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Order of China Securities Regulatory Commission
No. 37
The Administration Measures of Securities Issuance and Consignation, which were deliberated and adopted at the 189th chairman’s executive
meeting of China Securities Regulatory Committee Commission on September 11, 2006, are hereby promulgated and shall go into force
as of September 19, 2006.
Chairman of China Securities Regulatory Committee Commission, Shang Fulin
September 17, 2006
Administration Measures of Securities Issuance and Underwriting
Chapter I General Provisions
Article 1
In order to regulate securities issuance and underwriting and protecting the legitimate rights and interests of investors, the present
Measures are formulated under the Securities Law of the People’s Republic of China and the Company Law of the People’s Republic of
China.
Article 2
The present Measures apply to issuers who issue stocks or convertible corporate bonds (hereinafter collectively referred to as securities)
within the border territory of China, securities companies that underwrite securities within the border territory of China, and investors
who subscribe securities issued within the border territory of China.
Issuers, securities companies and investors who participate in the issuance of securities shall abide by other provisions concerning
securities issuance of China Securities Regulatory Commission (hereinafter referred to as CSRC) and the business rules of stock exchanges
and securities registration and clearing institutions. In underwriting securities, securities companies shall also abide by the related
provisions concerning sponsorship system, risk control system and inner control system of the CSRC.
Article 3
The securities service institutions and personnel that produce related documents for securities issuance shall rigidly fulfill the
statutory duties in light of generally recognized business standards and ethical norms of the securities industry, and shall be responsible
for the authenticity, accuracy and integrity of the issued documents.
Article 4
The CSRC shall supervise and manage the issuance and underwriting of securities in accordance with law.
Chapter II Inquiry and Price-Fixing
Article 5
As for the initial public offering of a stock, the issuing price of the stock shall be determined by making an inquiry to the specified
institutional investors (hereinafter referred to as inquiry objects).
Inquiry objects refer to the securities investment funds management companies, securities companies, trust and investment companies,
financial companies, insurance institutional companies, and qualified foreign institutional investors that meet the conditions prescribed
in the present Measures, and other institutional investors authorized and approved by the CSRC.
Article 6
Inquiry objects of pricing and the securities investment products under its management (hereinafter referred to as object of shares
rationing) shall be registered at Securities Association of China for record and be subject to the self-discipline management of
Securities Association of China
Article 7
Inquiry objects of pricing shall meet the conditions as follows:
(1)
It is established in light of law, and has not been imposed with any administrative penalty, supervising measure or criminal penalty
by the related supervising departments because of any significant violation of laws or regulations during the latest 12 months;
(2)
It may conduct stocks investment in accordance with law;
(3)
It has good credit record, and has necessary institutions and personnel for independently engaging in securities investment;
(4)
It has sound systems of inner risk evaluation and control which can be effectively executed, and the risk control indexes accord with
the related provision; and
(5)
Where it has been removed from the list of inquiry objects by Securities Association of China according to the provisions of the present
Measures, 12 months have lapsed since the date of removal.
Article 8
The following institutional investors, as inquiry objects, shall also satisfy the following conditions in addition to those provided
in Article 7 :
(1)
A securities company may conduct securities self-run business and securities assets management business upon approval;
(2)
A trust and investment company shall have been newly reregistered at the relevant supervising department for two or more years, its
registered capital shall not be lower than 400 million Yuan, and it shall have an active record of securities market investments
in the latest 12 months;
(3)
A financial company which has been established for 2 years or more with a registered capital not lower than 300 million Yuan and has
an active record of securities market investments in the latest 12 months; .
Article 9
A main consignee shall provide an investment value study report to the inquiry objects when making inquiries. Issuer, main consignee
or inquiry object shall never publicly disclose the content of an investment value study report in any form.
Article 10
An investment value study report shall be independently written and signed by the research personnel of a consignee, which shall
not provide an investment value study report written by an institution other than one of the underwriting syndicate. A consignee
that produces investment value study report shall establish perfect quality control system of investment value study report; the
personnel who write the report shall abide by the inner control system of securities companies.
Article 11
When writing an investment value study report, the following requirements shall be observed:
(1)
Independence, prudence and objectiveness;
(2)
The materials quoted shall be authentic, accurate, integrate and authoritative, and their sources shall be indicated;
(3)
The evaluation concerning the industry of the issuer shall be consistent and coherent;
(4)
There shall be no false record, misleading statement or momentous omission.
Article 12
An investment value study report shall make comprehensive analysis concerning the elements that affect the investment value of an
issuer, and shall at least contain the contents as follows:
(1)
The classification of the issuer’s industry, industrial policies, comparison between the issuer and the major competitors, and the
issuer’s status in the same industry;
(2)
Analysis concerning the issuer’s condition of operation and development prospect;
(3)
Analysis concerning the issuer’s capacity of making profits and their financial conditions;
(4)
Analysis concerning the issuer’s projects invested by raised funds;
(5)
Comparison between the investment value of the issuer and those that of the comparable listed companies in the same industry;
(6)
Macro economic trend, stock market trend and other elements that have important impact on the investment value of the issuer.
