Supreme Court Decisions

ANNOUNCEMENT OF THE GENERAL ADMINISTRATION OF CUSTOMS ON THE RELEVANT ISSUES CONCERNING THE ADJUSTMENT OF THE “CUSTOMS IMPORT AND EXPORT TARIFF OF THE PEOPLE’S REPUBLIC OF CHINA”

The General Administration of Customs

Announcement of the General Administration of Customs on the Relevant Issues concerning the Adjustment of the “Customs Import and
Export Tariff of the People’s Republic of China”

[2002] No. 39

December 25, 2002

Upon the approval of the State Council, the items and tariff rates in the Customs Import and Export Tariff of the People’s Republic
of China shall be adjusted as of January 1, 2003. For the relevant details, please refer to the 2003 version of Customs Import and
Export Tariff of the People’s Republic of China (published by Law Press. China). We hereby announce the relevant issues as follows:

I.

Part of the items in the import tariff have been adjusted, and the total number of the items of the import tariff after the adjustment
is 7445, which is 129 more than that in 2002.

II.

The MFN tariff rates of 3019 items in the import tariff has been reduced, and after the adjustment, the arithmetic average tariff
level has been reduced from 12% to 11%; while the common rates of import tariff are kept unchanged.

III.

Specific duty or compound duty shall continue to be applied to 51 items of commodities such as frozen chicken, beer and video cameras,
etc., with their tariff rates being reduced in different degrees compared with those in 2002.

IV.

The tariff quota administration shall continue to be applied to 10 agricultural products such as wheat, bean oil, etc. and 3 fertilizers
such as urea, etc., with their tariff rates beyond the quota being reduced in different degrees compared with those in 2002, and
their tariff rates within the quota being kept unchanged.

V.

With respect to the 15 commodities to which the Information Technology Agreement (ITA) tariff rates are partly applied, whether the
ITA tariff rates shall be applied to them shall be examined, checked and determined by the competent customs at the locality of the
enterprise. The consignee or consigner of the imported or exported goods or his agent shall, 15 working days before the goods are
actually imported, submit to the local customs an “Application Form on the Uses of the Commodities to which ITA Tariff Rates are
partly applied” (hereinafter referred to as “Application Form”, see Attachment 1). The customs shall, if determining that they shall
be subject to ITA tariff rates upon examination and check, issue a “Proof on Ascertainment of the Uses of the Commodities to which
ITA Tariff Rates are partly applied” (hereinafter referred to as “Proof on Uses”, see Attachment 2), and the customs at the place
of import shall levy customs duty according to the ITA tariff rates.

VI.

To the 757 items of imported commodities originating in Korea, Sri Lanka, Bengal and Laos, the tariff rates in Bangkok Agreement shall
be applied; while to the 20 items of imported commodities originating in Bengal, special preferential tariff rates shall be applied.

VII.

One item is added to the export tariff, and the tariff rates in the export tariff have not been adjusted.

VIII.

The tariff rates temporarily determined under the annual MFN shall be applied to 216 imported commodities, and the annually determined
temporary tariff rates shall be applied to 23 exported commodities, with the date of expiry to be December 31, 2003 (the date for
application).

IX.

The rate of single ad valorem duty, instead of the sliding scale duty, shall be applied to newsprint paper.

This is hereby the announcement.

Attachments:

1. Application Form on the Uses of the Commodities to which ITA Tariff Rates are Partly Applied (Omitted)

2. Proof on Ascertainment of the Uses of the Commodities to which ITA Tariff Rates are Partly Applied (Omitted)



 
The General Administration of Customs
2002-12-25

 







MEASURES FOR QUALIFICATION REGISTRATION OF GEOLOGICAL RECONNAISSANCE

The Ministry of State Land Resources

Notice of the Ministry of State Land Resources on Printing and Issuing Measures for Qualification Registration of Geological Reconnaissance

Guo Tu Zi Fa [2003] No.218

The ministries of state land resources of every province, autonomous region and municipality directly under the Central Government
(the ministry of state land environment resources, bureau of state land resources and housing, bureau of housing and land resources,
bureau of state land resources and planning):

In order to standardize the conditions for the access to geological reconnaissance market, to maintain the market order of geological
reconnaissance, to strengthen the supervision of the ability of the geological reconnaissance and to promote the development of geological
reconnaissance work, in accordance with regulations of the Mineral Resources Law of the People’s Republic of China and the Measures
for Registration Administration of the Reconnaissance Blocks of Mineral Resources, the ministry decided to set up registration system
and formulated Measures for Qualification Registration of Geological Reconnaissance, the measures are hereby printed and issued,
please carry out.

The Ministry of State Land Resources

June 24, 2003

Measures for Qualification Registration of Geological Reconnaissance

Article 1

In order to standardize the conditions for the access to geological reconnaissance market, to maintain the market order of geological
reconnaissance and to promote the development of geological reconnaissance work, the Measures are hereby formulated in accordance
with the Mineral Resources Law of the PRC and the Measures for Registration Administration of the Reconnaissance Blocks of Mineral
Resources.

Article 2

Registration shall go through in compliance with the Measure for obtaining the qualification certificates of geological reconnaissance
in case geological reconnaissance is undertaken in the territory and other sea jurisdiction of the PRC.

Article 3

The qualifications for geological reconnaissance are classified by nature of the professions of geological reconnaissance and the
registration should be kept according to the requirements of geological reconnaissance capability and level.

The professional classifications of the qualifications for geological reconnaissance and the conditions for registration are separately
promulgated.

Article 4

The Ministry of State Land Resources and the administrative departments of sate land resources of the people’s government of provinces,
autonomous regions and municipalities directly under the Central Government are the registration authorities of the qualifications
for geological reconnaissance.

The scope of functions of the Ministry of State Land Resources is as follows:

(I)

Registration of the qualifications for oceanic geological survey, oil and gas mineral reconnaissance, aviation physical geographical
reconnaissance, and aviation remote sensing geological reconnaissance;

(II)

Summarization, publication and provision of query services of information on registration of the qualifications for geological reconnaissance
of the whole country;

(III)

Supervision management on the registration of qualifications for geological reconnaissance by the administrative departments of sate
land resources of the people’s government of provinces, autonomous regions and municipalities directly under the Central Government
as well as the qualifications for geological reconnaissance of the whole country.

The scope of functions of the administrative departments of sate land resources of the people’s government of provinces, autonomous
regions and municipalities directly under the Central Government provinces, autonomous regions and municipalities directly under
the Central Government is as follows:

(I)

Registration of the qualifications for geological reconnaissance other than that specified in Item (I) of the above-mentioned clause
of this article;

(II)

Summarization, publication and provision of query services of information on registration of the qualifications for geological reconnaissance
in the corresponding administrative divisions;

(III)

Supervision management on the registration of qualifications for geological reconnaissance in the corresponding administrative divisions.

Article 5

The applicants for geological reconnaissance qualifications shall be enterprises or institutional unites directly engaged in the undertakings
of geological reconnaissance, which besides the requirements for a legal person shall meet the following conditions for the geological
reconnaissance qualifications.

Article 6

In applying for the geological reconnaissance qualifications, the applicant shall provide the registration authority with the following
materials:

(I)

Application for qualification registration of geological reconnaissance;

(II)

Documents or copy of the certification of the legal person;

(III)

Documents or copy of the positions of the legal representative and the responsible technological persons;

(IV)

Documents or copy of the certification of assets;

(V)

Name list of technicians and copies of the technical post_title and qualifications of senior and medium-level technicians;

(VI)

List of the main reconnaissance instruments and equipment;

(VII)

Other necessary materials required for submission by the registration authority.

In case of application for the qualification of oil and gas mineral reconnaissance, the documents or copy of the approval of the State
Council should be submitted for establishment of oil companies or consent of oil and gas mineral reconnaissance.

Article 7

Within 30 days upon receipt of the application for qualification registration of geological reconnaissance, the registration authority
shall check and verify the truthfulness of the application materials, and draw conclusions on whether or not the registration is
qualified in compliance with the requirements for the conditions of the geological reconnaissance qualifications, together with notices
given to the applicant.

If modification or supplementary materials are required from the applicant, the registration authority shall notify the applicant
of modification or supplementation within the term specified.

In case the registration conditions meet the requirements, the applicant shall within 30 days upon receipt of the notice handle with
the registration formalities and obtain the qualification certificates of geological reconnaissance and become the registered entity
eligible for geological reconnaissance, which can undertake the geological reconnaissance work by force of law within the registration
scope.

In case of failure to meet the registration requirements, the registration authority shall provide the applicant with the reasons
thereof.

Article 8

The qualifications of geological reconnaissance adopt the uniform inspection system at the intervals of inspection once two years
to be executed in December. And the uniform inspection work will be in the charge of the registration authority.

At the time of uniform inspection the registration holder shall carry the qualification certificate of geological reconnaissance (original
and duplicate) and fill in and submit the Uniform Inspection From of Geological Reconnaissance at the original registration authority
and accept the uniform inspection.

In qualified for the uniform inspection, the registration authority shall cover the special stamp on the qualification certificate
of geological reconnaissance (duplicate), and if not qualified, the registration authority shall proceed in compliance with the provisions
of Article 9 of the Measures.

In case of failure to accept the uniform inspection beyond the time schedule, the qualification certificate of geological reconnaissance
will automatically become invalid.

Article 9

in case of any of the following circumstances during the uniform inspection, the uniform inspection authority shall proceed as degrading
of the qualifications, and notify the inspected to handle with the formalities for alteration of the registration.

(I)

When the reconnaissance capabilities are lower than the requirements of the corresponding classifications;

(II)

Having not undertaken such classification of geological reconnaissance activities consecutively for two years;

(III)

Material negligence or violations of law in some type of reconnaissance works.

In case of any of the circumstances specified in Article 16 of the Measures, the registration authority will revoke the registration
qualifications and proceed according to Article 6 of the Measures.

Article 10

Eligible for the following conditions, the registration holder may apply for adding the business scope at the original registration
authority and verified in compliance with the requirements of the registration conditions, the original registration authority shall
notify the registration holder to handle with the formalities for alteration of the registration.

(I)

Expiry of two years of various reconnaissance works with qualified uniform inspections;

(II)

The working capacity for newly added reconnaissance work having reached the corresponding conditions and requirements of the added
business items; and

(III)

Free of material negligence or violations of law in various reconnaissance works.

Article 11

In any of the following cases, application should be made to the registration authority within 30 days for handling with the formalities
for alteration of the registration.

(I)

Consolidation, separation and renaming of the legal person;

(II)

Alteration of the domicile of legal person and the legal representative;

(III)

Addition or reduction of business classifications;

(IV)

Alteration required for by the laws, administrative regulations, rule and stipulations.

Article 12

In case of loss of the qualification certificates of geological reconnaissance (original and duplicate), announcement must be made
on the media designated by the Ministry of State Land Resources before application is made at the original registration authority
for handling with the formalities for repeated issuance of the certificates.

Article 13

The applicant shall provide the registration authority with true registration materials without any falsehood, and may not refuse
the inspection.

The registration authority should keep confidential the applicant’s materials relating to commercial secrets.

Article 14

The administrative departments of sate land resources of the people’s government of provinces, autonomous regions and municipalities
directly under the Central Government shall in the first month each year submit the Ministry of State Land Resources with the annual
reports of the previous year on the administration of the qualification registration of geological reconnaissance, which annual report
shall include: work survey, main achievements, existing issues, working plan, opinions and suggestions of the coming year.

Article 15

The registration authority shall regularly make random sampling inspection and evaluation on the professional capabilities and performance
of the registration holder and set up the practice archives thereof, and their practice behaviors, reputation maintenance, results
of sampling evaluation, social claims and defaults should be recorded in their practicing archives.

