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

CIRCULAR OF THE MINISTRY OF COMMERCE OF THE PEOPLE’S REPUBLIC OF CHINA, ISSUING SCHEME OF THE SECOND BATCH OF APPLICABLE QUANTITY OF TEXTILES EXPORTED TO THE USA AND EU IN 2006

Ministry of Commerce

Circular of the Ministry of Commerce of the People’s Republic of China, Issuing Scheme of the Second Batch of Applicable Quantity
of Textiles Exported to the USA and EU in 2006

Shang Mao Han [2006] No. 26

Administrative commercial departments in all provinces, autonomous regions, municipalities, separately listed cities, Xinjiang Production
and Construction Corps of CPLA, Harbin, Changchun, Shenyang, Xi’an, Nanjing, Wuhan, Chengdu and Guangzhou:

In accordance with Provisional Administrative Measures on Textiles Export (hereinafter referred to as “Measures”) and Commodities
List under Provisional Administration of Textiles Export, here releases the second batch of applicable quantity of textiles exported
to the USA and EU in 2006 (please refer to Appendix 1). Related matters are announced as follows:

The applicative quantities of 21 categories of textiles exported to the USA of the second distribution by achievement in 2006 equal
to the differential value between the total applicative quantities of 2006 and the first batch of applicative quantities in 2006
(please refer to No.102, 2005 for details). By this kind of calculating method, negative numbers appear in the second batch of applicative
quantities of some enterprises (please refer to Appendix 2), whose relevant applicative quantities will be deducted in equal mounts
in the first distribution of 2007.

The applicable quantities of the 10 categories of textiles exported to EU in the second distribution of 2006 by achievement accounts
25% of the total annual distributing quantities. Applicable quantities of this distribution refer to the rest of relevant categories
in 2006 (please refer to No.85, 2005).

The applicable quantity is 200 piece (kg, square meter) or 20 dozen (double dozen) at least. In case less than the least applicable
quantity, the applicable quantity of operator equals to zero.

Local administrative commercial departments should urge local operators to submit applications in line with the applicable quantities
released in the appendix and report date of the 13-digit import and export codes or Chinese post_titles of absent enterprises. Before
Apr 15, local administrative commercial departments should gather all application reports and electronic date of local operators
to Ministry of Commerce (please accept and report electronic date through visa system of provisional administration on textiles export).

In line with written reports as well as related electronic date, Ministry of Commerce will release formal distributing scheme separately,
based on which Provisional License of Textile Export will be issued to relevant operators.

Please all local administrative commercial departments transmit the circular to local operators and inform them that relevant achievement
and application quantity will also be announced at governmental website of Ministry of Commerce, column “information for textile
export”.

Related operators should support local administrative commercial departments to well finish work of affirming, submitting applications
within specified time. Those submitted after the deadline will be considered invalid.

Please China International Electronic Commerce Center well finish preparation work of related techniques.

Appendix1: The Second Batch of Applicable Quantity of Textile Exported to the USA in 2006 (issued by electronic form) (omitted)

Appendix 2: Name List of Enterprises with Negative Numbers in the Second Batch of Applicative Quantities (issued by electronic form)
(omitted)

Ministry of Commerce

Mar 27, 2006

Ministry of Commerce
2006-03-27

NOTIFICATION NO.9, 2006 OF FOREIGN ASSISTANCE PROJECT BID BOARD OF THE MINISTRY OF COMMERCE

Notification No.9, 2006 of Foreign Assistance Project Bid Board of the Ministry of Commerce

Tong Gao [2006] No.9

Foreign Assistance Project Bid Board of the Ministry of Commerce held the 9th regular meeting on April 18, 2006. Matters of concern
and resolution are notified as follows:

The bid-winning enterprise of Bahamas Stadium assistance project was examined and approved. The tendering board opened sealed tenders
on April 14, 2006. In all, 17 tender enterprises including Anhui Foreign Economic Construction Corporation (group) Co., Ltd., Qilu
Construction Group Corporation, Shanxi Construction Engineering (group) Co., Shanghai Construction Group General Co., Beijing Construction
Engineering Group Co., Ltd., Qingdao Construction Group Corporation, Hunan Construction Engineering Group Corporation, China State
Construction Engineering Corp., Yanjian Group Co., Ltd., China Civil Engineering Construction Corporation, China National Overseas
Engineering Corporation, Guangdong Xinguang International Group Co., Ltd., Guangdong Construction Engineering Group Co., Ltd., Jiangsu
Construction Group Corp., China Ershisanye Construction Group Co., Ltd., Beijing Urban Construction Group Co., Ltd. and Zhejiang
Electric Power Construction Corp. submitted the tender documents on time. Fujian Construction Engineering Group General Co., and
Chongqing Foreign Construction Corporation gave up. The Bid Board, in accordance with “the Measures for Tender Assessment of Undertaking
Foreign Assistance Complete Plant Projects” which was revised in 2005 by the Ministry of Commerce of the People’ Republic of China,
for Trial Implementation and the principles of “competing with no minimum bid” and “biding with reasonable lower price”, determined
to confer bid to Qilu Construction Group Corporation after two steps of tender review with technical measures and integrated quantity
measures.

The tender mode of Cuba Medical Treatment and Sanitation Materials assistance project was discussed. The Bid Board adopted limited
invitation tender mode, and 13 enterprises Suntime International Techno-Economic Cooperation (Group) Co., Ltd., Tianjin Machinery
Import & Export Corporation, China Meheco Corporation, Henan Cereals, Oil& Foodstuff Imp. & Exp.Group Corp., China Machine-
Building International Corporation, Suzhou Hengrun Import & Export Corp., Ltd., China National Pharmaceutical Foreign Trade Corporation,
China Xinjiang Tacheng Sanbao Import & Export Company, Shanghai Automobile Import & Export Co., Ltd., Northern International
Group Co., Ltd., Hebei Shenglun Imp.& Exp.(Group) Corp., China National Electronics Import and Export Corporation and XY Group
Co., Ltd. will be invited to participate in the bid. Specific matters of concern shall be notified later.

