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NOTICE OF THE STATE ADMINISTRATION OF TAXATION ON RELEVANT ISSUES CONCERNING THE PREPAID VALUE-ADDED TAX FOR INCREASING THE PURCHASE OF SPECIAL VALUE-ADDED TAX INVOICE BY THE GENERAL VALUE-ADDED TAX PAYER IN THE TUTORIAL PERIOD

State Administration of Taxation

Notice of the State Administration of Taxation on Relevant Issues concerning the Prepaid Value-added Tax for Increasing the Purchase
of Special Value-added Tax Invoice by the General Value-added Tax Payer in the Tutorial Period

Guo Shui Han [2005] No. 1097

Bureaus of State Taxes in all provinces, autonomous regions, municipalities under direct control of the Central Government, and cities
specially designated in the state plan:

It is recently reflected by some enterprises that the capital is seriously tied up when the general value-added tax payers (hereafter
referred to as the taxpayers) in the tutorial period prepay the value-added tax case-by-case in increasing the purchase of special
value-added tax invoice. This notice is hereby given on relevant issues in order to further facilitate the taxpayers.

I.

The arrangement of prepaying value-added tax by the taxpayer in increasing the purchase of special value-added tax invoice shall still
be effective. The prepaid value-added tax may be credited against the payable tax of the period concerned; where the prepaid value-added
tax after being credited still has balance, it shall be credited case-by-case while the taxpayer increases the purchase of the special
value-added tax invoice in the next period.

II.

The taxation authorities in charge shall strengthen the examination work of crediting the taxpayer’s prepaid value-added tax.

i.

Where the taxpayer wants the prepaid value-added tax to be credited, he/she shall himself/herself calculate the amount of tax to be
credited and apply for it to the taxation authorities in charge.

ii.

Upon receiving the application and after ascertaining the situation of tax paid by the taxpayer and the issuing of the special value-added
tax invoice is free of error, the taxation authorities in charge may directly issue special value-added tax invoice without charging
the prepaid tax any more to the tax payer whose balance of prepaid value-added tax is more than prepaid value-added tax for this
time; where the taxpayer’s prepaid value-added tax for this time is more than the balance of the prepaid value-added tax, the taxation
authorities in charge shall issue special value-added tax invoice to him/her after he/she prepays on the basis of the balance.

III.

The taxation authorities in charge shall, within the first month after the end of the taxpayer’s tutorial period, return once and
for all to the taxpayer the balance of the prepaid value-added tax arising from his/her increasing the purchase of the special value-added
tax invoice.

The State Administration of Taxation

November 18, 2005



 
State Administration of Taxation
2005-11-18

 







ANNOUNCEMENT NO.78, 2005 OF THE MINISTRY OF COMMERCE, THE MINISTRY OF AGRICULTURE, THE GENERAL ADMINISTRATION OF CUSTOMS, THE GENERAL ADMINISTRATION OF QUALITY SUPERVISION, INSPECTION AND QUARANTINE OF THE PEOPLE’S REPUBLIC OF CHINA

Ministry of Commerce, Ministry of Agriculture, General Administration of Customs, General Administration of Quality Supervision, Inspection
and Quarantine

Announcement No.78, 2005 of the Ministry of Commerce, the Ministry of Agriculture, the General Administration of Customs, the General
Administration of Quality Supervision, Inspection and Quarantine of the People’s Republic of China

[2005] No. 78

In accordance with related regulations of Foreign Trade Law of PRC and Administrative Regulations on Commodity Import and Export of
PRC, related matters are now announced as follows for the purposes of preventing spread of bird flu epidemic and protecting health
of people and production security of stock raising industry.

1.

Suspending import of poultry and poultry products form counties of epidemic-stricken counties such as Thailand, Vietnam, Indonesia,
Cambodia, Japan, the Democratic People’s Republic of Korea, Romania, Croatia, Kazakhstan, South Africa, Mongolia, Turkey, Russia
and Sweden. As from today, departments of quality inspection will not issue Declared Form of Import Commodity to poultry and poultry
products form above-mentioned epidemic-stricken counties until release of another announcement for resume of the import. Customs
will not accept import declarations of poultry and poultry products with no Declared Form of Import Commodity.

2.

All local administrative commercial sections will suspend release of Automatic Import License of meet chook and its products (all
meat chook products listed in appendix of List of Commodities under Administration of Automatic Import License) from above-mentioned
countries.

The announcement takes effect as form release. The poultry and poultry products import from new bird flu epidemic countries should
be implemented in line with the announcement also.

Ministry of Commerce

Ministry of Agriculture

General Administration of Customs

General Administration of Quality Supervision, Inspection and Quarantine

Oct 28, 2005



 
Ministry of Commerce, Ministry of Agriculture, General Administration of Customs, General Administration of Quality
Supervision, Inspection and Quarantine
2005-10-28

 







CIRCULAR BY THE MINISTRY OF LABOR AND SOCIAL SECURITY, THE MINISTRY OF COMMERCE, THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE ON PERMITTING HONG KONG/MACAO SERVICE PROVIDERS TO ESTABLISH SOLELY-FUNDED JOB INTERMEDIARY INSTITUTIONS IN THE MAINLAND

Circular by the Ministry of Labor and Social Security, the Ministry of Commerce, the State Administration for Industry and Commerce
on Permitting Hong Kong/Macao Service Providers to Establish Solely-funded Job Intermediary Institutions in the Mainland

No. 26 [2005] of the Ministry of Labor and Social Security

The bureaus of labor and social security, commerce administrative departments and administrative departments for industry and commerce
of all provinces, autonomous regions or municipalities directly under the Central Government,

The mainland has signed the Supplementary Agreement on Mainland/Hong Kong Closer Economic Partnership Arrangement and the Supplementary
Agreement on Mainland/ Macao Closer Economic Partnership Arrangement (hereinafter referred to as the CEPA) respectively with Hong
Kong and Macao on October 27 and October 29, 2004, which have come into force on January 1, 2005. In order to implement the CEPA,
we hereby make the following notices on relevant issues:

1.

Hong Kong service providers and Macao service providers may establish solely-funded job intermediary institutions with a minimum
registered capital of 125, 000 U.S. dollars.

The Hong Kong service providers and Macao service providers as mentioned in the present Circular shall conform to the definition of
the “service provider” in the CEPA and satisfy the requirements of the relevant provisions.

2.

The other procedures for Hong Kong service providers and Macao service providers to establish solely-funded job intermediary institutions
in the Mainland shall be executed according to the Interim Provisions on the Establishment of Sino-foreign Equity Joint and Sino-foreign
Contractual Job intermediary institutions.

The Ministry of Labor and Social Security

The Ministry of Commerce

The State Administration for Industry and Commerce

October 28, 2005



 
the Ministry of Labor and Social Security, the Ministry of Commerce, the State Administration for Industry and Commerce
2005-10-28

 







NOTICE OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE ON THE PROMOTION OF THE STATISTICS AND SUPERVISION SYSTEM OF EXTERNAL DEBT (BANK EDITION) AND THE ADJUSTMENT OF THE REQUIREMENT OF SUBMITTING DATA OF EXTERNAL DEBT

State Administration of Foreign Exchange

Notice of the State Administration of Foreign Exchange on the Promotion of the Statistics and Supervision System of External Debt
(Bank Edition) and the Adjustment of the Requirement of Submitting Data of External Debt

Hui Fa [2005] No. 78

October 28, 2005

Branches of the State Administration of Foreign Exchange in all provinces, autonomous regions, municipalities under direct control
of the Central Government, Branches in the Cities of Shenzhen, Dalian, Qingdao, Xiamen and Ningbo, and all designated Chinese-funded
foreign exchange banks:

In order to further improve the accuracy and timeliness of the statistics of external debt, the State Administration of Foreign Exchange
will in the near future promote nationwide the Statistics and Supervision System of External Debt (Bank Edition). The notice is hereby
given on relevant issues concerning the promotion program and the requirement of submitting data of external debt.

I.

As of November 1, 2005, such Chinese-funded banks as Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of
China, Construction Bank of China, the State Development Bank, the Agricultural Development Bank of China, the Export-Import Bank
of China, CITIC Industrial Bank, China Everbright Bank, Huaxia Bank China Minsheng Banking Corp., Ltd. shall submit the data of external
debt by logging on the Statistics and Supervision System of External Debt (Bank Edition).

II.

Other headquarters of Chinese-funded banks (excluding City Commercial Banks, Urban Credit Cooperatives and Rural Credit Cooperatives)
and the foreign-funded banks shall, as of December 1, 2005, submit the data of external debt by logging on the Statistics and Supervision
System of External Debt (Bank Edition).

III.

The mode of submitting the data of external debt for the City Commercial Banks, the Urban Credit Cooperatives, the Rural Credit Cooperatives
and branches of all the Chinese-funded banks shall remain unchanged.

IV.

After the banks adopt the Statistics and Supervision System of External Debt (Bank Edition), they shall daily submit the data of external
debt case-by-case (excluding the Usance Letter of Credit and the non-resident account). The banks shall, before the end of every
work day, record the newly-signed external debts and the external debts experiencing changes in day concerned into the Statistics
and Supervision System of External Debt (Bank Edition).