Article 16

In any of the following cases on the part of the registration holder, the registration authority shall not grant it with the qualification
registration of geological reconnaissance for three years.

(I)

Conceal of facts and falsehood in the relevant materials;

(II)

Failure to handling with the formalities for alteration of the registration in compliance with the relevant provisions of the Measures;

(III)

Participating in the reconnaissance without the license for mineral resource reconnaissance or undertaking of reconnaissance by tort;

(IV)

Subcontracting the implementation to the unit or individual without the qualification certificates of geological reconnaissance;

(V)

Undertaking of geological reconnaissance beyond the approved scope of reconnaissance;

(VI)

Mortgage, leasing or transferring of the qualification certificates of geological reconnaissance;

(VII)

Other material negligence or violations of law; or

(VIII)

Noncompliance with the professional ethic standards or breach of the principle of good faith.

Article 17

In case of abuse of positions for private purposes on the part of the workers of the registration authority that constitutes a crime,
criminal responsibilities shall be prosecuted, and in case no crime has been constituted, administrative punishment may be accorded
buy force of law.

Article 18

The qualification certificates of geological reconnaissance are divided into originals and duplicates, which are equally authentic.

The qualification certificates of geological reconnaissance are not restricted by administrative divisions, which are valid throughout
the country.

Article 19

The qualification certificates of geological reconnaissance are uniformly printed by the Ministry of State Land Resources, which is
in charge of uniformly formulating the application forms of the qualification registration of geological reconnaissance, the forms
for uniform inspection of the qualifications of geological reconnaissance, the special stamp for the qualification registration of
geological reconnaissance, and the special stamp for the uniform inspection of the qualifications of geological reconnaissance.

Article 20

In case of registration by the administrative departments of sate land resources of the people’s government of provinces, autonomous
regions and municipalities directly under the Central Government in violation of the provisions of the Measures, the Ministry of
State Land Resources is enpost_titled to make corrections thereof.

Article 21

Foreign investors and investors from Hong Kong, Macao and Taiwan that apply for registration of the qualifications of geological reconnaissance
shall proceed in compliance with the provisions of the Measures and special provisions, if any, specified by laws and administrative
regulations shall apply.

Article 22

Those entities that have obtained the qualification certificates of geological reconnaissance prior to the implementation of the Measures
shall apply with the registration authority for registration in compliance with Article 4 of the Measures, and by the end of the
registration work, the previous qualification certificates of geological reconnaissance will become invalid automatically.

Article 23

The Measures shall come into force as of the date of promulgation.



 
The Ministry of State Land Resources
2003-06-24

 







DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON REVISING THE PREVENTION AND CONTROL OF ATMOSPHERIC POLLUTION

Decision of the Standing Committee of the National People’s Congress on Revising the Law of the PRC on the Prevention and Control
of Atmospheric Pollution

     At its 15th Meeting, the Standing Committee of the Eighth National People’s Congress decides to revise the Law of the People’s Republic
of China on the Prevention and Control of Atmospheric Pollution as follows:

1. One paragraph is added to Article 8 as Paragraph 1: “The State adopts economic and technological policies and measures to facilitate
the prevention and control of atmospheric pollution and comprehensive utilization.”

2. One article is added as Article 9: “The people’s governments at various levels shall redouble their efforts in afforestation and
urban greening to improve the atmospheric environment.”

3. One article is added as Article 15: “Enterprises shall give priority to the adoption of clean production techniques that are instrumental
to high-efficient use of energy and reduced discharge of pollutants so as to decrease the generation of atmospheric pollutants.

“The State practises an elimination system for the backward production techniques and backward equipment which seriously pollutes
the atmospheric environment.

“The competent department for comprehensive economic and trade affairs under the State Council shall, in conjunction with other relevant
departments under the State Council, publish a catalog of the techniques which seriously pollute the atmospheric environment and
the use of which shall be prohibited within a time limit, and a catalog of the equipment which seriously pollutes the atmospheric
environment and the production, sale, importation and use of which shall be prohibited within a time limit.

“Producers, sellers, importers or users shall, within the time limit prescribed by the competent department for comprehensive economic
and trade affairs under the State Council in conjunction with the relevant departments under the State Council, stop the production,
sale, importation or use of the equipment listed in the catalog specified in the preceding paragraph. People who use the production
techniques listed in the catalog specified in the preceding paragraph shall, within the time limit prescribed by the competent department
for comprehensive economic affairs under the State Council in conjunction with the relevant departments under the State Council,
stop using such techniques.

“The equipment eliminated in accordance with the provisions of the preceding two paragraphs may not be transferred to another for
use.”

4. One article is added as Article 24: “The State promotes the dressing of coal by washing to reduce the sulfur and ash in coal, and
restricts the mining of high-sulfur or high-ash coal. If the coal mined from a newly-built coal mine is of high-sulfur or high-ash,
supporting facilities for the dressing of coal by washing shall be installed to make the sulfur and ash in coal fall within the prescribed
limits.

“If the coal mined from an established coal mine is of high-sulfur or high-ash, supporting facilities for the dressing of coal by
washing shall be installed within a time limit in accordance with the plan approved by the State Council.

“It is prohibited to mine the coal with toxic or harmful substances, such as radioactive and arsenic, that exceed the prescribed limits.”

5. One article is added as Article 25: “People’s governments of large or medium-sized cities shall make plans for people in the urban
areas to use sulfur-fixed briquette of coal as fuel or other clean fuel for cooking ranges, so as to gradually eliminate the direct
use of raw coal as fuel.”

6. One article is added as Article 26: “To establish a heat-engine plant within the urban areas of a city, both heating and electricity
shall be generated where it is necessary and conditions permit, and construction and acceptance for use of the network of pipelines
for heat supply shall be arranged in step with that of the main project of the plant.”

7. One article is added as Article 27: “The environmental protection department under the State Council together with relevant department
under the State Council may, in light of the meteorological, topographical, soil and other natural conditions, delimit the areas
where acid rain has occurred or will probably occur and areas that are seriously polluted by sulfur dioxide as acid rain control
areas and sulfur dioxide pollution control areas, subject to approval by the State Council.

“With respect to the heat-engine plants and other large or medium-sized enterprises in the acid rain control areas or sulfur dioxide
pollution control areas that discharge sulfur dioxide, if they are newly-built construction projects which cannot use low-sulfur
coal, supporting facilities for desulphurization and dust removal must be installed or other measures for control of the discharge
of sulfur dioxide or for dust removal adopted; if they are established enterprises which do not use low-sulfur coal, measures for
control of discharge of sulfur dioxide or for dust removal shall be adopted. The State encourages enterprises to adopt advanced technology
for desulphurization and dust removal.

“Enterprises shall gradually adopt measures to control the nitrogen oxide generated by the burning of coal.”

8. One article is added as Article 36: “Operators of the catering trade in urban areas must observe the regulations of the State Council
on the administration of environmental protection in relation to the catering trade, and adopt measures to prevent and control the
pollution caused by lampblack to the residential environment in the neighbourhood.”

9. One article is added as Article 38: “The State encourages and supports the production and use of high-grade, unleaded gasoline
and restricts the production and use of leaded gasoline.

“Relevant competent departments under the State Council shall make plans for gradually reducing the production of leaded gasoline
so as finally to stop the production and use of leaded gasoline.”

10. One article is added as Article 40: “Whoever, in violation of the provisions of Article 15 of this Law produces, sells, imports
or uses the equipment that is prohibited to produce, sell, import or use or employs the techniques that are prohibited to employ
shall be ordered to make rectification by the competent department for comprehensive economic and trade affairs of the people’s government
at or above the county level; if the circumstances are serious, the said competent department shall put forward suggestions thereon
and submit them to the people’s government at the corresponding level, which shall, according to the limits of authority prescribed
by the State Council, order the offender to suspend operation or close down.”

11. The post_title of Chapter III is revised as follows: “Prevention and Control of Atmospheric Pollution by the Burning of Coal”.

This Decision shall go into effect as of the date of promulgation.

The Law of the People’s Republic of China on the Prevention and Control of Atmospheric Pollution shall be revised correspondingly
in accordance with this Decision and shall be republished.

    






SUPPLEMENTARY CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE TAXATION SCOPE AFTER REFORM OF THE SHARING SYSTEM OF INCOME TAX REVENUES

The State Administration of Taxation

Supplementary Circular of the State Administration of Taxation on the Taxation Scope after Reform of the Sharing System of Income
Tax Revenues

GuoShuiFa [2003] No.76

June 25, 2003

The bureaus of state taxations and the bureaus of local taxations of the provinces, autonomous regions, municipalities directly under
the Central Government, and municipality separately listed on the State plan, and the entities in those bureaus:

In accordance with the spirit of the Circular of the State Council on Distributing the Scheme on the Reform of Income Tax Revenue
Sharing (GuoFa [2001] No.37), the State Administration of Taxation (SAT) handed down the Circular of the State Administration of
Taxation on the Taxation Scope after Reform of the Sharing System of Income Tax Revenues (GuoShuiFa [2002] No.8 ), which provide
for the specific taxation scope of the bureaus of state taxation and the bureaus of local taxation after the reform of the sharing
system of income tax revenues. Since execution of the new taxation scope from over one year ago, the bureaus of state taxation and
the bureaus of local taxation at various levels have taken consideration for the interests of the whole, strengthened the coordination
and cooperation in the division of taxation scope, and thus guaranteed the smooth progress of the reform of the sharing system of
income tax revenue. However, with the deepening of the enterprise reform, the forms of enterprise restructuring become more and more
varied, and some new situations have brought new problems to the taxation work of income taxes, in order to implement the principle
of taxation according to law, and to make up the omissions in taxation, the taxation scope for enterprise income tax after the enterprises’
restructuring and operation form changes shall be further clarified. For this purpose, the supplementary circular is hereby made
concerning the taxation scope of enterprise income tax on the basis of the spirit provided for by document GuoShuiFa [2002] No.8:

1.

Where the original enterprise is in any of the following situations, even if it has made the establishment (business start) registration,
its enterprise income tax shall be subject to taxation by the original taxation organ:

1)

The original enterprise is transferred or sold (auctioned) as a whole, but continues to exist and be qualified as an independent taxpayer.
However, if the original enterprise, after being transferred or sold (auctioned) as a whole, becomes a wholly-funded subsidiary of
the acquiring enterprise, and is brought into the scope of consolidate tax payment of the acquiring enterprise, then the income tax
of the enterprise transferred or sold (auctioned) as a whole shall be taxed by the taxation organ in charge of the taxation of income
tax of the acquiring enterprise.

2)

An enterprise acquires any other enterprise by merger (the acquired enterprise is written off) and continues to exist.

3)

A partnership enterprise is restructured into a limited liability company or a joint stock limited company, and no new investment
is absorbed in the restructuring.

4)

Alteration registration shall be made pursuant to the provisions of the State Administration for Industry and Commerce, such as for
expansion of the enterprise, alteration of the leading (subordinate) relationship, enterprise name, enterprise type, economic nature,
business scope, business duration, operation method, legal representative, shareholders, name (post_title) of the shareholder of the promoter
of the company, registered capital, addition or cancellation of any branch, as well as the alteration of domicile, or business site,
etc.

2.

Where an original domestic-funded enterprise is restructured into a foreign-funded enterprise, and the income tax of foreign-funded
enterprise and foreign enterprise shall be collected pursuant to the provisions, no matter the enterprise makes whichever industrial
and commercial registration, the taxation scope shall be determined pursuant to the Circular of the General Office of the State Council
on Transmitting the Opinions of the State Administration of Taxation on Adjusting the Taxation Scope of the Bureaus of state Taxation
and the Bureaus of Local Taxation (GuoBanFa [1996] No.4) on the limit of authority of the administration of income tax of foreign-funded
enterprises and foreign enterprises.

