NOTIFICATION NO.11, 2006 OF FOREIGN ASSISTANCE PROJECT BID BOARD OF THE MINISTRY OF COMMERCE

Notification No.11, 2006 of Foreign Assistance Project Bid Board of the Ministry of Commerce

Tong Gao [2006] No.11

Foreign Assistance Project Bid Board of the Ministry of Commerce held the 11th regular meeting of 2006 on May 26, 2006. Relevant matters
and resolution are now notified as follows:

The tender mode of Madagascar International Conference Hall assistance project was discussed. The Bid Board adopted limited invitation
tender mode, and 15 enterprises including China Civil Engineering Construction Corporation, Yanjian Group Co., Ltd., Anhui Foreign
Economic Construction Corporation (group) Co., Ltd., Qingdao Construction Group Corporation, Beijing Construction Engineering Group
Co., Ltd., Shanxi Construction Engineering (group) Co., China National Overseas Engineering Corporation, Guangdong Construction Engineering
Group Co., Ltd., Shanghai Construction Group General Co., Fujian Construction Engineering Group General Co., Jiangsu Construction
Group Corp., Nanjing Dadi Construction (group) Co., Ltd., China Ershisanye Construction Group Co., Ltd., Zhejiang Electric Power
Construction Corp. and China State Construction Engineering Corp. will be invited to participate in the bid. Specific matters of
concern shall be notified later.

The tender mode of Meeting Hall of Ministry of Foreign Affairs of the Republic of Cote d’Ivoire assistance project was discussed.
The Bid Board adopted limited invitation tender mode, and 15 enterprises including Anhui Foreign Economic Construction Corporation
(group) Co., Ltd., Gansu Foreign Engineering Corporation, Liaoning International Techno-Economic Cooperation Co., Ltd., Jiangsu Construction
Engineering Corp., Hainan Construction Engineering General Co., China Yunnan International Techno-Economic Cooperation Co.Ltd.,
China Jiangxi Corporation For Economic and Technical Cooperation, Weihai International Economic & Technical Cooperative Co.,
Ltd., China Shenyang International Economic & Technical Cooperation Corporation, China Foreign Construction General Corporation,
China Shanxi International Economic & Technical Cooperation Corporation, Jiangsu Geology & Engineering Co. Ltd., Ningbo Construction
Group Co.,Ltd., Guangsha Chongqing Construction (Group) Co., Ltd. and China Building Technique Group Co., Ltd. will be invited to
participate in the bid. Specific matters of concern shall be notified later.

The tender mode of Present Office of the Republic of Namibia was discussed. The Bid Board adopted limited invitation tender mode,
and 15 enterprises including Zhengtai Group Co., Ltd., China Civil Engineering Construction Corporation, China Jiangxi Corporation
For Economic and Technical Cooperation, Qingdao Construction Group Corporation, China State Construction Engineering Corp., Jiangsu
Construction Group Corp., Hainan Construction Engineering General Co., China Yunnan International Techno-Economic Cooperation Co.,
Ltd., Gansu Foreign Engineering Corporation, Liaoning International Techno-Economic Cooperation Co., Ltd., Weihai International Economic
& Technical Cooperative Co., Ltd., Dalian Zhucheng Construction Group Co., Ltd., China Shenyang International Economic &
Technical Cooperation Corporation, China Shanxi International Economic & Technical Cooperation Corporation and Hubei Construction
Engineering Group Corporation will be invited to participate in the bid. Specific matters of concern shall be notified later.

The tender mode of Shar-Shar Tunnel and North-South Connection of The Republic of Tajikistan assistance project was discussed. The
Bid Board adopted limited invitation tender mode, and 8 enterprises including China Railway 17BG Group Corporation Co., Ltd., Fujian
Construction Engineering Group General Co., Hunan Road & Bridge Construction Group Corporation, China Road & Bridge Corporation,
China Metallurgical Group Corp., China 15th Metallurgical Construction Co., Ltd., Beijing Municipal Engineering Corporation and
China Railway Engineering Corporation will be invited to participate in the bid. Specific matters of concern shall be notified later.

Department of Foreign Aid on implementing status of the 4th regular meeting of 2006 of Bid Board on Principle Suggestions on Matters
Concerning projects of the Reconstruction of 5.8 km Urban Avenue in Aid of Ethiopia was reported. The Bid Board determined to have
tender discussion with China Road & Bridge Company. Specific matters of concern shall be notified later.

The price of the agent supply contract of Eritrea construction materials assistance project was examined and approved.

The tender mode of RMB 40,000,0000 yuan fittings of the Democratic People’s Republic of Korea assistance project was discussed. The
Bid Board determined to have tender discussion with China National Complete Plant Import & Export Corporation (Group). Specific
matters of concern shall be notified later.

The tender mode of municipal roads renovation and street lamp reconstruction of Nairobi, capital city of Kenya assistance project
was discussed. The Bid Board determined to have tender discussion with China Road & Bridge Company about the design and construction.
Specific matters of concern shall be notified later.

Foreign Assistance Project Bid Board of the Ministry of Commerce

May 29, 2006

Foreign Assistance Project Bid Board of the Ministry of Commerce
2006-05-29

WORKING REGULATIONS FOR THE INTERNATIONAL EXCHANGE OF TAX INTELLIGENCE

Working Regulations for the International Exchange of Tax Intelligence

State Administration of Taxation
June 12, 2006
Chapter I General Provisions

Article 1

In order to strengthen the international taxation cooperation and regulate the international exchange of tax intelligence (hereinafter
referred to as intelligence exchange), the present Regulations are instituted in accordance with the agreements signed between the
Chinese Government and foreign governments on the avoidance of double taxation on incomes and properties and the prevention of tax
dodging and tax evasion (hereinafter referred to as the taxation agreement), the Law of the People’s Republic of China on Tax Imposition
and Administration and the specific rules for implementation thereof (hereinafter referred to as the Tax Imposition and Administration
Law) and the provisions of other related laws and regulations.

Article 2

The term ” intelligence exchange” as mentioned in the present Regulations refers to the act of exchanging the requested intelligence
between the administrative authority of China and a contracting state to the related taxation agreement (hereinafter referred to
as a contracting state) in order to correctly execute the taxation agreement and the domestic laws on the taxes as involved in the
taxation agreement.

Article 3

The intelligence exchange shall be conducted within the scope of the obligations and rights specified in the taxation agreement.

China enjoys the right to get the tax intelligence from the concerned contracting state and is also obliged to provide the tax intelligence
to concerned contracting state.

Article 4

The intelligence exchange shall be conducted through the administrative authorities confirmed by the taxation agreements or the representatives
authorized by the administrative authorities .The administrative authority of our country is the State Administration of Taxation
(SAT).

The tax authorities at or below the provincial level shall assist the SAT in the administration of the intelligence exchange within
its jurisdiction, for which the specific work shall be undertaken by the administrative department of international taxation or any
other related administrative departments.

Article 5

The intelligence exchange shall be conducted after a taxation agreement goes into effect and is executed. The items on the taxation
intelligence may trace back to those which take place before the taxation agreement goes into effect and is executed t.

Article 6

The related provisions of the Tax Imposition and Administration Law may be applied to the collection, investigation, verification
and disposal of tax intelligence conducted by the taxation department of our country. .

Chapter II Categories and Scope of Intelligence Exchange

Article 7

The categories of intelligence exchange consist of special intelligence exchange, automatic intelligence exchange, voluntary intelligence
exchange and simultaneous tax inspection, the visitation of the authorized representatives and the intelligence exchange within the
industrial scope .

The term “special intelligence exchange” refers to an act whereby the administrative authority of a contracting state raises specific
issues on a certain domestic taxation cases, and requests the administrative authority of its counterpart contracting state to provide
related intelligence and assist in investigation and verification in accordance with the taxation agreement. Special intelligence
exchange consists of: acquiring, investigating and verifying and confirming the identities of the companies and individual residents,
collecting or paying the prices and expenses, transferring properties or providing the situations, materials and credences related
to taxation, such as the use of properties and etc.

The term “automatic intelligence exchange” refers to an act whereby the administrative authorities of both contracting states, in
accordance with their promises, automatically provide the tax intelligence related to the acquisition of special incomes by taxpayers
in batches. Special incomes mainly consist of interests, stock dividends, royalties; wages and salaries, all kinds of subsidies,
bonuses, retirement pensions; commissions and labor remunerations; property proceeds and business incomes, etc.

The term “voluntary intelligence exchange” refers to an act whereby the administrative authority of a contracting state voluntarily
provides to its counterpart of the other contracting state with the intelligence that it has acquired in the process of executing
the taxation law and is regarded as helpful for its counterpart to implement the tax agreements as well as the domestic laws concerning
the taxes as involved in the taxation agreement. Voluntary intelligence exchange consists of imposing or paying the prices and expenses
by companies and individuals, transferring properties or providing the situations and materials in relation to taxation, such as
the use of properties and etc. The term “simultaneous tax inspection ” refers to an act whereby the administrative authorities of
the contracting states, in accordance with their agreement on the simultaneous inspection within the regions where they could respectively
and effectively exercise their tax jurisdiction, independently and simultaneously, conduct inspections to the tax-related items of
the taxpayers who have common or related interests therein and communicate with each other or exchange the tax intelligence as acquired
in the inspections.

The term “visitation of authorized representatives” refers to the acts whereby the administrative authorities of both contracting
countries, in accordance with their agreement on the visitation of authorized representatives upon their consensus, conduct on-the-spot
visitation to the regions where its counterpart effectively exercise tax jurisdiction so as to obtain and verify the taxation intelligence.

The term “intelligence exchange within the industrial scope” refers to the acts whereby the administrative authorities of both contracting
states conduct joint investigation, research and analysis on the operation mode, capital operation mode, pricing methods and tricks
of tax dodging of a certain industry and exchange the related taxation intelligence with each other.

Article 8

Save and except it is otherwise provided by both contracting states, the scope of the intelligence exchange is generally as follows:

(1)

The scope of states shall be limited to those countries that have formally signed with China a tax agreement that includes articles
on intelligence exchange and has gone into effect and execution;

(2)

The scope of taxes shall be limited to the taxes prescribed in the taxation agreement, mainly regarding the taxes of the incomes (and
properties) character;

(3)

The scope of persons shall be limited to the citizens of either or both of the contracting states; and

(4)

The scope of region shall be limited to the regions where the contacting states effectively exercise their tax jurisdiction .

Article 9

If any of the following circumstances occurs, the SAT may refuse the requests of the administrative authority of a contracting state
for the intelligence:

(1)

Any request for intelligence has nothing to do with the purpose of taxation;

(2)

Any request for intelligence lacks of pertinence;

(3)

Any request for intelligence fails to bear the signature of the administrative authority of a contracting state or its authorized
representative;

(4)

Any request for taxation intelligence oversteps the scopes of the persons, taxes and regions prescribed in the taxation agreement;

(5)

Where one of the contracting states requests for the provision of intelligence in order to execute the related provisions of its domestic
laws, but its domestic laws conflict with the taxation agreement;

(6)

Providing intelligence may do harm to the state interest of China;

(7)

Providing intelligence may cause any reveal of commercial secrets;

(8)

Providing intelligence may lead to any discriminatory treatment to any citizen or resident of China;

(9)

Any requested intelligence that cannot be acquired through normal administrative procedures in accordance with the laws and regulations
of China;

(10)

Any requested intelligence that may be acquired through normal administrative procedures and upon efforts within a contracting state;
and

(11)

Any other circumstance which the SAT regards as in violation of the provisions of the articles on tax intelligence exchange of the
taxation agreement.