An investment value study report shall, on the basis of the above-mentioned analysis, anticipate the rational investment value of
an issuer’s stock by using the estimating methods recognized generally in the industry.
Article 13
An issuer and its main consignee shall make recommendations and inquiries to the inquiry objects after publishing the prospectus
of an initial public offering stock and the announcement on issuance, and shall make recommendations to the public investors via
internet.
Inquiry may be divided into initial inquiry and accumulated bidding inquiry. An issuer and its main consignee shall determine the
issuing price span through initial inquiry, and determine the issuing price within the price span through accumulated bidding inquiry.
Article 14
If an initially offered stock is listed on the board of small and medium-sized enterprises, the issuer and its main consignee may
determine the issuing price in light of the outcome of initial inquiry instead of further conducting accumulated bidding inquiry.
Article 15
an inquiry object may determine by itself whether or not to participate in the initial inquiry; if an inquiry object applies for
participating in the initial inquiry, the main consignee can not refuse without legitimate reasons. An inquiry object that does not
participate in the initial inquiry, or participates in the initial inquiry but doe not make effective quotation, shall not participate
in the accumulated bidding inquiry and offline rationing.
Article 16
After the end of initial inquiry, where the number of the publicly offered shares is smaller than 400 million and the inquiry objects
that provide effective quotations are less than 20, or the number of the publicly offered shares is larger than 400 million and the
inquiry objects that provide effective quotations are less than 50, the issuer and its main consignee may not determine the issuing
price and shall suspend the issuance.
Where an issuer and its main consignee resume the issuance after suspending it, they shall report to the CSRC in time.
Article 17
An inquiry object shall make reasonable quotation according to the principles of independence, objectiveness and sincerity, may not
negotiate on the quotation or lower or raise prices on purpose.
Article 18
The securities self-run account of a main consignee may not participate in the inquiry, offline rationing and online issuance of
the shares issued this time.
An inquiry object that has actual control relationship with the issuer or its main consignee may not participate in the inquiry and
offline rationing of the shares issued this time, but may participate in the online issuance.
Article 19
An issuer and its main consignee shall, after the issuing price span and the issuing price being determined, respectively report
them to the CSRC for record and make public announcements accordingly.
Article 20
An issuer and its main consignee may not mislead investors in the process of recommendation, or disturb the normal quotation or subscription
of any inquiry object, or disclose other information of the issuer expect such public information as prospectus; there shall not
be any false record, misleading statement or momentous omission in the recommendation materials.
Article 21
An inquiry object shall summarize the inquiry situation of the previous year within one month upon the end of that year, and make
explanations on whether it persistently accords with the conditions prescribed in the present Measures and whether it complies with
the requirements on inquiry objects as prescribed in the present Measures. The summary report shall be reported to Securities Association
of China for record.
Article 22
When issuing securities, a listed company may determine the issuing price by means of inquiry, or by negotiating with its main consignee.
The price-fixing of securities issued by a listed company shall be in accordance with the relevant provisions on securities issuance
of listed companies prescribed by the CSRC.
Chapter III Securities Offering
Article 23
Where the number of the initially offered shares is more than 400 million, shares may be rationed to strategic investors. The issuer
shall subscribe a ration agreement with strategic investors in advance and shall report to the CSRC for record.
An issuer and its main consignee shall disclose the standards for selecting strategic investors, the total amount of shares rationed
to strategic investors, the proportion taken of the shares issued this time, and time limit on holding shares, etc.
Article 24
A strategic investor may not participate in the initial inquiry and accumulated bidding inquiry of a stock of initially public offering,
and shall make a promise that the holding period of the shares rationed to it this time shall not be less than 12 months, The holding
period shall be calculated as of the date when the stock publicly offered this time is listed.
Article 25
An issuer and its main consignee shall ration shares to the inquiry objects that take part in the offline rationing. Where less than
400 million shares are offered publicly, the quantity for rationing shall not be more than 20% of the total amount of this issuance;
where 400 million or more shares are offered publicly, the quantity for rationing shall not be more than 50% of the total amount
of this issuance after deducting the amount rationed to strategic investors. An inquiry object shall make a promise that the holding
period of the shares obtained this time through offline rationing shall not be less than 3 months. The holding period shall be calculated
as of the date when the stock publicly offered this time is listed.
Where the shares issued this time are rationed to strategic investors, upon the completion of the issuance, the quantity of the shares
without any restriction on holding period shall not be less than 25% of the total amount of this issuance.
Article 26
The rationing objects of shares shall be limited to the following categories:
(1)
Securities investment funds raised upon approval;
(2)
National social security funds;
(3)
Securities self-run accounts of securities companies;
(4)
Aggregate asset management plans of securities companies established upon approval;
(5)
Securities self-run accounts of trust and investment companies;
(6)
Aggregate trust plans established by trust and investment companies which have performed reporting procedures to the relevant supervision
departments;
(7)
Securities self-run accounts of financial companies;
(8)
Approved securities investment accounts of insurance companies or insurance assets management companies;
(9)
Securities investment accounts managed by qualified foreign institutional investors;
(10)
Enterprise annuity funds that have been put on records at the relevant supervision departments;
(11)
Other products of securities investment approved by the CSRC.