3.

The taxation scope for public institutions and social organizations shall comply with the spirit of document GuoShuiFa [2002] No.8
and the aforesaid provisions.

4.

The bureaus of state taxation and bureaus of local taxation at various levels shall further strengthen cooperation in the division
of taxation scope of income taxes, shall strengthen contact, coordination and communication in the aspects of execution of the policies
on enterprise income tax and determination and collection of enterprise income tax, etc., shall strictly comply with the policies
on reduction and exemption of enterprise income tax, and thus to ensure the uniformity and seriousness of the tax law.

5.

The Provisions shall be implemented as of July 1, 2003. In order to keep the stability of taxation order, where the taxation scope
in respect of any domestic-funded enterprise that is subject to the actual taxation by a bureau of state taxation or local taxation
is inconformity with the Circular, such scope will not be adjusted any more.



 
The State Administration of Taxation
2003-06-25

 







DETAILED RULES FOR THE IMPLEMENTATION OF THE TOBACCO PATENT SALES LAW






Detailed Rules For The Implementation of the Tobacco Patent Sales Law of the People’s Republic of China

     CHAPTER ONE GENERAL PROVISIONS CHAPTER TWO TOBACCO PATENT SALES LICENSES CHAPTER THREE PLANTATION, PURCHASE AND APPROPRIATION OF TOBACCO
LEAVES CHAPTER FOUR PRODUCTION OF TOBACCO PRODUCTS CHAPTER FIVE SALES OF TOBACCO PRODUCTS CHAPTER SIX TRANSPORTATION OF PATENT SALES
TOBACCO PRODUCTS CHAPTER SEVEN PRODUCTION AND SALE OF CIGARETTE PAPER, FILTER TIPS, CIGARETTE CELLULOSE, AND SPECIAL CIGARETTE MAKING
MACHINERIES CHAPTER EIGHT IMPORT AND EXPORT TRADE AND FOREIGN ECONOMIC AND TECHNICAL COOPERATION CHAPTER NINE SUPERVISION AND EXAMINATION
CHAPTER TEN LEGAL LIABILITY CHAPTER ELEVEN SUPPLEMENTARY PROVISIONS

   Article 1 The detailed rules have been formulated pursuant to the “Tobacco Patent Sales Law of the People’s Republic of China” (hereinafter
referred to as “Tobacco Patent Sales Law”).

   Article 2 Tobacco patent sales refer to monopoly of the State of the administration of production, marketing and import and export of patent
tobacco products.

   Article 3 Patent cut tobacco refers to tobacco filaments, dust and granules processed with tobacco leaves, re-cured tobacco leaves and tobacco
sheets as raw materials.

   Article 4 Institution of functions and administrative system of departments in charge of tobacco patent sales of the State Council and various
provinces, autonomous regions and municipalities shall be done in accordance with the provisions of Article 4 of the Tobacco Patent
Sales Law. For cities and counties which do not have administrative departments in charge of tobacco patent sales, the departments
of the cities and counties in charge of tobacco patent sales shall take charge of such rules under dual leadership of the tobacco
patent sales administrative departments in charge at the next higher level and the people’s governments at the same level, with the
tobacco patent sales administrative departments in charge at the next higher level to assume the main leadership.

   Article 5 The State shall control over the tar contents of cigarettes and cigars and major additives to cigarettes and cigars. Tobacco products
manufacturers should not use harmful additives and colorants in violation of the ralated provisions by the State.

CHAPTER TWO TOBACCO PATENT SALES LICENSES

   Article 6 Application for tobacco patent sales licenses shall be required according to the provisions of the Tobacco Patent Sales Law and the
provisions of this set of rules for producing and handling wholesale and retail sale of tobacco products subject to patent sales
and for handling imports and exports of such products and for handling purchase and marketing of foreign tobacco products.

Tobacco Patent sales licenses are divided into:

(1) Tobacco Patent Production Enterprise License;

(2) Tobacco Patent Wholesale Enterprise License;

(3) Tobacco Patent Retail Sale Enterprise License;

(4) Special Tobacco Monopoly Business License;

   Article 7 The following requirements shall be met in obtaining Tobacco Patent Production Enterprise Licenses:

(1) To have adequate amount of funds for producing the patent tobacco products;

(2) To have the technology and equipment for producing the patene tobacco products;

(3) To adapt to the requirements of the State industrial policies for the tobacco industry; and

(4) To adapt to other requirements as provided for by the State Council department in charge of tobacco potent sales.

   Article 8 The following requirements shall be met in obtaining Tobacco Patant Wholesale Enterprise Licenses:

(1) To have adequate funds for wholesale of patent tobacco products;

(2) To have adaquate operational site and personnel;

(3) To conform to the requirements of the distribution of patent tobacco wholesale enterprises; and

(4) To conform to other requirements as provided for by the State Council department in charge of tobacco patent sales.

   Article 9 The following requirements shall be met in obtaining Tobacco Patent Retailsales Enterprise Licenses:

(1) To have adequate funds for retailsale of patent tobacco products;

(2) To have the fixed site for business operations;

(3) To conform to the requirements of the distribution of patent tobacco retailsales enterprises; and

(4) To conform to other requirements as provided for by the State Council department in charge of tobacco patent sales.

   Article 10 The following requirements should be met for obtaining Tobacco Patent Sales Enterprise Licenses:

(1) To have corresponding funds for handling tobacco and related products patent sales;

(2) To have a fixed site and adequate professional personnel for business operation;

(3) To conform with the rational distribution of tobacco patent retail sales enterprises; and

(4) To conform with other requirements as provided for by the State Council department in charge of tobacco patent sales.

   Article 11 Administrative department in charge of tobacco patent sales under the State Council shall be responsible for issuance of licenses
and administration of patent sales of tobacco products and transport of such products according to the Tobacco Patent Sales Law and
the provisions of this set of regulations.

   Article 12 In applying for a license for the production of tobacco products for patent sales, an application should first of all be filed with
the administrative departments in charge of tobacco patent sales of the province, autonomous region or municipality (hereinafter
referred to as provincial level), for an examination comments and submitted to the administrative department in charge of tobacco
patent sales under the State Council for approval and issuance of the license.

   Article 13 In applying for licenses for wholesale of tobacco patent products for trans-provincial, autonomous regional or municipal operations,
an application should be first of all filed with the provincial level administrative departments in charge of tobacco patent sales
for examination and comments and then submitted to the administrative department under the State Council in charge of tobacco patent
sales for approval and issuance of the license.

In applying for a license for wholesale of tobacco patent sales products within a province, autonomous region or municipality, an
application should first of all be filed with the administrative departments in charge of tobacco patent sales in its domicile for
examination comments and then submitted to the provincial level administrative departments in charge of tobacco patent sales for
approval and issuance of the license.

   Article 14 In applying for a license for patent retail sales of tobacco products, the provisions of the Tobacco Patent Sales Law shall apply.

   Article 15 In applying for a business license for special tobacco patent sales for import and export of tobacco patent sales products or sales
of foreign patent sales tobacco products, an application should first of all be filed with the provincial level administrative departments
in charge of tobacco patent sales for examination and comments and then submitted to the administrative department under the State
Council in charge of tobacco patent sales for approval and issuance of the license.

In applying for a special business license for sales of duty-free foreign tobacco patent sales products within the Customs control
areas, an application should first of all be filed with the administrative department in charge of tobacco patent sales in its domicile
for examination and comments and then submitted to the provincial level administrative department in charge of tobacco patent sales
for approval and issuance of the license.

   Article 16 Organs responsible for issuance of tobacco patent sales licenses should, regularly or irregularly check enterprises or individuals
that have obtained such licenses. If any case is found to have failed to meet the requirements of the Tobacco Patent Sales Law and
this set of regulations, the organs that issued the license shall order a temporary stop of the patent sales for carrying out a rectification
until all the requirements are met.

The specific procedures for control of tobacco patent sales licenses shall be worked out by the administrative department in charge
of tobacco patent sales under the State Council according to the provisions of this set of regulations.

CHAPTER THREE PLANTATION, PURCHASE AND APPROPRIATION OF TOBACCO LEAVES

   Article 17 Administrative department in charge of tobacco patent sales under the State Council shall, together with people’s governments of
related provinces, autonomous regions and municipalities, map out plans for tobacco plantation according to the requirements of rational
distribution and the State plans under the principle of improved strains, regionalization and standardization.

   Article 18 Tobacco leaves should be purchased in a unified way by tobacco companies or their entrusted units. Tobacco companies or their entrusted
units may, according to needs, open tobacco purchasing stations (points) to purchase tobacco in areas that have received plans for
purchasing tobacco issued by the State. The opening of such purchasing stations (points) should get the approval of provincial level
administrative departments in charge of tobacco patent sales. Without approval, no unit or individual is allowed to purchase tobacco
leaves.

   Article 19 Groups for grading of tobacco leaves should be erected by local administrative departments in charge of tobacco patent sales, together
with related departments at the same level and tobacco producers to coordinate appraisals of grades of tobacco leaves for purchase.

   Article 20 Plans for State reserves, exports and appropriation of tobacco leaves shall be issued by the planning department of the State Council.

CHAPTER FOUR PRODUCTION OF TOBACCO PRODUCTS

   Article 21 Startups of tobacco product producers shall be applied by the provincial level tobacco patent sales administrative departments to
the State Council administrative department in charge of tobacco patent sales for approval and issuance of licenses and to the administrations
for industry and commerce for registration as tobacco patent sales production enterprises.

   Article 22 Producers of tobacco products should strictly operate according to the production plan issued by the State.

   Article 23 It is forbidden to use rotten tobacco leaves to make cigarettes, cigars or cut tobacco.

   Article 24 Registrations of trademarks should be undertaken for cigarettes, cigars and packed cut tobacco. In application for the registration,
document of approval for production issued by the State Council administrative Department in charge of tobacco patent sales should
be presented according to law.

CHAPTER FIVE SALES OF TOBACCO PRODUCTS

   Article 25 Enterprises that have obtained licenses for patent wholesale of tobacco products should operate within the scope and areas specified
in the licenses.

Enterprises or individuals that have obtained licenses for patent retail sales of tobacco products should buy the products for sales
from the local tobacco patent wholesale enterprises and accept the supervision and control by the organs issuing the tobacco patent
sales licenses.

   Article 26 A unit or individual without a tobacco wholesale patent license to one time sales of over 50 cartons of cigarettes or cigars shall
be regarded as a wholesale business without license.

   Article 27 No unit or individual is allowed to sell illegally produced tobacco products.

   Article 28 Producers of tobacco products for patent sales or patent tobacco wholesalers must not provide tobacco products to units or individuals
that are unavailable with tobacco patent retail sales licenses.

   Article 29 Cigarettes and cigars to be sold within the territory of PRC should have Chinese words to indicate tar contents of the products and
the words “Cigarette smoking is harmful to health” on the surface of the packs.

   Article 30 State Council administrative department in charge of tobacco patent sales shall, if necessary, distribute cigarettes and cigars among
different provinces, autonomous regions and municipalities according to market demand.

   Article 31 It is forbidden to sell rotten or deteriorated tobacco products. Rotten or deteriorated tobacco products should be destroyed under
the guidance of administrative departments in charge of tobacco patent sales or related administrative departments.

   Article 32 Tobacco products with forged or phony trademarks discovered by related departments according to law shall be destroyed openly by
administrative departments in charge of tobacco patent sales according to the related regulations but not to be resold by any means.

   Article 33 The appraisals and testing of tobacco products with forged or phony trademarks shall be carried out by tobacco quality testing stations
designated by quality control and supervision department of the State Council or the people’s governments of provinces, autonomous
regions and municipalities.

