be designated as basic farmland. In ecologically vulnerable areas, the rectification upon flat and slope farmland
shall, in the process of returning slope farmland and seriously desertificated farmland to forest, be strengthened, and the construction
and rectification upon slope-converted terraces, warp land dam and somewhat desertificated farmland shall also be strengthened to
ensure adequate basic fields for growing grain rations.

Greater efforts shall be made to improve the quality of basic farmland. Various effective measures shall be taken to improve the output
of farmland, to extend green manure and returning-straw-to-fertilizer technology, to give more support to the usage of organic fertilizer
so as to nurture the farmland; popularize the employment of such technologies as application formula fertilization, protective farming,
farmland fertilization, restoration of retreated farmland, improvement of fertilization of basic farmland. We shall increase the
input in the water conservancy construction in the basic farmland protection zone, renovate and match the drainage facility of irrigation
works, increase the effective irrigation area of basic farmland.

The concentrated input system for the construction of basic farmland shall be established. The public finance shall strengthen its
support upon the construction of basic farmland protection zone in the main grain production area (county) and main agricultural
production base. The funds used for the construction of water conservancy works, agricultural comprehensive development, land development
and rectification, farmland quality construction, the construction of farmland and forest shall favor the protection zone of basic
farmland; supportive measures shall be established to encourage the farmers to contribute their fund and labor voluntarily, to establish
high-standard basic farmland and to improve the production capability hereof. V. To carry out dynamic monitoring and circulate circular about the changing situation of basic farmland

The fundamental protection for basic farmland shall be perfected. The basic farmland achieves of four levels of authorities such as
provincial(borough/city), city(prefecture), county(city/section) and town shall have complete charts, pictures and data, which are
available for examination and shall serve as the evidence for supervising, examining, auditing, designating and altering basic farmland.
The information management system for basic farmland shall be established by combing land alteration investigation to precisely master
and analyze the utilization and variation of basic farmland. The grade of farmland fertility, soil fertility and environmental dynamic
monitoring, as well as farmland fertility investigation and quality evaluation shall be organized to be carried out. Accordingly,
the quality achieve of basic farmland shall be established by combining with farmland fertility survey and quality evaluation.

The dynamic supervision upon basic farmland shall be strengthened. The supervision network of basic farmland at five levels of authorities
such as provincial(borough/city), city(prefecture) county(city/section) , town and administrative village shall be established to
carry out dynamic inspection; dynamic supervision and information management system of basic farmland shall be carried out by employing
satellite remote sensing, to undertake regular supervision upon basic farmland protection zone, in particular the concentrated basic
farmland, that enjoying good quality and high yield ,that around cities and towns, that along the communication line so as to discover,
rectify, investigate and prosecute such acts as occupation of the basic farmland illegally. The farmland dynamic supervision system
shall be perfected to master the variance of farmland quality, and to issue quality supervision information. All levels of government
shall, in accordance with the result of dynamic supervision, summarize the protection of farmland and submit it to the higher authority.
VI. To explore new mechanism and implement the responsibility of basic farmland protection

The responsibility system of basic farmland protection shall be established in accordance with Ordinance on the Protection of Basic
Farmland. The farmland and basic farmland protection shall serve as the content of objective evaluation for the government leader
during its term. The responsibility document shall be signed to clarify the farmland preservation amount, protection area of basic
farmland, and quality reasonability determined by all levels of governments upon the overall program of land utilization. The objective
evaluation will be carried out regularly and the rewards and punishment measures will be fulfilled. The authorities of Land and Resources
and Agriculture as well as the relevant authorities shall, in accordance with their respective responsibility, strictly fulfill the
tasks related to the protection of basic farmland and try to mobilize the enthusiasm of the whole society. The responsibility document
concerning basic farmland protection shall be signed by the administrative village as a unit with the township government, which
shall be carried out by the contracted farmer household by means of marking in the land certificate and the certificate for land
contracted management rights to ensure the area, location and quality of basic farmland, and to clarify the responsibility, rights
and obligation of contracted farmer household.

The economic incentive system for the protection of farmland shall be explored and established. The agricultural subsidies of the
national government and local governments shall favor the regions where the task to protect farmland is heavy; the land development
and rectification items invested by the national government and other items supporting agriculture shall favor the regions where
striking achievements have been made. The fundamental task concerning the protection of farmland, dynamic supervision, construction
of information system and maintenance fee shall, in accordance with the relevant provisions, be arranged as a whole by the same level
financial sectors in the annual departmental budget. The advanced units and individuals for basic farmland protection shall be praised
and rewarded. Ministry of Land and Resources Ministry of Agriculture National Development and Reform Commission Ministry of Finance Ministry of Construction Ministry of Water Resources State Forestry Bureau September 28, 2005

Ministry of Land and Resources, Ministry of Agriculture, National Development and Reform Commission, Ministry of Finance,
Ministry of Construction, Ministry of Water Resources, and State Forestry Bureau
2005-09-28

CIRCULAR OF THE MINISTRY OF COMMUNICATIONS ON CLARIFYING THE RELEVANT ISSUES CONCERNING THE ADMINISTRATION OF PORT OPERATION

the Ministry of Communications

Circular of the Ministry of Communications on Clarifying the Relevant Issues concerning the Administration of Port operation

Jiao Shui Fa [2005] No.416

The communications offices (commissions) of all provinces, autonomous regions, and municipalities directly under the Central Government,
Shanghai Municipal Port Administration Bureau, and all the administrative departments of port at the localities of the relevant ports:

For the purpose of giving guidance to all regions for the good implementation of the Provisions, the Ministry has successively issued
the Circular on Relevant Issues concerning the Implementation of the Provisions on Port operation (Jiao Shui Fa [2004]No.235 ), and
the Letter of Reply to the Request of the Port and Shipping Administration of the Communications Office of Zhejiang Province for
Clarifying the Relevant Issues concerning Port Administration (Ting Shui Zi [2004]No.307 ) since the implementation of the Provisions
on Port operation (hereinafter referred to as the Provisions). Recently, some administrative departments of port have also raised
some questions on the administration of port operation. We hereby clarify the relevant issues as follows in order to give guidance
to all regions for their doing a good job for the implementation of the Provisions:

On Issues concerning Planning and Construction

On the approval documents for the use of shoreline of a port.

According to the requirements of the Provisions, an applicant for undertaking port operation shall, according to the provisions of
Port Law, Maritime Traffic Safety Law and the Regulations on the Administration of Traffic Safety of Inland Waters, and the Announcement
on Publicizing the Standards for Shoreline of Ports ([2004] No.5) of the Ministry of Communications, handle and submit the approval
documents for the use of shoreline of a port. Where the approval documents are not obtained for the use of the shoreline of an established
wharf, the owner of the wharf shall go through the approval formalities in accordance with the relevant provisions.

On the formalities for land use of a port.

Some regions report that the formalities for the use of land and water areas of a port have not been gone through. This issue falls
within the purview of other administrative departments, and each administrative department of ports shall coordinate with the relevant
departments or ask for instructions of the local people’s government to solve it through coordination.