Article 27
An inquiry object shall respectively appoint fund accounts and securities accounts for the objects of shares rationing under its
management, which shall be specially used for accumulated bidding inquiry and offline placement, and shall report the accounts appointed
to the CSRC, Securities Association of China and securities registration and clearing institutions for record.
Article 28
An object of shares rationing that participates in accumulated bidding inquiry and offline rationing shall pay the amount for subscription
in full amount, where only a securities account is appointed, the accumulated quantity of subscription shall not exceed the total
amount of shares rationed to inquiry objects this time.
Article 29
An issuer and its main consignee who determined the issuing price through accumulated bidding inquiry, where the aggregate quantity
of effective subscription with price above the issuing price is larger than the quantity of offline rationing, shall ration all the
effective subscription with price above the issuing price at the same proportion.
Where an issuing price is determined through initial inquiry, if the aggregate quantity of offline effective subscription is larger
than the quantity of offline rationing, all the effective subscription shall be rationed at the same proportion.
Article 30
A main consignee shall check the registration situation of inquiry objects and objects of shares rationing. An inquiry object that
falls under any of the following circumstances may not be rationed with shares:
(1)
It did not participate in the initial inquiry;
(2)
The name or account information of an inquiry object or object of shares rationing is inconsistent with those registered at Securities
Association of China;
(3)
It fails to offer a quotation within prescribed time limit or appropriate capital for subscription in full amount;
(4)
There is evidence which can prove the existence of such circumstances as violation of any law or regulation or violation of the principle
of good faith in the process of inquiry.
Article 31
An issuer and its main consignee shall conduct offline rationing of shares and online issuance at the same time.
Where the online issuing price is not yet determined, the investors taking part in the online issuance shall subscribe in accordance
with the upper limit of the price span; if the finally determined issuing price is lower than the upper limit of the price span,
the price difference shall be refunded to the investors.
An investor that takes part in online issuance shall observe the related provisions of securities exchanges and securities registration
and clearing institutions.
Article 32
Where initially public issuance of a stock reaches a certain scale, the issuer and its main consignee shall establish a claw-back
mechanism between offline rationing and online issuance, and adjust the proportion between the two in light of the situation of subscription.
Article 33
If there is any profit distribution plan or plan concerning the conversion of public accumulation funds into shares capital that
has not been handed in to the general meeting of shareholders for voting, or that has been voted and adopted by the general meeting
of shareholders but has not been actualized, the listed company shall issue securities after such plan is actualized. Before the
related plan is actualized, the main consignee may not underwrite the securities issued by the listed company.
Article 34
Where a listed company rations shares to the original shareholders (hereinafter referred to as rationing shares), it shall ration
shares to the shareholders registered at the book on the date of record at the same rationing ratio.
Article 35
Where a listed company publicly raises shares from unspecified objects (hereinafter referred to as additional issuance) or issues
convertible corporate bonds, the main consignee may classify the institutional investors that participate in offline rationing ,
and set different rationing ratios for different categories, while the institutional investors belonging to the same category shall
be rationed at the same ratio. The main consignee shall specify the standards of classification in the issuance announcement.
Where a main consignee fails to classify the institutional investors, it shall establish a claw-back mechanism between offline rationing
and online issuance, the rationing ratios of the two shall be the same with each other after the claw-back.
Article 36
Where a listed company issues additional stocks or convertible corporate bonds, it may ration all or part of shares by giving priority
to the original shareholders, the proportion of priority ration shall be disclosed in the issuance announcement.
Article 37
Where a listed company makes non-public issuance of securities, it shall conform to the related provisions on securities issuance
of listed companies prescribed by the CSRC in choosing the issuing objects and the issuing quantities.
Chapter IV Securities Consignation
Article 38
Before underwriting securities, a securities company shall report the issuing plan and the underwriting plan to the CSRC.
Article 39
A securities company that underwrites securities shall adopt the mode of exclusive sales or sales by proxy in light of provisions
of Article 28 of the Securities Law of the People’s Republic of China. A listed company that issues stocks non-publicly and does
not adopt the mode of self-distribution, or the mode of rationing, shall adopt the mode of sales by proxy.
Article 40
Where the mode of sales by proxy is adopted in the issuance of a stock, the disposal measures in case of issuance failure shall be
disclosed in the issuance announcement. If the issuance failed, the main consignee shall assist the issuer in refunding to the stock
subscribers in accordance with the issuing price adding the bank deposit interest of the same period.
Article 41
Where a securities issuance shall be underwritten by an underwriting syndicate in accordance with the provisions of laws and administrative
regulations, the consignees that compose the underwriting syndicate shall conclude an underwriting syndicate agreement, and the main
consignee shall be responsible to organize the underwriting work.
Where a securities issuance is mainly underwritten jointly by two or more securities companies, all securities companies that occupy
the position of main consignee shall bear the responsibilities of main underwriting together and fulfill the related obligations.