CHAPTER SIX TRANSPORTATION OF PATENT SALES TOBACCO PRODUCTS

   Article 34 Licenses for transporting patent sales tobacco products shall be approved and issued by administrative departments in charge of tobacco
patent sales at and above provincial level or their authorized organs. Procedures for administration of licenses for transport of
patent sales tobacco products shall be worked out by the State Council administrative department in charge of tobacco patent sales.

   Article 35 Trans-provincial, autonomous regional and municipal transportation of imported patent sales tobacco products, home-made special tobacco
machineries and cigarette cellulose, filter tips and imported cigarette paper cuts should be made by one’s own effort or on consignment
basis on the strength of licenses for transport of patent sales tobacco products signed and issued by the administrative department
of the State Council in charge of tobacco patent sales.

Trans-provincial, autonomous regional and municipal transportation of domestic patent sales tobacco products other than domestically
manufactured tobacco special machinery and cigarette cellulose, filter tips and imported cigarette paper cuts should be made by one’s
own effort or on consignment basis on the strength of licenses for transport of patent sales tobacco products signed and issued by
the administrative department of the State Council in charge of tobacco patent sales or by provincial level tobacco patent sales
administrative department.

Trans-city or county transportation of patent sales tobacco products within a province, autonomous region or municipality should be
made by one’s own effort or on consignment basis on the strength of licenses for transport of patent sales tobacco products signed
and issued by the provincial level administrative departments in charge of tobacco patent sales or by units entrusted by them.

The transportation of confiscated smuggled patent sales tobacco products should be made by one’s own effort or on consignment basis
on the strength of licenses for transport of patent sales tobacco products signed and issued by the administrative department of
the State Council in charge of tobacco patent sales.

   Article 36 It shall be considered as transportation of patent sales tobacco products without transport licenses in one of the following cases:

1. The amount and scope of patent sales tobacco products transported have gone beyond the limits as prescribed in the transport licenses;

2. Use of overdue, altered or copied patent sales tobacco products transport licenses;

3. Bearing no license for transport of patent sales tobacco and failure to present valid certificate certifying the purchase of patent
sales tobacco products in the locality; and

4. Other acts involving the transport of patent sales tobacco products without a transport license.

   Article 37 The transship of patent sales tobacco products which is put under the control by the Customs shall go through the transshipping formalities
according to the regulations of the Customs on transshipment.

CHAPTER SEVEN PRODUCTION AND SALE OF CIGARETTE PAPER, FILTER TIPS, CIGARETTE CELLULOSE, AND SPECIAL CIGARETTE MAKING MACHINERIES

   Article 38 Tobacco patent wholesale enterprises and tobacco products production enterprises should purchase cigarette paper, filter tips, cigarette
cellulose and special cigarette making machineries exclusively from enterprises with patent tobacco production licenses, special
patent tobacco businesses licenses. Enterprises producing cigarette paper, filter tips, cigarette cellulose and special cigarette
making machineries should not sell their products to units or individuals without a patent tobacco production license.

   Article 39 The procurement, sale and transfer of special cigarette making machineries should have prior approval of the administrative department
in charge of patent tobacco sales under the State Council.

The catalog of special cigarette making machineries shall be compiled by the administrative department in charge of patent tobacco
sales under the State Council.

   Article 40 No unit or individual is allowed to sell special cigarette making machineries, cigarette paper, filter tips and cigarette tip cellulose.

Obsolete and illegally assembled special cigarette making machineries, sub-standard cigarette paper, filter tips and cigarette cellulose
and their odds and ends should be put under the disposal of local administrative departments in charge of patent tobacco sales and
are not allowed to be sold by any means.

CHAPTER EIGHT IMPORT AND EXPORT TRADE AND FOREIGN ECONOMIC AND TECHNICAL

   Article 41 The establishment of patent tobacco production enterprises with foreign investment should get the prior consent from the administrative
department in charge of tobacco patent sales under the State Council as according to related regulations of the State.

   Article 42 Import of patent sales tobacco products can only be handled by enterprises with special patent tobacco business licenses. The plan
for such import should be examined and approved by the administrative department in charge of tobacco patent sales under the State
Council.

   Article 43 Tobacco products imported duty-free should be kept at bonded warehouses designated by the Customs and locked and controlled by local
administrative departments in charge of tobacco patent sales and the Customs houses designated by the administrative department in
charge of tobacco patent sales under the State Council. The Customs should certify each package of foreign tobacco products imported
duty-free according to the import plan which has been approved by the administrative department in charge of tobacco patent sales
under the State Council.

   Article 44 Duty-free cigarettes and cigars should only be put on retail sales inside the areas under the control of the Customs with special
signs prescribed by the administrative department in charge of tobacco patent sales under the State Council on the packs and cartons.

   Article 45 Cigarettes and cigars especially for export should bear the Chinese words of “For Export Only” on the packs and cartons.

CHAPTER NINE SUPERVISION AND EXAMINATION

   Article 46 Administrative departments in charge of tobacco patent sales should supervise over and check on the implementation of the Tobacco
Patent Sales Law and the provisions of this set of regulations, explore and punish cases that have been found violated the Tobacco
Patent Sales Law and the provisions of this set of regulations and, together with related departments of the State, check and punish
smuggling of tobacco patent sales products, sales of smuggled goods and fake or shoddy tobacco patent sales products.

   Article 47 The opening of tobacco patent sales markets should be examined and approved by the administrative department in charge of tobacco
patent sales under the State Council. Tobacco patent sales markets that have not been approved should be banned by the people’s governments
above the county level.

   Article 48 The administrative department in charge of tobacco patent sales under the State Council shall, if necessary, set up offices in major
areas according to the actual circumstances; provincial administrative departments in charge of tobacco patent sales shall, if necessary,
station personnel in tobacco patent production and business enterprises. The offices or personnel stationed shall carry out supervision
and checks on production and business activities within the scope authorized by the departments that have set up the offices or stationed
personnel.

   Article 49 In examining and punishing cases that have violated the Tobacco Patent Sales Law and the provisions of this set of regulations, administrative
departments in charge of tobacco patent sales may exercise the following powers and functions:

1. to inquire into parties, suspects and witnesses concerned;

2. to check the business sites of parties concerned and dispose of the patent sales tobacco products produced or managed illegally;
and

3. to refer to and copy contracts, invoices, accounts, bills, records, documents, business letters and other materials related to
the law- violating acts.

   Article 50 Administrative departments in charge of tobacco patent sales may on its own or together with related departments carry out check
and handle illegal transportation of patent sales tobacco products.

   Article 51 Patent sales tobacco products confiscated according to law by the people’s court or the patent administrative departments concerned
in charge of tobacco patent sales and patent sales tobacco products used as penalty funds, pecuniary money or tax payment should
be auctioned according to relevant regulations of the State and bidders should enter in the auction upon the strength of tobacco
patent wholesale licenses. Bidders for foreign tobacco products should have acquired a tobacco patent sales business license.

Auctioning enterprises established according to law shall verify the qualifications of bidders and accept supervision by administrative
departments concerned in charge of tobacco patent sales in their work of auctioning tobacco patent sales products.

   Article 52 In performing their duties, tobacco patent sales inspection personnel of administrative departments concerned in charge of tobacco
patent sales shall wear badges issued by the tobacco patent sales administrative department under the State Council and present inspection
certificates issued by provincial level tobacco patent sales administrative departments.

   Article 53 Units or individuals who have done a good work in reporting cases violating tobacco patent sales law shall be rewarded.

   Article 54 Punishments as defined in Article 30 of this set of regulations should be meted out as:

1. For purchasing tobacco leaves without authorization, a fine amounting to over 20% and less than 50% of the value of tobacco purchased
illegally shall be imposed and the tobacco leaves illegally purchased shall be purchased at State listed prices;

2. For cases of purchasing more than 1,000 kilograms of tobacco leaves without authorization, the tobacco leaves illegally purchased
together with all the illegal proceeds, shall be confiscated.

   Article 55 Punishments as defined in Article 31 of this set of regulations shall be meted out as:

1. For consigning or self-transportation of tobacco patent sales products without transport passes or the amount of tobacco patent
sales products carried has exceeded the amount prescribed in the transport passes, a fine amounting to over 20% and less than 50%
of the value of the products illegally transported and the tobacco patent sales products may be pruchased at State listed prices.

2. Tobacco patent sales products transported illegally and all the proceeds shall be confiscated in one of the following cases:

(1) The value of tobacco patent sales products illegally transported has exceeded RMB 50,000 or the amount of cigarettes has exceeded
100 parcels (one parcel includes 10,000 cigarettes);

(2) Those who have been punished at least twice by administrative departments in charge of tobacco patent sales;

(3) Resisting the inspection by the inspection personnel of administrative departments in charge of tobacco patent sales;

(4) Illegally transporting smuggled tobacco patent sales products;

(5) Transporting tobacco patent sales products manufactured by enterprises without tobacco patent sales production licenses;

(6) Illegal camouflaged transportation of tobacco patent sales products;

(7) Evading inspection by using special purpose transportation means to carry tobacco patent sales products; and

(8) Other illegal transportation acts and the cases are very serious.

3. For units or individuals who intentionally transport tobacco patent sales products without transport passes, their illegal proceeds
shall be confiscated and a fine amounting to over 10% and less than 20% of the value of the tobacco patent sales products transported
shall be imposed.

4. For cases of sending by post or carrying tobacco leaves and tobacco products from one place to another with the sending or carrying
amounts exceeding more than one time the limits set by the related department of the State Council, punishments shall be meted out
according to the provisions of Article 32 of this set of regulations.

   Article 56 Punishments as defined in Article 32 of this set of regulations shall be meted out as:

1. For enterprises producing tobacco products without patent tobacco production licenses, administrative departments in charge of
tobacco patent sales shall order them to shut down and confiscate all the illegal proceeds and impose a fine amounting to one time
and less than two times the value of the tobacco products produced and the tobacco products confiscated shall be destroyed openly.

2. For enterprises producing cigarette paper, filter tips, tobacco cellulose or special equipment for making tobacco without licenses,
administrative departments in charge of tobacco patent sales shall order them to shut down and confiscate all the illegal proceeds
and impose a fine amounting to one time and less than two times the value of the products produced and the products confiscated shall
be destroyed openly.

   Article 57 For cases of illegally handling wholesales of tobacco products without licenses as defined in Article 33 of this set of regulations,
administrative departments in charge of tobacco patent sales shall order them to shut down or stop the wholesale business, confiscate
all the illegal proceeds and impose a fine amounting to over 50% and less than one time the value of the tobacco products sold.

   Article 58 Punishments as defined in Article 32 of this set of regulations shall be meted out as:

1. For handling import and export business of tobacco patent sales products without licenses, administrative departments in charge
of tobacco patent sales shall order them to stop such business, confiscate all the illegal proceeds and impose a fine amounting to
over 50% and less than one time the value of the business handled.

2. For businesses handling the selling and buying of foreign tobacco products without special tobacco patent sales business licenses,
administrative departments in charge of tobacco patent sales shall order them to stop such business, confiscate all the illegal proceeds
and impose a fine amounting to 20%-50% of the value of the products handled illegally.

   Article 59 For licensed tobacco patent wholesale enterprises that have violated the provisions of the first paragraph of Article 25 of this
set of regulations by handling wholesales beyond the business and geographical scopes, administrative departments in charge of tobacco
patent sales shall order them to suspend their businesses, and confiscate all the illegal proceeds and impose a fine amounting to
10%- 20% of the value of the products handled.

   Article 60 For tobacco patent retail sale enterprises or individuals that have violated the provisions of the second paragraph of Article 25
of this set of regulations by failing to procure products from local tobacco patent wholesalers, administrative departments in charge
of tobacco patent sales shall confiscate all the illegal proceeds and impose a fine amounting to 5%-10% of the value of the products
procured.

