CIRCULAR OF THE PEOPLE’S BANK OF CHINA, MINISTRY OF FINANCE, CHINA BANKING REGULATORY COMMISSION, CHINA SECURITIES REGULATORY COMMISSION ON PROMULGATING THE SUPPLEMENTARY CIRCULAR ON THE ACQUISITION OF PERSONAL CREDITS

Circular of the People’s Bank of China, Ministry of Finance, China Banking Regulatory Commission, China Securities Regulatory Commission
on Promulgating the Supplementary Circular on the Acquisition of Personal Credits

Yin Fa [2006] No. 189

The people’s governments of each province, autonomous region, municipality directly under the Central Government, and city specifically
designated in the state plan, Shanghai Headquarters, all branches and business departments of the People’s Bank of China, central
sub-branches of the People’s Bank of China in provincial capital cities, central sub-branches of the People’s Bank of China in Dalian,
Qingdao, Ningbo, Xianmen and Shenzhen, the fiscal departments (bureaus) of each province, autonomous region, municipality directly
under the Central Government and city specifically designated in the state plan, the banking regulatory bureaus of each province,
autonomous region, municipality directly under the Central Government, and city specifically designated in the state plan, the securities
regulatory bureaus of each province, autonomous region, municipality directly under the Central Government, and city specifically
designated in the state plan,

On January 27, 2006, the People’s Bank of China, Ministry of Finance, China Banking Regulatory Commission, China Securities Regulatory
Commission printed and distributed the Supplementary Circular on Acquisition of Personal Credits (hereinafter referred to as the
Supplementary Circular ). You’re hereby informed of the following matters with regards to the release of the Supplementary Circular:

The Supplementary Circular shall be declassified as of the date of promulgation. The contents released shall be based on the Annex
of this Circular. The local people’s governments at all levels and all related departments shall rigorously carry out the national
uniform policies in accordance with the Supplementary Circular.

The publicity of the Supplementary Circular shall be subject to the principle that “it shall be posted in the institution which is
guilty of wrongdoing” and that “no putting on the Internet or on any newspaper”. Under the direction concerning the real conditions
of the local people’s governments and regulatory departments, it shall be put up in the business spots of the financial institution
by the liquidation group (trust group or work team) of the financial institution to be settled.

The local people’s governments at all levels and all related departments shall perform well in the propaganda and interpretation of
the Supplementary Circular, make the detailed and planned working scheme and strive to maintain the financial stability and social
stability. All identification and confirmation groups shall carefully implement their functions, strictly control the quality, and
fulfill the related tasks.

Appendix: Supplementary Circular on the Acquisition of Personal Credits

The People’s Bank of China

The Ministry of Finance of the People’s Republic of China

The China Banking Regulatory Commission

The China Securities Regulatory Commission

June 2, 2006
Appendix:
Supplementary Circular on the Acquisition of Personal Credits

You’re hereby informed of the related issues referring to the acquisition of personal credits to the financial institutions under
disposal during the period from September 30, 2004 to January 31, 2006 (including January 31, 2006, below the same):

The personal credits newly occurred after September 30, 2004 shall on the basis of the policies on the acquisition of personal credits
which are depicted in the Advice on the Purchase of Personal Credits and the Settlement Funds of Clients’ Securities (hereinafter
referred to as the Purchase Advice) and the Measures for the Implementation of the Purchase of the Personal Credits and the Settlement
Funds of Clients’ Securities (hereinafter referred to as the Implementation Measures), be gradually reinforced and treated in view
of different conditions.

Principle of Acquisition

(1)

The determination of personal credits, the standards on the calculation of credits, the raising and repayment of acquisition funds,
as well as the policies on the acquisition of personal savings deposits and the principal and interests of the settlement Funds of
clients’ securities shall be conducted in accordance with the Purchase Advice and the implementation Measures.

(2)

The legal contracts, which were concluded before or on September 30, 2004 and were updated after September 30, 2004 owing to their
expiration (in which the creditors were not changed and the original contract amounts were not exceeded, the same below) and which
were examined and verified by the regulatory department, shall be still subject to the standards which is presented in the Purchase
Advice and the Implementation Measures. As regards any contract updated without being examined or verified by the regulatory department,
it shall be subject to the standards for the acquisition of personal credits as decided in this Circular.

(3)

Where any new fund was transfused into the credit when an aforesaid original credit contract was updated, the new fund shall be subject
to the standards for the acquisition of personal credits as decided in this Circular.

(4)

The new personal credit concluded during the period from September 30, 2004 (excluding September 30, 2004, the same below) to January
31, 2006 shall be subject to the standards for the acquisition of personal credits as determined in this Circular.