Article 10

The tax authorities at or below the provincial level shall not refuse to provide intelligence to the SAT for any of the reasons as
follows, as well as the SAT shall not refuse to provide intelligence to a contracting state for any of the reasons as follows:

(1)

Any request for intelligence has nothing to do with the taxation interest of China;

(2)

The intelligence exchange between both contracting states is un-equivalent in quantity or quality;

(3)

The tax authority has the obligation of keeping the confidentiality for the information of taxpayers;

(4)

The bank has the obligation of keeping the confidentiality for the information of its depositors;

(5)

The taxation intelligence is mastered by an agent, intermediary agency or any other third party; or

(6)

Any other similar circumstance cognized by the SAT.

Article 11

In order to execute the taxation agreement and the domestic laws on the taxes concerned in the taxation agreement, when in need of
the assistance by the administrative authority of a related contracting state in providing taxation intelligence, the taxation authority
at or below the provincial level may file a request for special intelligence exchange and report it with the SAT in a level-by-level
way:

(1)

If it is necessary to obtain or verify the account books and credence kept by the other party to the transaction or an overseas branch
, but the other party to the transaction or the overseas branch is within the territory of the other contracting state;

(2)

If it is necessary to obtain or verify the banking accounts for payment, sums, and records on capital flow in the process of transaction
conducted between the taxpayer and an overseas company or obtaining incomes from abroad by the taxpayer, but the financial institution
is within the territory of the other contracting state;

(3)

If it is necessary to obtain or verify the information on tax declaration of the other party to a transaction, but the other party
to the transaction is within the territory of the other contracting state;

(4)

If it is necessary to acquaint itself with the basic situation of a taxpayer or the other party concerning the transaction or the
obtaining of incomes, consisting of the actual address of an individual or company, identity of citizens, place of company registration,
share controlling status of the company, and etc., whereas the aforesaid materials are in the control of the other contracting state;

(5)

If it is necessary to testify the authenticity and legality of the tax-related information provided by taxpayers;

(6)

If it is necessary to testify the association relationship between the taxpayers and overseas associated enterprises, and to obtain
the basic information of the overseas associated enterprises of taxpayers, consisting of the contracts, articles of association,
financial statements, application forms, auditing reports produced by Chinese CPA and the transactions between taxpayers and its
associated enterprises, etc.;

(7)

If it is necessary to acquaint itself with the situations on the nature and sum of all kinds of incomes such as the stock dividends,
interests, royalties, capital gains, subsidies, bonuses commissions and etc. that the taxpayer has obtained from or paid to abroad;

(8)

If it is necessary to verify the authenticity of the price and sum of the transactions between a taxpayer and an overseas company;

(9)

If it is necessary to verify the authenticity of the incomes or expenses declared by a taxpayer;

(10)

If it is necessary to verify the authenticity and legality of the overseas ratepaying of a taxpayer; and

(11)

If it is necessary to obtain any other material needed in the investigation into a tax-related case or in tax collection and administration
and that may be in the control of the other contracting party.

A request for special intelligence exchange shall be made in written form, attached with an English letter, and the electronic documents
shall be submitted simultaneously.

Article 12

After receiving a request from any tax authority at or below provincial level for special intelligence exchange provided by the administrative
authority of a contracting state, the SAT shall exam earnestly thereon.

If a request for special intelligence exchange includes any of the circumstances as follows, the SAT shall not approve or shall order
it to be re-handled:

(1)

Under any of the circumstances prescribed in Article 9 of the present Regulations;

(2)

If the administrative authority of a contracting state fails to effectively initiate the procedures for intelligence collection and
investigation in accordance with the provided information;

(3)

If the description in the English letter fails to be accurate or normative enough ; or

(4)

Any other circumstance as examined and cognized by the SAT .

Article 13

The taxation intelligence obtained by China from the administrative authority of a contracting state may be applied as the basis
for enforcement conduct of taxation law and can be produced in the litigation procedures.

In spite of the provisions of the preceding paragraph, if the administrative authority of a contracting state explicitly requests
that the tax authority of China shall obtain its approval before producing the taxation intelligence provided by it in the litigation
procedures, the administrative tax authority shall report it to the SAT level by level, which shall be negotiated between the administrative
authority of the contracting state and the SAT for disposal.

Article 14

If there is any special requirement in the domestic law of China on the format or any other respect in respect of the taxation intelligence
provided by the administrative authority of a contracting state to be produced as evidence, the administrative tax authority of the
contracting state shall report it to the SAT in a level by level manner, which shall be negotiated between the administrative authority
of the contracting state and the SAT for disposal. If there is any special requirement in the domestic law of a contracting state
on the format or any other respect in respect of the taxation intelligence provided by China to be produced as evidence, it shall
be negotiated between the SAT and the administrative authority of the contracting state and transacted in coordination with the administrative
tax authority concerned.

Article 15

After any taxation case as suspected of a crime is transferred to the judicial department in accordance with law, if the judicial
department needs to use the taxation intelligence provided by the contracting state as evidences for conviction and the administrative
tax authority clearly requires that its approval shall be obtained beforehand, the tax authority shall inform the judicial department
and report it to the SAT level by level so that the SAT may negotiate with the administrative authority of the contracting state
to determine the scope and degree of utilizing the aforesaid taxation intelligence.

Chapter III Confidentiality of the Taxation Intelligence

Article 16

The taxation intelligence shall be managed as confidential documents. The formulation, receipt and issuance, delivery, use, storage
or destruction of taxation intelligence shall be executed in accordance with the provisions of the Law of the People’s Republic of
China on the Confidentiality of State Secrets, the Provision of the Office of the Central Secret Committee and the State Secrecy
Bureau on the Confidentiality Administration of State Secret Carriers, the Provisions on State Secrets and the Specific Classification
of Confidentiality in Economic Work and the related laws and regulations.

Article 17

The principles for determining the confidentiality classification of tax intelligence are as follows:

(1)

The taxation intelligence shall be determined as secret in general;

(2)

The tax intelligence, under any of the circumstances as follows, shall be determined as confidential:

a) Any taxation intelligence items involves tax dodging, tax fraud or any other acts in violation of taxation laws and regulations;
or

b) If the administrative authority of a contracting state has any special requirement for confidentiality of the tax intelligence.

(3)

If any taxation intelligence involves any top state secret and if the reveal thereof may led to particularly serious damage to the
safety and interest of the state, it shall be determined as top secret;

(4)

If the contents of taxation intelligence involves any secret items of any other department or industry, the confidentiality classification
thereof shall be determined in accordance with the confidentiality scope of the related administrative departments.

For any intelligence whose confidentiality classification is hard to determine, the administrative tax authority shall report it to
the SAT for determination level by level.

Article 18

When determining the confidentiality classification, the term for confidentiality shall be determined simultaneously.

The term for confidentiality of the intelligence of top secrecy is generally 30 years. The term for confidentiality of the intelligence
at the confidential level is generally 20 years. The term for confidentiality of the intelligence at the secret level is generally
10 years.

For any special requirement for the term of confidentiality or any request for the alteration of the confidentiality classification
or term for confidentiality, the administrative tax authority shall report it to its superior organ for approval and indicate the
situation in the confidential document of taxation intelligence.

Article 19

In the investigation, collection or formulation of taxation intelligence, if any taxpayer, withholder or any other party concerned
makes declaration that the matter under investigation involves any state secret and refuses to provide the related materials, the
tax authority shall ask it to provide the authentication certification of state secrets issued by the state administrative department
of confidentiality.

When reporting any tax intelligence, the tax authority shall make a statement on the aforesaid circumstances.

Article 20

A register of confidential documents shall be prepared for the receipt and issuance of tax intelligence, and the documents shall
be numbered and registered one by one.

When any intelligence of top secrecy is received, it shall be read and used under the prescribed scope, and the personnel who access
and learn the contents of tax intelligence of top secrecy shall be recorded down in written. When any tax intelligence of top secrecy
is delivered, it shall be sent by the confidential channels and confidential communications.

Article 21

When delivered, any tax intelligence shall be packed and sealed, as well as be delivered in accordance with the related provisions
on confidentiality.

When packing and sealing any tax intelligence, the envelope thereof shall be stamped with the seal of confidentiality classification
and shall be marked with the contents such as serial number, the names of the addressor and addressee and etc.

Article 22

The tax intelligence and related documents as formulated and issued shall be kept by special designated persons in charge.

Safe and confidential places and position shall be chosen for the preservation of the confidential carrier of tax intelligence, and
necessary equipments shall be installed as well.

The tax intelligence of top secrecy shall be preserved in the confidential office and be kept by special personnel in charge.

Article 23

Any tax intelligence and related documents to be pigeonholed shall be archived in accordance with the related provisions of the state
archives laws.

Any tax intelligence and the related documents to be destroyed shall be destroyed upon the approval of the administrative leader of
the tax authority at the same level in accordance with the provisions on the destruction of confidential documents.

Article 24

The working staff of tax intelligence shall strictly comply with discipline of confidentiality, implement their obligations on confidentiality
and shall receive the education and trainings on confidentiality before they go to work.

Before leaving their post, the intelligence staff shall sort out and transfer all the tax intelligence preserved by them. For a transfer,
the formal formalities for transfer shall be performed, and the person conducting the transfer and the person taking over the tax
intelligence shall sign the checklist of intelligence.

Article 25

The tax intelligence shall be formulated, processed and stored by special persons using special computers, for which effective measures
for confidentiality such as the restriction of visits and data encryption shall be taken to the aforesaid computers.

Article 26

The translation of tax intelligence shall be conducted by the working staff of tax intelligence.

If the translation of tax intelligence shall be done by a special organization or person beyond the tax authority under any special
circumstance, a confidentiality agreement shall be signed or other measures for confidentiality shall be taken to avoid any reveal
of tax intelligence.

Article 27

The tax authority may inform the purpose of collecting intelligence and sources and contents of intelligence to the related taxpayers,
withholders or any other party concerned, as well as the related department or personnel that execute the corresponding domestic
laws on the taxes involved in the taxation agreement and shall inform them of the obligations of confidentiality simultaneously.

In spite of the provisions of the preceding paragraph, under any of the circumstances as follows, the tax authority shall not make
any notification without the approval of the SAT: (1) If any taxpayer, withholder or any other party concerned is grossly suspected
of having committed any taxation irregularity and thus any notification may influence the investigation of the case; or (2) If a
contracting state declares that the sources and contents of the intelligence shall not be told to the taxpayers, withholders or any
other parties concerned.

Article 28

If any tax intelligence is used as evidences in the litigation procedures, the tax authority shall apply to the court for not conducting
any open cross-examination at the court in accordance with the provisions of laws such as the Administrative Procedure Law,.

Article 29

Except that there are other provisions in the taxation agreement, the tax intelligence exchanged by both contracting states shall
not be transferred or revealed to any other personnel or department having noting to do with taxation.

If the auditing department, disciplinary examination department or anti-financial-crime department of the state is in need of related
tax intelligence, it shall be provided upon the approval of the SAT.