   Article 61 For cases that handle retail sale of tobacco products without tobacco patent retail sales licenses, administration for industry and
commerce or administrative departments in charge of tobacco patent sales, according to the opinion of administration for industry
and commerce, shall order them to stop their retail sales businesses, confiscate all the illegal proceeds and impose a fine amounting
to 20%- 50% of the value of the products handled.

   Article 62 For cases of marketing illegally manufactured tobacco patent sales products in violation of Article 27, the first paragraph of Article
40 of this set of regulations, administrative departments in charge of tobacco patent sales shall order them to stop the marketing
operations, confiscate all the illegal proceeds and impose a fine amounting to 20%-50% of the value of the products marketed and
the tobacco patent sales products confiscated shall be destroyed openly.

   Article 63 For cases of handling trans-provincial, autonomous regional and municipal tobacco products wholesale business without obtaining tobacco
patent wholesale licenses in violation of this set of regulations, administrative department in charge of tobacco patent sales shall
impose a fine amounting to over 10% and less than 20% of the value of the total amount handled.

   Article 64 For cases that provide tobacco patent sales products to units or individuals without tobacco patent sales licenses in violation of
the provisions of Article 28 and the second paragraph of Article 38 of this set of regulations, administrative departments in charge
of tobacco patent sales shall confiscate all the illegal proceeds and impose a fine amounting to 20%-50% of the value of the products
sold.

   Article 65 For tobacco wholesale enterprises

INTERIM MEASURES FOR BID-INVITING AND BIDDING MANAGEMENT OF PRELIMINARY REALTY MANAGEMENT

The Ministry of Construction

Circular on Distributing the Interim Measures for Bid-Inviting and Bidding Management of Preliminary Realty Management of the Ministry
of Construction

JianZhuFang [2003] No.130

The construction departments of the provinces and autonomous regions, the bureaus of the real estate administration of the municipalities
directly under the Central Government, and the Construction Bureau of Xinjiang Production and Construction Regime:

In order to regulate the bid-inviting and bidding activities of the realty management, to safeguard the legitimate rights and interests
of the bid-inviting and bidding parties, and to promote the fair competition of the realty management market, the Interim Measures
for Bid-Inviting and Bidding Management of Preliminary Realty Management are hereby formulated and distributed to you, which are
required for implementation. Please inform the House and Real Estate Department of our Ministry of any circumstances during the implementation.

The Ministry of Construction of PRC

June 26, 2003

Interim Measures for Bid-Inviting and Bidding Management of Preliminary Realty Management

Chapter I General Provisions

Article 1

The Measures are formulated in order to regulate the bid-inviting and bidding activities of the realty management, to safeguard the
legitimate rights and interests of the bid-inviting and bidding parties, and to promote the fair competition of the realty management
market.

Article 2

The preliminary realty management herein shall refer to the realty management implemented by the realty management enterprise engaged
by the construction entity before the owners or the owners￿￿ commission select a realty management enterprise at its own discretion.

The Measures shall apply when the construction entity selects the realty management enterprises with the corresponding qualification
and when the administrative departments supervise and manage the bid-invitation and bidding activities of the realty management through
bid-invitation and bidding.

Article 3

A construction entity of any residential and the non-residential realty in a same realty management area shall select the realty management
enterprise with the corresponding qualification through bid-invitation and bidding; and where there are no more than 3 bidders or
the residence scale is relatively small, the construction entity may select the realty management enterprise with the corresponding
qualifications through agreement upon approval by the administrative department of real estate of the people￿￿s government of the
district or county of the place where the realty is located.

The state promotes that the construction entities of other realty engage the realty management enterprises with the corresponding
qualification via bid invitation and bidding.

Article 4

The bid-invitation and bidding activities of preliminary realty management shall stick to the principle of openness, fairness, justice
and good faith.

Article 5

The administrative department of construction under the State Council shall be in charge of the supervision and administration of
the bid-inviting and bidding activities of the realty management activities all over the country.

The administrative departments of construction of the local people￿￿s governments of the provinces and autonomous regions shall be
in charge of the supervision and administration on the bid-inviting and bidding activities of the realty management activities within
their respective administrative divisions.

The administrative departments of real estate of the local people￿￿s governments of the municipalities directly under the Central
Government, prefectures and counties shall be in charge of the supervision and administration on the bid-inviting and bidding activities
of the realty management activities in their respective administrative divisions.

Article 6

Any entity and individual shall not violate the provisions of laws and administrative regulations, restrict or exclude the eligible
realty management enterprise from participating in the bidding or illegally intervene the bid-inviting and bidding activities of
realty management in any way.

Chapter II Bid Invitation

Article 7

The bid inviter herein refers to the realty construction entity that carries out the bid-inviting of preliminary realty management
according to law.

The bid-invitation of preliminary realty management shall be organized and implemented by the bid inviter. The bid inviter shall not
restrict or exclude the potential bidders with imposition of irrational conditions, carry out discriminative treatment to the potential
bidders or put forward the requirements of excessive high qualifications inconsistent with the actual requirements for the bid invitation
of the realty management project to the potential bidders.

Article 8

The bid invitation of preliminary realty management includes open bidding and invited bidding.

In case of open bidding, the bid inviter shall promulgate the bid-inviting announcement on public medium, and at the same time promulgate
free bid-inviting announcement on the China Information Website of Housing and Real Estates and the site of China Association of
Realty Management.

The bid-inviting announcement shall clearly state the name and address of the bid inviter, the basic circumstances of the bid-inviting
project and the method for obtaining the bid-inviting documents, etc.

In case of invited bidding, the bid inviter shall issue bidding invitations to no less than 3 realty management enterprises, which
should include the same items as stipulated by the preceding paragraph.

Article 9

The bid inviter may entrust the bid-inviting agency to handle with the bid invitation, and if competent, the bid inviter may also
organize and implement the bid-inviting activities by itself.

The bid-inviting agency of realty management shall handle with the bid invitation in the authorized scope of the bid inviter and abide
by the relevant provisions of the Measures on the bid inviter.

Article 10

The bid inviter shall complete the preparation of the bid-inviting documents prior to the bid invitation according to the features
and requirements of the realty management project

The bid-inviting documents shall include the following content:

(I)

brief introduction of the bid inviter and the bid-inviting project, including name, address, contact information of the bid inviter,
the basic circumstance of the project, and the housing and the relevant facilities for realty management use, etc;

(II)

content and requirement of the realty management service, including service content, service standards, etc;

(III)

requirements for the bidder and bidding documents, including the qualification of the bidder, the format and the main content of the
bidding documents, etc;

(IV)

standard and method for bidding evaluation;

(V)

bid-inviting scheme, including bid-inviting organizations and institutions, the time and place for opening of bidding, etc;

(VI)

instructions on signing the realty service contract;

(VII)

other instructions and other content as provided for by laws and regulations;

Article 11

The bid inviter shall￿￿within 10 days upon the issuance of the bidding invitation, submit the following materials for filling by the
administrative department of real estates of the people￿￿s government at the county level or above of the place where the realty
project is located:

(I)

the government approval for the development and construction of the realty project relating to the realty management;

(II)

the bid-inviting announcement or bid invitation;

(III)

the bid-inviting documents;

(IV)

other materials as provided for by laws and regulations.

In case of violation of the provisions of laws and regulations during bid invitation, the administrative departments of real estates
shall timely order the bid inviter to rectify.

Article 12

The bid inviter of the open bidding may pre-examine the bidding qualification of the bidding applicants according to the provisions
of the bid-inviting documents.

For the realty management project carrying out the pre-examination of the bidding qualification, the bid inviter shall clearly state
the conditions of the qualification pre-examination and the method for obtaining the bid-inviting documents on the bid-inviting announcement.

The documents of the qualification pre-examination shall generally include the application format of the qualification pre-examination,
the notice of applicant, and the qualification documents, performance, technological equipment and financial situation of the enterprise
which bidding applicants are required to provide, as well as the resumes, performance, etc certificate materials of projected project
executives and main management persons.

Article 13

Upon qualification pre-examination, the bid inviter of the open bidding shall issue the qualified notification of qualification pre-examination
to the bidding applicants who are qualified in the qualification pre-examination, inform them of the time, place and method for obtaining
the bid-inviting documents, and issue the result of qualification pre-examination to the bidding applicants who are not unqualified.

In case of excessive bidding applicants who are qualified in the qualification pre-examination, the bid inviter may choose no less
than 5 bidding applicants who are qualified in the qualification pre-examination.

Article 14

The bid inviter shall determine the reasonable time required by the bidder for preparation of the bidding documents. In case of the
realty management project of open bidding, it shall be no less than 20 days from the day of issuing the bid-inviting documents to
the day when the bidders submit the bidding documents.

Article 15

In case of carrying out necessary clarification or modification, the bid inviter shall notify all recipients of the bid-inviting documents
in written at least 15 days prior to the deadline for submission of the bidding documents required in the bid-inviting documents.
The content of clarification or modification is the integral part of the bid-inviting documents.

Article 16

The bid inviter may organize the potential bidding applicants to visit and investigate on the site of the realty project and provide
the detailed materials of concealed project drawings, etc. For the question posed by the bidding applicants, the bid inviter shall
make clarifications and send the written notice thereof to all recipients of the bid-inviting documents.

Article 17

The bid inviter shall not disclose name and quantity of the potential bidders who have obtained the bid-inviting documents and other
relevant bid-inviting and bidding circumstances possibly influencing fair competition.

Article 18

Prior to determining the bid winner, the bid inviter shall not hold negotiations with the bidder on the substantive content of bidding
price, bidding scheme, etc.

Article 19

In case of selecting realty management enterprise through bid-invitation and bidding, the bid inviter shall complete the bid-inviting
and bidding works of the realty management in the time schedule specified as follows:

(I)

projects of newly established and currently marketable commodity housing shall be completed within 30 days prior to current marketing;

(II)

projects of presale commodity housing shall be completed before obtaining the Presale License of Commodity Housing;

(III)

newly established and not marketable projects shall be completed 90 days prior to delivery for use.

Chapter III Bidding

Article 20

The bidder herein refers to the realty management enterprise which follow the bid invitation of preliminary realty management and
participate in competition.

The bidder shall have the corresponding qualification of the realty management enterprise and other conditions required in the bid-inviting
documents

Article 21

In terms of questions that need to be clarified in the bid-inviting documents, the bidder shall put forth them in writing to the bid
inviter.

Article 22

The bidder shall formulate the bidding documents that follow the substantive requirements and conditions posed in the bid-inviting
documents according to the content and requirements of the bid-inviting documents:

The bidding documents shall include the following content:

(I)

bidding letter;

(II)

bidding quotation;

(III)

scheme of the realty management;

(IV)

other materials necessary for the bid-inviting document.

Article 23

The bidder shall seal and send the bidding documents to the place of bidding prior to the deadline for submission of the bidding documents
as required in the bid-inviting documents. The bid inviter shall upon receipt of the bidding documents present the evidence indicating
the recipient and the time of receipt to the bidder and properly preserve the bidding documents. Prior to the opening of bidding,
any entity and individual shall not open the bidding documents. The bidding documents that are delivered after the deadline for submission
of the bidding documents as required in the bid-inviting documents are invalid, and the bid inviter shall reject to receive them.

Article 24

The bidder may supply, modify or withdraw the bidding documents prior to the deadline for submission of the bidding documents as required
in the bid-inviting documents, and notify the bid inviter in writing. The content of the supplement and modification is the integral
part of the bidding documents and shall be delivered, received and preserved according to the provisions of Article 23 of the Measures.
The content of the supplement and modification that are delivered after the deadline for submission of the bidding documents as required
in the bid-inviting documents are invalid.

Article 25

The bidder shall not cheat to win the bid through falsehood in the name of others or by other means.