Where an underwriting syndicate is constituted with three or more consignees, a deputy-main consignee may be set to assist the main
consignee in organizing the underwriting activities.
Article 42
The member of an underwriting syndicate shall carry through underwriting activities in light of the provisions in the underwriting
syndicate agreement and the underwriting agreement, and may not conduct any false underwriting.
Article 43
The underwriting syndicate agreement and the underwriting agreement may be concluded after the issuing price is determined.
Article 44
The main consignee shall set up special departments or institutions to coordinate the companys departments of investment bank research,
marketing, etc, to complete such work as information disclosure, recommendation, book-keeping, price-fixing, shares rationing and
capital clearance, etc together.
Article 45
A securities company may not, in the process of underwriting, induce other people to subscribe shares by means of providing overdraft
or kickback or other illegitimate means recognized by the CSRC.
Article 46
A listed company, in arranging the suspension and resumption of listing related securities during the period of securities issuance,
shall observe the related rules of securities exchanges corporation.
The main consignee shall appropriate and pay the interests on funds deposited for the purchase of new securities in time according
to the related provisions.
Article 47
After the end of payment for subscription by investors, a main consignee shall employ an accounting firm with the qualification of
related securities business (hereinafter referred to as accounting firm) to examine and verify the capital for subscription and produce
a report on the verification of capital; where a stock of initial public offering is issued, it is necessary to further employ a
law firm to witness whether the acts of inquiry and rationing to strategic investors and inquiry objects are in line with laws, administrative
regulations and the provisions of the present Measures, and then produce special legal opinions.
Article 48
Where more than 400 million shares of initially public offering are issued, the issuer and its main consignee may adopt greenshoe,
the exercise of this power shall abide by the related provisions of the CSRC, securities exchanges and securities registration and
clearing institutions.
Article 49
Where a securities is publicly offered, the main consignee shall report the summary report of underwriting to the CSRC for record
within 10 days as of the date when the securities is listed so as to summarize and explain the basic situations during the issuance
period and the performance of the new shares after being listed, and shall provide documents as follows:
(1)
Separate edition of the prospectus;
(2)
Underwriting agreement and underwriting syndicate agreement;
(3)
Opinions of witness by the lawyer (only for the initially public offering);
(4)
Report on the verification of capital produced by the accounting firm; and
(5)
Other documents required by the CSRC.
Article 50
Where a listed company makes non-public issuance of a stock, the issuer and its main consignee shall hand in the following documents
to the CSRC upon the accomplishment of the issuance:
(1)
Statement on issuance situation;
(2)
Report made by the main consignee on the compliance of this issuing process and objects of subscription;
(3)
Opinions of witness concerning the compliance of this issuing process and objects of subscription presented by the lawyer of the issuer;
(4)
Report concerning the verification of capital produced by the accounting firm; (5) Other documents required by the CSRC.
Chapter V Information Disclosure
Article 51
An issuer and its main consignee shall, in the process of issuance, prepare the documents of information disclosure and perform the
obligation of information disclosure in light of the procedures, contents and formats stipulated by the CSRC.
Article 52
The information disclosed by an issuer and its main consignee in the process of issuance shall be authentic, precise, and integrate;
and there shall be no false record, misleading statement or momentous omission.
Article 53
An issuer and its main consignee shall publish the information disclosed in the process of issuance on at least one of the newspapers
and periodicals appointed by the CSRC; and shall, at the same time, publish such information on the internet website appointed by
the CSRC; and exhibit such information at the place appointed by the CSRC for public reference.
Article 54
The letter of intent publicized by an issuer shall conform to the prospectus in terms of contents and formats, except that the letter
of intent does not include the issuing price and the amount of capital to be raised, and shall have equal legal biding force of law
with the prospectus.
Article 55
An issuer and its main consignee shall publish the issuance announcement simultaneously when publishing the abstract of the letter
of intent or the prospectus, and shall make detailed explanation of the issuing plan.
Article 56
Where an issuer and its main consignee announce the issuing pricing and the price-earning ratio, the earnings per share shall be
calculated on the basis of the net profit of the previous year of the issuance audited by accounting firm before or after deducting
non-routine profits/losses, whichever is smaller, divided by the total capital of stocks.
The issuer that provides profit forecasting shall still complement the disclosure of the issuing earnings per share ratio based thereon.
The earnings per share shall be calculated on the basis of the forecasted net profit of the previous year of the issuance audited
by accounting firm before or after deducting non-routine profits/losses, whichever is smaller, divided by the total capital of stocks.
The issuer may also disclose such issuing price index as the net value per share ratio, which can reflect the features of the industry
where the issuer belongs.
Article 57
In case of rationing a stock of initially public offering to strategic investors, the issuer and its main consignee shall disclose
the name, subscription quantity, promised holding period and other information of each strategic investor in the announcement of
the results of offline rationing.
Article 58
After a listed company makes non-public issuance of new shares, it shall prepare and disclose the statement on issuing situation.
Article 59
Before the securities issued this time is listed, the issuer and its main consignee shall prepare the documents of information disclosure
and make announcement in light of the requirements of securities exchanges.