V.

The usance letter of credit shall, depending on different currencies and time limits, be reported on a consolidated basis. The usance
letter of credit of the same currency, whose time limit is within one year, shall be reported on a consolidated basis; and the usance
letter of credit of the same currency, whose time limit is more than one year, shall be reported on a consolidated basis.

VI.

The non-resident account shall, depending on different currencies, be reported on a consolidated basis, and be recorded as external
debt of bank (within one month).

VII.

This notice shall go into effect as of the date of promulgation. Upon receiving this notice, all the Branches shall promptly transmit
it to the Sub-branches and the foreign-funded banks under their jurisdiction. If any question is encountered in the implementation
of this notice, please contact the Department of Capital Account Management of the State Administration of Foreign Exchange.

Contact Person: Zhou Haiwen

Contact Telephone Number: 010-68402366



 
State Administration of Foreign Exchange
2005-10-28

 







CIRCULAR OF THE MINISTRY OF FINANCE ON PRINTING AND DISTRIBUTING THE PROVISIONAL MEASURES FOR ADMINISTRATION OF SPECIAL VENTURE CAPITAL FOR THE EXPLORATION OF OVERSEAS MINERAL RESOURCES

2005103120051031Ministry of Financeepdf/e04881.pdfKOverseas, mineral resources, venture, exploration, special capital, go global, mineral enterprisee04881Circular of the Ministry of Finance on Printing and Distributing the Provisional Measures for Administration of Special Venture Capital
for the Exploration of Overseas Mineral Resources
Cai Jian [2005] No.637Relevant central entities, financial departments (bureaus) of all the provinces, autonomous regions, municipalities directly under
the Central Government and the cities specifically designated in the state plan:For the purpose of strengthening the administration of special venture capital for the exploration of overseas mineral resources,
enhancing the capital profit, we formulated the Provisional Measures for Administration of Special Venture Capital for the Exploration
of Overseas Mineral Resources, in accordance with the requirements of budget management and the provisions of relevant laws and regulations
of the state. It is hereby printed and distributed to you, please implement it accordingly.Annex: Provisional Measures for Administration of Special Venture Capital for the Exploration of Overseas Mineral Resources
Ministry of FinanceOctober 31, 2005Annex:Provisional Measures for Administration of Special Venture Capital for the Exploration of Overseas Mineral ResourcesChapter I General PrinciplesArticle 1 These measures are formulated for the purposes of implementing ￿￿Go Abroad￿￿ strategy, encouraging and guide the geological exploring
units and mining enterprises to go abroad for exploring and developing mineral resources (except petroleum and natural gas, the same
below), tightening up the administration of special venture capital for the exploration of overseas mineral resources (￿￿special
capital￿￿ for short below), and improving funds returns.
Article 2 Special capital means subsidies and funds of interest discount specially used for geological exploring units and mining enterprises
to go abroad for mineral resources exploring and developing projects that are in short supply in China and national economy needs
badly.
Article 3 Mineral enterprises in terms of these measures means the enterprises relying mainly on development and utilization of mineral products,
exploring of mineral resources, mining and ore dressing within the business range registered for record in industrial and commercial
administration.
Article 4 Special capital is preferentially arranged for the exploring with good metallogenic conditions or background and exploring and developing
projects that are rich in resource reserves, have better exploring and developing conditions, striking anticipated benefit, perfect
works in early stage and invested correspondingly by relative units of Central Government and local government.
Article 5 Special capital is managed project by project, special fund for special use. No unit and individual could keep back, forcibly occupy
and misappropriate it.
Chapter II QualificationsArticle 6 Applying for special capital must meet following requirements:1.The implementation of the project should accord with national laws and industrial policies, laws of the country where the project
is executed and standard of international law, should not harm national sovereignty, safety and public interests;
2.Investing in enterprises abroad should be approved by the Ministry of Commerce or provincial competent commercial administration;
mineral resource developing project abroad should be approved or gone through the record registration formalities by National Development
and Reform Commission or provincial development and reform authority or gone through the record formalities in the Ministry of Commerce
and the Ministry of Land and Resources;
3.The executed project has obtained the license (or permission) for exploring and developing mineral resources issued by the competent
authority for mineral resources of the country where the project is executed. The plan for executing the project has been approved
by the country where the project is executed. The contract or agreement (initialed text) should be signed for the joint venture and
cooperated project with foreign enterprises;
4.The executed project should meet the requirements of raw materials, fuel, power, main equipment, communications and transport and
ect.
5.The mineral area where the project is executed has excellent inside and outside conditions. The explored and developed mineral resources
have good market prospects and striking economic benefit;
6.Domestic unit has mining right of the project exclusively or together with foreign joint venture or cooperated unit;7.Main mineral resources (or roughing products) explored in the developing project should be transported to home;8.Other requirements requested by the Ministry of Finance.Article 7 The materials that should be provided for applying for special capital:1.Copy of legal person credentials of the enterprises and public institutions or copy of the duplicate of industrial and commercial
license;
2.Whoever executes exploring project should provide qualification certificate for geological exploring. Whoever executes developing
project should provide the certificate of corporate body registered in the country where the project is executed approved by the
state;
3.License of mineral resources exploring or mining issued by competent administration of mineral resources of the country where the
project is executed. Whoever invests jointly or cooperates with foreign enterprises should provide the copy of signed contract or
agreement (initialed text);
4.Approval Certificate for Investment Abroad of the People￿￿s Republic of China issued by the Ministry of Commerce (to Central enterprises)
or by provincial competent commercial department (to other enterprises);
5.Written approval documents or record certificate for investment project abroad issued by National Development and Reform Commission
or provincial development and reform authority;
6.Record Form for Mineral Resources Developing Project Abroad that has been put on record in the Ministry of Commerce and Ministry of
Land and Resources;
7.Written comments on the reported project issued by our economic and commercial counselor office in the country where the project is
executed;
8.Other materials requested by Ministry of Finance.Ministry of Finance may readjust the qualification certificates to be provided according to the needs of the state policy.Chapter III Management of BudgetArticle 8 The state shall support the project that has been made pre-survey and general survey in the early stage in the form of financial subsidies.
Financial subsidies are mainly used for looking for mines.The state shall support the project that is in the stage of detailed investigation, exploring and mining in the form of providing
financial interest discount of domestic bank loan.
Article 9 Ministry of Finance shall release guide to apply for special capital project according to relative requirements of ￿￿Go Abroad￿￿ strategy
of the state.
Article 10 Geological exploring units and mining enterprises applying for special capital should draw up project feasibility report, project
design and expenditure budget.The projects executed by Central enterprises and public institutions and the units directly affiliated to Central enterprises and
public institutions should be reported directly to the Ministry of Finance after examination and gathering together of Central competent
administration or Central enterprises and public institutions. The project executed by other enterprises and public institutions
should be reported to the Ministry of Finance after the examination and gathering together of Financial Departments (Bureaus) of
all provinces, autonomous regions, municipalities directly under the Central government.
Article 11 The Ministry of Finance shall organize relative experts to give comments on and examine the project application materials submitted
by Central competent administrations, Central enterprises and public institutions and the locality.
Article 12 The Ministry of Finance shall release appropriation budget according to experts￿￿ examination and financial power of this year.Special capital shall be appropriated in accordance with relative provisions of rules for administration of financial national treasury.Article 13 Financial management and account settlement of special capital should be carried out according to current regulations of the state
about Chinese invested or Chinese-foreign joint venture enterprises abroad.
Chapter IV Supervision and ExaminationArticle 14 Financial authorities at all levels should make necessary supervision and examination on the use of special capital and evaluate the
real achievements of the use of special capital.
Article 15 The financial authorities at all levels should establish supervision and constraint mechanism for managing the use of special capital,
establish project tracking and feedback system, for handling and correcting the problems in use of the funds in time and serious
issues should be reported to the Ministry of Finance.
Article 16 The competent unit responsible for the project should improve the administration of special capital, strictly abide by financial accountant
rules and cooperate actively relative organs to make supervision and examination.
Article 17 The unit undertaking the project should submit the information of project progress and use of the funds to the financial authority
at the same level. The competent unit responsible for the project should arrange check and acceptance after fulfilling the project
in accordance with requirements.
Article 18 The competent units responsible for the project and undertaking the project and corresponding persons who have caused the special
capital held back, embezzled or losses because of malfeasance or other illegal activities should be ascertained responsibilities
in accordance with Punishment and Disciplinary Regulations for Illegal Financial Activities. Whoever commits a crime should be transferred
to judicial organ for their criminal responsibilities.
Chapter V Supplementary ArticlesArticle 19 These measures shall come into effect as of October 31, 2005.