The bidder shall not mutually conspire to bid, squeeze out other bidders in fair competition or damage the legitimate rights and interests
of the bid inviter or the bidders.

The bidder shall not mutually conspire to bid and damage the national interests, the social public interests or the legitimate rights
and interests of others.

The bidder is prohibited from winning of the bid by unfair means of bribery to the bid inviter or the members of bidding evaluation
commission, etc.

Chapter IV Opening, Evaluation and Winning of Bid

Article 26

Opening of bid shall be carried out at the same time as the deadline for submission of the bidding documents defined in the bid-inviting
documents; the place of opening of bid shall be the place predetermined in the bid-inviting documents.

Article 27

Opening of bid shall be presided over by the bid inviter and all bidders shall be invited to participate in the opening. The opening
of bid shall be carried out according to the following provisions:

The sealing condition of the bidding document shall be examined by the bidder or its representative, or be examined and notarized
by the notary agency authorized by the bid inviter. Upon confirmation free of errors, the workers shall open the bidding document
in public and read the bidder￿￿s name, the bidding price and other main content of the bidding documents.

For all the bidding documents received prior to the deadline for submission of the bidding documents required in the bid-inviting
documents, the bid inviter shall open them in public.

The course of bidding opening shall be recorded and filed by the bid inviter for future reference.

Article 28

Bidding evaluation shall be in the charge of the Bidding Evaluation Commission established by the bid inviter by force of law.

The Bidding Evaluation Commission shall be composed of the representatives of the bid inviter and the experts in the realty management,
and the number of the members shall be odd of no less than five, among which the experts in the realty management other than the
representatives of the bid inviter shall be no less than 2-thirds of total members.

The expert members of the Bidding Evaluation Commission shall be confirmed by the bid inviter by the means of random sampling from
the expert name list set up by the administrative departments of real estate.

The person of interest with the bidder shall not a member of the Bidding Evaluation Commission of the relevant project.

Article 29

The administrative departments of real estate shall set up a name list of experts for bidding evaluation. The administrative department
of real estate of the people￿￿s government of provinces, autonomous regions and municipalities directly under the Central Government
may combine the name list of experts or implement the computer networking of the expert name list for cities with a small number
of experts.

The administrative department of real estate shall carry out training on laws and businesses with the experts in the expert name list,
carry out comprehensive examination and evaluation on their bidding evaluation competence, probity and justness, etc, and timely
cancel the expert qualification for bidding evaluation of the person who is incompetent or violates laws and disciplines. The person
who is cancelled from the expert qualification of bidding evaluation shall not participate in any bidding evaluation activities.

Article 30

The members of Bidding Evaluation Commission shall perform their obligations carefully, fairly, faithfully and honestly.

The members of Bidding Evaluation Commission shall not contact for private purposes with any bidder or person of interest with the
result of bid-invitation and shall not accept pecuniary and other benefits from the bidders, intermediary and other person of interest.

The members of Bidding Evaluation Commission and workers relating to the bidding evaluation activities shall not disclose the examination
and appraisal and comparison of the bidding documents and the recommendation circumstances of the candidate bid winners and other
circumstances relating to the bidding evaluation.

The workers relating to bidding evaluation activities in the preceding paragraph refer to all persons who get acquainted with the
circumstances relating to the bidding evaluation because of participating in the supervision or routine work of bidding evaluation
other than the members of Bidding Evaluation Commission.

Article 31

The Bidding Evaluation Commission may require in writing the bidders to clarify or explain the content of ambiguous meaning in the
bidding documents. The bidder shall clarify and explain on them in written form, and the clarification and explanation shall not
exceed the scope of the bidding documents or change the substantive content of the bidding documents.

Article 32

In case of convening a site demonstration meeting in the course of bidding evaluation, the bid inviter shall describe it in advance
in the bid-inviting documents and indicate the relevant score weight.

The members of Bidding Evaluation Commission shall carry out the comprehensive evaluation according to the requirements of the Bidding
evaluation in the bid-inviting documents and based on the circumstances of the score of the bidding document and the site demonstration,
etc.

Except for the part of site demonstration, the bidding evaluation shall be conducted confidentially.

Article 33

The Bidding Evaluation Commission shall examine and appraise and compare the bidding documents against the standards and methods of
the bidding evaluation defined by the bid-inviting documents and sign and confirm the results of bidding evaluation.

Article 34

Upon examination and appraisal, if the Bidding Evaluation Commission hold that all bidding documents are not in compliance with the
requirements of the bid-inviting documents, the Bidding Evaluation Commission may veto all biddings.

In case all the realty management project that must conduct the bid-invitation by force of law are vetoed, the bid inviter shall initiate
a new bid invitation.

Article 35

Upon the completion of bidding evaluation, the Bidding Evaluation Commission shall put forth a written report of bidding evaluation,
illustrate the opinions of the Bidding Evaluation Commission on examination and appraisal and comparison to the various bidding documents,
and recommend no less than 3 qualified candidate bid winners arranged in order according to the standards and methods of the bidding
evaluation specified by the bid-inviting documents.

The bid inviter shall confirm the bid winner according to the order of candidate bid winners. If the candidate bid winners who are
confirmed to win bid give up the bid or fail to perform the contract, the bid inviter may confirm other candidate bid winners as
the bid winner according to order.

Article 36

The bid inviter shall confirm the bid winner 30 days prior to the deadline of the bidding valid term. The bidding valid term shall
be stated in the bid-inviting documents.

Article 37

The bid inviter shall issue the notification of bid winning to the bid winner, and at the same time notify all the bidders failing
in bid of the results and return their bidding documents.

The bid inviter shall, within 15 days upon the confirmation of bid winner, file with the administrative departments of real estate
of the people￿￿s governments at the county level or above of the place where the realty project is located. The filing materials
shall include materials such as the course of opening of bid and bidding evaluation, the means and reason on the confirmation of
bid winner, the bidding evaluation of the Bidding Evaluation Commission and the bidding documents of the bid winner. In case of proxy
of the bid invitation, the contract on proxy of the bid invitation shall be attached.

Article 38

The bid inviter and bid winner shall, within 30 days upon issuing the notification of bid winning, reach a written contract according
to the bid-inviting documents and the bidding documents of bid winner; the bid inviter and the bid winner shall not reach other agreements
departing from the substantive content of the contract.

Article 39

In case of failing to enter into a contract without proper reason, the bid inviter shall compensate for the damages thereof to the
bid winner.

Chapter V Supplementary Provisions

Article 40

In case the bidder and other persons of interests hold that the bid-inviting and bidding activities are not in compliance with the
relevant provisions of the Measures, they are enpost_titled to put forth different opinions to the bid inviter or complain to the relevant
department by force of law.

Article 41

In case the bid-inviting documents or the bidding documents are prepared in more than two languages, there must be a Chinese version;
and in case of any discrepancies over the interpretation of different versions, Chinese version shall prevail. In case of any discrepancy
between the amounts expressed in words and that in number, that in words shall prevail.

Article 42

For the residence scale that is relatively small specified in Article 3 of the Measures, upon the approval of the administrative
departments of real estate of the people￿￿s governments of the district or county where the realty is located, the means of agreement
may be adopted for selection of the realty management enterprise, and the standard of scale thereof shall be determined by the administrative
departments of real estate of the people￿￿s governments of provinces, autonomous regions and municipalities directly under the Central
Government.

Article 43

Reference will be made with the Measures when the owners and the owners’ meeting select the realty management enterprises with the
corresponding qualification by means of bidding.

Article 44

The Measures shall come into force on September 1, 2003.

 
The Ministry of Construction
2003-06-26

 




IMPLEMENTATION RULES FOR PROVISIONAL REGULATIONS OF THE ADMINISTRATION OF INTERNATIONAL NETWORKING OF COMPUTER INFORMATION

Implementation Rules for Provisional Regulations of the Administration of International Networking of Computer Information in the
PRC

     Article 1 In accordance with Provisional Regulations of the Administration of international networking of Computer Information in
the People’s Republic of China (hereinafter referred to as Provisional Regulations), these Rules are formulated for the purpose of
strengthening the administration of the international networking of computer information and ensuring the healthy development of
the exchange of international information through computers.

   Article 2 These Rules shall apply to the connection of computer information networks within the territory of the People’s Republic of China
with international networks.

   Article 3 Following are the definitions of terms used in these Rules:

(1) International networking refers to the connection of computer inter- connected networks, specialized computer information networks,
corporate computer information networks and other computer information networks linked by special lines within the territory of People’s
Republic of China with foreign computer information networks.

(2) Access networks refer to computer information networks which are connected with international networks through interconnected
networks. Access networks can be those connected at multi-levels.

(3) International inward and outward channels refer to physical information channels required for international networking.

(4) Subscribers refer to individuals, legal persons and other organizations which connect their computers or networks with international
networks through access networks. Personal subscribers refer to individuals with account numbers for networking.

(5) Specialized computer information networks refer to those operated for the exclusive use of certain sectors.

(6) Corporate computer information networks refer to those operated within enterprises for internal use.

   Article 4 The State shall develop an overall plan for the layout of international networking and the utilization of various resources. International
networking shall adopt technical codes, safety standards and policies on service charges set by the State in a unified form so that
the quality of the service can be improved. International networking shall subject itself to the administration by level, that is,
interconnected units, access units and subscribers are under the administration by level, and meanwhile international inward and
outward channels are subject to the unified administration. The State encourages fair competition in a good order in services related
to international networking and advocates resources sharing so as to promote the healthy development of international networking.

   Article 5 The office of Leading Group for Information Technology Advancement under the State Council is responsible for organizing and coordinating
relevant departments in the formulation of regulations and standards for safety, operations, charges and services related to international
networking. The office shall check and supervise the enforcement of those regulations and standards.

   Article 6 China Internet Information Center is responsible for the management of internet addresses, domain names and catalogues of network
resources and shall provide relevant information services.

   Article 7 Computer information networks within the territory of China, when connected with international networks, must use international inward
and outward channels provided by the national public telecommunication network of the Ministry of Posts and Telecommunications.

No units and individuals are allowed to set up channels by themselves or use other channels for international networking.

   Article 8 China Public Computer Interconnected Network, China Golden Bridge Information Network, China Education and Research Computer Network,
China Science and Technology Network are under the administration of Ministry of Posts and Telecommunications, Ministry of Electronic
Industry, State Education Commission and Chinese Academy of Sciences respectively. China Public Computer Interconnected Network and
China Golden Bridge Information Network are profit-making networks, while China Education and Research Computer Network and China
Science and Technology Network are non-profit-making ones.

Profit-making networks shall be given equal treatment on service rates and technical support.

Non-profit-making networks refer to those serving the public interest which are not operated for making profits.

Charges for the channel utilization of non-profit-making networks shall be collected at a preferential rate.

   Article 9 With regard to the establishment of new interconnected networks, interconnected units must, after being approved by competent authorities
at ministerial level, submit their applications and feasibility reports to Leading Group for Information Technology Advancement under
the State Council. After examined by the Leading Group, applications and feasibility reports shall be submitted to the State Council
for approval.

Feasibility reports on interconnected networks shall mainly include the nature and scope of networking services, technical programs
of networking, economic analyses, management and safety measures, etc.

   Article 10 Access networks must be connected with international networks through interconnected networks. International networking conducted
in other ways is prohibited.

Access units must meet the requirements stipulated in Article 9 of Provisional Regulations. Their applications and feasibility reports
on access networks shall be submitted to competent authorities or units charged with the administration of interconnected units.
The competent authorities or units shall inform applicants of their decision in a written form within 20 working days from the date
they receive applications.

Feasibility reports on access networks shall mainly include the nature and scope of networking services, technical program of networking,
economic analysis, management and safety measures, etc.