Chapter VI Supervision and Punishment
Article 60
Where any issuer, securities company, securities service institution or inquiry object violates any provision of the present Measures,
the CSRC may order it to rectify; as for the directly responsible person in charge and other persons directly responsible, the CSRC
may take such administrative supervision measures as supervised talks and determining them as inappropriate persons, and register
at the record of creditworthiness and publicize the names.
Article 61
Where any issuer, securities company, securities service institution, inquiry object or its directly responsible person in charge
violates any law, administrative regulation, or any provision of the present Measures, administrative penalties shall be imposed
thereupon in accordance with law when it is due; where it/he is suspected of being involved in any crime, it/he shall be transferred
to judicial authorities and its/his criminal liabilities shall be investigated.
Article 62
Where a securities company falls under any of the following circumstances, in addition to undertaking the legal responsibilities
stipulated in the Securities Law, it may not take part in the underwriting of securities within 36 months as of the date of being
confirmed by the CSRC:
(1)
Underwriting unapproved securities;
(2)
In the process of underwriting, making advertisements that are false or may mislead investors or conducting other activities of publicity
and recommendation; or inducing other people to purchase shares by illicit means; or
(3)
In the process of underwriting, there is false record, misleading statement or momentous omission in the disclosed information .
Article 63
Where a securities company falls under any of the circumstances as follows, in addition to undertaking the legal responsibilities
stipulated in the Securities Law, it may not take part in the underwriting of securities within 12 months as of the date of being
confirmed by the CSRC:
(1)
Leaking information on securities issuance in advance;
(2)
Canvassing underwriting business by means of unfair competition;
(3)
Failing to disclosing information as required in the process of underwriting;
(4)
The actual operation in the process of underwriting does not conform to the issuing plan submitted to the CSRC;
(5)
Writing or publishing the study report concerning investment value by violating the related provisions.
Article 64
Where an issuer and its main consignee provide, by violating the related provisions, any financial subsidy or compensation to the
investors that take part in subscription, the CSRC may order it to rectify; where the former circumstance is serious, it may give
admonition or impose fines.
Article 65
Where an inquiry object falls under any of the following circumstances, Securities Association of China shall remove it from the
list of inquiry
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the Ministry of Finance
Notice of the Ministry of Finance on Printing and Distributing the Rules for the Bid Invitation of Accounting Firms for the Audit
Entrustment
Cai Hui [2006] No.2
To the departments (bureaus) of finance of all provinces, autonomous regions and municipalities directly under the Central Government,
Shenzhen City Bureau of Finance, relevant ministries, commissions of and institutions directly under the State Council and enterprises
under central administration,
For the purpose of regulating the activities relating to the bid invitation of accounting firms for the audit entrustment, promoting
the fair competition in the industry of certified public accountants and protecting the lawful rights and interests of tenderees
and bidding firms, the Ministry of Finance has formulate the Rules for the Bid Invitation of Accounting Firms for the Audit Entrustment,
which are now printed and distributed to you. The Rules shall come into force as of the date of March 1, 2006.
Annex: Rules for the Bid Invitation of Accounting Firms for the Audit Entrustment
Ministry of Finance (Seal)
January 1, 2006 Annex:Rules for the Bid Invitation of Accounting Firms for the Audit Entrustment
Article 1
For the purpose of regulating the activities relating to the bid invitation of accounting firms (hereinafter referred to as the firms)
for the audit entrustment, promoting the fair competition in the industry of certified public accountants and protecting the lawful
rights and interests of tenderees and bidding firms, these Rules are formulated according to the Bidding Law of the People’s Republic
of China, the Law of the People’s Republic of China on Certified Public Accountants and other relevant laws.
Article 2
The tenderees shall abide by the Bidding Law of the People’s Republic of China for the audit entrustment of firms by way of bid invitation,
which shall conform to these Rules.
Article 3
The principles of openness, fairness, equity and good faith shall be followed for the bidding activities.
No entity or individual may violate the laws or administrative regulations, restrict or exclude firms from participating in the bidding
or illegally interpose the bidding in any form.
When undertaking and conducting the audit work by way of bidding, a firm shall abide by the audit rules and professional ethics, fulfill
obligations and accomplish the bid winning project in strict accordance with the agreement on the audit work.
Article 4
The following procedures shall be observed when conducting the bid invitation of firms for the entrustment of audit work:
(1)
Bid invitation, which includes the determination of the way of bid invitation, the issuance of bid invitation announcements (in the
case of public bid invitation) or issuance of bid invitation letters (in the case of selective bid invitation), the formulation of
bid invitation documents and the delivery of bid invitation documents to potential bidding firms;
(2)
Bid opening;
(3)
Bid evaluation; and
(4)
Determination of the bid winning firm, issuance of the bid winning notice and conclusion of the agreement on the audit work with the
bid winning firm.
Article 5
Generally, a tenderee shall entrust a firm by way of public bid invitation.