On the issue concerning the inconformity of the existing operating wharfs with the overall planning of ports.

Since there was no overall planning for some ports before, or there was overall planning but it has been revised in recent years,
the inconformity of the existing operating wharfs with the current overall planning of ports were resulted in. With regard to these
issues, the administrative departments of ports of all regions shall, under the leadership of the local people’s government and in
accordance with the relevant provisions, properly solve them through appropriate policy support or economic compensation and other
methods. The Permit for Port Operation may not, according to law, be granted to any wharf that does not conform to the overall planning
and construction of a port.

On the issue concerning the construction of a wharf within the areas that have not been brought into the scope of overall planning
of ports.

Article 14 of the Port Law prescribes that “The construction of a port shall conform to the port planning. No port facility may be
built against the port planning.” Therefore, the construction of all the port facilities shall conform to the overall planning of
ports. Where it is necessary to build any port facility within the area that has not been brought into the scope of overall planning
of ports, the overall planning of the port in this area must be worked out at first. And after the overall planning of the port is
examined and approved according to the prescribed procedures, the construction may be carried on by going through relevant formalities
according to the relevant procedures for project construction.

II.

On Issues concerning the License for Port operation

On the power of examination and approval of the Permit for Port Operation

In accordance with the relevant provisions of the Port Law and the Administrative License Law, all the Permits for Port Operation
shall be subject to the examination and approval of and issued by the administrative department of ports of the region where the
port is located, with the exception that the license for operation of port tally business shall be subject to the examination and
approval of the Ministry of Communications and the Permit for Port Operation shall be issued by the said Ministry.

On the issue concerning the link-up of the license for port operation with industrial and commercial registration handled by the administrative
department of industry and commerce.

Whether the license for port operation is handled prior to the industrial and commercial registration with the administrative department
of industry and commerce or not, each region may, according to the provisions of Article 14 of the Provisions, seek support from
the local administrative department of industry and commerce through negotiation. For many years, the license for transport business
of the water transport enterprises of our country is issued upon the strength of the approval for establishment and the industrial
and commercial documents after the water transport enterprises have obtained the approval of the competent department of industry
for the preparation of their establishment, and have gone through registration formalities with the administrative department of
industry and commerce. Therefore, each region may also negotiate with the administrative department of industry and commerce about
the practice agreed between both sides, and shall do a good job for the link-up.

On the issue concerning the administration of the qualifications of individuals for port business operation.

The individuals undertaking port operation as mentioned in Article 3 of the Provisions refers to the individual operators or partners
that engage in port operation activities and have obtained the qualifications for port operation according to law. The Provisions
prescribes that an individual may engage in port operation, provided that it complies with and satisfies the qualification conditions
as prescribed in the Provisions. The fixed abode of an individual operator or partner may be regarded as the fixed business place
in the qualification conditions.

On the issue concerning whether or not the engagement of fishing wharfs or military wharfs in long-term or short-term port operation
shall be brought into port administration.

In accordance with the provisions of the Port Law, the planning and management of fishing wharfs at fishing ports or military wharfs
at military ports will not be brought into the scope of administration of the administrative department of ports, but the port operation
of fishing wharfs or military wharfs, whether long-term or short-term, shall be brought into the scope of port administration. And
the fishing wharfs and the military wharfs shall obtain the Permit for Operation of Port and accept the supervision and administration
by the administrative department of ports.

On the issue concerning whether or not the official wharf shall handle the Permit for Operation of Port.

The official wharfs of such departments of customs, frontier defense and public security may not engage in port business operations.
If, apart from satisfying the need of official function, it is necessary for the said official wharfs to undertake port business
activities in actual operation, they shall obtain the Permit for Port Operation and, shall accept the supervision and administration
by the administrative department of port.

On the issue concerning whether or not the wharfs of ship repairing yards or shipyards shall be brought into port administration.

The wharfs of a ship repairing yard or shipyard are the facilities built by making use of shoreline resources, and shall be brought
into the scope of administration of port planning and construction. If, apart from repairing and building ships, the wharfs of a
ship repairing yard or shipyard also undertake the port operation as prescribed in the Provisions, they shall be brought into the
scope of port administration, and shall obtain the Permit for Port Operation.

On the issue concerning whether or not the ferries of villages or towns or traffic wharfs of tied islands shall apply for the Permit
for Port Operation.

Article 3 of the Port Law prescribes that “The port as mentioned in the Law refers to the areas that consist of water area and land
area within a certain scope with such functions as the entering and leaving, anchoring or berthing of vessels, embarking and disembarking
of passengers, loading and unloading, lighterage and storage of goods, etc., and the corresponding wharf facilities”. In view of
the above, the business operation and work safety of the ferries of villages and towns shall be subject to the administration of
the administrative department of ports, including administrative license for port operation and the supervision of the work safety
of the enterprises, etc.

The wharfs engaging in surface transport between land and island shall be brought into the port administration according to the provisions
of the Port Law, and shall obtain the Permit for Port Operation.

On the issue concerning whether or not the operation license shall be obtained for the business operations of enterprise wharfs that
are not used as public wharfs.

In accordance with the provisions of the Port Law, any wharf enterprise undertaking the business operation of ports as specified by
the Provisions, whether it provides public service to society or not, shall be deemed as port operation activities, and shall obtain
the Permit for Port Operation, and accept the supervision and administration of the administrative department of ports.

On the issue concerning the temporary license for port operation.

There is no temporary or long-term license for port operation in the Provisions, the administrative departments of ports at all the
regions shall handle it according to Article 17 of the Provisions on the suspension of business operation or shutting up shop of
relevant port operators. During the implementation, every region shall establish and bring into practice the routine supervision
responsibility system in light of their respective actual situations, grasp the information about the changes of port facilities
and operation of port operators, and carry out effective administration.

10.

On the issue concerning the determination of the conditions for the license for port service operation.

Article 3 of the Provisions has clearly and specifically set down prescriptions on the content of port services provided to ships,
but the Provisions cannot set down concrete and uniform licensing conditions for the various services due to the difference of the
scale of ports and the variety of demands for providing services to ships. Every region shall, in light of the actual situation,
determine corresponding conditions according to the business nature. For instance, in the case of provision of shore power supply
for vessels, a port shall have the source of power supply and safe and reliable power supply facilities; in the case of provision
of fuels and materials supply for vessels, a port shall have oil supply wharfs or vessels and the corresponding facilities and equipments,
etc. The principles of ensuring the safety and providing effective service shall be observed with the aim of serving enterprises
in determining the access conditions, no unreasonable conditions may be set up.

11.

On the license for supply of vessel fuels and materials.