Article 30

Any taxation authority at any level shall not reveal the sources and contents of the tax intelligence in any announcement or notification
on the cases involving taxation irregularity concerned in the tax intelligence or in taxation documents such as the Decision on the
Taxation Measure or the Decision on Taxation Punishment.

Article 31

The general work of intelligence exchange and the cases investigated and punished taking advantage of tax intelligence shall not
be propagandize or reported in any news media such as broadcasting, television, website and publication. If necessary, it shall be
reported to the SAT level by level for approval, not revealing the sources and contents of the tax intelligence in the publicity
materials.

Chapter IV Management Procedures of Intelligence Exchange

Section I Management Procedures of Special Intelligence, Automatic Intelligence and Voluntary Intelligence

Article 32

If the SAT requests for or provides to the administrative authority of a contracting state or receives from the administrative authority
of a contracting state any special taxation intelligence, automatic tax intelligence or automatic tax intelligence (hereinafter referred
to as the three types of intelligence), it shall be conducted in accordance with the procedures as follows:

(1)

Registration for archival filing. The contents shall be included such as the name of the administrative tax authority of the contracting
state concerned, number of copies, date and medium of the three types of intelligence, for which the registration may be conducted
in either a paper form or an electronic form;

After the registration, the originals of the letters and replies from the administrative authority of a contracting state, the photocopies
of the letters and replies to the administrative authority of a contracting state and the originals of intelligence shall be put
on file.

(2)

Classification and examination. It shall be examined whether or not the three types of intelligence meet the requirements for collection
or investigation, such as whether or not the intelligence is complete, especially whether or not the items and the year of the collection
or investigation are explicit, whether or not the clue is clear and whether or not it is under any circumstance prescribed in Articles
9 through 12 of the present Regulations. For any automatic intelligence, it shall be changed into an identifiable format, classified
and made statistics according to different regions and be filed into the register;

If any intelligence meets the requirement for utilization, investigation and punishment or mutual exchange, it shall be classified
as usable intelligence. Otherwise, it shall be classified as unusable intelligence. For any unusable intelligence, if further investigation
and verification is necessary, judged from the tax-related items or sum, it may be negotiated between the SAT and the administrative
authority of the contracting state and, for which a request for complementing the related intelligence may be put forward or the
provincial authority may be required to provide the related supplementary intelligence.

(3)

Transfer for investigation and verification. For the usable three types of intelligence, it shall be transmitted to the provincial
authority as a confidential document through post or network system, and the date of transfer, method of transfer, the states involved,
number of copies, and the term of review, etc shall be illuminated in a form of official document.

(4)

Request for (provision of) intelligence. The three types of intelligence requested from (provided to) the administrative authority
of the contracting state, as well as the situation of verification shall be encrypted and be stamped with an English confidential
seal.

Article 33

The SAT shall seriously exam the examination report of special intelligence and the English letter provided by the tax authority
at or below the provincial level to the contracting states. Any intelligence failing to be verified in accordance with the requested
items of special intelligence of a contracting state shall be sent back to the verification unit for re-examination.

The contents to be examined mainly consist of: (1) Whether the provision of special intelligence has a legal basis; (2) Whether it
meets the requirements for contents mentioned in a Letter of Request for Special Intelligence, consisting of: the serial number of
the Letter, date as well as the person who requests the investigation, etc.; (3) In the process of verification and disposal in accordance
with the related information and materials provided in the requested items of special intelligence such as the contracts, financial
report forms, invoices, photocopies of tax payment certificates, , whether the related domestic laws and regulations shall be properly
interpreted , and whether the appellations, date of inuring and related clauses of related laws and regulations shall be provided;
(4) Whether any requested items of special intelligence that is unsatisfied shall be listed and whether the reason shall be interpreted
; (5) Whether the currency and unit of measurement shall be indicated; (6) Considering any instances of tax payment, whether the
instances of tax payment in China have been indicated, consisting of the tax rate and the amount of the tax paid or withheld; (7)
Whether the year or period of tax payment shall be indicated; (8) Whether it shall be indicated that the intelligence to be exchanged
(certification documents or supportive documents) have been agreed to be completely or partly apprized to the taxpayers of the receiving
party or to any other related party ; (9) Whether it shall be indicated that it is necessary for the counterpart to feed back the
utilization of the intelligence to China; and (10) Whether the English confidential seal shall be stamped thereto.

Article 34

After receiving any of the three types of intelligence requested by or provided to a contracting state, the tax authority at or below
the provincial level shall transact it according to the procedures as follows:

(1)

Registration for archival filing. The following contents shall be included: the serial number of the received document, the type of
intelligence, the number of copies, the contracting state, as well as the requested term for investigation and punishment; and simultaneously,
the tax authority shall make up the registration of related contents in every link in the process of handling the three types of
intelligence, fill in the Statistical Form of International Taxation Intelligence Exchange and report it to the SAT at the end of
the year.

The principles of one archive for one document shall be insisted on in the registration for archival filing.

(2)

Classified auditing. The tax authority shall examine whether the three types of intelligence as requested or provided meets the related
requirements, consisting of whether the information is complete, especially whether the items and years of collecti

CIRCULAR OF THE MINISTRY OF CULTURE ON APPLICATION OF EXPORT SUBSIDIZATION PROJECT OF HOME-PRODUCED AUDIOVISUAL PRODUCTS OF 2006

Circular of the Ministry of Culture on Application of Export Subsidization Project of Home-produced Audiovisual Products of 2006

The Culture Departments at all provinces, autonomous regions and municipalities directly under the Central Government and the audiovisual
products export entities concerned:

For the purpose of carrying out the Going-Out Project of Chinese culture and facilitating the export of home-produced audiovisual
products, the Ministry of Finance and the Ministry of Culture have set up the Special Fund for the Export of Home-produced Audiovisual
Products to subsidize or reward the export of home-produced audiovisual products. Under the Measures for the Management of the Special
Fund for the Export of Home-produced Audiovisual Products (For Trial Implementation) and the budget of the Special Fund for the Export
of Home-produced Audiovisual Products 2006, the export subsidization project of home-produced audiovisual products of 2006 has been
officially started. The issues concerning the application of the Subsidization Project for the Special Fund for the Export of Home-produced
Audiovisual Products are hereby notified as follows:

The management and practice of the Subsidization Project for the Special Fund for the Export of Home-produced Audiovisual Products
shall be implemented in accordance with the Measures for the Management of the Special Fund for the Export of Home-produced Audiovisual
Products (for Trial Implementation). The administrative departments throughout the country shall notify the entities concerned to
apply for the subsidy in time and the deadline is October 16, 2006. Any overdue application shall not be attended.

The applying entities shall fill in the Application Form for the Project of the Special Fund for the Export of Home-produced Audiovisual
Products and submit the necessary materials, including the certifying document of the applying entity’s qualification, the certifying
document of the capacity to bring the project into effect, the feasibility study report of the project, the execution plan of the
project, the copyright certification documents and the other relevant materials.

The Measures for the Management of the Special Fund for the Export of Home-produced Audiovisual Products (for Trial Implementation)
has been released at the website of China Culture Market(www.ccm.gov.cn). It can be found in the Exportation of Home-produced Audiovisual
Products Section on the Audiovideo Film Channel. Applicants can directly download the Project Application Form of the Special Fund
for the Export of Home-produced Audiovisual Products.

Please report the application materials to the Culture Market Department of the Ministry of Culture

Address: No.10, Beidajie Rd., Chaoyangmen, Dongcheng District, Beijing

Zip code: 100020

Contact: Han Xianfeng, Liu Luping

Telephone :010-6555189765551898

Fax : 010-65551899

E-mail :hanxianfeng@ccm.gov.cn

The Ministry of Culture

September 7, 2006

The Ministry of Culture
2006-09-07

ANNOUNCEMENT NO.70, 2006 OF MINISTRY OF COMMERCE ON PROLONGING ANTI-DUMPING INVESTIGATION ON OCTANOL

Announcement No.70, 2006 of Ministry of Commerce on Prolonging Anti-dumping Investigation on Octanol

[2006] No. 70

Ministry of Commerce released announcement on Sep 15, 2005, deciding to carry out anti-dumping investigation on octanol originated
from South Korea, Saudi Arabia, Japan, EU and Indonesia with a tariff code of 29051600 in Import and Export Tariff of the People’s
Republic of China.

In accordance with Article 26 of Anti-dumping Regulations of the People’s Republic of China, Ministry of Commerce decides to prolong
the anti-dumping investigation for another 6 months for the complexity of this case, which means the anti-dumping investigation will
not be terminated until Mar 15, 2007.

Ministry of Commerce

Sep 15, 2006

Ministry of Commerce
2006-09-15

CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON THE TAX REBATE RATE APPLICABLE TO PART OF THE EXPORT COMMODITIES IN 2006

export commodities, tax rebate rate

Circular of the Ministry of Finance and the State Administration of Taxation on the Tax Rebate Rate Applicable to Part of the Export
Commodities in 2006

Cai Shui [2006] No.6

Departments (Bureaus) of Finance, Bureaus of State Taxes of all provinces, autonomous regions, municipalities directly under the Central
Government, and cities specially designated in the state plan, and Bureau of Finance of the Xinjiang Production and Construction
Corps:

In 2006, the customs commodity codes have been readjusted. And in order to guarantee the correct carrying-out and implementation of
the policies concerning export rebates, this Circular is hereby released on the new customs commodity code and the export rebates
rate for these commodities as follows:

htm/e04725.htmSerial Number

Serial Number	Customs Commodity Code	Name of Commodity	Applicable Export Rebates Rate
1	7601101000	The unforged aluminum containing more than or equal to 99.5% of aluminum by weight	Cancelled
2	7601109000	Other unforged aluminums	5
3	7901119000	Other unforged zinc containing more than or equal to 99.99% but less than 99.995% of zinc	5
4	2712909000	Paraffin wax subject to the antecedent Duty Paragraph
5	2903590010	Aldrin, Heptachlor and Toxaphene
6	2903620000	Hexachlorobezene and DDT
7	2925200020	Chlordimeform
8	2924199011	Azodrin and Phosphamidon	5
9	2903590020	Chlordane
10	2931000031	Chloroethane Mercury subject to the antecedent Duty Paragraph
11	2842900011	Mercuric Arsenide, Potassium Mercuric Thiocyanate, Ammonium Mercuric Thiocyanate
12	2842900012	Mercuric Amide Chloride, Mercuric Potassium Chloride and Mercuric Potassium Iodide
13	2851009020	Mercury Arsenide subject to the antecedent Duty Paragraph
14	2851009090	Mercury Rhodanate subject to the antecedent Duty Paragraph
15	2834299010	Mercuric Nitrate and Mercurous Nitrate
16	2833299010	Mercuric Sulfate and Mercurous Sulfate
17	2827399090	Mercuric Chloride subject to the antecedent Duty Paragraph
18	2827600010	Mercuric Iodide and Mercurous Iodide
19	2931000090	Mercuric Acetate and other Organic Mercury subject to the antecedent Duty Paragraph
20	2838000010	Mercuric Thiocyanate
21	2827590010	Mercuric Bromide and Mercurous Bromide
22	2825909010	Mercuric Oxide and Mercurous Oxide

This circular shall enter into force as of the date of January 1, 2006

The Ministry of Finance

The State Administration of Taxation

January 26, 2006

ANNOUNCEMENT NO.7, 2006 OF THE GENERAL ADMINISTRATION OF CUSTOMS CONCERNING PROMULGATION AND IMPLEMENTATION OF CATALOGUE FOR GUIDANCE OF INDUSTRIAL STRUCTURE ADJUSTMENT

General Administration of Customs

Announcement No.7, 2006 of the General Administration of Customs Concerning Promulgation and Implementation of Catalogue for Guidance
of Industrial Structure Adjustment (2005)

No.7, [2006]

Upon the approval of the state council, the National Development and Reform Commission delivered the Catalogue for Guidance of Industrial
Structure Adjustment (2005), (hereinafter referred as Catalogue for the Guidance of Industries and the detail of which attached),
through Decree No.40 of the National Development and Reform Commission of the People’s Republic of China. The decree provides that
the catalogue shall be put into effect from December 2, 2005. Some issues related to the execution in the customs are promulgated
as follows:

From December 2, 2005, the formalities to exempt the obligations of paying Import Tariffs and Tax on value added in the process of
importing could be conducted complying with the Circular of the State Council on Adjustment of Imported Equipment Taxation Policies
(Guo Fa [1997] No.37) based on project confirming documents given by the competent departments in charge of investment, if the imported
appliances self-serviced don’t fall into the scope of goods provided in the Catalogue of Non-duty-Free Commodities to be Imported
for domestic-funded Projects, and the imported cost of which is not beyond the total invested money and the domestic invested project
belongs to the encouraged classification in Catalogue for the Guidance of Industries.