Acquisition Standards

The acquisition of the personal credits which took place during the period from September 30, 2004 to January 31, 2006 and which fell
in the range of acquisition shall accord with the following standards:

(1)

Where the accumulative amount of credits of a same person (an individual with the same identity card number) is 100, 000 Yuan or less,
the aforesaid credits shall be totally purchased;

(2)

Where the accumulative amount of credits of a same person is over 100, 000 Yuan (excluding 100, 000 Yuan) but less than 200, 000 Yuan,
90 % of the aforesaid credits shall be purchased;

(3)

Where the accumulative amount of credits of a same person is over 200, 000 Yuan (excluding 200, 000 Yuan) but less than 500, 000 Yuan,
80 % of the aforesaid credits shall be purchased;

(4)

Where the accumulative amount of credits of a same person is over 500, 000 Yuan (excluding 500, 000 Yuan) but less than 1, 000, 000
Yuan, 70 % of the aforesaid credits shall be purchased;

(5)

Where the accumulative amount of credits of a same person is over 1, 000, 000 Yuan (excluding 1, 000, 000 Yuan) but less than 2, 000,
000 Yuan, 60 % of the aforesaid credits shall be purchased;

(6)

Where the accumulative amount of credits of a same person is over 2, 000, 000 Yuan (excluding 2, 000, 000 Yuan) but less than 3, 000,
000 Yuan, 50 % of the aforesaid credits shall be purchased; and

(7)

Where the accumulative amount of credits of a same person is over 3, 000, 000 Yuan (excluding 3, 000, 000 Yuan), the aforesaid credits
shall not be purchased.

Where any personal credit which took place after September 30, 2004 is in violation of the related provisions, the related department
shall hold the related persons responsible, and shall timely convey them to the judicial department if they are involved in any crime.

For any matter not included in this Circular, it shall be subject to the Purchase Advice, Implementation Measures and other provisions.

2006-06-02

ANNOUNCEMENT NO.45, 2006 OF MINISTRY OF COMMERCE ON PRELIMINARY ARBITRATION ON WEAR RESISTANT OVERLAY

Announcement No.45, 2006 of Ministry of Commerce on Preliminary Arbitration on Wear Resistant Overlay

[2006] No. 45

Ministry of Commerce issued an announcement on June 13, 2005 to start an anti-dumping investigation on the imported Wear Resistant
Overlay originating from The U.S. and EU (hereinafter referred to as the investigated products).

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

The Wear Resistant Overlay is listed under Tariff No. 48064000 in Customs Tariff of Import and Export of the People’s Republic of
China.

In accordance with Article 28 and 29 of Anti-dumping Regulations of People’s Republic of China, Ministry of Commerce decided to take
anti-dumping measures by deposit in security as of June 16, 2006.

Deposit in security rates are as follows:

Companies of the U.S.:

MW Custom Papers, LLC 10.35%

All Others 42.79%

Companies of EU.:

Papierfabrik Schoeller & Hoesch GmbH & Co. KG 24.64%

All Others 42.79%

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

Appendix: Preliminary Arbitration of Ministry of Commerce on Anti-dumping Investigation on Imported Wear Resistant Overlay Originating
from The U.S. and EU (omitted)

Ministry of Commerce

June 16, 2006

Ministry of Commerce
2006-06-16

NOTICE OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON THE PREFERENTIAL POLICIES FOR ENTERPRISE INCOME TAXES OF TECHNICAL INNOVATION ENTERPRISES

Notice of the Ministry of Finance and the State Administration of Taxation on the Preferential Policies for Enterprise Income Taxes
of Technical Innovation Enterprises

Cai Shui [2006] No. 88

Public finance departments (bureaus), state taxation bureaus and local taxation bureaus of all provinces, autonomous regions and municipalities
under the Central Government and cities specifically designated in state plan, and the Public Finance Bureau of Xinjiang Production
and Construction Corps.

With a view to implementing the Outline for the State Mid/Long-term Scientific and Technical Development (2006-2020) (Guo Fa [2005]
No. 44), we hereby notify the related preferential policies for enterprise income taxes of technical innovation enterprises as follows
under the Notice of the State Council on Printing, Distributing and Implementing Several Supporting Policies for the Outline for
the State Mid/Long-term Scientific and Technical Development (2006-2020) (Guo Fa [2006] No. 6),

With regard to the Expenditure for Technical Development

As regards the Chinese-funded and foreign-funded enterprises, scientific research institutions and universities and colleges with
perfect financial verification system and tax collection by checking accounts (hereinafter referred to as the enterprises), the expenditure
for technical development occurring for the research and development of new products, new technologies and work techniques shall
be deducted before tax collection under the related provisions.

The following items of expenditure for technical development that actually occur within the tax year of any of the aforesaid enterprises
is allowed, on the basis of 100% offset under the related provisions, to be re-deducted at the rate of 50% of the amount that actually
occurs before the enterprise income tax is collected, which shall include the expenditure for new product designs, expenditure for
formulating technical procedures, expenditure for equipment adjustments, expenditure for trial production of raw materials and semi-products,
expenditure for technical books and materials, expenditure for intermediate experiments that have not been included into the state
plan, wages of researchers, depreciation of instruments and equipments for research and development, expenditure for commissioning
any other entity or individual to make scientific research and trial production and other expenditure directly related to scientific
research and trial production.