The General Office of the State Council distributed the Circular Concerning Port Supply to Foreign and Chinese Ocean-going Vessels
(Guo Ban Fa [1992] No.2) and the Supplementary Circular Concerning Port Supply to Ocean-going Vessels (Guo Ban Fa [1995] No.7) respectively
in 1992 and 1995, which have played an important role in doing a good job for port supply to vessels of our country at that time.
Afterwards, the State Council has carried out major reform of the port operation system of our country, and a series of laws and
regulations concerning port operation has been enacted. The above-mentioned two documents are obviously at variance with the existing
management system and laws and regulations, therefore the existing legal provisions shall prevail. The Port Law and the Provisions
lift control over the business of supply of fuels and materials to vessels, any enterprise or individual satisfying the prescribed
qualification conditions is allowed to undertake the business of supplying fuels and materials to vessels. In the meantime, administration
and regulation shall be intensified to ensure the safety management and operation order of ports. At present, the state implements
the franchising of fuel oil supply, and every region shall, when examining the business qualifications for port supply of fuels and
materials, examine whether or not the conditions as prescribed in the Provisions are satisfied, and whether or not the franchising
license issued by the relevant departments has been obtained.

12.

On the issue concerning the administration of provision of ballasting water, garbage disposal and other port services for vessels.

The provision of ballasting water and collection and disposal of garbage for vessels and other port services belongs to port operation
activities and shall be brought into the administration scope of port operation for administration on them, and the license for port
operation shall be obtained for undertaking business activities of this kind. Any enterprise or individual that provides port services
shall accept the administration of the administrative department of ports for its/his business operation, no matter what department
it/he is directly or indirectly subordinated to.

13.

On the issue concerning the issuance of the Permit for Port Operation to old wharfs.

With regard to some old wharfs that cannot meet the licensing conditions for port operation as prescribed in the Provisions because
they have been built for a long time, or the fundamental materials of the wharfs or ports for inspection and acceptance have been
lost, or some of them even have not undergone the inspection and acceptance, the applicant for port operation shall organize experts
or qualified entities to conduct technical detection and assessment. The administrative department of ports shall issue the Permit
for Port Operation to the applicants that satisfies the conditions upon the assessment, and may not issue the operation license to
those that do not satisfy the conditions. If any applicant has difficulties in organizing technical detection and assessment, it/he
may entrust the administrative department of port to organize the assessment in a one-off manner, and shall bear corresponding fees
needed.

14.

On the issue concerning the newly added operation facilities and the business scopes of port enterprises.

In the case of addition of any operation facilities without exceeding the approved business scope during the process of its business
operation, the port enterprise need not obtain the operation license once again, but shall, according to the provisions of Article
30 of the Provisions, submit to the administrative department of ports the relevant information on the newly added facilities. If
it is necessary to expand or alter the business scope after adding new operation facilities, it shall go through alteration formalities
in accordance with the provisions of Article 16 of the Provisions.

15.

On the issue concerning the issuance of the Permit for Port Operation to the port that has not separated government functions from
enterprise management.

In accordance with the provisions of the Port Law, any port, whether large or small, shall separate government functions from enterprise
management. The relevant provincial communications offices shall press the people’s government of the region where the port is located
to implement the requirements of the relevant documents of the State Council, accelerate the separation of government functions from
enterprise management of ports, and clarify which departments shall perform the functions of port administration. As for those ports
that have not separated government functions from enterprise management, they have no specific administrative department of ports,
and therefore, have no principal part to perform the administrative functions of port operation.

16.

On the issue concerning the punishment against the irregular management and operation.

The Provisions have, according to the Port Law, clarified different types of punishment to the acts of management and operation of
port enterprises that violate the regulations, which are measures that can ensure the implementation of laws and regulations, and
of which the suspension of the Permit for Port Operation is the most severe punishment. The administrative departments of ports at
all regions shall, in strict accordance with the Administrative Punishment Law and the Provisions, give punishment to the concrete
violations, and shall, if necessary, formulate concrete administrative measures in light of the actual situation, so as to intensify
administration on port operation and supervision over law enforcement.

17.

On the issue concerning the operation license for pilot production or operation of newly built port facilities.

With regard to pilot production of newly built port facilities, the Permit for Port Operation shall be obtained from the administrative
department of ports. If any applicant for port operation is unable to provide the reporting documents or materials for inspection
and acceptance of port operation facilities, it/he may submit the certification documents regarding pilot production of construction
entities at first, and then submit the relevant certificate of inspection and acceptance of the completion of the construction project
after the expiration of the pilot production.

III.

On the Issue concerning Port Practicing Personnel’s Taking of Posts after Obtaining Qualification Certificates

For the purpose of ensuring the work safety of a port, the port practicing personnel shall have the corresponding qualifications according
to the relevant laws and regulations. The work for the training, examination and license issuance of the practicing personnel shall
be carried out according to the provisions of relevant laws and regulations. At present, in some regions there exists the problem
that the repeated training, examination and license issuance are carried out by various departments, which have imposed excessive
economic burden on enterprises. The administrative department of each port shall communicate and coordinate with the relevant local
departments, and solve the problem properly. The certificates issued after the training and examination that really comply with the
relevant laws and regulations shall be acknowledged.

the Ministry of Communications

September 12, 2005

the Ministry of Communications
2005-09-12

MEASURES FOR THE ADMINISTRATION ON AUTHENTICATION TRAINING INSTITUTIONS

Announcement of the General Administration of Quality Supervision, Inspection and Quarantine of People’s Republic of China

No. 81

The Measures for the Administration on Authentication Training Institutions, which has been deliberated and adopted at the executive
meeting of the General Administration of Quality Supervision, Inspection and Quarantine on August 31, 2005, is hereby promulgated
and shall go into effect as of November 1 , 2005.
Li Changjiang, the Director of the General Administration of Quality Supervision, Inspection and Quarantine

September 29, 2005

Measures for the Administration on Authentication Training Institutions
Chapter I General Provisions

Article 1

With a view to intensifying the supervision and administration on authentication training institutions and regulating the authentication
training activities, the present Measures are formulated according to the Administrative License Law of the People’s Republic of
China, the Regulations of the People’s Republic of China on Authentication and Accreditation and the relevant provisions of the State
Council.

Article 2

The term “authentication training institution” as mentioned in the present Measures refers to the organizations that undertake the
basic training activities to those persons engaging in the authentication appraisal, audit, examination or any other authentication-related
activity.

Article 3

The conducting of authentication training activities within the territory of the People’s Republic of China shall be subject to the
present Measures.

Article 4

The State Authentication and Accreditation Regulatory Commission (hereinafter referred to as the SCARC) shall be responsible for
the uniform administration and supervision on the authentication training institutions and authentication training activities thereof.

The local quality and technology supervisory departments at all levels and the entry-exit inspection and quarantine institutions of
all regions (hereinafter jointly referred to as the local authentication supervisory and administrative department) shall, in light
of their respective functions, carry out supervision and inspection over the authentication training activities within their respective
jurisdictions.

Article 5

The State encourages the accreditation training institutions to obtain the accreditation of accreditation institutions as authorized
by the SCARC ((hereinafter referred to as the accreditation institutions) so as to guarantee the authentication training capacity
on a continuous and stable basis.