After implementation of Catalogue for the Guidance of Industries, the coding of the “Items of the Project Industrial Policy under
Examination and Approval” shall be “I” in the project confirmation documents. For example, the first item in the first group of the
encouraged classification in Catalogue for the Guidance of Industries shall be filled in as follows: the Upgrade low- and Medium-yield
Farmland Synthetical Transformation and Stable- and High-yields Fundamental Farmland Construction (I0101); the second item in the
sixth group shall be filled in as follow: Natural Gas Hydrate exploratory development (I0602).

In order to keep the consistency of policy, the domestic invested project which is examined and approved or checked or filed before
December 2, 2005 (December 2, 2005 is not included) may, in case that the project conforms to the Catalogue of Industries, Products
and Technology Currently Particularly Encouraged by the State for Development (revised in 2000), continue to conduct the formalities
to exempt the obligations of paying import tariffs and tax on value added in the process of importing complying with the original
concerned regulations. And the date of the project’s examination and approval or check or filing will be set as the standard with
respect to the time consideration. The related project unit shall hold relevant materials to the customs for applying to conduct
the filing formalities of tax deduction and exemption before December 12, 2006, and out of such date the customs will not accept
and deal with the application hereinbefore. The materials include the project confirmation documents delivered by the competent departments
of investment and the “Items of the Project Industrial Policy under Examination and Approval” shall be filled in the same as the
original examined and approved items and coding.

If the project confirmation documents delivered by the competent departments in charge of investment need to be modified, the modification
shall only be made by the delivered department by the way of “correspondence”; the way of making modification directly in the copy
of the confirmation document shall be forbidden and such modification will be rejected by the customs.The announcement is hereby
specially issued.

Annex: the Catalogue for Guidance of Industrial Structure Adjustment (2005) (omitted).

General Administration of Customs

February 9, 2006

General Administration of Customs
2006-02-09

ACCOUNTING STANDARD FOR BUSINESS ENTERPRISES NO. 7 – EXCHANGE OF NON-MONETARY ASSETS

Ministry of Finance

Accounting Standard for Business Enterprises No. 7 – Exchange of Non-monetary Assets

Cai Kuai [2006] No. 3

February 15, 2006

Chapter I General Provisions

Article 1

To standardize the confirmation and measurement of non-monetary assets transaction, and disclosure of relevant information, these
standards are formulated according to the Accounting Standard for Business Enterprises – Basic Standards.

Article 2

The non-monetary assets transaction is an exchange of non-monetary assets between transacting parties, mainly including the transactions
of inventories, fixed assets, intangible assets and long-term equity investments. This kind of exchange involves little or no monetary
assets (namely, monetary assets are referred to as a “boot”).

The term “monetary assets” refers to the monetary capital held by enterprises, the assets to be received in fixed or determined amounts
of currency, including cash, bank deposits, accounts and notes receivable, and bond investments to be held to maturity.

The term “non-monetary assets” refers to the assets other than monetary assets.

Article 3

Where a non-monetary assets transaction satisfies the following conditions at the same time, the fair value of the assets and relevant
payable taxes shall be regarded as the transaction cost, and the difference between the fair value and the carrying value of the
asset surrendered shall be recorded into the profit or loss of the current period:

(1)

The transaction is commercial in nature; and

(2)

The fair value of the assets received or surrendered can be measured reliably.

If the fair values of both the assets received and surrendered can be reliably measured, the fair value of the assets surrendered
shall be the basis for the determination of the cost of the assets received, unless there is any exact evidence showing that the
fair value of the assets received is more reliable.

Chapter II Confirmation and Measurement

Article 4

A non-monetary assets transaction, meeting any of the following conditions, is commercial in nature:

(1)

The future cash flow of the assets received is different from that of the surrendered assets in the aspects of risk, time and amount
notably; and

(2)

The current values of the expected future cash flow of the assets received and surrendered is different, and the difference between
them is more significant than the fair values of the assets received and surrendered.

Article 5

When determining whether or not a non-monetary assets transaction is commercial in nature, an enterprise shall pay attention to whether
or not the transacting parties are connected ones. The existence of the relationship between connected parties is likely to cause
the loss of commercial nature of non-monetary assets transaction.

Article 6

Where any non-monetary assets transaction does not meet the conditions as prescribed in Article 3 of these Standards at the same
time, the carrying value and relevant payable taxes of the assets surrendered shall be the cost of the assets received and no profit
or loss is recognized.

Article 7

Where a boot is caused when an enterprise treats the fair value and relevant payable taxes as the cost of the assets received, the
boot shall be accounted for according to the following circumstances, respectively:

(1)

The enterprise, which pays the boot, shall record the difference between the cost of the assets received and the sum of the carrying
value of the assets surrendered plus the paid boot and relevant payable taxes into the profit or loss of the current period;

(2)

The enterprise, which receives the boot, shall record the difference between the costs of the assets received plus the received boot
and the carrying value of the assets surrendered plus relevant payable taxes into the profit or loss of the current period.

Article 8

Where a boot is caused when an enterprise treat the carrying value of the surrendered assets and the relevant payable taxes as the
cost of the received assets, the boot shall be accounted for according to the following circumstances, respectively:

(1)

The enterprise, which pays the boot, shall treat the result of the carrying value of the assets surrendered plus the paid boot and
relevant payable taxes as the cost of the assets received, and no profit or loss may be recognized; or

(2)

The business enterprise, which receives the boot, shall treat the result of the carrying value of the assets surrendered minus the
received boot and plus relevant payable taxes as the cost of the assets received, and no profit or loss may be recognized.

Article 9

Where several assets received in a non-monetary assets transaction simultaneously, the cost of each received assets shall be determined
according to the following circumstances, respectively:

(1)

If the non-monetary assets transaction is commercial in nature and the fair value of the assets received can be reliably measured,
the cost of each received asset shall be determined by applying the proportion of the fair value of each asset received to the total
fair value of the assets received to allocate the total cost of the assets received; or

(2)

If the non-monetary assets transaction is not commercial in nature, or it is commercial in nature, but the fair value of the assets
received can not be reliably measured, the cost of each received assets shall be determined by applying the proportion of the original
carrying value of each asset received to the total original carrying value of the assets received to allocate the total cost of the
assets received.

Chapter III Disclosure

Article 10

An enterprise shall disclose the following information relating to non-monetary transactions in the annotation:

(1)

Types of the assets received and surrendered;

(2)

Determination method for the assets received;

(3)

Fair values of the assets received and surrendered, as well as the carrying value of the surrendered assets; and

(4)

Profit or loss of a non-monetary assets transaction.

Ministry of Finance
2006-02-15

ACCOUNTING STANDARDS FOR ENTERPRISES NO. 22 – RECOGNITION AND MEASUREMENT OF FINANCIAL INSTRUMENTS

the Ministry of Finance

Accounting Standards for Enterprises No. 22 – Recognition and Measurement of Financial Instruments

No. 3 [2006] of the Ministry of Finance

February 25, 2006

Chapter I General Principles

Article 1

With a view to regulating the recognition and measurement of financial instruments, the present Standards are formulated according
to the Accounting Standards for Enterprises – Basic Principles .

Article 2

The term “financial instruments” refers to the contracts under which the financial assets of an enterprise are formed and the financial
liability or right instruments of any other entity are formed.

Article 3

The term “derivative instruments” refers to the financial instruments or other contracts which are involved in the present Standards
and are characterized by the following:

(1)

The values thereof varies with particular interest rates, prices of financial instruments, prices of commodities, foreign exchange
rates, price indexes, premium rate indexes, credit ratings, credit indexes and other similar variables; if the variable is a non-financial
variable, there shall not exist any special relationship between such variable and any party to the contract;

(2)

No initial net investment is required, or, as compared to contracts of other types that have similar responses to the market changes,
very little initial net investment is required;

(3)

It is settled on a certain future date.

Derivative instruments shall include forward contracts, futures contracts, exchanges and options, as well as the instruments that
contain one or more of the characters of a forward contract, futures contract, exchange or option.

Article 4

The following items shall be subject to other relevant accounting standards:

(1)

The long-term equity investments as regulated by the Accounting Standards for Enterprises No. 2 – Long-term Equity Investment shall
be subject to the Accounting Standards for Enterprises No. 2 – Long-term Equity Investments;

(2)

The share-based payments as regulated by the Accounting Standards for Enterprises No. 11 – Share-based Payments shall be subject to
the Accounting Standards for Enterprises No. 11 – Share-based Payments;

(3)

The recombination of debts shall be subject to the Accounting Standards for Enterprises No. 12 – Debt Recombination;

(4)

The rights available from the settlement of anticipated debts shall be subject to the Accounting Standards for Enterprises No. 13
– Contingencies;

(5)

The contingent consideration contracts of the combining parties in business combinations shall be subject to the Accounting Standards
for Enterprises No. 2 – Business Combination;

(6)

The rights and obligations involved in a lease shall be subject to the Accounting Standards for Enterprises No. 21 – Leases;

(7)

The transfer of financial assets shall be subject to the Accounting Standards for Enterprises No. 23 – Transfer of Financial Assets;

(8)

Hedges shall be subject to the Accounting Standards for Enterprises No. 24 – Hedging;

(9)

The rights and obligations involved in the original insurance contracts shall be subject to the Accounting Standards for Enterprises
No. 25 – Original Insurance Contracts;

(10)

The rights and obligations involved in a re-insurance contract shall be subject to the Accounting Standards for Enterprises No. 26
– Re-insurance Contracts;

(11)

The equity instruments as issued by an enterprise shall be subject to the Accounting Standards for Enterprises No. 37 – Presentation
of Financial Instruments.