 
Ministry of Finance
2005-10-31

 







MEASURES GOVERNING THE EXTERNAL MARKS OF AUTOMOBILE PRODUCTS

National Development and Reform Commission

Order of the National Development and Reform Commission

No. 38

In accordance with relevant laws and regulations of the state and the relevant provisions of the “Policies on Development of the Automobile
Industry”, the “Measures Governing the External Marks of Automobile Products”, which were deliberated and adopted at the working
meeting of the directors of the National Development and Reform Commission, are hereby promulgated, and shall come into force as
of February 1, 2006.

Director General of the National Development and Reform Commission, Ma Kai,

November 3, 2005

Measures Governing the External Marks of Automobile Products

Chapter I General Provisions

Article 1

These Measures are formulated according to the relevant laws and regulations for the purpose of regulating the external marks of the
products of automobile manufacturing enterprises, protecting the lawful rights and interests of consumers, propelling automobile
manufacturing enterprises on enhancing their consciousness of quality and brand, and carrying out the “Policies on Development of
the Automobile Industry”.

Article 2

“External marks of automobile products” as mentioned in these Measures shall refer to the registered commodity trademarks, names of
manufacturing enterprises, places of origin, names of vehicle types, models, displacement of engines, gear-box types, driving modes,
and other marks reflecting the features of vehicles.

Article 3

These Measures shall be applied to the automobiles manufactured within the territory of China and sold oriented to the domestic
markets. No unified requirements are set forth for the automobiles manufactured within the territory of China and sold oriented
to the foreign markets and the imported automobiles.

Article 4

The competent department of automobile industry shall be responsible for regulating and administering the indication of external
marks of automobile products.

Chapter II Indication of Marks

Article 5

On an eye-catching position on the external surface of the front part of the vehicle body of a domestically manufactured automobile,
there shall be installed at least a permanently existing commodity trademark.

Article 6

On a distinctive position of the tail of the vehicle body (on the surface of the rear part of the vehicle body above the bumper) of
a domestically manufactured passenger vehicle, commercial vehicle or trailer the name of the automobile manufacturing enterprise,
the commodity trademark and the name of the vehicle type, etc. shall be indicated. If a figurative commodity trademark needs to be
indicated, it shall be affixed in the middle of the external surface of the tail of the vehicle body (except for any vehicle whose
tail of the vehicle body is attached with a spare tire or whose rear part of the vehicle body is installed with a door opening towards
left and right).

If all parties of a joint venture automobile manufacturing enterprise intends to make combined indication with the shortened form
of their name in Chinese characters or with the Chinese character trademarks they has registered, the name of the manufacturing
enterprise shall be no longer needed to indicate .

Article 7

A special vehicle using a purchased chassis shall keep the commodity trademark, the name of the manufacturing enterprise, etc. of
the original chassis. Meanwhile, the information of the special vehicle manufacturing enterprise such as its name, the commodity
trademark, the name of the vehicle type, etc. shall be indicated.

Article 8

The commodity trademark of the manufacturing enterprise or the enterprise name shall be indicated on the product of automobile parts
and components . The specific method of indication shall be decided by the enterprise itself.

Chapter III Requirements on Marks

Article 9

The name of an automobile manufacturing enterprise shall be indicated with Chinese characters. For the type of a vehicle whose length
is more than 4.2 m, the height of its Chinese characters shall not be under 25mm; while for the type of a vehicle whose length is
no more than 4.2 m, the height of its Chinese characters shall not be under 20mm. The name of the manufacturing enterprise and the
literal trademark of commodity must be indicated with the same material.

Article 10

The name of a vehicle type may be indicated with either Chinese characters or English letters, and the height of the characters or
letters shall not be under 15mm.

Article 11

The contents indicated on the external mark of an automobile product shall be consistent with those indicated on the scutcheon of
the vehicle product, the leave factory conformity certificate of the complete vehicle and other similar documents.

Article 12

Among the marks on the front part and rear part of the body of a passenger vehicle or commercial vehicle, the name of the automobile
manufacturing enterprise, the commodity trademark and the name of the vehicle type, etc. shall be permanently kept, and shall not
be coated by means of spraying paints or be stuck with non-drying glue.

Chapter IV Supplementary Provisions

Article 13

Automobiles as mentioned in these Measures shall refer to the vehicles as defined in Clause 2.1 of the national standards (GB/T3730.1–2001),
including passenger vehicles (as defined in Clause 2.1.1) and commercial vehicles (as defined in Clause 2.1.2), among which, the
vehicles as defined in Clauses 2.1.1.11, 2.1.2.3.5, and 2.1.2.3.6 shall be special automobiles; the trailers as mentioned therein
shall refer to the vehicles as defined in Clause 2.2 of the national standards (GB/T3730.1 –2001).

Article 14

The “name of an automobile manufacturing enterprise” as mentioned in these Measures shall refer to the name of automobile manufacturing
enterprise registered in the administrative department for industry and commerce or the name of automobile manufacturing enterprise
published in the “Announcement”.

When an enterprise name is indicated, either the full or the shortened form of name may be adopted. When the shortened form of an
enterprise name is adopted, it shall be reported for archival filing at the time when f applying for the “Announcement of Road
Motor Vehicle Manufacturing Enterprises and Their Products”.

The share-controlling subsidiary company of a domestic automobile manufacturing enterprise (group) may, pursuant to the requirement
of the parent company, indicate the enterprise name or the shortened form thereof.

Article 15

“Permanently kept” as mentioned in these Measures shall refer to that is not allowed to aging or naturally fall off within the service
life of product.

Article 16

Starting from February 1, 2006, any new product for declaring the “Announcement of Road Motor Vehicle Manufacturing Enterprises
and Their Products” (hereinafter referred to as “Announcement”) must conform to these Measures, otherwise the said product shall
not be permitted to be published on the “Announcement”.

Article 17

Automobile manufacturing enterprises shall adjust the external marks on the vehicle types and vehicle bodies listed in the “Announcement”
according to the provisions of these Measures as soon as possible. From May 1, 2006, all vehicle types listed in the “Announcement”
shall meet the requirements of these Measures. Any vehicle type that fails to meet the said requirements shall be suspended from
publishing in the “Announcement”.

Article 18

These Measures shall come into force as of February 1, 2006.



 
National Development and Reform Commission
2005-11-03

 







CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE ENTRY INTO FORCE AND IMPLEMENTATION OF THE AGREEMENT FOR THE AVOIDANCE OF DOUBLE TAXATION BETWEEN THE GOVERNMENTS OF CHINA AND GEORGIA

the State Administration of Taxation

Circular of the State Administration of Taxation on the Entry Into Force and Implementation of the Agreement for the Avoidance of
Double Taxation between the Governments of China and Georgia

Guo Shui Fa [2005] No. 176

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

The Chinese government and the government of the Republic of Georgia signed the Agreement for the avoidance of double taxation and
the prevention of fiscal evasion with respect to taxes on income and property in Beijing on June 22, 2005. The Agreement has been
confirmed by both governments by exchanging notes through their respective foreign affairs departments on August 9, 2005 and October11,
2005 respectively, and has now completed the necessary legal procedures for entering into force. According to the provisions of Article
29 of the Agreement, the Agreement will enter into force on November 10, 2005, and will be implemented as of January 1st, 2006.
The State Administration of Taxation has distributed the text of the Agreement to you by promulgating “Letter of the State Administration
of Taxation [2005] No. 114” on July 6, 2005. Please comply with and implement it accordingly.

The State Administration of Taxation

November 4, 2005



 
the State Administration of Taxation
2005-11-04

 







NOTICE OF SAT AND SAFE ON PUTTING INTO TRIAL USE THE REGIME OF DECLARING TAX REIMBURSEMENT FOR EXPORT WITHOUT PROVIDING THE PAPER FORM OF COLLECTION VERIFICATION AND WRITING-OFF OF EXPORT PROCEEDS IN FOREIGN EXCHANGE

The State Administration of Taxation, the State Administration of Foreign Exchange

Notice of SAT and SAFE on Putting into Trial Use the Regime of Declaring Tax Reimbursement for Export without Providing the Paper
Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange

Guo Shui Han [2005] No. 1051

Bureaus of State Taxes and Branches of the State Administration of Foreign Exchange in all provinces, autonomous regions, municipalities
under direct control of the Central Government, and cities specially designated in the state plan:

The Submission and Examination System via Internet for the Collection Verification and Writing-off of Export Proceeds in Foreign Exchange
has recently been launched by the State Administration of Foreign Exchange in order to simply the formalities in collection verification
and writing-off of export proceeds in foreign exchange and to facilitate trade. And in order to ameliorate the transition of the
regime in collection verification and writing-off of export proceeds in foreign exchange, the State Administration of Taxation and
the State Administration of Foreign Exchange decide to select several export enterprises in Guangdong, Liaoning and Beijing to put
into trail use the new regime of declaring tax reimbursement for export without providing the special couplet of tax reimbursement
for export of the form of collection verification and writing-off of export proceeds in foreign exchange, and of the taxation authorities
examining tax reimbursement for export using the electronic data in collection verification and writing-off of export proceeds in
foreign exchange. And the relevant issues concerning this are hereby notified as follows:

I.