Chapter II Conditions for Establishment and Procedures for Approval

Article 6

The establishment of any authentication training institution shall be subject to the approval of the SCARC and obtain the legal-person
qualification before carrying out the authentication training activities within the approved scope.

Article 7

To establish a authentication training institution, the following conditions shall be met:

(1)

having fixed business place, necessary training and teaching facilities and working conditions;

(2)

having the registered capital not lower than RMB 200 thousand Yuan;

(3)

having four or more full-time teachers of the qualifications of registered training teachers, and having two or more full-time teachers
for each course;

(4)

having the quality management system documents as required by the relevant authentication training institutions;

(5)

having self-owned or authorized, by relevant organizations, training courses on intellectual property rights; and

(6)

other conditions as required.

As for the establishment of a foreign-funded authentication training institution, the foreign investor shall, in addition to the above-mentioned
conditions, obtain the professional authentication training qualification and authentication training authorization as provided for
by laws of the country or region where the foreign investor is located, as well as the suitable teaching staff for authentication
training authorization.

Article 8

The examination and approval procedures for the establishment of a authentication training institution shall be:

(1)

The applicant applying for the establishment of a authentication training institution (hereinafter referred to as the applicant)
shall submit a written application and the relevant authentication materials to the SCARC;

(2)

The SCARC shall conduct a preliminary examination on those application materials as submitted by the applicant, and shall, within
5 days as of the day when the application materials are received, decide in written whether or not to accept the application;

(3)

The SCARC shall, as of the day when an application is accepted, examine and verify the virtual content of the application materials,
and shall, within 20 days, decide whether or not to approve it. If it decides to approve the application, it shall issue a Notice
on Approval of the Establishment of a Authentication Training Institution to the applicant; if it decides to disapprove the application,
it shall notice the applicant of the result in written and make explanations; and

(4)

The applicant shall, upon the strength of the Notice on Approval of the Establishment of a Authentication Training Institution as
issued by the SCARC, go through the relevant registration formalities in accordance with laws, and obtain a Letter on Approval of
a Authentication Training Institution on the basis of the registration formalities.

The SCARC shall make public the list of those authentication training institutions established according to law.

Article 9

The valid period of a Letter on Approval of the Establishment of a Authentication Training Institution shall be four years.

Where a authentication training institution needs to extend the valid period of a Letter on Approval of the Establishment of a Authentication
Training Institution, it shall file an application with the SCARC within 90 days before the expiration of the valid period.

Article 10

Any permanent representative office of an overseas authentication training institution as established within the territory of the
People’s Republic of China may, after the SCARC has put it on records in written, fulfill the business contacts, market research,
technical exchange or other dissemination and generation activities. But it may not engage in the authentication training business
operation.

Article 11

Where a authentication training institution intends to conduct the relevant training courses as subcontracted from overseas authentication
training institutions or organizations, it shall be subject to the approval of the SCARC.

Article 12

The authentication institution, authentication training institution or authentication consulting institution may engage in the training
activities of internal auditors within the approved scope. However, no authentication institution may conduct the training activities
of internal auditors to the authentication consignor that has entrusted it for authentication.

The teachers of training internal auditors shall be of the qualifications of senior auditors or senior consultants.

Chapter III Behavior Criterions

Article 13

A authentication training institution shall, in light of the basic authentication training rules as well as the norms and rules for
authentication training courses as provided for by the SCARC, engage in the authentication training activities.

As for a new authentication training field, where no uniform norm or rule for authentication training courses has been formulated
the authentication training institution may set down the corresponding norms and rules for authentication training courses by itself.

Article 14

The authentication training institution shall publicize the information on the basic requirements for authentication training and
the charging rate, and shall ensure the authenticity, accuracy and integrity of the information.

Article 15

The authentication training institution shall accomplish such basic procedures as the design of courses, management of courses, management
of trainees, management of certificates and appraisal on management as provided for in the norms and rules for authentication training
institutions and authentication training courses, and ensure the integrity, authenticity and effectiveness of authentication training
activities, and shall not reduce or omit any authentication training procedure or content.

The authentication training institution shall make complete records of the authentication training process and keep them in archives.

Article 16

The authentication training institution shall establish the system for the management on training courses and the appraisal on training
teachers suitable for the norms and rules for authentication training courses, and when necessary, may obtain the confirmation thereof
by a authentication institution.

Article 17

The authentication training institution and its training teachers shall timely make a authentication training conclusion, and ensure
the objectiveness and authenticity thereof.

Where a trainee meets the relevant requirements after authentication training, the authentication training institution shall issue
a quality authentication training certificate to him; if he fails to meet the requirements, the authentication training institution
shall notice him of the result and make explanations.

Article 18

The authentication training conclusion shall, after the training teacher affixes his name thereon, be signed by the person in-charge
of or a person authorized by the authentication training institution.

The authentication training institution and its authentication training teachers shall be responsible for the authentication training
conclusion.

Article 19

The authentication training institution shall supervise, monitor and appraise the effectiveness of its own authentication training
activities, and shall conduct the examination and management review on the internal quality system at least once in 12 months.

The authentication training institution shall, before the end of January each year, submit a work report of the previous year respectively
to the SCARC and the local authentication supervisory and administrative department.

Article 20

Under any of the following circumstances, a authentication training institution shall, prior to the occurrence of alteration, report
it to the SCARC and handle the relevant alteration matters:

(1)

The business scope of authentication training alters;

(2)

The legal representative or shareholders alters;

(3)

The full-time teachers alter; or

(4)

The name of the authentication training institution alters.

Chapter IV Supervision and Inspection

Article 21

The SCARC shall supervise and inspect the authentication training institutions by means of examination of annual reports, on-the-spot
supervision, selective examination on authentication training activities and results, organizing craft brothers for deliberation
and solicitation of opinions from trainees.

Article 22

The accreditation institution shall conduct authentication supervision over those authentication training institutions that have
obtained the accreditation.

Article 23

The local authentication supervisory and administrative department shall, in accordance with the present Measures, supervise and
inspect the authentication training activities, and shall investigate and handle the illegal acts.

Article 24

Any entity or individual has the right to report any illegal or irregular authentication training act to the SCARC or the local authentication
supervisory and administrative departments, which shall conduct the investigation and handling in a timely manner and shall keep
secret for the person reporting the offence.

Article 25

Under any of the following circumstances, the SCARC shall go through the formalities for canceling the decision on approval of a
authentication training institutions:

(1)

The valid period of a Letter on Approval of a Authentication Training Institution has expired and has not been extended;

(2)

The authentication training institution has been terminated according to law;

(3)

The authentication training institution has lost the capacity for authentication training; or

(4)

Any other circumstance as prescribed by laws or regulations, under which the decision on approval of authentication training institutions
shall be cancelled.