Foreign Assistance Project Bid Board of the Ministry of Commerce

April 21, 2006

Foreign Assistance Project Bid Board of the Ministry of Commerce
2006-04-21

CIRCULAR OF THE SUPREME PEOPLE’S COURT ON STRICTLY IMPLEMENTING THE RELATED PROVISIONS FOR THE DISPOSAL OF PROPERTIES INVOLVED IN SMUGGLING CASES

Circular of the Supreme People’s Court on Strictly Implementing the Related Provisions for the Disposal of Properties Involved in
Smuggling Cases

Fa [2006] No 114
April 30, 2006

The higher people’s courts of all provinces, autonomous regions and municipalities directly under the Central Government, the PLA
military courts, and Xinjiang Production and Construction Corps Branch of the Higher People’s Court,

The General Administration of Customs reported that some local courts failed to judge or only partially judged the illicit money and
properties related to the criminal cases of smuggling. As for the properties that the people’s court failed to make a judgment of
recovery or confiscation were confiscated or recovered by the customs offices by way of administrative punishment, which then results
in bad consequences such as administrative lawsuits. In order to earnestly regulate the law enforcement, we hereby restate the related
provisions as follows.

As for the disposal of illicit money and properties involved in criminal cases, there are definite laws and judicial interpretations.
In Article 92 of the Customs Law, it is provided that “Before the people’s court makes a judgment or the customs office makes a
decision on the punishment, the goods, articles and means of transportation detained by any customs office under law may not be disposed
of” and that “Smuggled goods, articles, illegal incomes, smuggling vehicles, or specially-made equipments, which are confiscated
by the people’s court or the customs office, shall be disposed of uniformly by the customs office under law, and the money from the
disposal and the fines over shall be turned in to the central treasury.” In Article 23 of the Opinions of the Supreme People’s Court,
the Supreme People’s Procuratorate and the General Administration of Customs on Some Issues concerning the Laws Applicable to the
Disposal of Criminal Cases of Smuggling, it is provided that “The people’s court shall, when adjudicating the criminal cases of smuggling,
examine and confirm the money and properties as stated in the lists and certification documents, and make a ruling of recovery and
confiscation according to law; the customs shall dispose of the articles in light of the judgment of the people’s court and the related
provisions in the Customs Law, and turn them in to the central treasury.”

Therefore, it shall strictly follow and implement the aforesaid provisions of laws and judicial interpretations and make judgments
of recovery or confiscation of the illicit money and properties involved in this case when any of the local people’s courts hears
a criminal case of smuggling. For any new situation or new problem occurring during the process of trial of the criminal case of
smuggling, it shall intensify the contact and collaboration with the customs office and other related departments. In case of any
new problem related to the application of laws, it shall report it to the Supreme People’s Court in a timely manner.

The Supreme People’s Court
2006-04-30

CIRCULAR OF CHINA SECURITIES REGULATORY COMMISSION CONCERNING ABOLISHING THE PROCEDURES OF THE STOCK ISSUANCE EXAMINATION AND APPROVAL OF THE CSRC

Circular of China Securities Regulatory Commission concerning Abolishing the Procedures of the Stock Issuance Examination and Approval
of the CSRC

Zheng Jian Fa [2006] No. 47

On the basis of approval of the State Council, the Procedures of the Stock Issuance Examination and Approval of the CSRC (approved
by the State Council and promulgated by the CSRC on March 16, 2000) shall be abolished on May 18, 2006.

China Securities Regulatory Commission

May 17, 2006

China Securities Regulatory Commission
2006-05-17

1...232425 Page 24 of 25

Probate

MEASURES FOR THE ADMINISTRATION OF TAX DEDUCTION OR EXEMPTION (FOR TRIAL IMPLEMENTATION)

REPLY OF THE STATE ADMINISTRATION OF TAXATION ON RELEVANT ISSUES CONCERNING THE TERM FOR RECOVERING OVERDUE TAXES

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

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

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

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

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

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

CIRCULAR OF THE MINISTRY OF COMMERCE OF THE PEOPLE’S REPUBLIC OF CHINA, ISSUING SCHEME OF THE SECOND BATCH OF APPLICABLE QUANTITY OF TEXTILES EXPORTED TO THE USA AND EU IN 2006

NOTIFICATION NO.9, 2006 OF FOREIGN ASSISTANCE PROJECT BID BOARD OF THE MINISTRY OF COMMERCE

CIRCULAR OF THE SUPREME PEOPLE’S COURT ON STRICTLY IMPLEMENTING THE RELATED PROVISIONS FOR THE DISPOSAL OF PROPERTIES INVOLVED IN SMUGGLING CASES

CIRCULAR OF CHINA SECURITIES REGULATORY COMMISSION CONCERNING ABOLISHING THE PROCEDURES OF THE STOCK ISSUANCE EXAMINATION AND APPROVAL OF THE CSRC

CONSTITUTION ACT, 1982 – page 22

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

CONSTITUTION ACT, 1982 – page 17

CONSTITUTION ACT, 1982 – page 16

CONSTITUTION ACT, 1982 – page 12

CONSTITUTION ACT, 1982 – page 11

CONSTITUTION ACT, 1982 – page 10

CONSTITUTION ACT, 1982 – page 9

CONSTITUTION ACT, 1982 – page 8

CONSTITUTION ACT, 1982 – page 7