If a bid invitation project is under any of the following circumstances, the method of selective bid invitation may be adopted:
(1)
There is particularity , meaning the firm can only be chosen from a limited scope; or
(2)
There is an emergency, meaning the entrustment cannot be accomplished by the way of public bid invitation within the prescribed time
limit.
Article 6
Where the way of public bid invitation is adopted, a bid invitation announcement shall be publicized. Where the way of selective bid
invitation is adopted, the bid invitation letters shall be sent out to at least three firms.
The bid invitation announcement and the bid invitation letters shall state the name and address of the tenderee, the quality, quantity,
implementation site and time of the bid invitation project as well as the measures for obtaining bid invitation documents, etc.
Article 7
A tenderee may request the potential firms to provide relevant qualification certificates and performance conditions in the bid invitation
announcement or the bid invitation letters, and carry out the qualification examination of potential bidding firms according to the
requirements of the project for bid invitation.
A tenderee shall make full use of the industrial information as publicized by the fiscal department and the association of certified
public accountants, and implement the provisions of the Ministry of Finance on the audit administration during the process of qualification
examination,.
Article 8
A tenderee shall formulate bid invitation documents according to the characteristics of bid invitation project and the requirements.
The bid invitation documents shall include:
(1)
The introduction of the bid invitation project;
(2)
The standards for the qualification examination of bidding firms;
(3)
The requirements on the quotes for bidding;
(4)
The standards for bid evaluation; and
(5)
The main articles of the agreement on the audit work to be concluded.
Article 9
A tenderee shall make explicit disclosure of the information about the bid invitation project in the bid invitation documents in order
to facilitate the determination of the workload, the formulation of the work schemes, the presentation of reasonable quotes and the
formulation of bidding documents by the bidding firms, which shall include the organizational structure, industry, operational type,
distribution and financial information (such as the assets scale and structure, debts, annual revenues and other relevant financial
indicators) of the entities to be audited.
Article 10
A tenderee shall conform to the requirements of the bid invitation project and reasonably determine the evaluation items, set down
the standards for evaluation and design the weight of the score of each evaluation item in the total score by the way of comprehensively
considering the work schemes, personnel situation, relevant work experiences, records of professional ethics and quality control
level, degree of commercial responses and quotes of bidding firms. The weight of the score as reported by any bidding firm shall
not be more than 20%.
The specific design of bid evaluation standards may be determined by referring to the attached Reference Table for the Evaluation
Items and the Design of their Weights.
Article 11
Where the time limit to complete the corresponding work for a bid invitation project needs to be determined, the tenderee shall reasonably
determine the time limit by taking into account the particularity of the industrial services of certified public accountants, and
state it in the bid invitation documents.
Article 12
A tenderee may organize the potential bidding firms for discussions and answering questions according to the specific conditions of
the bid invitation project. Where the potential bidding firms need to consult the detailed materials about the bid invitation project,
the tenderee shall offer convenience if possible.
Article 13
A tenderee shall consider the particularity of the industrial services of certified public accountants when determining the time limit
for the bidding firms to formulate bidding documents, and the time limit shall generally be not less than 20 days from the day when
the bid invitation documents are sent out to the expiry date for the bidding firms to submit bidding documents.
Article 14
A tenderee shall open the bids publicly and invite all the bidding firms to participate in the bid opening.
Article 15
A tenderee shall organize a bid appraisal committee to be responsible for bid appraisal.
The bid appraisal committee shall be composed of representatives of the tenderee and experts familiar with the industry of certified
public accountants Anyone that has interests with a tenderer shall not be a member of the bid appraisal committee for the relevant
project.
The members of a bid appraisal committee (hereinafter referred to as the judges) shall be an odd number of 5 persons or more, of which
the experts familiar with the industry of certified public accountants shall be no less than two thirds of all the members generally.
The name list of judges shall be kept unannounced before the bid winning results are determined.
Article 16
A tenderee shall take measures necessary to guarantee that the bids are evaluated under a strictly confidential circumstance. No entity
or individual may illegally intervene in or influence the process or result of bid appraisal.
Article 17
The judges shall give scores for bidding firms according to the standards for bid appraisal.
The bid appraisal committee shall rank all the bidding firms according to their scores and recommend the bid winning candidate firms
according to the ranking.
Article 18
The bid appraisal committee shall work out a written bid appraisal report to the tenderee after completing the bid appraisal,.
The tenderee shall determine the bid winning firm according to the written bid appraisal report as worked out and the bid winning
candidate firms as recommended by the bid appraisal committee, or may authorize the bid appraisal committee to directly determine
the bid winning firm.
Article 19
After the bid winning firm is determined, the tenderee shall send out a bid winning notice to the bid winning firm, and notify the
bid winning result to all the bidding firms that fail the bidding.
Article 20
A tenderee shall conclude an agreement on the audit work with the bid winning firm on the basis of the bid invitation documents and
the bidding documents of the bid winning firm within 30 days after the bid winning notice is sent out.
The tenderee shall not require the bid winning firm to alter the substantial contents of the bid invitation project, enhance the technical
requirements of the bid invitation project, reduce the fees for the entrusted matter or seek for commissions from the bid winning
firm for any excuse.