Article 26

Under any of the following circumstances, the SCARC may, pursuant to the request of any interested party or its function, revoke
a decision on approval of a authentication training institution:

(1)

The functionary makes an approval decision by abusing his authorities or neglecting his duties;

(2)

An approval decision is made by exceeding the statutory authorities;

(3)

An approval decision is made by violating the statutory procedures;

(4)

An approval is granted to an applicant that is not of the application qualifications or does not meet the statutory conditions; or

(5)

Other circumstances, under which an approval decision may be revoked.

Chapter V Penalty Provisions

Article 27

Where any authentication training activity is illegally carried out without approval, the violator shall be charged to stop its authentication
training activities and be imposed upon a fine of 30,000 Yuan, and shall be publicized.

Article 28

Where a authentication training institution illegally undertakes the relevant training courses subcontracted from an overseas authentication
training institution or organization without approval, it shall be charged to stop its training business operations as subcontracted,
and be imposed upon a fine of 20,000 Yuan; where the circumstance is serious, the SCARC shall charge the violator to stop its business
operation for rectification even revoking its approval document, and shall be publicized.

Article 29

Where an applicant applies for establishing a authentication training institution by disguising the relevant conditions or providing
false materials, the SCARC shall refuse to accept or disapprove the application, and give a warning to the applicant.

Article 30

Where a authentication training institution obtains the approval document by frauds, bribes or any other unjustifiable means, it
shall be charged to stop its authentication training activities and be fined 30,000 Yuan; and the SCARC shall revoke the approval
document and publicize it.

Article 31

Where a authentication training institution undertakes the authentication training activities by exceeding its business scope as
approved by the SCARC, it shall be charged to make corrections and be fined 30,000 Yuan; if the circumstance is serious, the SCARC
shall charge it to stop its business operation for rectification even revoke its approval document, and publicize it.

Article 32

Where a authentication training institution alters, leases or lends its approval certificate or illegally transfers its authentication
training business operation by subcontracting its authentication training business or entrusted recruitment, it shall be charged
to make corrections and be fined 30,000 Yuan; if the circumstance is serious, the SCARC shall charge it to stop its business operation
for rectification even revoking its approval document, and publicize it.

Article 33

Where a authentication training institution undertakes false or misleading dissemination by means of the public information, websites
or advertisements, it shall be charged to make corrections and be fined 5,000 Yuan; if the circumstance is serious, the SCARC shall
charge it to stop its business operation for rectification, and publicize it.

Article 34

Where any provision in Articles 13 up to 20 of the present Measures is violated, the violator shall be charged to make corrections
and be warned; if the circumstance is serious, the violator shall be fined 5,000 Yuan up to 20,000 Yuan.

Article 35

When the SCARC or the local authentication supervisory and administrative department conducts supervision and inspection on a authentication
training institution, if the institution disguises the relevant information, provides false materials or refuses to provide true
information that can reflect its actual activities, it shall be charged to make corrections and be fined 10,000 Yuan up to 50,000
Yuan; if the circumstance is serious, the SCARC shall charge it to stop its business operation for rectification, and publicize it.

Article 36

Where a permanent representative office of an overseas authentication training institution established within the territory of the
People’s Republic of China has not been put on records at the SCARC or engages in the authentication training business operation,
it shall be charged to make corrections and be fined 20,000 Yuan, and be publicized.

Article 37

Where a authentication training institution employs any training teacher that has not been registered or affirmed by an accreditation
institution, it shall be charged to make corrections and be fined 5,000 Yuan; if the circumstance is serious, the SCARC shall charge
it to stop its business operation for rectification, and publicize it.

Article 38

Where a authentication training institution continues to undertake the authentication training activities during the period that
the SCARC charges it to stop its business operation for rectification, it shall be charged to make corrections and be fined 30,000
Yuan; if the circumstance is serious, the SCARC shall revoke its approval document , and publicize it.

Article 39

In the case of buying, selling, forging or illegal use of approval documents, authentication training certificates or other authentication
training documents, the violator shall be charged to make corrections and be fined 30,000 Yuan.

Where a authentication training institution commits any illegal act as prescribed in the preceding paragraph, the SCARC shall charge
it to stop its business operation for rectification even revoke its approval document, and publicize it.

Article 40

Where any functionary of the SCARC or the local authentication supervisory and administrative department violates the provisions
of Items (1) up to (4) of Article 26 of the present Measures in the work related to the examination and approval of authentication
training institutions, the department in-charge shall impose upon him an administration sanction. If any crime is constituted, he
shall be subject to criminal liabilities.

Chapter VI Supplementary Provisions

Article 41

The examination and approval on or any other matter related to the establishment of a authentication training institution or a permanent
representative office in any other province, autonomous region or municipality directly under the Central Government of the People’s
Republic of China by an applicant from Hong Kong or Macao Special Administrative Region or Taiwan Region shall be conducted by referring
to the present Measures.

Article 42

The charges for authentication training shall be subject to the price laws and administrative regulations of the state.

Article 43

The power to interpret the present Measures shall remain with the General Administration of Quality Supervision, Inspection and Quarantine.

Article 44

The present Measures shall go into effect as of November 1, 2005.

Those provisions for the examination and approval on authentication training institutions or other relevant administrative provisions
that conflict with the present Measures shall be suspended from enforcement as of the day of the implementation of the present Measures.

General Administration of Quality Supervision, Inspection and Quarantine
2005-09-29

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING THE RELEVANT ISSUES ON STRENGTHENING THE ADMINISTRATION OF SPECIAL VAT INVOICES

the State Administration of Taxation

Circular of the State Administration of Taxation Concerning the Relevant Issues on Strengthening the Administration of Special VAT
Invoices

Guo Shui Fa [2005] No. 150

The state taxation bureaus of all provinces, autonomous regions, municipalities directly under the Central Government and cities specifically
designated in the state plan:

It is recently reported by some regions that it is prevalent that some general VAT taxpayers (hereinafter referred to as the general
taxpayers) issue special VAT invoices to the general taxpayers as the third party for tax frauds where no special VAT invoice (hereinafter
referred to as the special invoices) needs to be issued in the dealings with small-scale taxpayers. With a view to guarding against
falsification of special invoices and stopping the frauds of the deduction of value-added tax and export tax refund by false special
invoices, you are hereby notified of the relevant issues as follows:

The taxation authorities shall intensify the administration on small-scale taxpayers. A comprehensive check of small-scale taxpayers
shall be conducted, and any taxpayer whose annual sales amount exceeds the standard of small-scale taxpayers shall be regarded as
a general taxpayer by the taxation authority according to the relevant provisions. Where a taxpayer meets the conditions of general
taxpayers but fails to apply for going through the formalities for the confirmation of general taxpayers, his taxable amount shall
be calculated at the VAT rate on the basis of the sales amount, the input taxes may not be deducted and no special invoice may be
used therefor. Where a taxpayer who has exceeded the standard of small-scale taxpayers is not confirmed as a general taxpayer according
to law, the handling person or person responsible for examination and approval shall be investigated for legal liabilities.

II.