   Article 11 Access units engaged in profit-making operations concerning international networking (hereinafter referred to as profit-making access
units) shall be subject to the administration of the system of international networking business licenses (hereinafter referred to
as business licenses). The pattern of business licenses shall be drawn up by Leading Group for Information Technology Advancement
under the State Council in a unified form.

Business licenses shall be issued by competent authorities charged with the administration of profit-making interconnected units and
shall be reported to Leading Group for Information Technology Advancement under the State Council for the record. Competent authorities
charged with the administration of interconnected units shall carry out the annual examination of profit-making access units.

Access units engaged in trans-provincial (or regional, municipal) operations shall apply to competent authorities charged with the
administration of profit-making interconnected units for international networking business licenses. Access units engaged in business
operations within their own provinces (or regions, municipalities) shall apply to competent authorities charged with the administration
of profit-making interconnected units or other competent authorities at the provincial level under their authorization for international
networking business licenses.

With business licenses issued by competent authorities, profit-making access units shall perform registration procedures with the
State administrative departments of industry and commerce and go through formalities with enterprises offering telecommunication
services for the connection of telecommunication lines. Those enterprises shall begin to provide telecommunication lines and other
related services to access units within 30 working days.

   Article 12 Computers or computer information networks of individuals, legal persons and other institutional subscribers must be connected with
international networks through access networks. International networking conducted in other ways is prohibited.

   Article 13 When applying to access units for international networking, subscribers shall submit valid identification papers and other supporting
documents and fill in subscribers’ registration forms.

Access units shall send a written reply to subscribers within 5 working days from the date they receive applications.

   Article 14 In accordance with Provisional Regulations and these Rules, Ministry of Posts and Telecommunications shall formulate rules on the
administration of international networking inward and outward channels which shall be reported to Leading Group for Information Technology
Advancement under the State Council for the record.

In accordance with Provisional Regulations and these Rules, competent authorities or units charged with the administration of interconnected
units shall formulate rules on the administration of interconnected networks which shall be reported to Leading Group for Information
Technology Advancement under the State Council for the record.

   Article 15 The pattern of application forms and subscribers’ registration forms shall be drawn up by competent authorities charged with the
administration of interconnected units in accordance with these Rules.

   Article 16 Suppliers of international inward and outward channels shall be responsible for offering international inward and outward channels
as well as fair, excellent and safe services to interconnected units. They may collect charges for the use of channels at regular
intervals.

Interconnected units shall go through relevant formalities with suppliers of international inward and outward channels for the connection
or extension of international inward and outward channels which shall be reported to Leading Group for Information Technology Advancement
under the State Council for the record. Suppliers of international inward and outward channels shall provide channels to interconnected
units within 100 working days from the date they receive applications.

Suppliers of international inward and outward channels and interconnected units shall sign corresponding agreements and strictly perform
their respective duties and commitments.

   Article 17 Suppliers of international inward and outward channels, interconnected units and access units must set up network management centers,
strengthen management systems and improve the safety management of network information.

Interconnected units shall sign agreements with access units so as to strengthen the management of their own networks and access networks;
carry out technical training and management education concerning international networking for access units; provide access units
with fair, excellent and safe services; and collect charges for networking from access units in accordance with relevant State regulations.

Access units shall subject themselves to the administration of interconnected units and access units at higher levels; sign agreements
with access units at lower levels and make subscription regulations with subscribers so as to strengthen the administration of access
units at lower levels and subscribers; carry out management education, technical consulting and training for access units at lower
levels and subscribers; provide access units at lower levels and subscribers with fair, excellent and safe services; and collect
charges from access units at lower level and subscribers in accordance with relevant State regulations.

   Article 18 Subscribers shall subject themselves to the administration of access units and observe subscription regulations. They are forbidden
from entering certain computer systems without permission and illegally changing others’ information; distributing malicious information,
giving out information in other people’s names and violating others’ privacy through networks; developing and spreading computer
viruses and engaging in other activities in violation of legitimate rights and interests of networks and individuals.

Subscribers are enpost_titled to receiving services of various kinds from access units and obligated to pay relevant charges.

   Article 19 Suppliers of international inward and outward channels, interconnected units and access units shall store all the data related to
their services. When the office of Leading Group for Information Technology Advancement under the State Council and other competent
authorities carry out examinations, they shall forward relevant data in a timely manner.

In every February, suppliers of international inward and outward channels and interconnected units shall submit reports about their
network operation, business development and organizational management in the previous year to the office of Leading Group for Information
Technology Advancement under the State Council.

   Article 20 Interconnected units, access units and subscribers shall abide by relevant State laws and regulations and strictly observe rules
on safety and security. They are not allowed to engage in activities at the expense of State security and secrets and forbidden from
producing, retrieving, duplicating and spreading information that may disrupt public order and contain obscene and pornographic contents.
Harmful information, once detected, shall be reported immediately to relevant competent authorities and effective measures shall
be taken to prevent it from being spread.

   Article 21 Specialized computer information networks which are connected with international networks are not allowed to engage in the business
operation of international networking. Corporate computer information networks and other networks which are connected with international
networks through special lines shall be operated for internal use only. Units in charge of the operation of specialized computer
information networks, corporate computer information networks and other networks which are connected with international networks
through special lines shall set up network operation centers, strengthen management systems and improve the safety management of
network information with reference to these Rules.

   Article 22 Those who violate Article 7 and Item 1 of Article 10 of these Rules shall be ordered to terminate their networking activities by
public security departments and may be imposed a fine less than RMB 15,000. Unlawful incomes, if made, shall be confiscated.

Those who violate Article 11 of these Rules and engage in the business operation of international networking without business licenses
shall be given warning and required by public security departments to secure business licenses within a stated time. Those who do
not secure business licenses within the stated time shall be ordered to terminate their networking activities. Unlawful incomes,
if made, shall be confiscated.

If acting in violation of Article 12 of these Rules, individuals shall be imposed a fine less than RMB 5,000 and legal persons as
well as other institutional subscribers shall be given warning and imposed a fine less than RMB 15,000 by public security departments.

Those who violate Item 1 of Article 18 of these Rules shall be imposed punishment by public security departments in accordance with
relevant laws and regulations.

Those who violate Item 1 of Article 21 of these Rules shall be given warning and may be imposed a fine less than RMB 15,000 by public
security departments. Unlawful incomes, if made, shall be confiscated. Those who violate Item 2 of Article 21 of these Rules shall
be given warning and may be imposed a fine less than RMB 15,000 by public security departments. Unlawful incomes, if made, shall
be confiscated.

   Article 23 Those who violate Provisional Regulations, these Rules and other relevant laws and regulations at the same time shall be imposed
punishment in accordance with relevant laws and regulations. They shall be prosecuted for criminal liabilities according to the law
for any crimes committed.

   Article 24 These Rules shall also apply to computer networking with Hong Kong Special Administrative Region, Taiwan and Macao.

   Article 25 These Rules shall go into effect as of the date of promulgation.

    






REGULATIONS OF THE PEOPLE’S REPUBLIC OF CHINA ON FISHING VESSEL INSPECTION

The State Council

Decree of the State Council of the People’s Republic of China

No.383

The Regulations of the People’s Republic of China on Fishing Vessel Inspection, which were adopted at the 11th executive meeting of
the State Council on June 11, 2003, are hereby promulgated and shall come into force on August 1, 2003.

Wen Jiabao, Premier of the State Council

June 27, 2003

Regulations of the People’s Republic of China on Fishing Vessel Inspection

Chapter I General Provisions

Article 1

In order to regulate the inspection of fishing vessels, to guarantee that the fishing vessels have the conditions for safe voyage
and operation, to safeguard the safety of the fishing vessels and the life and properties of the fishermen, and to prevent environmental
pollution, the Regulations are formulated in accordance with the Fishing Law of the People’s Republic of China.

Article 2

The Regulations shall apply to the inspection of the fishing vessels that are registered and are to be registered in the People’s
Republic of China (hereinafter referred to as fishing vessels). Accessory fishing vessels engaging in international shipping shall
be exempted.

Article 3

The administrative department of fishing under the State Council shall be in charge of the inspection of fishing vessels, as well
as the supervision and administration thereof, of the whole nation.

The Bureau of Fishing Vessel Inspection of the People’s Republic of China (hereinafter referred to as the state fishing vessel inspection
agency) shall exercise the function of fishing vessel inspection and of the supervision and administration thereof.

The local agencies of fishing vessel inspection shall, pursuant to the Provisions hereof, be responsible for the relevant fishing
vessel inspection work.

The departments of public security, frontier defense, quality supervision, and industry and commerce administration, etc. at various
levels shall, within the scope of their respective duties, assist in the work of fishing vessel inspection and of supervision and
administration.

Article 4

The state applies compulsory inspection to fishing vessels. Compulsory inspection is divided into preliminary inspection, operation
inspection, and temporary inspection.

Article 5

The principles of giving priority to safety, guaranteeing quality, and facilitating fishermen shall be abided by in the inspection
of fishing vessels.

Chapter II Preliminary Inspection

Article 6

Preliminary inspection of fishing vessel refers to the overall inspection carried out over a fishing vessel by the agency of fishing
vessel inspection before that vessel is put into operation.

Article 7

The owner or operator of any of the following fishing vessels shall apply for a preliminary inspection:

1)

Manufactured fishing vessels;

2)

Rebuilt fishing vessels (including the fishing vessels rebuilt from non-fishing vessels, and the ocean fishing vessels rebuilt from
fishing vessels sailing within China);

3)

Imported fishing vessels.

Article 8

With respect to manufactured and rebuilt fishing vessels, the design drawings and technical documents thereof shall be subject to
the examination and approval by the agency of fishing vessel inspection, and the preliminary inspection shall be applied for prior
to the start of manufacturing or rebuilding. The agency of fishing vessel inspection shall, within 20 workdays upon receipt of the
design drawings and technical documents, make the examination decision and notify the party concerned in writing.

The entities that design, manufacture, and rebuild fishing vessels shall meet the conditions set forth by the state, and abide by
the technical rules for fishing vessels of the state.

Article 9

The preliminary inspection of a fishing vessel to be manufactured or rebuilt shall be carried out at the same time with the manufacturing
or rebuilding.

The important equipment, parts, and materials that are used to manufacture or rebuild a fishing vessel and that are related to the
voyage, operation, personal and property safety, and prevention of environmental pollution shall, before being used, go through the
inspection by the agency of fishing vessel inspection, and only those passing the inspection may be used.

The catalogue of the important equipments, parts and materials subject to inspection as specified in the preceding paragraph shall
be formulated by the administrative department of fishing under the State Council.

Article 10

With respect to imported fishing vessels, the design drawings and technical documents thereof shall be subject to the examination
and confirmation by the agency of fishing vessel inspection, and the preliminary inspection shall be applied for before the vessels
are put into operation. With respect to import of old fishing vessels, the technical assessment certificate for old fishing vessels
issued by the agency of fishing vessel inspection of the state shall be obtained before the import.

Article 11

With respect to the fishing vessels passing the inspection, the agency of fishing vessel inspection shall issue the certificate of
fishing vessel inspection within 5 workdays upon the completion of the inspection; and with respect to those failing the inspection,
the agency shall notify the parties concerned in writing, and explain the reasons thereto.

No entity or individual may change, without authorization, the tonnage, load line, main engine power, fixed personnel number, and
navigable areas of a fishing vessel that has passed the inspection; or remove without authorization any of its important equipment
or parts that are related to the voyage, operation, personal and property safety, and prevention of environmental pollution. Where
alteration or removal is necessary, ratification shall be obtained from the agency of fishing vessel inspection that made the inspection.