Article 5

The present Standards does not regulate the irrevocable credit commitments as made by enterprises (i.e., commitments to grant loans),
with the exception of the following:

(1)

the designated commitments to grant loans made to the financial liabilities which are measured at their fair values, of which the
variation is recorded into the profits and losses of the current period;

(2)

the commitments to grant loans which can be settled with the net amount of cash or by way of exchange or by issuing any other financial
instruments; and

(3)

the commitments to grant loans at an interest rate which is lower than the market interest rate.

For the commitments to grant loans not regulated by the present Standards, the Accounting Standards for Enterprises No. 13 – Contingencies
shall apply.

Article 6

The present Standards does not regulate the contracts, which are concluded for the stipulated purchase, sale or use, and, when the
time becomes mature, non-financial items are bought or sold as a performance of the contract. However, the contracts which can be
settled with cash or the net amount of other financial instruments or can be bought or sold and settled by exchanging financial instruments
shall be subject to the present Standards.

Chapter II Classification of Financial Assets and Financial Liabilities

Article 7

Financial assets shall be classified into the following four categories when they are initially recognized:

(1)

the financial assets which are measured at their fair values and the variation of which is recorded into the profits and losses of
the current period, including transactional financial assets and the financial assets which are measured at their fair values and
of which the variation is included in the current profits and losses;

(2)

the investments which will be held to their maturity;

(3)

loans and the account receivables; and

(4)

financial assets available for sale.

Article 8

Financial liabilities shall be classified into the following two categories when they are initially recognized:

(1)

the financial liabilities which are measured at their fair values and of which the variation is included in the current profits and
losses, including transactional financial liabilities and the designated financial liabilities which are measured at their fair values
and of which the variation is included in the current profits and losses; and

(2)

other financial liabilities.

Article 9

The financial assets or liabilities meeting any of the following requirements shall be classified as transactional financial assets
or financial liabilities:

(1)

The purpose to acquire the said financial assets or undertake the financial liabilities is mainly for selling or repurchase of them
in the near future;

(2)

Forming a part of the identifiable combination of financial instruments which are managed in a centralized way and for which there
are objective evidences proving that the enterprise may manage the combination by way of short-term profit making in the near future;

(3)

Being a derivative instrument, excluding the designated derivative instruments which are effective hedging instruments, or derivative
instruments to financial guarantee contracts, and the derivative instruments which are connected with the equity instrument investments
for which there is no quoted price in the active market, whose fair value cannot be reliably measured, and which shall be settled
by delivering the said equity instruments.

Article 10

Besides the provisions of Article 21 and 22 of the present Standards, only the financial assets or financial liabilities meeting
any of the following requirements can be designated, when they are initially recognized, as financial assets or financial liabilities
as measured at its fair value and of which the variation is included in the current profits and losses:

(1)

The designation is able to eliminate or obviously reduce the discrepancies in the recognition or measurement of relevant gains or
losses arisen from the different basis of measurement of the financial assets or financial liabilities;

(2)

The official written documents on risk management or investment strategies of the enterprise concerned have recorded that the combination
of said financial assets, the combination of said financial liabilities, or the combination of said financial assets and financial
liabilities will be managed and evaluated on the basis of their fair values and be reported to the key management personnel.

The equity investment instruments, for which there is no quoted price in the active market and whose fair value cannot be reliably
measured, shall not be designated as a financial asset which is measured at its fair value and of which the variation is recorded
into the profits and losses of the current period.

The active market refers to the markets which are concurrently featured by the following:

(1)

The objects of transaction in the market are homogeneous;

(2)

Buyers and sellers are available at any time to undertake the transaction at their own free will; and

(3)

The pricing information of the market is open.

Article 11

The term “held-to-maturity investment” refers to a non-derivative financial asset with a fixed date of maturity, a fixed or determinable
amount of repo price and which the enterprise holds for a definite purpose or the enterprise is able to hold until its maturity.
The following non-derivative financial assets shall not be classified as investments held to their maturity:

(1)

the designated non-derivative financial assets which, at their initial recognition, are measured at their fair values and of which
the variation is included in the current profits and losses;

(2)

the non-derivative financial assets which are designated as sellable at their initial recognition; and

(3)

loans and account receivables.

An enterprise shall, on the balance sheet date, make an appraisal on its purpose of holding and ability to hold. Where there is any
change, it shall be dealt with according to the present Standards.

Article 12

Under any of the following circumstances, it shows that the enterprise concerned does not have a clear intention to hold the financial
asset investment until its maturity:

(1)

The term for holding the financial assets is not definite;

(2)

It will sell the financial assets when any of the following changes: the market interest rate, the fluid demand, the substitutive
investment opportunity or the investment returns ratio, the source and condition of financing, or foreign exchange risk and etc.,
with the exception of the sale of the financial assets which is caused by any uncontrollable and independent event which is anticipated
not to repeat and is difficult to be reasonably predicted;

(3)

The issuer of the financial assets can settle it with a sum which is obviously lower than the post-amortization cost;

(4)

Any other circumstance which shows that the enterprise concerned does not have the clear intention to hold the financial assets until
its maturity.

Article 13

The post-amortization cost of a financial asset or financial liability refers to the following result after adjustment of the initially
recognized amount of the financial asset or financial liability:

(1)

after deducting the already paid principal;

(2)

after plus or minus the accumulative amount of amortization incurred from amortizing the balance between the initially recognized
amount and the amount of the maturity date by adopting the actual interest rate method; and

(3)

after deducting the impairment losses that have actually incurred (only applicable to financial assets).

Article 14

The actual interest rate method refers to the method by which the post-amortization costs and the interest incomes of different installments
or interest expenses are calculated in light of the actual interest rates of the financial assets or financial liabilities (including
a set of financial assets or financial liabilities).

The actual interest rate refers to the interest rate adopted to cash the future cash flow of a financial asset or financial liability
within the predicted term of existence or within a shorter applicable term into the current carrying amount of the financial asset
or financial liability.

When the actual interest rate is determined, the future cash flow shall be predicted on the basis of taking into account all the contractual
provisions concerning the financial asset or financial liability (including the right to repay the loan ahead of schedule, call options,
similar options and etc.), and the future credit losses shall not be taken into account.

The various fee charges, trading expenses, premiums or reduced values, etc., which are paid or collected by the parties to a financial
asset or financial liability contract and which form a part of the actual interest rate, shall be taken into account in the determination
of the actual interest rate. Where the future cash flow or term of existence of a financial asset or financial liability cannot be
predicted reliably, the contractual cash flow of the financial asset or financial liability for the whole term of the contract shall
be taken into account.

Article 15

Under any of the following circumstances, it shows that the enterprise concerned is not able to hold the fixed term financial asset
investment until its maturity:

(1)

Having no available financial resources to continuously provide funds to the financial asset investment so as to hold the financial
asset investment until its maturity;

(2)

Being subject to the restriction of any law or administrative regulation so that it is hard for the enterprise concerned to hold the
financial asset investment until its maturity;

(3)

Any other circumstance showing that the enterprise concerned is not able to hold the fixed term financial asset investment until its
maturity.

Article 16

Where an enterprise sells its outstanding held-to-maturity investment within the current accounting year or re-classifies it as the
amount of sellable financial asset, and the such amount is considerably large as compared with the amount before such investment
is sold or re-classified, the surplus of such investment shall be re-classified as a sellable financial asset which shall not be
classified as a held-to-maturity investment within the current accounting year and the following two complete accounting years. However,
the following circumstances shall be excluded:

(1)

The date of sale or re-classification is quite near to the maturity date or the repo date of the said investment (e.g., within 3 months
prior to maturity) that any change of the market interest rate will produce little impact upon the fair value of the said investment;

(2)

After almost all the initial principal of the investment has been drawn back by way of repayment at fixed intervals or repayment ahead
of schedule according to the provisions of the contract, the remaining part of the investment will be sold or re-classified;

(3)

The sale or re-classification is caused by any independent event that the enterprise cannot control, is predicted not to occur again
and is hard to be reasonably predicted. Such events mainly include:

The held-to-maturity investment is sold due to the serious worsening of the credit situation of the investee;

ii.

The held-to-maturity investment is sold due to the fact that the relevant tax provisions have canceled the relevant policies on the
pre-tax credit of interest taxes against the held-to-maturity investment or have remarkably reduced the pre-tax creditable amount;

iii.

The held-to-maturity investment is sold due to any important business enterprise combination or serious disposal so as to maintain
the prevailing interest risk position or maintain the prevailing credit risk policies;

iv.

The held-to-maturity investment is sold due to any significant readjustment of laws or administrative regulations on the scope of
permitted investment or the amount of investment of any particular investment product;

The held-to-maturity investment is sold due to the regulatory departments demands for significantly enhancing the fluidity of assets
or significantly enhancing the risk weight of the held-to-maturity investment in the calculation of capital adequacy ratio;

Article 17

“Loans and accounts receivable” refers to the non-derivative financial assets for which there is no quoted price in the active market
and of which the repo amount is fixed or determinable. An enterprise shall not classify any of the following non-derivative financial
assets as a loan or account receivable:

(1)

the non-derivative financial assets which are to be sold immediately or in the near future;

(2)

the non-derivative financial assets which are designated to be measured at their fair value when they are initially recognized and
of which the variation is recorded into the profits and losses of the current period;

(3)

the non-derivative financial assets which are designated as sellable when they are initially recognized;

(4)

the non-derivative financial assets whose holder finds it hard to take back almost all of the initial investment due to any reason
other than the worsening of the credit of the debtor.

The funds for securities investment and other similar funds as held by an enterprise shall not be classified as a loan or account
receivable.

Article 18

The “sellable financial assets” refers to the non-derivative financial assets which are designated as sellable when they are initially
recognized as well as the financial assets other than those as described below:

(1)

loans and accounts receivables;

(2)

investments held until their maturity; and

(3)

financial assets measured at their fair values and of which the variation is recorded into the profits and losses of the current period.

Article 19

An enterprise shall not, after classifying a financial asset or financial liability as a financial asset or financial liability measured
at its fair value and of which the variation is recorded into the profits and losses of the current period when it is initially recognized,
re-classify it as any other type of financial assets or financial liabilities, nor may it re-classify any other type of financial
assets or financial liabilities as a financial asset or financial liability measured at its fair value and of which the variation
is recorded into the profits and losses of the current period.

Chapter III Embedded Derivative Instruments

Article 20

An embedded derivative instrument shall refer to a derivative instrument which is embedded into a non-derivative instrument (namely,
the principal contract) so that some or all of the cash flow of the mixed instrument changes with the change of particular interest
rates, prices of the financial instrument, prices of commodities, foreign exchange rates, pricing indexes, premium rate indexes,
credit ratings, credit indexes or other similar variables. The embedded derivative instruments and the principal contract jointly
form into a mixed instrument, e.g., the convertible company bonds, etc.

Article 21

An enterprise may designate a mixed instrument as a financial asset or financial liability measured at its fair value and of which
the variation is recorded into the profits and losses of the current period, excepting those under the following circumstances:

(1)

Where the embedded derivative instrument does not significantly change the cash flow of the mixed instrument;

(2)

Where the derivative instruments embedded in similar mixed instruments shall obviously not be separated from the relevant mixed instruments.