The taxation authorities shall do a good job in the confirmation work of a general taxpayer. The qualification confirmation of a general
taxpayer shall be subject to strict examination and approval in accordance with the relevant existing provisions, and any taxpayer
that meets the conditions for confirmation of a general taxpayer shall be urged to apply for the qualification confirmation of a
general taxpayer. Whenever a taxpayer files an application for the qualification confirmation of a general taxpayer with the taxation
authority, the competent taxation authority shall timely carry out the examination and approval of the case, make an appointment
for interviews and conduct on-spot verification. If the conditions for confirmation are met, the competent taxation authority shall
timely confirm it, and may not delay it under any excuse, nor may it refuse to make confirmation without any justifiable reason.

III.

The taxation authorities shall intensify the administration on special invoices of general taxpayers.

It is necessary to intensify the administration on the use of special VAT invoices by general taxpayers and require the taxpayers
to issue special invoices in strict compliance with the Provisions on the Use of Special VAT Invoices and other relevant provisions.

The general taxpayer, whose tax declaration is abnormal, shall be subject to key examination to find whether or not the names of goods
indicated in the acquired special invoices or lists of the sold goods accord with the scope of its business or the raw materials
consumed in the course of production, and to find whether or not the actual dealer is the issuer of the special invoices in light
of the taxpayer’s relevant materials, such as the purchase-and-sale contract and the settlement voucher issued by the bank.

Anyone who violates the Provisions on the Use of Special VAT Invoices shall be punished in accordance with relevant provisions; and
anyone that is suspected of issuing invoices for any third party or defrauding the input tax deduction or export tax refund shall
be transferred to the auditing department for auditing.

IV.

When a taxation authority carries out the authentication of special invoices, it shall seriously examine the content of special invoices,
and detain and transfer to the auditing department for auditing those invoices with wrong cryptograph, inconsistent authentication
(excluding the inconsistent authentication of taxpayers’ identification numbers or the inconsistent authentication of invoices’ codes)
or repeated authentication.

The taxation authorities shall intensify the work relating to the tax payment evaluation, and shall lay emphases on the tax payment
evaluation of those general taxpayers that deduct VAT input taxes by paying for goods in cash, purchasing goods on credit or entrusting
any other entity or individual to pay for goods, and shall conduct on-the-spot verification when necessary. Where it finds that any
taxpayer purchases any goods that is inconsistent with its actual business, or that the taxpayer fails to pay for the goods for a
long time, or entrusts any other person to make large payment without any justifiable reason, or has not concluded a purchase-and-sale
contract (excluding the sporadic purchases or sales) for the purchase and sale of goods or the provision of taxable services, the
taxpayer shall be transferred to the auditing department for auditing.

Please carry them out accordingly.

the State Administration of Taxation

September 12, 2005

the State Administration of Taxation
2005-09-12

MINISTRY OF COMMERCE ANNOUNCEMENT NO.46, 2005 ON PRELIMINARY ARBITRATION ON DIMETHYL CYCLOSILOXANE (CYCLIC DIMETHYL SILOXANE)

Ministry of Commerce

Ministry of Commerce Announcement No.46, 2005 on Preliminary Arbitration on Dimethyl Cyclosiloxane (Cyclic Dimethyl Siloxane)

[2005] No.46

Ministry of Commerce issued an announcement on July 16, 2004 to start an anti-dumping investigation on the imported Dimethyl Cyclosiloxane
(Cyclic Dimethyl Siloxane) originating from Japan, U.S., U.K. and Germany (hereinafter referred to as the investigated products).

In accordance with Article 24 of Anti-dumping Regulations of People’s Republic of China, Ministry of Commerce made the preliminary
arbitration that dumping of the investigated products had taken place, which had caused material injury to China’s industry and there
was a casual relationship between the dumping and the injury.

The Dimethyl Cyclosiloxane (Cyclic Dimethyl Siloxane) is listed under No. 29310000, 38249090 in Import and Export Tariffs of General
Administration of Customs of PRC.

In accordance with Article 28 and 29 of Anti-dumping Regulations of People’s Republic of China, Ministry of Commerce decided to take
anti-dumping measures by deposit in security as of September 29, 2005.

Deposit in security rates are as follows:

Companies of Japan:

GE Toshiba Silicones Co., Ltd: 16%

All Others: 35%

Companies of U.S.:

Dow Corning Corporation: 13%

All Others: 35%

Companies of U.K.:

Dow Corning Limited: 13%

All Others: 35%

Companies of Germany.:

Wacker-Chemie GmbH:35%

All Others: 35%

The relevant interested parities could apply written comments, with related evidence, to Ministry of Commerce for consideration within
20 days as of the date this announcement is issued.

Appendix:

Ministry of Commerce Preliminary Arbitration on Anti-dumping Investigation on Imported Dimethyl Cyclosiloxane (Cyclic Dimethyl Siloxane)
Originating from Japan, U.S., U.K. and Germany

Ministry of Commerce

September 29, 2005

Ministry of Commerce
2005-09-29

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE EFFECTIVENESS OF THE EXCHANGE OF LETTERS FOR MUTUAL EXEMPTION OF TAX ON INTERNATIONAL AIR TRANSPORT INCOME BETWEEN CHINA AND LUXEMBOURG

The State Administration of Taxation

Circular of the State Administration of Taxation on the Effectiveness of the Exchange of Letters for Mutual Exemption of Tax on International
Air Transport Income between China and Luxembourg

Guo Shui Fa [2005] No.143

The bureaus of state taxation and the bureaus of local taxation of all the provinces, autonomous regions, municipalities directly
under the Central Government, and cities specifically designated in the state plan, Yangzhou Taxation Institute, and all the entities
directly under the State Administration of Taxation,

The Exchange of Letters between the Government of the People’s Republic of China and the Government of the Grand Duchy of Luxembourg
for Mutual Exemption of Tax on International Air Transport Income of Air Transport Enterprises was signed by Xie Xuren, Director
General of the State Administration of Taxation and Juncker, Finance Minister of Luxembourg on July 22nd, 2005 and August 4th, 2005
respectively on behalf of their own government, and is hereby printed and distributed to you. The Exchange of Letters shall go into
effect since August 4, 2005, and shall be implemented since October 1st, 2005.

Annex: Exchange of Letters between the Government of the People’s Republic of China and the Government of the Grand Duchy of Luxembourg
for Mutual Exemption of Tax on International Air Transport Income of Air Transport Enterprises

State Administration of Taxation

September 12, 2005 Annex:Exchange of Letters between the Government of the People’s Republic of China and the Government of the Grand Duchy of Luxembourg for
Mutual Exemption of Tax on International Air Transport Income of Air Transport Enterprises

Letter of the Chinese Party

Your Excellency,

It’s my honor to refer to the issue of exemption of tax on income obtained from undertaking international transport by the air enterprises
of both countries, and suggest making the following arrangements on behalf of the government of the People’s Republic of China:

All the taxes shall be exempted in the opposite country on the income, profit and proceeds obtained from undertaking international
transport business in the opposite country by the air transport enterprises designated by the governments of both countries.