The Bureaus of State Taxes and Branches of the State Administration of Foreign Exchange in the areas where this policy is put into
trial use, shall do well the work hereof in accordance with The Measures of the State Administration of Taxation and the State Administration
of Foreign Exchange for Putting into Trial Use in Several Export Enterprises in Guangdong, Liaoning and Beijing the Regime of Declaring
Tax Reimbursement for Export without Providing the Paper Form of Collection Verification and Writing-off of Export Proceeds in Foreign
Exchange (please refer to the annex).

II.

The measures for the administration of tax reimbursement for export shall remain unchanged in the areas where this policy is not put
into trial use.

III.

The Bureaus of State Taxes and Branches of the State Administration of Foreign Exchange in the areas where this policy is put into
trial use, shall, during the work hereof, closely cooperate with each other and timely sum up the experience so as to advance the
work hereof, and report the questions encountered during the work. And other areas where the Submission and Examination System via
Internet for the Collection Verification and Writing-off of Export Proceeds in Foreign Exchange has already been carried out, may,
with reference to the spirit of this notice, actively study the operational issues in local areas. The State Administration of Taxation
and the State Administration of Foreign Exchange will study the work of carrying-out nationwide in accordance with the situations
of putting into trial use this policy and with the carrying-out in every area.

Annex: The Measures of the State Administration of Taxation and the State Administration of Foreign Exchange for Putting into Trial
Use in Several Export Enterprises in Guangdong, Liaoning and Beijing the Regime of Declaring Tax Reimbursement for Export without
Providing the Paper Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange

The State Administration of Taxation

the State Administration of Foreign Exchange

November 4, 2005 Annex:The Measures of the State Administration of Taxation and the State Administration of Foreign Exchange for Putting into Trial Use in
Several Export Enterprise in Guangdong, Liaoning and Beijing the Regime of Declaring Tax Reimbursement for Export without Providing
the Paper Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange

In order to advance the Submission and Examination System via Internet for the Collection Verification and Writing-off of Export Proceeds
in Foreign Exchange, and to optimize the administration of tax reimbursement for export, the State Administration of Taxation and
the State Administration of Foreign Exchange decide to select 30 export enterprises in Guangdong Province, 20 in Liaoning Province
and those in the Economy and Technology Development Zone in the Xicheng District of Beijing (hereafter referred to as the pilot enterprises,
and please refer to Annex 4 for the name list of the pilot enterprises in the Provinces of Guangdong and Liaoning) to put into trial
use the new regime of declaring tax reimbursement (exemption) for export without providing the special couplet of tax reimbursement
for export of the form of collection verification and writing-off of export proceeds in foreign exchange (hereafter referred to as
the Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange). And the relevant issues concerned is
hereby notified as follows:

I.

Where the pilot enterprises declare enter out of goods as of September 1, 2005 (the export date specified in the Goods Declaration
for Exportation (specially used for tax reimbursement for export) shall prevail)), the foreign exchange authorities in charge need
not, after the pilot enterprises go through the procedure of collection verification and writing-off of export proceeds in foreign
exchange at the foreign exchange authorities in charge, affix the seal of “the collection of export proceeds in foreign exchange
has been verified and written off” on the Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange.
Where the pilot enterprises apply for tax reimbursement (exemption) for export goods to the taxation authorities in charge, they
need not provide the Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange.

II.

The Bureaus of State Taxes and Branches of the State Administration of Foreign Exchange at the provincial level in the areas where
this policy is put into trial use, shall, in accordance with the local Transmission Program of Electronic Data of Collection Verification
and Writing-off of Export Proceeds in Foreign Exchange (hereafter referred to as the Transmission Program) which has been filed to
the State Administration of Taxation and the State Administration of Foreign Exchange for record, organize and carry out the related
works of electronic data transmission.

The Transmission Program shall place stress on the safety, secrecy, accuracy and timeliness of the transmission of electronic data,
and the data transmission shall be in conformity with the data interface standard of the Examination System for Tax Reimbursement
for Export, and a system of account checking-up between the two sides shall be established.

The Bureaus of State Taxes at the provincial level in the areas where this policy is put into trial use shall formulate mechanisms
and management measures governing the transmission of electronic data within the local taxation system so as to ensure the safety
of the electronic data.

III.

The Branches of the State Administration of Foreign Exchange at the provincial level in the areas where this policy is put into trial
use shall, in accordance with the Transmission Program, daily transmit to the Bureaus of State Taxes at the provincial level the
electronic data of collection verification and writing-off of export proceeds in foreign exchange of the pilot enterprises (including
the verified and written-off electronic data and the overdue unverified and unwritten-off electronic data, etc.), and periodically
provide, in accordance with the bilaterally-decided time limit and means of transmission, the Electronic Data Book of the Verified
and Written-off Collection of Export Proceeds in Foreign Exchange (specially used for tax reimbursement for export) (please refer
to Annex 1), which serves as the evidence for handling tax reimbursement (exemption) for export goods or proving the electronic data.

Whereas the Bureau of State Taxes of Beijing and the Beijing Office of the State Administration of Foreign Exchange have adopted an
encryption system of electronic sealing for the electronic data of collection verification and writing-off of export proceeds in
foreign exchange in the Transmission Program, they may need not provide in paper form the Electronic Data Book of the Verified and
Written-off Collection of Export Proceeds in Foreign Exchange (specially used for tax reimbursement for export).

IV.

In accordance with Article 2 of the Notice of the State Administration of Taxation on Relevant Issues concerning the Administration
of Tax Reimbursement (Exemption) for Export Goods (Guo Shui Fa [2004] No. 64), where the pilot enterprises declare tax reimbursement
(exemption) for export goods and the settlement of foreign exchange is postdated, the electronic data of collection verification
and writing-off of export proceeds in foreign exchange may temporally be exempt from the examination of the taxation authorities;
in case that the electronic data of collection of export proceeds in foreign exchange of the pilot enterprises have not yet been
verified and written-off in 180 days as of the export declaration date (the export date specified in the Goods Declaration for Exportation
(specially used for tax reimbursement for export) shall prevail)), Article 5 of this Notice shall be applied to deal with it; in
case that the pilot enterprise is in any one of the 6 circumstances listed in Article 2 of the Document Guo Shui Fa [2004] No. 64,
the taxation authorities shall handle tax reimbursement (exemption) only after they conduct checking-ups between the tax reimbursement
data declared by the pilot enterprise and the electronic data of the verified and written-off collection of export proceeds in foreign
exchange.

The taxation authorities, while examining tax reimbursement for export, shall pay attention to the conformity between the Serial Number
of the Form of Collection Verification and Writing-off of Export Proceeds in Foreign Exchange and the Approval Code of the Goods
Declaration for Exportation.

V.

The electronic data of collection of export proceeds in foreign exchange of the pilot enterprises have not been verified and written-off
after they declared tax reimbursement (exemption) for export goods.

(1)

Where the pilot enterprises do not receive the electronic data transmitted by the foreign exchange authorities in the time limit of
5 work days prescribed in Document Guo Shui Fa [2004] No. 64 after they provided within paper the Form of Collection Verification
and Writing-off of Export Proceeds in Foreign Exchange, the taxation authorities in charge shall issue to the pilot enterprises the
Enquiry Notice for No Electronic Data of Verified and Written-off Collection of Export Proceeds in Foreign Exchange (hereafter referred
to as the Enquiry Notice, and please refer to Annex 2). The pilot enterprises shall, within 15 work days after receiving the Enquiry
Notice, provide the taxation authorities in charge with the Attestation of the Collection of Export Proceeds in Foreign Exchange
Having Been Verified and Written-off (hereafter referred to as the Attestation, please refer to Annex 3) issued by their foreign
exchange authorities in charge.

(2)

The pilot enterprises may enquire, with the Enquiry Notice and at the foreign exchange authorities in charge, the situations of verification
and writing-off of collection of export proceeds in foreign exchange. And as regard to the verified and written-off collection of
export proceeds in foreign exchange, the foreign exchange authorities shall, within 5 work days as of the enquiry day, issue to the
pilot enterprises the Attestation of Verification and Writing?Coff, and retransmit, on the day after the issuing of the Attestation
(postponed in case of the legal festivals), the electronic data of the verified and written-off collection of export proceeds in
foreign exchange.

(3)

The taxation authorities in charge of the pilot enterprises shall examine the Attestation provided within the prescribed time limit
by the enterprises hereof and their electronic data, and handle for them the business of tax reimbursement (exemption) after acknowledging
the electronic data is free of error.

(4)

Where the pilot enterprises fail to provide the Attestation within the prescribed time limit or the Attestation is not free of error,
the taxation authorities in charge shall not handle for the enterprises hereof the business of tax reimbursement (exemption) for
export goods, and shall recover those handled businesses and regard it as goods for home use to be taxed in accordance with the related
provisions.

VI.

The measures of administration of tax reimbursement (exemption) for export goods for the enterprises where the new regime is not put
into trail use shall remain unchanged.

VII.

This measure shall go into effect as of November 11, 2005.

Annexes:

1.

The Electronic Data Book of the Verified and Written-off Collection of Export Proceeds in Foreign Exchange (specially used for tax
reimbursement for export).(omitted)

2.