Article 22

Where a mixed instrument related to an embedded derivative instrument fails to be designated as a financial asset or financial liability
measured at its fair value and of which the variation is included in the current profits and losses, and it can simultaneously meet
the following conditions, the embedded derivative instrument shall be separated from the mixed instrument and treated as an independent
derivative instrument:

(1)

Where there is no close relationship between it and the principal contract in terms of economic features and risks; and

(2)

Where it shares the same conditions with that of the embedded derivative instrument, and the independent instrument meets the requirements
of the definition of derivative instrument.

Where it is impossible to make an independent measurement when it is obtained or subsequently on the balance sheet date, the mixed
instrument shall be designated entirely as a financial asset or financial liability measured at its fair value and of which the variation
is included in the current profits and losses.

Article 23

Where the principal contract is a financial instrument after the embedded derivative instrument is separated from the mixed instrument
according to the present Standard, it shall be dealt with according to the present Standard; if the principal contract is a non-financial
instrument, it shall be dealt with according to other accounting standards.

Chapter IV Recognition of Financial Instruments

Article 24

When an enterprise becomes a party to a financial instrument, it shall recognize a financial asset or financial liability.

Article 25

Where a financial asset satisfies any of the following requirements, the recognition of it shall be terminated:

(1)

Where the contractual rights for collecting the cash flow of the said financial asset are terminated; or

(2)

Where the said financial asset has been transferred and meets the conditions for recognizing the termination of financial assets as
provided for in Accounting Standards for Enterprises No. 23 – Transfer of Financial Assets.

The “termination of recognition” shall refer to the writing off the financial asset or financial liability from the account or balance
sheet of the enterprise concerned.

Article 26

Only when the prevailing obligations of a financial liability are relieved in all or in part may the recognition of the financial
liability be terminated in all or partly.

Where an enterprise transfers any of its assets used for repaying its financial liabilities into any institution or to establish a
trust, and the prevailing obligations to repay the liabilities remain to exist, it shall not terminate the recognition of the said
financial liability and the transferred asset.

Article 27

Where an enterprise (debtor) enters into an agreement with a creditor so as to substitute the existing financial liabilities by way
of any new financial liability, and if the contractual stipulations regarding the new financial liability is substantially different
from that regarding the existing financial liability, it shall terminate the recognition of the existing financial liability, and
shall at the same time recognize the new financial liability.

Where an enterprise makes substantial revisions to some or all of the contractual stipulations of the existing financial liability,
it shall terminated the recognition of the existing financial liability or part of it, and at the same time recognize the financial
liability after revising the contractual stipulations as a new financial liability.

Article 28

Where the recognition of a financial liability is totally or partially terminated, the enterprise concerned shall include into the
profits and losses of the current period the gap between the carrying amount which has been terminated from recognition and the considerations
it has paid (including the non-cash assets it has transferred out and the new financial liabilities it has assumed).

Article 29

Where an enterprise buys back part of its financial liabilities, it shall distribute, on the repo day, the carrying amount of the
whole financial liabilities in light of the comparatively fair value of the part that continues to be recognized and the part whose
recognition has already been terminated. The gap between the carrying amount which is distributed to the part whose recognition has
terminated and the considerations it has paid (including the non-cash assets it has transferred out and the new financial liabilities
it has assumed) shall be recorded into the profits and losses of the current period.

Chapter V Measurement of Financial Instruments

Article 30

The financial assets and financial liabilities initially recognized by an enterprise shall be measured at their fair values. For the
financial assets and liabilities measured at their fair values and of which the variation is recorded into the profits and losses
of the current period, the transaction expenses thereof shall be directly recorded into the profits and losses of the current period;
for other categories of financial assets and financial liabilities, the transaction expenses thereof shall be included into the initially
recognized amount.

Article 31

The “transaction expenses” refers to the newly added external expenses attributable to the purchase, distribution or disposal of a
financial instrument. The newly added external expenses refer to the expenses that will occur only when the enterprise concerned
purchases, distributes, or disposes of any financial instrument.

The transaction expenses include handing charges and commissions as well as other necessary expenditures an enterprise pays to its
agency institutions, consultation companies, securities dealers and etc., but exclude the bond premiums, reduced values, financing
expenses, internal management costs, and other expenses that are not directly related to the transaction.

Article 32

An enterprise shall make subsequent measurement on its financial assets according to their fair values, and may not deduct the transaction
expenses that may occur when it disposes of the said financial asset in the future. However, those under the following circumstances
shall be excluded:

(1)

The investments held until their maturity, loans and accounts receivable shall be measured on the basis of the post-amortization costs
by adopting the actual interest rate method;

(2)

The equity instrument investments for which there is no quotation in the active market and whose fair value cannot be measured reliably,
and the derivative financial assets which are connected with the said equity instrument and must be settled by delivering the said
equity instrument shall be measured on the basis of their costs.

Article 33

An enterprise shall make subsequent measurement on its financial liabilities on the basis of the post-amortization costs by adopting
the actual interest rate method, with the exception of those under the following circumstances:

(1)

For the financial liabilities measured at their fair values and of which the variation is recorded into the profits and losses of
the current period, they shall be measured at their fair values, and none of the transaction expenses may be deducted, which may
occur when the financial liabilities are settled in the future;

(2)

For the derivative financial liabilities, which are connected to the equity instrument for which there is no quotation in the active
market and whose fair value cannot be reliably measured, and which must be settled by delivering the equity instrument, they shall
be measured on the basis of their costs.

(3)

For the financial guarantee contracts which are not designated as a financial liability measured at its fair value and the variation
thereof is recorded into the profits and losses of the current period, and for the commitments to grant loans which are not designated
to be measured at the fair value and of which the variation is recorded into the profits and losses of the current period and which
will enjoy an interest rate lower than that of the market, a subsequent measurement shall be made after they are initially recognized
according to the higher one of the following:

the amount as determined according to the Accounting Standards for Enterprises No. 13 – Contingencies; or

ii.

the surplus after accumulative amortization as determined according to the principles of the Accounting Standards for Enterprises
No. 14 – Revenues is subtracted from the initially recognized amount.

Article 34

Where an enterprise has the intention of holding or the ability to make changes so that an investment is no longer suitable to be
classified as a held-to-maturity investment, the investment shall be re-classified as a sellable financial asset, and a subsequent
measurement shall be made at it fair value. The balance between the carrying amount of the said investment at the re-classification
day and the fair value shall be computed into the owners equity, and when the said sellable financial asset is impaired or transferred
out when it is terminated from recognizing, it shall be recorded into the profits and losses of the current period.

Article 35

Where part of the held-to-maturity investment is sold or the re-classified amount thereof is considerably large, and if it does not
fall within any of the exceptions as described in Article 16 , so that the remainder of the said investment is no longer suitable
to be classified as a held-to-maturity investment, the enterprise shall re-classify the remainder of the said investment as a sellable
financial asset, and shall make subsequent measurement on it according to its fair value. The gap between the carrying amount of
the said remnant part of the investment at the re-classification day and the fair value shall be computed into the owners equity.
And when the said sellable financial asset is impaired or transferred out when it is terminated from recognition, it shall be recorded
into the profits and losses of the current period.

Article 36

As for the financial assets and financial liabilities, which, according to the present Accounting Standards, shall be measured at
their fair values, but of which the prior fair values cannot be measured reliably, the enterprise shall measure them at their fair
values when their fair values can be reliably measured, and the gap between the relevant carrying amount and the fair value shall
be dealt with according to Article 38 of the present Accounting Standards herein.

Article 37

Where the intention of holding or the ability to hold changes, or the fair value can not be reliably measured any more, or the term
of holding has exceeded “two complete accounting years” as described in Article 16 of the present Accounting Standards herein, which
makes it no longer sui

CIRCULAR OF THE PEOPLE’S BANK OF CHINA ON GUARDING AGAINST MONEY LAUNDRY BY MAKING USE OF FAKE US BILLS

People’s Bank of China

Circular of the People’s Bank of China on Guarding against Money Laundry by Making Use of Fake US Bills

Yin Fa [2006] No. 60

March 6, 2006

Shanghai Headquarters of the People’s Bank of China, all the branches and business management departments of the People’s Bank of
China, the central sub-branches of the capital cities of all provinces, Dalian, Qingdao, Ningbo, Xiamen and Shenzhen Central Sub-branches,
all the wholly state-owned commercial banks, joint stock commercial banks, and China Postal Savings and Remittance Bureau,

A kind of fake US bills, which are called “super US bills” by the judicial department of U.S.A. and are manufactured verisimilar and
fraudulent, has aroused the attention of international society in recent years. This kind of fake US bills have been introduced into
our country from abroad, and the criminals are trying to carry out money laundry by making use of fake US bills by smuggling, trafficking
and other means.

With a view to maintaining economic and financial safety, preventing financial institutions from being utilized by criminals to carry
out money laundry, safeguarding the capital security of financial institutions and severely striking money laundry concerning the
manufacturing and trafficking of fake US bills, the Circular on the relevant working requirements is hereby issued as follows:

All the financial institutions shall reinforce the precautious consciousness against the crime of money laundry by making use of fake
US bills, and improve their employees’ abilities to identify fake US bills in the receipt and payment of currencies by means of various
trainings and education.

II.

All the financial institutions shall practically strengthen the construction of the internal control mechanism against money laundry,
implement the requirements of regulation compliance, strictly perform such obligations to strike money laundry as the identification
of clients’ statuses and the keeping of trading records, etc. Any transaction of US bills in large-amount shall be reported strictly
in accordance with the relevant provisions of the People’s Bank of China on anti-money laundry.

III.

All the financial institutions shall strengthen the daily audit and monitoring of the incomes and expenses of US bills, and shall
conduct thorough analysis and research to any abnormal condition on the incomes and expenses of US bills, and in case any suspectable
transaction is found, a report shall be made according to the relevant provisions of the People’s Bank of China on anti-money laundry.

IV.

All the branches of the People’s Bank of China shall strengthen the monitoring and analysis of large-amount and suspectable transactions
of US bills, and shall also report the information relevant to fake US bills or the clues of money laundry found in the daily monitoring,
investigation of cases or striking of underground banks to the Currency, Gold and Silver Bureau and Anti-Money Laundering Bureau
of the People’s Bank of China in addition to the reporting in accordance with the normal procedures prescribed in the relevant provisions
thereof.

Shanghai Headquarters of the People’s Bank of China, all the branches and business management departments of the People’s Bank of
China, the central sub-branches of the capital cities of all the provinces (capital) and the central sub-branches of the deputy provincial
cities are requested to forward this Circular to the urban commercial banks, rural commercial banks, rural credit cooperatives and
foreign-funded banks within their respective jurisdictions.

People’s Bank of China
2006-03-06

THE GUIDANCE FOR THE ARTICLES OF LISTED COMPANY (REVISED IN 2006)

China Securities Regulatory Commission

Circular of China Securities Regulatory Commission on Printing and Distributing the Guidance for the Articles of Listed Company (Revised
in 2006)

Zheng Jian Gong Si Zi[2006] No. 38

All listed companies:

In order to promote the standardized operation of listed companies, the Guidance for the Articles of Listed Company (Revised in 2006)(hereinafter
referred to as “the Guidance”) is hereby formulated in accordance with Company Law of the People’s Republic China, Securities Law
of the People’s Republic of China, and promulgated to you for its observance and compliance.