If Your Excellency accepts the said arrangements, it’s my honor to suggest that this letter and the letter of reply acknowledged by
Your Excellency on the government of the Grand Duchy of Luxembourg’s acceptance of the aforesaid suggestions proposed by the government
of the People’s Republic of China shall constitute an agreement between the governments of both countries. The said agreement shall
enter into force as of the date when Your Excellency makes a letter of reply.

With highest respect.

Representative of the Government of the People’s Republic of China

Director General of the State Administration of Taxation: Xie Xuren

July 22nd, 2005

Letter of the Luxembourg Party

Your Excellency,

It’s my honor to acknowledge the receipt of your letter, dated July 22nd, 2005, which reads as follows,

“It’s my honor to refer to the issue of exemption of tax on income obtained from undertaking international transport by the air enterprises
of both countries, and suggest making the following arrangements on behalf of the government of the People’s Republic of China:

With highest respect.

Representative of the Government of the People’s Republic of China

Director General of the State Administration of Taxation: Xie Xuren”

I sincerely acknowledge that the Luxembourg agrees with the contents of the letter, and avail myself of this opportunity to renew
to Your Excellency the assurances of my highest respect.

Representative of the Government of the Grand Duchy of Luxembourg

Finance Minister Jean-Claude Juncker

The State Administration of Taxation
2005-09-12

TOTAL IMPORT AMOUNT, DISTRIBUTING PRINCIPLE AND APPLYING PROCEDURES OF TARIFF QUOTA OF CHEMICAL FERTILIZER IN 2006

Ministry of Commerce

Ministry of Commerce Announcement No. 67, 2005 on Total Import Amount, Distributing Principle and Applying Procedure of Tariff Quota
of Chemical Fertilizer in 2006

[2005] No. 67

In accordance with Administrative Measures on Commodities Import and Export of the People’s Republic of China as well as promises
for China entry WTO, total import amount, distributing principle and applying procedures of tariff quota of chemical fertilizer in
2006 are announced as follows. All qualified units of chemical fertilizer import may apply to administrative organs on important
industrial products authorized by Ministry of Commerce, or directly apply to Ministry of Commerce during Oct 15, 2005 to Oct 31,
2005.

Appendix: Total Import Amount, Distributing Principle and Applying Procedures of Tariff Quota of Chemical Fertilizer in 2006

Ministry of Commerce

Sep 29, 2005

Total Import Amount, Distributing Principle and Applying Procedures of Tariff Quota of Chemical Fertilizer in 2006

Chemical fertilizer types under tariff quota administration in 2006: Carbamide (tariff code: 31021000), Diammonium phosphate (tariff
code: 31053000), Compound chemical fertilizer (tariff code: 31052000). Tax rate included in tariff quota is 4%, but that excluded
in tariff quota is 50%.

Total amount of tariff quota:

Total amount of tariff quota of chemical fertilizer in 2006

Carbamide: 3,300,000 ton;

Diammonium phosphate: 6,900,000 ton;

Compound chemical fertilizer 3,450,000 ton

Distributing principle:

Import achievement of applying unit;

Production capacity, operation scale and sales conditions;

Whether the distributed quotas were adequately used or not;

Quantity conditions of applying quota;

Applying conditions of new importers;

Other considerations. Tariff quota of state trade Total amount of tariff quota of chemical fertilizer of state trade in 2006 Carbamide:
2,970,000 ton; Diammonium phosphate: 4,490,000 ton; Compound chemical fertilizer 2,240,000 ton Units applying for tariff code of
chemical fertilizer of state trade: companies of agriculture product materials with import radix and achievement; “Three Stations”
of agriculture (station soil and fertilizer, station of seed and station of agriculture technique) with import radix and achievement;
chemical fertilizer producing enterprises with import radix and achievement; qualified new import applicants. Tariff quota of non-state
trade Total amount of tariff quota of chemical fertilizer of non-state trade in 2006 Carbamide: 330,000 ton; Diammonium phosphate:
2,410,000 ton; Compound chemical fertilizer: 1,210,000 ton Units applying for tariff code of chemical fertilizer of non-state trade:
companies of small trade with import radix and achievement; foreign-invested enterprises with import radix and achievement; chemical
fertilizer importing enterprises in special economic zone with import radix and achievement; qualified new import applicants. Required
materials for tariff quota application All units applying for tariff quota need to submit the following materials:

Basic conditions of applying units: copy of business license of industry and commerce, registration fund, production capacity, operation
scale, sales revenue, tax total amount.

Distributed quota quantity in recent 3 years (2003-2005), including quota amount of each type, and copy of related distributing documentary;

Chemical fertilizer import achievement in recent 3 years (2003-2005), including import achievement of each type (import achievement
subjects to statistics of Customs);

Type and amount of tariff quota of chemical fertilizer tariff quota in 2006, and give clear indication of state trade or non-state
trade (the two types can not be applied at one time). Applying procedure

All import-applying units should submit applying materials to administrative organs on important industrial products, which will be
transmitted to Ministry of Commerce. Central enterprises may directly submit to Ministry of Commerce.

Ministry of Commerce
2005-09-29

LETTER OF MOLSS ON THE ISSUES RELATED TO HOLDING PROFESSIONAL QUALIFICATION CERTIFICATES BY FOREIGNERS FOR THEIR EMPLOYMENT IN CHINA

the Ministry of Labor and Social Security

Letter of MOLSS on the Issues related to Holding Professional Qualification Certificates by Foreigners for Their Employment in China

Lao She Ting Han [2005] No.323

The offices or bureaus of labor and social securities of all the provinces, autonomous regions, and municipalities directly under
the Central Government,

The Provisions on the Administration of Employment of Foreigners in China (Lao Bu Fa [1996] No.29) prescribes that any foreigner who
works in China shall have the professional skill and the corresponding work experiences as are needed for undertaking his/her job.
In 2000, the Ministry formulated and promulgated the Provisions on Recruiting Practicing Personnel of Technical Type of Work (Order
No.6 of the Ministry of Labor and Social Security) in accordance with the Labor Law and the Professional Education Law, which requires
all the personnel practicing the profession (type of work) as prescribed by the state shall have corresponding professional qualification
certificate. In accordance with the Provisions, any foreigner who works in China and practices the profession (type of work) as prescribed
by the state shall also have corresponding professional qualification certificate. We hereby make the following notice on relevant
issues concerning foreigners’ holding professional qualification certificates for their employment in China:

Since the Chinese government has not reached any agreement with any government of any other country on mutually recognizing professional
qualification certificate, foreigners who undertake the profession (type of work) as prescribed by the state shall have the Professional
Qualification Certificate of the People’s Republic of China in principle.

II.