The Enquiry Notice for No Electronic Data of Verified and Written-off Collection of Export Proceeds in Foreign Exchange(omitted)

3.

The Attestation of the Collection of Export Proceeds in Foreign Exchange Having Been Verified and Written-off(omitted)

4.

The Name List of the Pilot Enterprises in the Provinces of Liaoning and Guangdong(omitted)



 
The State Administration of Taxation, the State Administration of Foreign Exchange
2005-11-04

 







MEASURES FOR THE ADMINISTRATION OF LIQUOR CIRCULATION

Ministry of Commerce

Order of the Ministry of Commerce

No. 25

The Measures for the Administration of Liquor Circulation, which were adopted at the 15th executive meeting of the Ministry of Commerce
on October 19, 2005, are hereby promulgated and shall come into force on January 1, 2006.

Minister Bo Xilai

November 7, 2005

Measures for the Administration of Liquor Circulation

Chapter I General Provisions

Article 1

The present Measures are formulated according to the relevant laws and regulations of the state for the purpose of regulating the
order of liquor circulation, promoting the orderly development of the liquor market, safeguarding the interests of the state and
protecting the legitimate rights and interests of liquor producers, operators and consumers.

Article 2

The term “liquor” as mentioned in the present Measures refers to the liquor drink with more than 0.5% (cubic fraction) of alcoholic
degree (ethanol content), including fermented liquor, distilled liquor, compound liquor, edible liquor and any other drink with alcohol
component, except the medicinal liquor or any liquor in the category of health food whose production has been approved by the relevant
administrative department of the state in accordance with the law.

The term “liquor circulation” as mentioned in the present Measures includes the business operations like the wholesale, retail and
storage and transport of liquor.

Article 3

Any entity or individual that engages in any activity of liquor circulation within the territory of the People’s Republic of China
shall observe the present Measures.

Article 4

A system of archival filing of operators as well as a traceability system shall be established for liquor circulation.

Article 5

The Ministry of Commerce shall take charge of the supervision and administration for liquor circulation throughout the country.

The competent departments of commerce at or above the county level shall take charge of the supervision and administration of liquor
circulation of their administrative regions.

Chapter II Archival Filing and Registration

Article 6

An entity or individual that engages in the wholesale or retail of liquor (herein after referred to in general as “liquor operator”)
shall, within 60 days as of acquiring a business license, make the archival filing and registration formalities in the competent
department of commerce at the same level as the administrative department for industry and commerce where the registration is handled
according to the principle of territorial administration.

Article 7

The procedures for archival filing and registration formalities of liquor operators are as follows:

(1)

Collecting the Registration Form for Liquor Circulation Archival Filing (hereinafter referred to as the Registration Form). The Registration
Form may be downloaded from the official website of the Ministry of Commerce (https://www.mofcom.gov.cn) or be collected from the
local competent department of commerce.

(2)

Filling in the Registration Form. An liquor operator shall fill in the Registration Form in a complete, accurate and authentic manner
and meanwhile shall earnestly read the terms as attached to the Registration Form, which shall be signed and affixed with a seal
by the legal representative or business owner.

(3)

Submitting the following materials for archival filing and registration to the competent department of commerce:

(a)

A Registration Form in duplicate as filled in according to item (2) of Article 7 of the present Measures;

(b)

A photocopy of the business license that is signed or affixed with a seal by the legal representative or business owner as well as
a photocopy of the Sanitation License; and

(c)

Any other material as recognized by the Ministry of Commerce that is publicly required by the competent department of commerce at
the provincial level.

Article 8

The competent department of commerce shall, within 5 workdays as of receiving the aforesaid materials submitted by the liquor operator,
handle the formalities for archival filing and registration and affix its seal on the Registration Form.

Article 9

The competent department of commerce shall record and keep the archived and registered information as well as registration materials
of liquor operators completely and accurately , establish records on archival filing and registration, report them to the competent
department at the higher level on a periodic basis and may publicize them to the general public.

Article 10

Where any registered item in the Registration Form alters, the relevant liquor operator shall, within 30 days as of alteration (in
the case of any item regarding the industrial and commercial registration, it shall be within 30 days as of the alteration of industrial
and commercial registration), handle the formalities for alteration in the competent department of commerce.

The competent department of commerce shall, after receiving the written materials submitted by the liquor operator, handle the formalities
for alteration within 5 workdays.

A Registration Form shall, as of the day when the registration is writing off by the liquor operator in the administrative department
for industry and commerce or as of the day when the business license of the liquor operator is revoked, be automatically invalidated.
The competent department of commerce shall verify any write-off or revoke in collaboration with the administrative department for
industry and commerce at the same level on a periodic basis.

Article 11

The competent department of commerce shall, when handling the registration for archival filing and registration or for any alteration
of archival filing and registration, only collect the cost of production of relevant materials as verified by the local administrative
department for price and shall not charge any other fee.

Article 12

The liquor operator shall not forge, alter, rent, lend, transfer, purchase or sell or cheat for the Registration Form for Liquor Circulation
Archival Filing.

Chapter III Operating Rules

Article 13

The relevant state standards or industrial standards shall be implemented according to law in the business operations of liquor such
as wholesale, retail and storage and transport.

Article 14

A liquor operator (supplier) shall, when undertaking any wholesale of liquor goods, fill in the Attached Documents of Liquor Circulation
(hereinafter referred to as the Attached Documents) and record the circulation information of liquor goods in detail. The Attached
Documents shall follow the whole course of liquor circulation, be bundled with the goods, and match with the goods so as to realize
the traceability of the circulation information throughout the course from the day when liquor goods leave the factory to the point
of sales terminal.

The Attached Documents shall include such contents as the sales entity (name, address, serial number of archival filing and registration,
contact way), name of the purchasing entity, sales date, goods (name, specification, place of production, batch number of production
or production date, quantity and unit) and shall be affixed with the seal of the operator.

The liquor operator that has established perfect traceability system that meets the requirements of the present Measures may, upon
the recognition of the Ministry of Commerce, use the documents as formulated by itself instead of the Attached Documents as provided
for by the present Measures.

Article 15

The liquor operator shall, when purchasing any liquor goods, claim the photocopies of the business license, sanitation license, production
license (limited to producers), registration form, power of attorney of liquor goods distribution (limited to producers) of a supplier
that supplies goods for the first time.

The liquor operator shall claim the photocopy of the effective certificate certifying that the goods pass the quality inspection as
well as of the Attached Documents affixed with the seal of liquor operator or the documents that meet the provisions of paragraph
2 of Article 14 of the present Measures for each batch-based purchase of liquor goods. For any imported liquor goods, the photocopy
of the Sanitation Certificate of Imported Goods as well as the Examination Certificate of Imported Goods Labels as verified and issued
by the state entry-exit inspection and quarantine department shall be claimed also.

The liquor operator shall establish an account for purchase and sale in the liquor business operation and keep it for 3 years.

Article 16

The liquor operator shall mark and sell the bulk liquor in a fixed place. Any mobile sale of bulk liquor is prohibited.

The containers of bulk liquor shall meet the requirements of the state on food sanitation, to which the mark of meeting the standards
of the state on labels of liquor drinks shall be attached and on which the valid sales term after opening, business operator as
well as the contact telephone shall be indicated.

Article 17

The liquor operator shall, when storing or transporting any liquor goods, meet the relevant requirements for the administration of
food sanitation, fireproofing security and storage and transport. The liquor goods shall be kept away from areas of serious pollution
or heavy radiation and shall not be placed together with any poisonous, harmful, polluted or corrosive substance (source).

Article 18

The liquor operator shall, when selling any liquor goods, indicate the price and shall be honest and creditworthy.

Article 19

The liquor operator shall not sell any liquor goods to any minor and shall indicate this in an eye-catching position in its business
place.

Article 20

It’s prohibited to undertake the wholesale, retail or storage and transport of the following goods:

(1)

Any liquor goods produced by using any substance harmful to human such as non-edible alcohol;

(2)

Any liquor goods, of which the name or address of the production plant or production date has been forged or altered;

(3)

Any liquor goods that injured any intellectual property right such as the right to the exclusive use of trademark;

(4)

Any liquor goods which is adulterated, or any interior which is posed to superior or any fake which is posed to genuine or liquor
which exceeds the quality guaranty period or any liquor goods that is illegally imported; or

(5)

Any other liquor goods as prohibited by any law or regulation of the state.

Chapter IV Supervision and Administration

Article 21

The competent departments of commerce at or above the county level shall, according to the relevant laws and regulations of the state
as well as the present Measures, carry out supervision and administration for liquor circulation within their administrative region.

The competent department of commerce at all level shall not restrict or hinder the circulation of legal liquor goods within their
region.

Article 22

The competent department of commerce shall, when carrying out supervision and administration, show the effective certificate, and
the relevant law enforcers shall be no less than 2 persons. Under any circumstance where any relevant evidence is held or where any
tip-off is received, the law enforcers may consult the account or take samples randomly. In the case of any samples taking, the
effective certificate shall be shown to the party concerned.