The Guidance constitutes two parts: the main body and remark. The content between the brackets “[ ]” in the main body shall be filled
by the companies in light of actual circumstances.

Such a listed company as issues domestic share (A share) or domestically listed shares denominated in foreign-currency (i.e. B shares)
or both of them (hereinafter referred to “the listed company”) shall, in accordance with the interpretations and explanation in the
remark part and by reference to the provisions and requirements in the main body hereof, specify the content in the main body of
the Guidance for the Articles of the Listed Company.

The Guidance constitutes the basic content of the articles of listed company where the listed company may, in accordance with specific
circumstances, either add otherwise content for its practical need or made literal or order alteration without in contravention of
relevant laws and rules. The listed company shall, for the need of adding or revising the necessary content Guidance, made ad hoc
hint and clue when the board of directors announces its Articles of Association.

The Guidance shall be enforced as of the printing date of the Circular. Meanwhile, Circular on Printing and Distributing the Guidance
for the Articles of Listed Company ( Zheng Jian[1997] No.16) shall be nullified and repealed simultaneously. The listed company shall,
at the first shareholders conference after the Circular was distributed, make corresponding revision of its Articles of Association.

The listed company in time of its initial public offering shall, in time of submitting documents to China Securities Regulatory Commission
draft and revise the content of its Articles of Association (or draft of the Articles of Association) in accordance with the Guidance
and the requirements of the Circular.

Such a listed company as issues foreign capital stock or both the domestic share and foreign capital stock shall continue the enforcement
of the Mandatory Provisions for Articles of Association of Companies to be Listed Overseas and revise the Articles of Association
by reference to the Guidance.

China Securities Regulatory Commission

March 16, 2006

the Guidance for the Articles of Listed Company (Revised in 2006) ContentsChapter I General Provisions

Chapter II Business Tenet and Scope

Chapter III Stock

Section 1 Stock Issuing

Section 2 Stock Increase, Reduction and Buyback

Section 3 Stock Transfer

Chapter IV. Shareholders and Shareholders Conference

Section 1 Shareholders

Section 2 General Provisions of Shareholders Conference

Section 3 Convention of Shareholders Conference

Section 4 Resolution and Notification of Shareholders Conference

Section 5 Convocation of Shareholders Conference

Section 6 Voting and Decision of Shareholders Conference

Chapter V Board of Directors

Section 1 Directors

Section 2 Board of Directors

Chapter VI Manage and other Top Management Personnel

Chapter VII Board of Supervisors

Section 1 Supervisors

Section 2 Board of Supervisors

Chapter VIII Financial and Accounting System, Profit Distribution and Auditing

Section 1 Financial and Accounting System

Section 2 Internal Auditing

Section 3 Appointment of Certified Public Accountant

Chapter IX Notification and Proclamation

Section 1 Notification

Section 2 Proclamation

Chapter X Merger, Separation, Capital Increase, Capital Reduction, Dissolution and Liquidation

Section 1 Merger, Separation, Capital Increase, Capital Reduction

Section 2 Dissolution and Liquidation

Chapter XI Revision of Articles of Association

Chapter XII Supplementary Articles

Chapter I General Provisions

Article 1

The Articles is, in accordance with Company Law of the People’s Republic China(hereinafter referred to as “Company Law” ), Securities
Law of the People’s Republic of China(hereinafter referred to as “Securities Law”), formulated and enacted in the interest of maintaining
the lawful rights of the companies , their shareholders and creditors, standardizing the structure and acts of the companies.

Article 2

The limited liability company( hereinafter referred to “the company”) shall be established in accordance with [Name of Law] and other
relevant provisions.

The company shall be established in accordance with [Methods of Establishment]; registered in[place of the company registration authority]
of the local Industrial & Commercial Administration Bureau where the company obtains its business license with[Number of Business
License] noted.

Remark: Where the establishment of a company needs approval in accordance with laws and administrative regulations, names of approval
authorities and documents of approval shall be mentioned and interpreted.

Article 3

The company, with the approval of [name of the approval/ examination authority] on [date of the approval/ examination] , issues common
RMB[stock volume] stock to social public and gets listed in [Full Name of the Stock Exchange] on[On-sale Date] . The foreign stock
of the company who issues the domestically listed shares in foreign currency by means of stock option shall be [Stock volume] listed
in [Full Name of Stock Exchange] on [On-sale Date]

Remarks: Such a company have not issued (or planned to issue) domestically listed shares in foreign currencies needn’t give an explanation
thereon mentioned in this Section. The same below.

Article 4

Registration name of the company

[Chinese Full Name]

[English Full Name]

Article 5

Domicile of the Company: [Full Name of the Domicile of the Company, Postal Code] .

Article 6

The Registered Capital shall be in RMB yuan[Volume of Registered Capital]

Remark: Where the alteration of registered capital arises from the company’s increase or loss of registered capital, the company may,
after resolution concerning the increase or decrease of registered capital has been passed by the shareholders conference, pass a
resolution concerning the alteration particulars of the Articles of Association and authorizes the board of directors to be responsible
for interpreting and explaining the detailed registered capital alteration procedures

Article 7

The company’s business term shall be [Number of Years] or [The company is permanent limited liability company] .

Article 8

[Board of Director or Manager] shall be the legal person of the company.

Article 9

All the assets of the company shall be divided into equal stocks, with the shareholders bearing responsibilities in term of its purchased
stocks and the company bearing responsibilities in term of all its assets.

Article 10

The Articles of Association shall, as of the date of its entry into force, become the lawfully documents binding the relations between
the organization and conduct of companies, the company and its shareholders and relations between shareholders, as well as those
of the company, shareholders, board of directors, board of supervisors, senior managers. The shareholders may, in accordance with
the Articles of Association, sue board of directors, board of supervisors, managers and other senior mangers, vice versa.

Article 11

The term “other senior managers” referred to herein mean the deputy general managers, secretary of the board of directors and the
person in charge of finance.

Remark: The Company may, in accordance with practical circumstances, define and determine its top management personnel in the Articles
of Association.

Chapter II Business Tenet and Scope

Article 12

Business Tenet of the Company: [Business Tenet]

Article 13

After lawful registration, business scope of the company: [Business Scope]

Remark: such a business scope of the company as belongs to the items needing the approval of law and administrative rules, it shall
be approved pursuant to law.

Chapter III Stock

Section 1 Stock Issuing

Article 14

Stock of the company takes stock means.

Article 15

Every stock of the same kind stocks issued at the same time shall have the same issue term and price; the share of stocks purchased
by any unit or individual shall have the equal right.

Every stock of the same kind stocks issued at the same time shall have the same issue term and price; the share of stocks purchased
by any unit or individual shall be paid the same value.

Article 16

The stock issued by the company shall have it value marked by RMB.

Article 17

The stock issued by the company shall be uniformly deposited in[Name of the Stock Registration Authority]

Article 18

The company sponsors shall be[names of the Sponsors] , number of purchased stocks[stock volume] , forms and time of investment [Specific
Means and Time]

remark: Where the sponsors in the company which has been established no less than one year have transferred their holdings, they need
not fill in

Article 19

The total volume of the company shall be [stock volume] . The stock of the company shall be: common stock[volume] and other [volume]
stocks.

Remark: Other kind of stock of the company shall be interpreted and explained.

Article 20

The company or its subsidiaries(including its subsidiary enterprises shall not, by such means as donation, advancement, guarantee,
compensation or loan, provide any sponsor to the buyer or potential buyer of stock of the company.

Section 2 Stock Increase, Reduction and Buyback

Article 21

The company may, in accordance with the operation and development as well as laws and rules, adopt the following means to increase
capital provided that the resolution has been made by the shareholder conference:

(1)

Issuing stock publicly;

(2)

Issuing stock Secretly;

(3)

Offering bonus stock to the current shareholder;

(4)

Transferring and increasing capital stock by accumulation fund;

Laws and rules as well as other means approved by China Securities Regulatory Commission

Remark: Such a company as issues convertible bond shall also make detailed provisions upon the its issue, share transfer procedure
and arrangement as well as alteration of its capital stock and etc.

Article 22

The company may decrease registered capital. The reduction of registered capital shall be handled in accordance with Company Law and
other relevant provisions and procedures prescribed in the Articles of Association.

Article 23

The stock of the company may be purchased in accordance with law, administrative rules, regulation, and provisions of the Articles
of Association under the following circumstances:

(1)

Reduction of the company’s registered capital;

(2)

Merging with other companies holding the stock of the company

(3)

Awarding stock to the staff of the company;

(4)

Where the shareholders raise objection upon the resolution concerning merger and separation made by the company and demand the company
withdraw its stock..

The company shall not purchase or sell the stocks the company except the aforesaid circumstances.

Article 24

The stock of the company may be purchased by any of the following means;

(1)

Centralized price biding in securities exchange;

(2)

Offer ;

(3)

Other means approved by China Securities Regulatory Commission

Article 25

Where the stock of the company is purchased for the reasons arising from Item(1) to Item(3) in Article 23 of the Articles of Association,
it shall be decided by shareholders resolution. Where the stock of the company is purchased in accordance with Item(1) Article 23
, its shall be canceled as of ten days upon its purchase; where the stock of the company is purchased in accordance with Item(1),
Item(2) or Item(4) in Article 23 ,it shall be transferred or canceled within six months upon its purchase.

The stock purchased in line with Item(3) of Article 23 shall not exceed 5% of the total stock volume of the company; the capital
used for its purchase shall come from the after-tax profit hereof; the purchased stock shall be transferred to the staff of the company
within one year;

Section 3 Stock Transfer

Article 26

Stock of the company may be transferred lawfully.

Article 27

The object as the pledge of the company’s stock shall not be accepted by other companies

Article 28

The stock of the company held by the sponsor shall not be transferred within one year as of the date of the company’s establishment.
The stock issued prior to the company’s public issue of stock shall not be transferred within one year as of its on-sale date in
the securities exchanges.

The directors, supervisors and senior managers shall report to the company its stock holding and alteration, with its annual stock
transfer no more than 25% of the total stock volume hereof ; its holding shall not be transferred within one year as of its on-sale
date. The aforesaid personnel, shall not transfer its holding of the company within one year as of their ex-serving.

Remark: where other restrictive terms are made by the company upon the stock transfer held by the directors, supervisors, senior managers,
the relevant explanation and interpretation shall be given.

Article 29

Where the stocks held the directors, supervisors, seniors and shareholders holding 5% of the total share of the company are sold six
months after its buying-in or purchased six months after its sale, the yield thereupon shall be possessed by the company and the
board of directors shall withdraw all its yield. Where the securities company, as the sole underwriter, purchases all the unsold
stocks and therefore exceeds the 5% possession limit, it is exempt from the six months restriction when it resells the stocks.

Where the board of directors refuses to comply with the provisions of the preceding paragraph, other stockholders have the right to
ask the board to enforce it within 30 days.

Where the board of directors fails to enforce it within the aforesaid time limit, the shareholder shall in their own names be enpost_titled
to file a suit to the people’s court in the interest of the company.

Where the board of directors’ refusal to comply with the first paragraph of this article has resulted in losses to the company, the
responsible directors shall bear joint liability.