The part that fails to be offset with the expense for technical development that actually occurs in an enterprise’s annual year may
be offset with the taxable income of the enterprise in the next following year, for which the time limit for offset may not be longer
than 5 years.

With Regard to the Fund for the Education of Staff

With regard to the fund for the education of staff that an enterprise collects and actually uses in the very year, the part within
2.5% of the aggregate taxable wage may be deducted before the enterprise income tax is collected.

With regard to the Accelerated Depreciation

Where the unit value of any of the enterprise’s instruments and equipments for research and development is less than 0.3 million Yuan,
the expenditure may be calculated into the cost in one or several installments and shall be deducted before the enterprise income
tax is collected. Any instrument or equipment that meets the standards for fixed assets shall be subject to separate administration,
and no depreciation shall be made any more.

Where the unit value of any of the enterprise’s instruments and equipments for research and development is more than 0.3 million Yuan,
accelerated depreciation may be based on either the double-declining balance method or the sum of the year digits method. Once a
specific method for depreciation is determined, it may not be modified at will.

The instruments and equipments as provided for in the aforesaid two paragraphs refer to those that an enterprise has newly purchased
for research and development after January 1, 2006.

With regard to the Tax Preferential Policies for High Tech Enterprises

Any high tech enterprise established within the state high-tech industrial development park as of January 1, 2006 shall be exempted
from enterprise income taxes within 2 years as of the year when it starts to make profits. After the expiration of the time limit
for tax exemption, the enterprise income tax shall be collected at a reduced tax rate of 15%.

After the aforesaid enterprise starts its business operation, its profit-making year shall be the first tax year when it starts to
make profits. In case the enterprise is run at a loss at the beginning, the balance may be made up on a year basis under the provisions
of taxation laws. Its first profit-making year shall be the tax year when it can offset the losses and begins to make profits.

As for any Chinese-funded enterprise that enjoys the tax preferential policy for two-year exemption of enterprise income tax as of
the year when it begins business operation, it can enjoy the preferential policy till the expiration and may not enjoy any preferential
policy for the exemption of enterprise income tax any more within 2 years as of its profit-making year.

The present Notice shall go into effect as of January 1, 2006. Where any related provision conflicts with the present Notice, the
present Notice shall prevail. Where the state makes any further reform on the tax collection system, the related tax preferential
policies shall be implemented under the updated provisions on tax collection.

Please carry them out accordingly.

The Ministry of Finance of the People’s Republic of China

The State Administration of Taxation

September 8, 2006

The Ministry of Finance, the State Administration of Taxation
2006-09-08

CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION CONCERNING THE LIST ( THE 16TH GROUP )OF REFUNDABLE PERSONAL INSURANCE PRODUCTS WITH A TERM MORE THAN ONE YEAR EXEMPTED FROM BUSINESS TAX

Circular of the Ministry of Finance and the State Administration of Taxation concerning The List ( the 16th Group )of Refundable Personal
Insurance Products with a Term More than One Year Exempted from Business Tax

Cai Shui [2006] No. 115

The public finance departments (bureaus) and local taxation bureaus in all provinces, autonomous regions, municipalities directly
under the Central Government, cites specifically designated in the state plan, the public Finance bureau of Xinjiang Production and
Construction Corps:

Pursuant to relevant provisions of the Circular on Exemption from Business Tax on Certain Projects (Cai Shui Zi [1994] No.002) and
the Circular of the Ministry of Finance and the State Administration of Taxation on Certain Issues concerning the Exemption from
Business Tax on Life Insurance Business (Cai Shui [2001] No.118), it is decided after examination and verification to exempt from
business tax on the premiums gained from the insurance products which are sold by related insurance companies and satisfy the conditions
of exemption from tax, and the list of the insurance products exempted from tax is attached to the Appendix.

Appendix: The List of the Insurance Products Exempted from Business Tax

the Ministry of Finance

the State Administration of Taxation

September 19, 2006

Ministry of Finance, the State Administration of Taxation
2006-09-19

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CIRCULAR OF THE PEOPLE’S BANK OF CHINA, MINISTRY OF FINANCE, CHINA BANKING REGULATORY COMMISSION, CHINA SECURITIES REGULATORY COMMISSION ON PROMULGATING THE SUPPLEMENTARY CIRCULAR ON THE ACQUISITION OF PERSONAL CREDITS

ANNOUNCEMENT NO.45, 2006 OF MINISTRY OF COMMERCE ON PRELIMINARY ARBITRATION ON WEAR RESISTANT OVERLAY

NOTICE OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON THE PREFERENTIAL POLICIES FOR ENTERPRISE INCOME TAXES OF TECHNICAL INNOVATION ENTERPRISES

CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION CONCERNING THE LIST ( THE 16TH GROUP )OF REFUNDABLE PERSONAL INSURANCE PRODUCTS WITH A TERM MORE THAN ONE YEAR EXEMPTED FROM BUSINESS TAX

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