The competent department of commerce is obliged to keep the commercial secrets of the parties concerned.

The liquor operator shall coordinate in the supervision and examination of the competent department of commerce by providing the
relevant information in a faithful manner and shall not unlawfully transfer or destroy any liquor goods waiting for examination
and inspection.

Article 23

The competent department of commerce shall establish a monitoring system for liquor circulation, carry out monitoring and analysis
on the local liquor circulation, establish the archival filing of liquor operators and publicize it to the general public at a
proper time.

The Ministry of Commerce shall apply the modern information techniques to establish the information system regarding the administration
of liquor circulation and the security of liquor goods. The competent departments of commerce at all levels and liquor operators
shall report the relevant information in a timely manner.

Article 24

The competent department of commerce may, by itself or in collaboration with the relevant departments, take the sample and conduct
tests to the liquor goods as sold in the administrative region and may publicize the testing results to the general public.

The liquor authentication conclusion as produced or accredited by the competent department of commerce shall be based on the testing
results as produced by the statutory testing institution of the state or on the authentication report as produced by the enterprise
whose right has been injured.

Article 25

The liquor industrial organization is encouraged to establish and perfect an industrial self-discipline system.

Article 26

Any entity or individual is enpost_titled to tip off or expose any violation of the present Measures to the local competent department
of commerce, administrative department for industry and commerce or the relevant competent department.

Chapter V Legal Liabilities

Article 27

Where any entity or individual violates the provisions of Article 6 , paragraph 1 of Article 10 of the present Measures, the competent
department of commerce shall give it/him a warning and order it/him to correct within a time limit. Where it/he refuses to correct
within the prescribed term, the competent department of commerce may, based on the circumstances, fine the liquor operator less
than 2, 000 yuan and may publicize it to the general public.

Any entity or individual that violates the provisions of Article 12 of the present Measures may be fined less than 10, 000 yuan
according to the circumstances. Any entity or individual that violates any law or regulation on the administration of industry and
commerce shall be transferred to the administrative department for industry and commerce for handling in accordance with law. Where
a crime is constituted, the violator shall be subject to criminal liabilities according to law.

Article 28

Where any entity or individual violates the provisions of Article 14 or 15 of the present Measures, the competent department of commerce
shall give it/him a warning, order it/him to correct and publicize it to the general public. Where any entity or individual refuses
to correct, the competent department of commerce may, according to the circumstances, impose on it/him a fine less than 5, 000
yuan and publicize it to the general public.

Article 29

Where any entity or individual violates the provisions of Article 16 or 17 of the present Measures, the competent department of commerce
shall give it/him a warning and order it/him to correct. In the case of any serious circumstances, the competent department of commerce
may impose on it/him a fine less than 10, 000 yuan and transfer it/him to the administrative department for industry and commerce
for handling in accordance with law. Where a crime is constituted, the violator shall be subject to criminal liabilities according
to law.

Article 30

Where any entity or individual violates the provisions of Article 1 19 of the present Measures, the competent department of commerce
shall, by itself or in collaboration with the relevant department, give it/him a warning and order it/him to correct. Under any serious
circumstances, a fine less than 2, 000 yuan shall be imposed.

Article 31

Where any entity or individual violates the provisions of Article 20 of the present Measures, the competent department of commerce
shall, by itself or in collaboration with the relevant department, confiscate the illegal goods and impose on it/him a fine less
than 30, 000 yuan according to the circumstances. Any entity or individual that violates any law or regulation on the administration
of industry and commerce or injures the right to the exclusive use of trademark shall be transferred to the administrative department
for industry and commerce for handling in accordance with law. Any entity or individual that violates any other law or regulation
shall be transferred to the relevant organ for handling in accordance with law. Where a crime is constituted, the violator shall
be subject to criminal liabilities according to law.

Article 32

Where any entity or individual violates the provisions of paragraph 3 of Article 22 of the present Measures, the competent department
of commerce shall give it/him a warning and order it/him to correct. Under any serious circumstances, a fine less than 10, 000 yuan
may be imposed.

Article 33

Where the competent department of commerce conducts any supervision and administration on liquor circulation in violation of the present
Measures, it shall be given an administrative sanction according to law.

Chapter VI Supplementary Provisions

Article 34

The licensing system shall be continued in those regions where the licensing administration of liquor circulation has been carried
out according to law. The circulation of liquor goods shall be subject to the traceability system according to the present Measures.
The License for Liquor Circulation shall be deemed as the Registration Form.

Article 35

The Registration Form and the Attached Documents shall be uniformly formulated by the Ministry of Commerce. The competent departments
of commerce at the provincial level shall take charge of the specific implementation.

Article 36

The competent departments of commerce at or above the county level may entrust the relevant organizations to conduct the supervision
and administration of liquor circulation according to law.

Article 37

The power to interpret the present Measures shall remain with the Ministry of Commerce.

Article 38

The present Measures shall come into force as of January 1, 2006. A 3-month transitional period shall be set as of the day of implementation.
Within the transitional period, the liquor operator shall handle the formalities for archival filing and registration as well as
establish a traceability system according to the provisions of the present Measures.



 
Ministry of Commerce
2005-11-07

 







MEASURES FOR THE SUPERVISION AND ADMINISTRATION OF THE PILOT SECURITIZATION OF CREDIT ASSETS OF FINANCIAL INSTITUTIONS

China Banking Regulatory Commission

Order of China Banking Regulatory Commission

No. 3

The present Measures for Supervision and Administration of the Pilot Securitization of Credit Assets of Financial Institutions, which
were adopted at the 38th chairman’s meeting of China Banking Regulatory Commission on September 29, 2005, are hereby promulgated
and shall go into effect as of December 1, 2005.

Chairman of China Banking Regulatory Commission Liu Mingkang

November 7, 2005

Measures for the Supervision and Administration of the Pilot Securitization of Credit Assets of Financial Institutions

Chapter I General Provisions

Article 1

With a view to regulating the pilot securitization of credit assets, promoting the cautious implementation of securitization of credit
assets by financial institutions, effectively managing and controlling the relevant risks in the securitization of credit assets
and protecting the legitimate rights and interests of investors and the parties concerned, and in accordance with the Banking Supervision
Law of the People’s Republic of China, the Law of the People’s Republic of China on Commercial Banks, the Trust Law of the People’s
Republic of China and other relevant laws and regulations as well as the Measures for the Administration of the Pilot Securitization
of Credit Assets, the present Measures are formulated.

Article 2

For the purposes of the present Measures, the term “financial institutions” shall refer to the commercial banks, policy banks, trust
and investment companies, finance companies, urban credit cooperatives and rural credit cooperatives as established in China, and
other financial institutions subject to the supervision and administration of China Banking Regulatory Commission (hereinafter referred
to as the CBRC).

Article 3

The present Measures shall be applicable to those structural financing activities which are carried out within the territory of the
People’s Republic of China and whereby a banking financial institution, as the promoter, entrusts the credit assets to a trustee
institution, and the trustee institution issues beneficial securities to investment institutions in the form of asset-backed securities
and pays the yields from asset-backed securities by the cash generated from the aforesaid assets.

Article 4

When engaging in the securitization businesses of credit assets as the promoter, trustee, credit enhancement institution, loan service
institution, capital custodian in the securitization or the investment institution of asset-backed securities, a financial institution
shall perform relevant duties according the relevant laws, administrative regulations, ministerial rules and the relevant legal documents
relating to the securitization of credit assets, and shall effectively identify, measure, monitor and control relevant risks.

Article 5

The CBRC shall supervise and administrate the securitization businesses of credit assets of financial institutions according to law.

Without approval of the CBRC, a financial institution may not engage in the securitization businesses of credit assets as the promoter
or the trustee of special purpose trusts for the securitization of credit assets.

Chapter II Market Access Management

Article 6

The term “promoter in the securitization of credit assets” shall refer to the financial institutions which transfer the credit assets
by establishing special purpose trusts.

Article 7

When a banking financial institution, as the promoter in the securitization of credit assets, transfers the credit assets by establishing
special purpose trusts, it shall satisfy the following requirements:

(1)

Having good social reputation and operational performance, and having no major irregularities within the latest three years;

(2)

Having sound corporate governance structure, and risk management and internal control system;

(3)

Having a reasonable target and clear strategic planning for the securitization businesses of credit assets, which comply with its
overall management objectives and development strategies;

(4)

Having proper standards and procedures for the selection of trustee institutions for special purpose trusts;

(5)

Having professional personnel, a business processing system, accounting system and management information system as well as a risk
management and internal control system which are necessary for carrying out the securitization businesses of credit assets;

(6)

Having no bad record on engaging in the securitization businesses of credit assets within the latest three years; and

(7)

Other prudential requirements as prescribed by the CBRC.

Article 8

The term “trustee for special purpose trusts” shall refer to the institution that promises the trusts and thus takes charge of the
management of special purpose trust assets and the issuance of asset-backed securities in the course of the securitization of credit
assets. A trustee shall be a trust and investment company as established according to law or any other institution approved by the
CBRC.