Chapter IV Manage and His Senior Managers

Section 1 Shareholder

Article 30

The company shall, in accordance with the certificate provided by the securities registration authority, establish stock ledge, which
serves sufficient evidence of the shareholding. The shareholder shall enjoy rights and bear responsibilities in line with the volume
of its shareholding; the shareholders with the same kind of stock shall enjoy equal rights and bear same obligations.

RemarkThe company shall sign stock keeping agreement with securities authorities, regularly investigate the documents and shareholding
alteration of the main shareholders(including stock equity pledge) and master its equity structure.

Article 31

In case of shareholding convention, stock dividend distribution, liquidation and the such acts as the identification of the shareholders
needing certification , the convener of the board of directors or shareholders conference shall be responsible for deciding the date
of record, after which the registered shareholders are enpost_titled to the relevant rights and interests.

Article 32

Shareholders of the company are enpost_titled to the following rights:

(1)

Dividend or other forms of interest distribution in accordance with their shares;

(2)

Requiring, convening, presiding, attending or entrusting shareholders agent to attend the shareholders conference and performing the
relevant voting power;

(3)

Supervising the performance of the company, raising proposal or inquiry;

(4)

Transferring, donating or pledging its shareholding in accordance with laws, administrative rules and the provisions hereof.

(5)

Consulting the Articles of Association, stock ledger, counterfoil of the debenture; record of shareholders conference, resolution
of the board of directors, resolution of the board of supervisors, financial statement;

(6)

Participating in the residual property of the company in accordance with their shares in occasion of the company’s termination or
liquidation;

(7)

Demanding the company to withdraw the shares of the shareholder who raise an objection to the merger and separation resolution made
in the shareholders conference;

(8)

Other rights prescribed in laws, administrative rules, regulations and the provisions hereof.

Article 33

Where the shareholder requires consulting the aforesaid relevant information or asks for the relevant documents, it shall show its
certificate of the kind of its shareholding and the share volumes to the company who shall approve the requirement hereof after the
identification of the shareholder has been certified.

Article 34

Where the resolutions of the shareholders conference and board of directors violate laws and administrative rules, the shareholders
are enpost_titled to demanding the people’s court to announce the verdict of its nullity.

Article 35

Where the directors, senior managers violate laws, administrative rules or the provisions hereof in time of fulfilling their duty
and thereby have caused damage to the company, the shareholders with 1% of shareholding singly or jointly in for no less than 180
days are enpost_titled to require in written application the board of supervisors to file a suit to the people’s court; where the violation
of law by the board of supervisors in time of performing its duty causes damage to the company, the shareholders are enpost_titled to
require in written application the board of directors to file suit to the people’s court.

Where the board of directors and board of supervisors refuse to file suit after having received the written application as described
in the preceding paragraph, or fail to do so within 30 days as of its acknowledgement, or the delayed sue may cause irreparable loss
to the company, the shareholders as prescribed in the preceding paragraph are authorized to file suit directly to the people’s court
in their own name.

Where the infringement of the lawful rights of the company has caused damage to the company, the shareholders as prescribed in the
preceding paragraph are authorized to take proceedings to the people’s court.

Article 36

Where the violation of laws, administrative rules or the provisions hereof by the directors, senior managers has caused damage to
the shareholders, the latter may lodge a complaint to the people’s court.

Article 37

Shareholders of the company shall bear the following obligations:

(1)

Observing law, administrative rules and the Articles of Association;

(2)

Paying capital in accordance with its purchased share and means of stock buy-in;

(3)

Stocks shall not be withdrawn except the circumstances prescribed in laws, rules and provisions;

(4)

Not abusing the stockholder’s right to infringe the interest of the company or other shareholders; not abusing the independent position
of the legal person of the company to impair the interest of the creditor of the company;

Where the shareholder’s abuse of its power has caused damage to other shareholders, it shall honor its indemnity obligations in accordance
with the law.

Where the shareholder’s abuse of its independent position and shareholder’s limited liability and evasion of its debt have caused
serious damage to the creditor’s interest, it shall bear joint liability upon the debt of the company.

(5)

Other obligations that shall be born as prescribed in laws, administrative rules and the provisions.

Article 38

The shareholders with more than 5% of the voting shares of the company pledges its shareholding, they shall submit a report in written
form to the company upon its occurrence.

Article 39

The controlling shareholders and the actual shareholding controllers shall not abuse their correlative relationship to cause damage
to the company. Otherwise, they shall honor their indemnity obligations.

The controlling shareholders and the actual shareholding controllers shall act faithfully and assume responsibility to the company
and other public shareholders. The controlling shareholders shall fulfill strictly the rights of subscriber and buyer in accordance
with the laws, shall not impair lawful rights of the company and other public shareholders by such means as interest distribution,
capital reorganization, foreign investment, occupation of funds, loan guarantee, not utilize its controlling position to cause damage
to the interest of the company and other public shareholders.

Section 2 General Provisions of Shareholders Conference

Article 40

The shareholders conference constitutes the organ of power of the company, exercising the following authorities:

(1)

Deciding the business guidance and investment plan of the company;

(2)

Electing and replacing the posts such as directors and supervisors, deciding the particulars about directors and supervisors;

(3)

Examining and approving the report from the board of directors;

(4)

Examining and approving the report from the board of supervisors;

(5)

Examining and approving the annual financial budget plans and final settlement plans;

(6)

Examining and approving the profit allocation plans and plans to cover company losses;

(7)

Adopting resolutions relating to increase or reduction of the company’s registered capital;

(8)

Adopting resolutions relating to increase or reduction of the company’s registered capital;

(9)

Adopting resolutions relating to merger, division, change of corporate form, dissolution and liquidation of the company;

(10)

Revising the Articles of Association;

(11)

Making decision upon the employment and dismissal of certified public accountant office;

(12)

Examining and approving the guarantee particulars prescribed in Article 41 hereof;

(13)

Examining such proceedings as the purchased and sold assets in one year by the company exceed 30% of the audited total assets of the
company of the latest term;

(14)

Examining, approving and altering the proceedings for the usage of the collected fund;

(15)

Examining stock-based incentive plan;

(16)

Examining other proceedings prescribed in laws, administrative rules, regulations or provisions that shall be decided by the shareholders
conference.

Remark: The aforesaid authority of shareholders conference shall not be exercised by the board of directors or other authorities and
individuals by means of authorization.

Article 41

the below external guarantee acts shall be approved by the shareholders conference.

(1)

Any guarantee after the total external guarantee volume of the company and its controlling subsidiaries reaches or exceeds 50% of
the latest audited net assets of the latest term;

(2)

Any guarantee after the total external guarantee volume of the company reaches or exceeds 30% of the latest audited net assets of
the latest term;

(3)

The guarantee provided to the guarantee objective whose asset liability ratio exceeds 70%

(4)

The single guarantee volume exceeds 10% of the latest audited net assets;

(5)

The guarantee provided to shareholders, the actual controller and the associated party.

Article 42

The shareholders conference falls into annual stockholders conference and interim shareholders conference. The annual shareholders
conference shall be held once every year, within 6 months after the conclusion of the preceding fiscal year.

Article 43

The interim shareholders conference shall be held within two months when one of the following circumstances occurs:

(1)

The number of directors falls below the number prescribed herein or below two-thirds of the number prescribed in the Articles of Association;

(2)

The company’s losses which are not covered have reached one-third of the total amount of the share capital;

(3)

Request from Shareholders holding at least 10 percent of the company’s stocks;

(4)

The board of directors deems it necessary;

(5)

The board of directors proposes the convention of the conference;

(6)

Other circumstances prescribed in laws, administrative rules, regulations or the Articles of Association.

Remark: The company shall settle the specific number in Item (1) of this Article.

Article 44

The place for the convention of shareholders conference shall be: [Specific Place] .

the shareholders conference shall prepare the meeting place and be convened in the form of on-site meeting. The company shall also
provide [Internet or other means] for the convenient attendance of the shareholders. Such shareholders as attend the conference by
the aforesaid means shall be deemed presence.

Remark: The Articles of Association may prescribe that the place of shareholders conference shall be where the company locates or
other specific places. Where the shareholders conference is held otherwise, the means of its convention and the lawful identification
of the shareholders shall be expressly defined in the Articles of Association.

Article 45

The company shall employ a lawyer to give legal advice the relevant notification in the time of the convention of the shareholders
conference;

(1)

Whether the convention and convocation procedures comply with laws, administrative means and the provisions;

(2)

Whether the qualification of attendant and convener is lawful and effective;

(3)

Whether the voting procedure and result is lawful and effective;

(4)

Legal advice issued upon other relevant questions in response to the request of the company.

Section 3 Convention of Shareholders Conference

Article 46

The independent directors have the right to propose the convention of interim shareholders conference to the board of directors. With
regard to the proposal, the board of directors shall, in accordance with the provisions in laws, administrative rules and the Articles
of Association, made feedback in written form concerning approval or disapproval its convention within 10 days as of its acknowledgement.

Where the board of directors approves the convention of the interim shareholders conference, it will distribute the notice thereof
within 5 days after the decision has been made by the board of directors; otherwise, the reasons shall be interpreted and proclaimed.

Article 47

The board of supervisor is authorized to propose the convention of interim shareholders conference and shall be submitted to the board
of directors in written form. The board of directors shall, in accordance with the provisions in laws, administrative rules and the
Articles of Association, made feedback in written form concerning approval or disapproval its convention within 5 days as of its
acknowledgement.

Where the board of directors approves the convention of interim shareholders conference, it will distribute a notice thereof within
5 days after the decision has been made by the board of directors and the alteration of the original proposal in the notice shall
win the approval of the board of supervisors.

Where the board of directors disapproves its convention or fails to make feedback within 10 days as of its acknowledgement, it shall
be deemed incapable to fulfill the obligation of its convention; the board of supervisor may thereby convene and preside over the
conference.

Article 48

Such shareholders as singly or jointly hold more than 10% of the shares of the company have the right to propose in written form the
convention of interim shareholders conference to the board of directors. The board of directors shall, in accordance with the provisions
in laws, administrative rules and the Articles of Association, raise the feedback in written form concerning the approval or disapproval
of the convention of the shareholders conference within 10 days upon its acknowledgement.

Where the board of directors approves its convention, it shall, within 5 days after the decision has been made by the board of director,
issue a notice where the alteration upon the original request shall win the approval from the relevant shareholders.

Where the board of directors disapproves its convention, it, shall, within 5 days after the decision has been made by the board of
director, issue a notice where the alteration upon the original request shall win the approval from the relevant shareholders.

Where the board of directors fails to issue the notice within the prescribed time limit, it shall be deemed failure to convene and
preside over shareholder conference and the shareholders singly or jointly holding more than 10% of the company’s share for more
than 90 consecutive days may convene and preside it over independently.

Article 49

Where the board of supervisors or shareholders decide convening the conference independently, they shall notify the board of directors
in written form and put on record in the local branches of China Securities Regulatory Commission.

Prior to the announcement of the decision in the shareholders conference, the shareholders of the convened shareholders shall not
be less than 10%.

The convened shareholders shall, in time of issuing the notice of shareholders conference and the announcement of the resolution of
the shareholders conference.

Article 50

With respect to the shareholders conference independently convened by the board of supervisors or the shareholders, the board of directors
and its secretary shall give coordination. The board of directors shall provide the stock ledger of the stock registration date.

Article 51

Where the shareholders conference is

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