Subject to the approval of the Ministry of Labor and Social Security, any foreigner who undertakes the profession (type of work) with
foreign characteristics in China, for example, western style cook, western style pastry-cook, and etc., may work or hold a post in
China upon the strength of the professional qualification certificate issued by the government of his/her own country or industry
association. The certificate shall be subject to the notarization of the notarial office of his/her own country, and the notarial
certificate shall be in Chinese or English.

III.

Foreigners are allowed to take the Professional Qualification Examination (only Chinese Examination Paper shall be provided) within
China, and all the localities shall provide corresponding services for their taking the examination.

General Office of the Ministry of Labor and Social Security

September 13, 2005

the Ministry of Labor and Social Security
2005-09-13

CIRCULAR OF CHINA SECURITIES REGULATORY COMMISSION ON RELEVANT ISSUES CONCERNING THE INVESTMENT OF MONEY MARKET FUNDS IN SHORT-TERM FINANCING BONDS

China Securities Regulatory Commission

Circular of China Securities Regulatory Commission on Relevant Issues Concerning the Investment of Money Market Funds in Short-term
Financing Bonds

All fund management companies and fund custodian banks,

With a view to further regulating the investment operation of money market funds and promoting the sound development of money market
funds, and in accordance with the Securities Investment Funds Law, the Measures for the Administration of the Operation of Securities
Investment Funds, the Interim Provisions on the Administration of Money Market Funds and other relevant laws and regulations, the
Circular on relevant issues concerning the investment of monetary market funds in short- term financing bonds is given as follows:

The credit rating of the short-term financing bonds as invested by money market funds shall not be lower than the following standards:

(1)

The short-term credit rating being Grade A-1 or the equivalent to Grade A-1 as assessed by a domestic credit rating institution;

(2)

For any short-term financing securities that have been exempted from credit rating according to the relevant provisions, the credit
rating and the follow-up rating of the relevant issuers for the latest 3 years shall meet any of the following conditions:

(a)

The long-term credit rating being Grade AAA or the equivalent to Grade AAA as assessed by a domestic credit rating institution;

(b)

The credit rating as assessed by an international credit rating institution being one-level lower than the China’s sovereign credit
rating (e.g. where the China’s sovereign credit rating is Grade A, the corresponding credit rating at one level lower is Grade BBB+).

Where an issuer has both domestic credit rating and international credit rating, the domestic credit rating shall prevail.

The proportion of investment of money market funds in short-term financing bonds and the short-term enterprise bonds issued by the
same company may not exceed 10% of the net value of fund assets in total. Where any fund investment fails to meet the said proportion
due to the factors that go beyond the control of a fund manager, such as market fluctuation and change of fund size, the relevant
fund manager shall complete the adjustment within 10 trading days.

During the period when any short-term financing bonds are held by the money market funds, where the credit rating downgrades and fails
to meet the relevant investment requirements, the said short-term bonds shall all be reduced within 20 trading days as of the release
of the relevant rating report.

The present Circular shall go into effect as of the day of promulgation.

China Securities Regulatory Commission

September 30, 2005

China Securities Regulatory Commission
2005-09-30

MINISTRY OF COMMERCE ANNOUNCEMENT NO. 62, 2005 ON NON STATE-RUN TRADE PERMISSIBLE IMPORT AMOUNT, DISTRIBUTION GIST AND APPLICATION PROCEDURE OF CRUDE OIL AND PRODUCT OIL

Ministry of Commerce

Ministry of Commerce Announcement No. 62, 2005 on Non State-run Trade Permissible Import Amount, Distribution Gist and Application
Procedure of Crude Oil and Product Oil

[2005] No. 62

In accordance with Commodity Import and Export Administrative Enactment of PRC and relevant commitment of China’s entry into WTO,
Non State-run Trade Permissible Import Amount, Distribution Gist and Application Procedure of Crude Oil and Product Oil is now announced.

All the qualified crude oil and product oil import units could apply to Import Administrative Organization of Important Industrial
Products or Import Supervision Organization of Foreign-invested Enterprises authorized by Ministry of Commerce, or could apply to
Ministry of Commerce directly.

The cognizance duration of Ministry of Commerce is from October 1, 2005 to October 31, 2005

Appendix :

Non State-run Trade Permissible Import Amount, Distribution Gist and Application Procedure of Crude Oil

Non State-run Trade Permissible Import Amount, Distribution Gist and Application Procedure of Product Oil

Ministry of Commerce

September 16, 2005

Ministry of Commerce
2005-09-16

12 Page 1 of 2

Expungements

MEASURES FOR THE ADMINISTRATION OF QUALITY TESTING OF CONSTRUCTION PROJECTS

NOTICE OF SASAC ON ISSUES CONCERNING THE ADMINISTRATION OF THE STOCK RIGHT OF STATE-OWNED SHARES IN THE SHARE-TRADING REFORM...

OPINIONS OF MINISTRY OF LAND AND RESOURCES, MINISTRY OF AGRICULTURE, NATIONAL DEVELOPMENT AND REFORM COMMISSION, MINISTRY OF FINANCE, MINISTRY OF CONSTRUCTION, MINISTRY OF WATER RESOURCES, AND STATE FORESTRY BUREAU CONCERNING IMPROVING THE PROTECTION OF BASIC FARMLAND

CIRCULAR OF THE MINISTRY OF COMMUNICATIONS ON CLARIFYING THE RELEVANT ISSUES CONCERNING THE ADMINISTRATION OF PORT OPERATION

MEASURES FOR THE ADMINISTRATION ON AUTHENTICATION TRAINING INSTITUTIONS

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING THE RELEVANT ISSUES ON STRENGTHENING THE ADMINISTRATION OF SPECIAL VAT INVOICES

MINISTRY OF COMMERCE ANNOUNCEMENT NO.46, 2005 ON PRELIMINARY ARBITRATION ON DIMETHYL CYCLOSILOXANE (CYCLIC DIMETHYL SILOXANE)

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE EFFECTIVENESS OF THE EXCHANGE OF LETTERS FOR MUTUAL EXEMPTION OF TAX ON INTERNATIONAL AIR TRANSPORT INCOME BETWEEN CHINA AND LUXEMBOURG

TOTAL IMPORT AMOUNT, DISTRIBUTING PRINCIPLE AND APPLYING PROCEDURES OF TARIFF QUOTA OF CHEMICAL FERTILIZER IN 2006

LETTER OF MOLSS ON THE ISSUES RELATED TO HOLDING PROFESSIONAL QUALIFICATION CERTIFICATES BY FOREIGNERS FOR THEIR EMPLOYMENT IN CHINA

CIRCULAR OF CHINA SECURITIES REGULATORY COMMISSION ON RELEVANT ISSUES CONCERNING THE INVESTMENT OF MONEY MARKET FUNDS IN SHORT-TERM FINANCING BONDS

MINISTRY OF COMMERCE ANNOUNCEMENT NO. 62, 2005 ON NON STATE-RUN TRADE PERMISSIBLE IMPORT AMOUNT, DISTRIBUTION GIST AND APPLICATION PROCEDURE OF CRUDE OIL AND PRODUCT OIL

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