Article 9

To be a trustee for special purpose trusts, a trust and investment company shall satisfy the following requirements:

(1)

Having registered anew for more than three years under the relevant provisions of the state;

(2)

Its registered capital shall be not less than RMB 0.5 billion Yuan, and its net assets at the end of each of the latest three years
shall be not less than RMB 0.5 billion Yuan;

(3)

The asset status and fluidity of its self-management businesses are good and comply with the relevant supervisory requirements;

(4)

All of its original deposit liabilities have been cleared up, and there is no new deposit liability or any other disguised liability
in the name of trusts, etc.;

(5)

It shall have good social reputation and operational performance, all of its due trust projects shall have been smoothly completed
according to the stipulations of contracts, and there is neither bad record of misappropriating trust assets, nor major irregularities
within the latest three years;

(6)

Having a sound corporate governance structure and operational procedures for trust businesses, as well as the risk management and
internal control system;

(7)

Having professional personnel, a business processing system, accounting system, management information system and a risk management
and internal control system necessary for performing the duties of trustee institutions for special purpose trusts;

(8)

Having disclosed the annual report pursuant to the provisions; and

(9)

Other prudential requirements as prescribed by the CBRC.

Article 10

To apply for the qualification of a trustee for special purpose trusts, a trust and investment company shall file an application with
the CBRC, and submit the following documents and materials (in triplicate):

(1)

An application report;

(2)

The company’s business license, certificate of registered capital and certificate of new registration for three years or more;

(3)

The operational rules, the accounting system as well as the risk management and internal control system for the management of special
purpose trust assets;

(4)

The list and resumes of the persons in-charge of businesses and main business personnel for the management of special purpose trust
assets;

(5)

The company’s financial statements as audited of the latest three fiscal years;

(6)

The self-discipline commitment of the applicant; and

(7)

Other documents and materials as required by the CBRC.

Article 11

The CBRC shall, within five working days as of the date of receipt of complete application materials from a trust and investment company,
decide whether or not to accept the application. If the CBRC decides not to accept the application, it shall inform in writing the
applicant of the decision and give the reasons therefor; if the CBRC decides to accept the application, it shall, within one month
as of the day when the application is accepted, make a written decision on whether or not to approve the application.

Article 12

The market access requirements and procedures for other financial institutions to apply for the qualification of a trustee for special
purpose trusts shall be separately promulgated by the CBRC.

Article 13

Where a banking financial institution, as the promoter, entrusts the credit assets to a trustee and lets the trustee issue beneficial
securities to investment institutions in the form of asset-backed securities, an application shall be jointly filed by the banking
financial institution that satisfies the requirements as prescribed in Article 7 of the present Measures and the financial institution
that has obtained the qualification of a trustee for special purpose trusts, and the following documents and materials (in triplicate)
shall be submitted thereby:

(1)

An application report signed by the promoter and the trustee;

(2)

A feasibility research report;

(3)

Proposal on the securitization businesses of credit assets;

(4)

Drafts of the trust contract, loan service contract, capital custody contract as well as other relevant legal documents;

(5)

The draft of legal opinions issued by practicing lawyers, the draft of accounting opinions issued by certified public accountants,
the draft of the credit rating report and the statements on continuous follow-up rating arrangements as issued by the credit appraisal
institutions;

(6)

Promoter’s standards and procedures for the selection of the trustee for special purpose trusts;

(7)

The operational procedures, the accounting system as well as the risk management and internal control system of the promoter in the
securitization businesses of credit assets;

(8)

The list and resumes of the persons in charge of businesses and main business personnel of the promoter for the securitization businesses
of credit assets;

(9)

Trustee’s standards and procedures for the selection of the loan service institution, the capital custodian and other institutions
involved in the securitization businesses of credit assets;

(10)

The statements on the principles and methods of the trustee for the investment management of the yields from credit assets within
the intervals of paying the yields from credit assets; and

(11)

Other documents and materials required to be submitted by the CBRC.

The “proposal on the securitization businesses of credit assets” as mentioned in Item (3) of the preceding Paragraph shall contain:

(1)

Names and domiciles of the promoter, trustee, loan service institution, capital custodian and other institutions participating in
the securitization, and statement on their related relationships;

(2)

Statements on the experiences and default records of the promoter, trustee, loan service institution and capital custodian in their
respective earlier securitization businesses;

(3)

Standards for choosing credit assets for the establishment of special purpose trusts, statements on the asset pool and the relevant
statistical information;

(4)

Granting procedures, examination and approval standards, forms of guaranty and administrative measures for the credit assets in asset
pool, and procedures and methods for the disposal of default loans;

(5)

Transaction structure and main rights and obligations of each participant;

(6)

List of taxes and expenses that need to be paid for the cash flow of trust assets, the sources of payments for various taxes and expenses,
payment links and the priority order of payments;

(7)

Plan on issuance of asset-backed securities, including the information about the different grades of asset-backed securities, the
amount of the principal, credit rating, coupon rate and time limit of each grade and the priority order of the principal and interest
payment;

(8)

Modes of internal and external credit enhancement for the securitization businesses of credit assets, and the drafts of the relevant
contracts;

(9)

Clause of clearance repurchase and other selective or compulsory clauses with respect to redemption or termination;

(10)

Risk analysis of the securitization business of the aforesaid credit assets as well as the control measures;

(11)

Contents which remind the investment institutions of risks at the eye-catching place of the prospectus; and

(12)

Other contents as prescribed by the CBRC.

Article 14

The CBRC shall, within five working days as of the date of receipt of complete application materials jointly submitted by a promoter
and a trustee, decide whether or not to accept the application. If the CBRC decides not to accept the application, it shall inform
in writing the applicant of the decision and give the reasons therefor; if the CBRC decides to accept the application, it shall,
within three month as of the day when the application is accepted, make a written decision on whether or not to approve the application.

Chapter III Operational Rules and Risk Management

Article 15

A financial institution shall, according to its own operational objectives, capital strength, risk management capacity and features
of risks in securitization businesses of credit assets, determine whether or not to engage in the securitization businesses of credit
assets, as well as the methods of engagement and the scale.

Article 16

A financial institution shall, before carrying out the securitization businesses of credit assets, fully identify and assess potential
credit risks, interest rate risks, fluidity risks, operational risks, legal risks, reputation risks and etc., and shall set up corresponding
internal examination and approval procedures, business process system, risk management and internal control system; and the procedures
for disposing of the securitization businesses of credit assets and managing the risks therein shall be subject to the examination
and approval of its credit management department, funds transaction department, risk management department, legal affair department
or regulation compliance department, financial department, settlement department, and other relevant department, and where necessary,
may be subject to the approval of the board of directors or a special committee as authorized thereby.

Article 17

A financial institution shall be fully aware of the obligations and duties that shall be borne for its engaging in the securitization
businesses of credit assets, and shall, according to its specific role in the securitization businesses of credit assets and the
features of risks in securitization businesses of credit assets, set down corresponding risk management policies and procedures,
so as to continuously and effectively identify, measure, monitor and control risks in the securitization businesses of credit assets
and to avoid possible conflicts of interest resulted from two or more roles it performed in the securitization businesses of credit
assets.

A financial institution shall bring the risk management of securitization businesses of credit assets into its overall risk management
system.

Article 18

The board of directors and the senior management of a financial institution shall know the securitization businesses of credit assets
and the potential risks thereof, and determine the overall strategies and policies for the development of securitization businesses
of credit assets, and ensure the human and material resources, such as professional personnel, management information system and
accounting system, which are necessary for the securitization businesses of credit assets. The personnel engaged in the securitization
businesses of credit assets or the risk management shall fully understand the legal relationship, transaction structure of the securitization
businesses of credit assets as well as the main risks and the methods and techniques to control them.

Section I Promoters

Article 19

The credit assets to be securitized by a promoter of the securitization of credit assets shall meet the following requirements:

(1)

Having a comparatively high homogeneity;

(2)

Being able to produce predictable cash flow yields; and

(3)

Complying with the laws, administrative regulations and the relevant provisions as prescribed by the CBRC and other regulatory authorities.

Article 20

A promoter shall transfer credit assets on the basis of the conditions and clauses concerning fair market transaction, and may not
act against laws, administrative regulations, the relevant provisions as prescribed by the CBRC and other regulatory authorities,
and stipulations in the loan contract.

Article 21

A promoter shall accurately distinguish and appraise the risks transferred by way of securitization businesses of credit assets and
the remaining risks, and shall effectively monitor and control the remaining risks.

A promoter shall, according to the relevant provisions in Chapter IV of the present Measures, calculate and withdraw the capital for
the remaining risks.

Article 22

A promoter shall ensure that the trustee will remind the investment institutions at an eye-catching place of the prospectus on issuance
of asset-backed securities that the asset-backed securities do not represent the promoter’s liabilities, and the recourse of investment
institutions of asset-backed securities is only limited to the trust assets. The promoter will not assume obligations and duties
for other potential losses in the securitization businesses of credit assets except for those as promised in the relevant legal documents
on the securitization of credit assets, such as the trust contract or the loan service contract.