The tenderee shall not conclude any other agreement with the bid winning firm that is contrary to the substantial contents of the
agreement on the audit work.
Article 21
The Ministry of Finance and the fiscal departments of all the provinces, autonomous regions and municipalities directly under the
Central Government shall supervise the audit-related bidding activities and deter and deal with illegal and irregular acts during
the course of audit-related bidding activities according to the law.
Article 22
The entrustment of firms for other authentication and relevant services by the tenderees by way of bid invitation shall be conducted
by reference to these Rules.
Article 23
The power to interpret these Rules shall remain with the Ministry of Finance.
Article 24
These Rules shall come into force as of March 1, 2006.
Annex: Reference Table for the Appraisal Items and the Design of Their Weights htm/e04794.htm Annex
Annex:
Reference Table for the Appraisal Items and the Design of Their Weights
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Appraisal Items |
Weight Scope |
|
Work Plan |
20%-30% |
|
Personnel Situation |
20%-30% |
|
Relevant Work Experiences |
15%-25% |
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Records of Professional Ethics and Quality Control Level |
10%-15% |
|
Degree of Commercial Responses |
5% |
|
Quote |
10%-20% |
Annotation: As to the appraisal of quotes, the standards for appraisal shall be the absolute value of the discrepancy between the
quote and average quote, and the lower the absolute value of the discrepancy is, the higher the score will be.
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Ministry of Commerce
Announcement No.5, 2006 of Ministry of Commerce, on Starting Anti-dumping Interim Review on Imported Ethanolamine
[2006] No.5
The Ministry of Commerce issued Announce No.57 of 2004 on November 14, 2004 to start levying anti-dumping duties on imported Ethanolamine
(hereinafter referred to as investigated product) originating in Japan, the U.S., Iran, Malaysia, Taiwan Region and Mexico. Among
the related enterprises, the anti-dumping duties rate on Ethanolamine from Optimal Chemicals (Malaysia) Sdn. Bhd. was 9%.
The above-mentioned enterprise applied to Ministry of Commerce for a dumping and dumping margins judicial review on the anti-dumping
measures implemented to the enterprise and raised petition for amending the anti-dumping duty rate correspondingly.
In respond to the application, Ministry of Commerce made an examination on related issues and decided to start a judicial review,
as of the date when this announcement is issued, on the anti-dumping measures implemented on the investigated product from the above-mentioned
enterprise during a period from January 1, 2005 to December 31, 2005.
The investigated product is listed under No. 29221100, 29221200 in Import and Export Tariffs of the General Administration of Customs
of the People’s Republic of China.
Interested parties can apply in written forms to respond to charges in the interim review within 20 days as of the date the Announcement
is issued.
To get the necessary information for the investigation, Ministry of Commerce will send out questionnaire to the interested parties
accordingly, the answer sheet of which shall be submitted within 37 days as of the date of issuance of the questionnaire.
The interested parties could raise written petition for holding a hearing, which could also be held initiatively by Ministry of Commerce
when necessary.
Ministry of Commerce could, when necessary, send out staff to relate countries for field examination and verification, before which
the countries and enterprises will get notice in advance.
Any form of obstruction against the investigation may result in an arbitration based on the available fact and information.
Address: No. 2, DongChangAn St., Beijing
Postcode: 100731
Bureau of Fair Trade for Imports and Exports, Ministry of Commerce
Tel: 86-10-65198924;65198915
Fax: 86-10-65198915;65198172
Ministry of Commerce
February 10, 2006
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Ministry of Commerce
2006-02-10
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The Ministry of Finance
Accounting Standards for Enterprises No. 11 – Share-based Payments
Cai Kuai [2006] No.3
February 15, 2006
Chapter I General Provisions
Article 1
These Standards are formulated in accordance with the Accounting Standards for Enterprises – Basic Standards for the purpose of regulating
the recognition, and measurement of share-based payments, and the disclosure of relevant information. .
Article 2
The term “share-based payment” refers to a transaction in which an enterprise grants equity instruments or undertakes equity-instrument-based
liabilities in return for services from employee or other parties.
The share-based payments shall consist of equity-settled share-based payments and cash-settled share-based payments.
The term “equity-settled share-based payment” refers to a transaction in which an enterprise grants shares or other equity instruments
as a consideration in return for services.
The term “cash-settled share-based payment” refers to a transaction of payment of cash or any other asset obligation calculated and
determined on the basis of shares or other equity instruments undertaken by the enterprise in return for services.
The term “equity instrument” as mentioned in these Standards refers to the equity instruments of the enterprise’s own.
Article 3
The following items shall be governed by other accounting standards:
(1)
The Accounting Standards for Enterprises No. 20 – Business Combination shall apply to a transaction in which an enterprise issue the
equity instrument and obtains the net assets of another enterprise in a business combination.
(2)
The Accounting Standards for Enterprises No. 22 – Recognition and Measurement of Financial Instruments, shall apply to a transaction
in which equity instruments are granted as a consideration for other financial instruments.