Section II Trustees of Special Purpose Trusts

Article 23

A trustee of special purpose trusts shall, within ten working days as of the date of issuance of asset-backed securities, report to
the CBRC the information on issuance of asset-backed securities and submit to the CBRC the relevant legal documents formally concluded
with the promoter, credit enhancement institution, loan service institution and other institution that provides service for the securitization
transaction of credit assets.

During the existence period of asset-backed securities, the trustee shall submit the reports on disclosure thereof to the CBRC.

Article 24

A trustee shall account for and manage the credit assets as the trust assets, its self-owned assets and other assets separately. The
trust assets in different securitization transactions shall be separately accounted and managed.

Article 25

Any of the following matters shall be reported to the CBRC by a trustee within five working days as of the date of occurrence:

(1)

The quality of credit assets as the trust assets has significantly changed, which may make it impossible to pay the yields derived
from asset-backed securities to investment institutions on schedule;

(2)

The trustee, loan service institution or capital custodian violates the relevant laws, administrative regulations, ministerial rules
or other legal documents on the securitization of credit assets, which may affect the payment of yields derived from asset-backed
securities on schedule;

(3)

The external credit enhancement institution is changed;

(4)

The credit rating of asset-backed securities or other risk exposure from securitization is changed;

(5)

The clearance repurchase occurs; or

(6)

Other matter as prescribed by the CBRC that may result in major losses to the securitization businesses of credit assets.

Article 26

Where a trustee terminates the performance of duties due to its leave, dismissal by the assembly of holders of asset-backed securities
or other circumstance as stipulated in the trust contract, the termination shall be reported to the CBRC within five working days.

A new trustee institution shall report the termination to the CBRC within five working days as of the day when the trust contract
is concluded, and submit the newly concluded trust contract as well as other relevant legal documents.

Article 27

Where a loan service institution is changed, the trustee shall timely notify the borrowers of the change, report it to the CBRC within
five working days and submit the newly concluded loan service contract.

Where a capital custodian is changed, the trustee shall report the change to the CBRC within five working days, and submit the newly
concluded capital custody contract.

Article 28

A trustee shall remind the investment institutions at an eye-catching place of the prospectus on issuance of asset-backed securities
that the asset-backed securities only represent the corresponding shares of beneficial rights to special purpose trusts but not the
trustee’s liabilities . The trustee shall bear the obligations of paying the yields derived from asset-backed securities to investment
institutions within the limit of the trust assets, and will not assume obligations and duties for other potential losses in the securitization
businesses of credit assets.

Section III Credit Enhancement Institutions

Article 29

For the purposes of the present Measures, the term “credit enhancement” shall refer to the credit protection provided through contractual
arrangements in the transaction structure of the securitization businesses of credit assets. A credit enhancement institution shall,
in light of its commitment to the obligations and duties in the relevant legal documents, provide a certain degree of credit protection
for other institutions that participate in the securitization businesses of credit assets, and assume corresponding risks in the
securitization businesses of credit assets.

Article 30

The credit enhancement may be provided by way of internal credit enhancement and/or external credit enhancement. The former shall
include but not limited to the over-collateralization, hierarchy of asset-backed securities, cash collateral account and spread account,
etc.; and the latter shall include but not limited to the standby letters of credit, guarantee and insurance, etc..

Article 31

A financial institution shall specify the conditions, degree and time limit of protection for the credit enhancement in the relevant
legal documents on the securitization of credit assets when providing credit enhancement, and clearly distinguish the obligations
and duties borne for credit enhancement from those for other roles it performs.

Article 32

A financial institution shall, within the scope of the laws, administrative regulations and the relevant provisions as prescribed
by the CBRC and other regulatory authorities, stipulate the conditions and clauses for the provision of credit enhancement as well
as the obligations and duties to be borne according to the conditions and clauses concerning fair market transaction.

Article 33

A credit enhancement institution shall ensure that the trustee disclose the credit enhancement arrangements for the securitization
businesses of credit assets and remind the investment institutions at an eye-catching place of the prospectus on issuance of asset-backed
securities that the credit enhancement is provided only within the scope as promised in the relevant legal documents on the securitization
of credit assets, and the credit enhancement institution will not assume obligations and duties for other potential losses resulted
from the securitization businesses of credit assets.

Article 34

A commercial bank shall calculate and withdraw the capital according to the relevant provisions in Chapter IV of the present Measures
when providing credit enhancement for the securitization businesses of credit assets.

Section IV Loan Service Institutions

Article 35

The term “loan service institutions” shall refer to the institutions that accept the entrustments of trustees and are responsible
for the management of loans in the securitization businesses of credit assets. A loan service institution shall be a financial institution
legally established in China which has the qualification for the management of loan-related businesses.

Article 36

A loan service institution can be a promoter in the securitization of credit assets. When a loan service institution is a promoter,
it shall conclude a loan service contract separately with the trustee.

Article 37

A loan service institution shall, according to the loan service contract concluded with the trustee institution, collect the principal,
interest and other yields derived from the securitized assets, and shall timely and sufficiently transfer them into the capital account
opened by the trustee institution at the capital custodian.

Article 38

A loan service institution shall set down policies and procedures for the management of securitized assets, and the duty of managing
loans shall be performed by a special operational department of the institution. A separate account shall be established for the
securitized assets so as to manage the securitized assets separately from its self-owned credit assets. The securitized assets in
different securitization transactions of credit assets shall be separately accounted for and managed as well.

Article 39

A loan service institution shall have necessary professional personnel and corresponding operational processing system and management
information system when performing the duty of loan service.

Article 40

The loan service fees shall be determined on the basis of the conditions and clauses concerning fair market transaction.

Article 41

A loan service institution shall ensure that the trustee will remind the investment institutions at an eye-catching place of the prospectus
on issuance of asset-backed securities of the fact that the loan service institution performs the duty of managing loans according
to the loan service contract does not mean that the loan service institution shall assume the obligations and duties for potential
losses resulted from the securitization businesses of credit assets.

Article 42

The CBRC will, according to the economic substance of the obligations and duties borne by a loan service institution in the securitization
businesses of credit assets, judge whether or not the risk exposure from securitization is formed. In case the risk exposure from
securitization is formed, the loan service institution shall calculate and withdraw the capital in accordance with the relevant provisions
in Chapter IV of the present Measures.

Section V Capital Custodians

Article 43

The term “capital custodian” shall refer to the institution that accepts the entrustments of trustees and is responsible for taking
care of the capital in trust accounts in the securitization businesses of credit assets.

The promoter or loan service institution in the securitization of credit assets may not act as the capital custodian for a same transaction.

Article 44

The trustee shall select a commercial bank that satisfies the following requirements as the capital custodian:

(1)

Having a special business department responsible for performing the duty of keeping the trust capital;

(2)

Having a sound capital custodian system and a risk management and internal control system;

(3)

Having the conditions and abilities for the safe keeping of the trust capital;

(4)

Having enough full-time personnel who are familiar with the business operations regarding safekeeping of trust capital;

(5)

Having a safe and efficient settlement and clearing system;

(6)

Having business premises, safety measures and other facilities as required for keeping the trust capital; and

(7)

Having no major irregularities within the latest three years.

Article 45

A capital custodian shall set up separate accounts for each trust capital in the securitization of credit assets and manage them separately,
and shall strictly separate the trust capital under its custody from its self-owned assts or any other assets it manages.

Article 46

Where a capital custodian, within the interval for paying yields derived from credit assets to the investment institutions of asset-backed
securities, finds that any investment instruction for managing the yields from credit assets violates any law, administrative regulation,
any other relevant provision or the contract on keeping the capital, it shall report the violation to the CBRC.

Section VI Investment Institutions of Asset-backed Securities

Article 47

If a financial institution can buy and sell government bonds or financial bonds under the laws, administrative regulations or the
relevant provisions as prescribed by the CBRC and other regulatory authorities, it may also invest in asset-backed securities within
the scope as prescribed by the laws, administrative regulations as well as by the relevant provisions of the CBRC and other regulatory
authorities.

Article 48

A financial institution that invests in asset-backed securities shall be fully aware of the potential credit risks, interest rate
risks, fluidity risks, legal risks and etc., and shall formulate corresponding policies and procedures for investment management,
and establish a business process system, a management information system as well as a risk control system for making investment in
the asset-backed securities.

The personnel participating in the investment in and risk management of asset-backed securities shall fully know the transaction structure,
the status of asset pool, the situation of credit enhancement and credit rating as well as other information, and make an investment
decision based thereon, and shall analyze risk features of asset-backed securities and apply relevant risk management methods and
techniques to control the risks.

Article 49

A financial institution that invests in asset-backed securities a will face potential credit risks of the assets in asset pool. The
financial institution shall, according to the clients, regional and industrial characteristics of the assets in asset pool, bring
the aforesaid credit risks into its uniform credit risk management system, which includes the management of risk concentration.

Article 50

A financial institution that invests in asset-backed securities shall apply the internal quota management, and shall, according to
its risk prefer

CONSTITUTION ACT, 1982 – page 22

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