Chapter II The Equity-settled Share-based Payments
Article 4
The equity-settled share-based payment in return for employee services shall be measured at the fair value of the equity instruments
granted to the employees.
The fair value of the equity instruments shall be confirmed in accordance with Accounting Standards for Enterprises No. 22 – Recognition
and Measurement of Financial Instruments.
Article 5
As to an equity-settled share-based payment in return for services of employees, if the right may be exercised immediately after the
grant, the fair value of the equity instruments shall, on the date of the grant, be included in the relevant cost or expense and
the capital reserves shall be increased accordingly.
The “grant date” refers to the date on which the share-based payment agreement is approved.
Article 6
As to a equity-settled share-based payment in return for employee services, if the right cannot be exercised until the vesting period
comes to an end or until the prescribed performance conditions are met, then on each balance sheet date within the vesting period,
the services obtained in the current period shall, based on the best estimate of the number of vested equity instruments, be included
in the relevant costs or expenses and the capital reserves at the fair value of the equities instruments on the date of the grant.
If, on the balance sheet date, the subsequent information indicates that the number of vested equity instruments is different from
the previous estimate, an adjustment shall be made and on the vesting date, the estimate shall be adjusted to equal the number of
the actually vested equity instruments.
The ” vesting period” refers to the period during which the specified vesting conditions are to be satisfied.
As to a share-based payment with a specified service period as the vesting condition, the vesting period shall be from the grant date
to the vesting date. As to a share-based payment with specified performances as the vesting condition, the length of the vesting
period shall be estimated in accordance with the most likely performance outcome.
The “vesting date” refers to the date on which the vesting conditions are met and the employees and other parties have the right to
obtain the equity instruments or cash from an enterprise.
Article 7
An enterprise shall, after the vesting date, make no adjustment to the relevant costs or expenses as well as the total amount of the
owner’s equities which have been confirmed.
Article 8
An equity-settled share-based payment in return for the service of any other party shall be conducted in accordance with the following
circumstances, respectively:
(1)
If the fair value of the service of any other party can be measured in a reliable way, the fair value of the service on the acquisition
date by any other service party shall be included in the relevant costs or expenses, and the owner’s equities shall be increased
accordingly.
(2)
If the fair value of the service of any other party can not be measured in a reliable way, but the fair value of the equity instruments
can be measured in a reliable way, the fair value of the equity instruments on date of the service acquisition shall be included
in the relevant costs or expenses, and the owner’s equities shall be increased accordingly.
Article 9
On the vesting date, an enterprise shall, based on the number of the equity instruments of which the right is actually exercised,
calculate and confirm the amount of the paid-in capital or capital stock to be transferred in, and transfer it in the paid-in capital
or stock capital.
The “vesting date” refers to the date on which the employees and other parties exercise the right, acquire cash or equity instruments.
Chapter III The Cash-settled Share-based Payments
Article 10
A cash-settled share-based payment shall be measured in accordance with the fair value of liability calculated and confirmed based
on the shares or other equity instruments undertaken by an enterprise. .
Article 11
As to a cash-settled share-based payment instruments, if the right may be exercised immediately after the grant, the fair value of
the liability undertaken by the enterprise shall, on the date of the grant, be included in the relevant costs or expenses, and the
liabilities shall be increased accordingly.
Article 12
As to a cash-settled share-based payment, if the right may not be exercised until the vesting period comes to an end or until the
specified performance conditions are met, on each balance sheet date within the vesting period, the services obtained in the current
period shall, based on the best estimate of the information about the exercisable right, be included in the relevant costs or expenses
and the corresponding liabilities at the fair value of the liability undertaken by the enterprise.
If, on the balance sheet date, the subsequent information indicates that fair value of the current liability undertaken by the enterprise
are different from the previous estimates, an adjustment shall be made and on the vesting date the estimate shall be adjusted to
equal the actually exercisable right.
Article 13
An enterprise shall, on each balance sheet date and on each account date prior to the settlement of the relevant liabilities, re-measure
the fair values of the liabilities and include the changes in the current profits and losses.
Chapter IV Disclosure
Article 14
An enterprise shall, in the notes, disclose the information related to the cash-settled share-based payments as follows:
(1)
The total amounts of the equity instruments that are granted, exercised and invalidated in the current period;
(2)
The range of the vesting prices for the share options or other equity instruments issued outward at the end of period, and the remainder
of the contractual period;
(3)
The weighted average prices of the share options or other equity instruments exercised in the current period which are calculated
based on the vesting date prices; and
(4)
The measures for the confirmation of the fair value of the equity instruments.
The enterprise may disclose the information of homogeneous share-based payments on a consolidated basis.
Article 15
An enterprise shall, in its notes, disclose the effects of the share-based payment transactions on the current financial status and
operating outcomes, which shall at least include the information as follows:
(1)
The total amount of the expenses as result of equity-settled share-based payments, which is recognized in the current period;
(2)
The total amount of the expenses as a result of cash-settled share-based payments, which is recognized in the current period; and
(3)
The total amount of the employee services and other party services as a result of the share-based payments in the current period
.
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