Article 12

The preliminary inspection of imported fishing vessels and ocean fishing vessels shall be organized by the state fishing vessel inspection
agency in a unified way. The preliminary inspection of any other fishing vessel shall be implemented by the agency of fishing vessel
inspection of the port of registry; where the place of manufacturing or place of rebuilding of a fishing vessel is inconsistent with
the port of registry of that vessel, the preliminary inspection shall be implemented by the agency of fishing vessel inspection of
the place of manufacturing or rebuilding; that agency of fishing vessel inspection shall, within 5 workdays upon completion of inspection,
handover the technical materials, such as the inspection report, and inspection records, etc., to the agency of fishing vessel inspection
of the port of registry.

Chapter III Operation Inspection

Article 13

Operation inspection of fishing vessel refers to the conventional inspection carried out over a fishing vessel in operation by the
agency of fishing vessel inspection.

Article 14

The owner or operator of a fishing vessel in operation shall apply for operation inspection pursuant to the time provided for by the
administrative department of fishing under the State Council.

An agency of fishing vessel inspection shall carry out inspection of the following items pursuant to the provisions of the administrative
department of fishing under the State Council and according to the operation term and safety requirements of the fishing vessels:

1)

Structure and the mechanical and electrical equipment of the fishing vessel;

2)

Equipments and parts related to the safety of the fishing vessel;

3)

Equipments and parts related to the prevention of environmental pollution;

4)

Other inspection items specified by the administrative department of fishing under the State Council.

Article 15

An agency of fishing vessel inspection shall carry out an operation inspection within 3 workdays from the day on which the fishing
vessel applying for inspection reaches the place of inspection. If the vessel passes the inspection, the agency shall affix opinions
on or issue the certificate of fishing vessel inspection within 5 workdays upon the completion of the inspection; in the event of
issuing inspection certificate for an ocean fishing vessel inspected overseas, the period may be extended for 15 workdays. If the
vessel fails the inspection, the agency shall notify the party concerned in writing and explain the reasons thereto.

Article 16

Where a fishing vessel needs to be repaired upon inspection, the owner or operator of that vessel shall select a repairer that meets
the conditions provided for by the state. The repair of fishing vessels shall be in compliance with the technical rules on fishing
vessels of the state.

The important equipment, parts, and materials that are used to repair a fishing vessel and that are related to the voyage, operations,
personal and property safety, and prevention of environmental pollution shall, before being used, go through the inspection by the
agency of fishing vessel inspection, and only those passing the inspection may be used.

Article 17

Where a fishing vessel in operation needs to change any of the important equipment, parts, and materials that are related to the voyage,
operation, personal and property safety, and prevention of environmental pollution, the owner or operator of that vessel shall abide
by Paragraph 2 of Article 16 hereof.

Article 18

The operation inspection of ocean fishing vessels shall be organized by the state fishing vessel inspection agency in a unified way.
The operation inspection of any other fishing vessel shall be implemented by the agency of fishing vessel inspection of the port
of registry; where a fishing vessel is unable to return to the port of registry for the operation inspection, the agency of fishing
vessel inspection of the port of registry shall entrust the correspondent agency of the place of operation or repair of that vessel
to make the inspection; the agency of fishing vessel inspection that makes the inspection shall, within 5 workdays upon the completion
of the inspection, handover the technical materials, such as the inspection report, and inspection records, etc., to the agency of
fishing vessel inspection of the port of registry.

Chapter IV Temporary Inspection

Article 19

Temporary inspection of fishing vessel refers to the unconventional inspection carried out by the agency of fishing vessel inspection
over a fishing vessel in operation that is involved in certain circumstances.

Article 20

With respect to any of the fishing vessels involved in any of the following circumstances, the owner or operator shall apply for the
temporary inspection:

1)

Being unable to return to the port of registry in time as a result of invalidation of the inspection certificate;

2)

Being ordered to be inspected for inconformity with the relevant requirements of the laws and regulations on water transportation
safety or environmental protection;

3)

Being in any other specific circumstances provided for by the administrative department of fishing under the State Council.

Article 21

An agency of fishing vessel inspection shall carry out a temporary inspection within 2 workdays from the day on which the fishing
vessel applying for inspection reaches the place of inspection. If the vessel passes the inspection, the agency shall affix opinions
on or issue the certificate of fishing vessel inspection within 3 workdays upon the completion of the inspection; if the vessel fails
the inspection, the agency shall notify the party concerned in writing and explain the reasons thereto.

Article 22

The division of jurisdiction over temporary inspection of fishing vessels shall comply with the provisions of Article 18 hereof on
the division of jurisdiction over operation inspection.

Chapter V Supervision and Administration

Article 23

An agency of fishing vessel inspection may not accept the applications for inspection with respect to the fishing vessels involved
in any of the following circumstances:

1)

Those of which the design drawings and technical documents are not examined and approved or confirmed by the agency of fishing vessel
inspection;

2)

Those manufactured or rebuilt in violation of Paragraph 2 of Article 8 and Paragraph 2 of Article 9 of the Regulations;

3)

Those repaired in violation of Article 16 or 17 of the Regulations.

Article 24

Local agencies of fishing vessel inspection shall carry out the inspection within the scope ratified by the state fishing vessel inspection
agency.

Article 25

The personnel engaging in fishing vessel inspection shall pass the examination by the agency of fishing vessel inspection of the state
before taking the corresponding fishing vessel inspection work.

Article 26

Fishing vessel inspection agencies and the inspection personnel thereof shall strictly abide by the rules for fishing vessel inspection,
carry out the inspection on spot, and be responsible for the inspection conclusions.

The rules for fishing vessel inspection shall be formulated by the state fishing vessel inspection agency, and be promulgated for
implementation upon approval by the administrative department of fishing under the State Council.

Where the state has not formulated corresponding inspection rules for the fishing vessels or products for vessel use that are newly
created, the inspection rules acknowledged by the state fishing vessel inspection agency may be applied.

Article 27

A party having any objection to the inspection conclusion of a local agency of fishing vessel inspection may apply for re-inspection
pursuant to the provisions of the state fishing vessel inspection agency.

Article 28

The charges for inspection of fishing vessels shall comply with the charging standards stipulated by the administrative departments
of price and finance under the State Council.

Article 29

The formats of the inspection certificate, inspection records, and inspection report of fishing vessels, as well as the official inspection
stamp, shall be set forth by the state fishing vessel inspection agency in a unified way.

Article 30

The fishing vessel inspection personnel, when performing duties according to law, shall have the right to check the inspection certificates
and technical status of the fishing vessels, and the relevant entities and individuals shall cooperate.

The investigation and handling of major maritime casualties of fishing vessels shall have the participation of the agency of fishing
vessel inspection.

Article 31

With respect to a fishing vessel in any of the following circumstances, the owner or operator thereof shall, 7 workdays prior to the
day of disuse, registry alteration, or rebuilding of the fishing vessel or within 20 workdays upon loss of the fishing vessel, apply
for writing off the certificate of fishing vessel inspection with the agency of fishing vessel inspection; for failure to file the
application within the said time limit, the certificate of fishing vessel inspection shall be invalidated as of the day of completion
of the registry alteration or rebuilding of the fishing ship or the day of disuse or loss of the fishing vessel, and the agency of
fishing vessel inspection shall write off the certificate of fishing vessel inspection:

1)

Being disused pursuant to the relevant provisions of the state;

2)

Alteration of registry from China to any foreign country;

3)

Being rebuilt from a fishing vessel to a non-fishing vessel;

4)

Being lost as the result of sinking, etc.

Chapter VI Legal Liabilities

Article 32

If any fishing vessel, in violation of the Regulations, goes into operation in water without being inspected and obtaining the certificate
of fishing vessel inspection, that fishing vessel shall be confiscated.

If any fishing vessel that should be disused pursuant to the provisions continues to operate, the operation shall be ordered to be
stopped immediately, the invalidated certificate of fishing vessel inspection shall be withdrawn, the fishing vessel that shall be
disused shall be dismantled forcibly, and a fine ranging from 2,000 Yuan to 50,000 Yuan shall be imposed concurrently; and the criminal
liabilities shall be investigated for according to law if a crime is constituted.

Article 33

For failure to, in violation of the Regulations, apply for operation inspection or temporary inspection for any fishing vessel for
which the inspection shall be applied for, that vessel shall be ordered to be stopped from operation and the inspection shall be
applied for within a prescribed time limit; for failure to apply for the inspection within the said time limit, a fine ranging from
1,000 Yuan to 10,000 Yuan shall be imposed, and the certificate of fishing vessel inspection may be suspended.

Article 34

If any party, in violation of the Regulations, commits any of the following acts, that party shall be ordered to correct the act immediately,
and be imposed on a fine ranging from 2,000 Yuan to 20,000 Yuan; if the vessel is being operated, the operation shall be ordered
to be stopped immediately; if the party refuses to correct the act or refuses to stop the operation, the important equipment, parts
and materials illegally used shall be dismantled forcibly or the certificate of fishing vessel inspection shall be suspended; and
the criminal liabilities shall be investigated for according to law if a crime is constituted:

1)

Using any important equipment, parts, and materials that are related to the voyage, operations, personal and property safety, and
prevention of environmental pollution and that have not passed the inspection to manufacture, rebuild, or repair a fishing vessel;

2)

Dismantling without authorization any of the important equipment and parts that are related to the voyage, operations, personal and
property safety, and prevention of environmental pollution;

3)

Changing without authorization the tonnage, load line, main engine power, fixed personnel number, or navigable areas of a fishing
vessel.

Article 35

If any working person of the agency of fishing vessel inspection takes up the work of fishing vessel inspection without passing the
examination, that person shall be ordered to stop the inspection work immediately, and be imposed on a fine ranging from 1,000 Yuan
to 5,000 Yuan.

Article 36

If any party, in violation of the Regulations, is involved in any of the following circumstances, that party shall be ordered to correct
the act immediately, and the directly liable personnel in charge and other directly liable personnel shall be given the sanctions
of demotion, removal from post, or cancellation of inspection qualification; the criminal liabilities shall be investigated for according
to law if a crime is constituted; and the certificate of fishing vessel inspection already issued shall be invalidated:

1)

Failing to carry out the inspection pursuant to the relevant provisions of the administrative department of fishing under the State
Council;

2)

Issuing the certificate of fishing vessel inspection issued or the inspection records or inspection report that are inconsistent with
the actual status of the fishing vessel;

3)

Carrying out the fishing vessel inspection beyond the prescribed authority.

Article 37

Forged or altered certificates of fishing vessel inspection, inspection records or inspection reports, and privately engraved official
stamp of fishing vessel inspection shall be confiscated; and the criminal liabilities shall be investigated for according to law
if a crime is constituted.

Article 38

The administrative punishments provided for in the Regulations shall be decided by the administrative departments of fishing of the
people’s governments of county level and above or the administrative enforcement agencies of fishing affiliated thereto.

Where the organs making administrative punishments specified in the preceding paragraph, or the functionary thereof accept money or
properties, or other benefits from others by taking advantage of the post, or fail to perform the supervision duties, or fail to
investigate the illegal acts that have been found out, or has any other act of neglect of duties, abuse of powers, or seeking private
benefits through wrongful means, and constitutes a crime, the directly liable person in charge and other directly liable persons
shall be investigated for criminal liabilities according to law; and administrative sanctions shall be given if a crime has not been
constituted.

Chapter VII Supplementary Provisions

Article 39

Where the flag country of a foreign fishing vessel entrusts the People’s Republic of China to inspect that vessel, the provisions
of the Regulations shall be followed in the execution.

Article 40

The Regulations shall come into force on August 1, 2003.



 
The State Council
2003-06-27

 







INTERIM PROVISIONS OF SHANGHAI MUNICIPALITY ON THE ADMINISTRATION OF REAL ESTATE AGENTS

Interim Provisions of ShangHai Municipality on the Administration of Real Estate Agents

     CHAPTER I GENERAL PROVISIONS CHAPTER II APPLICATION CONDITIONS AND PROCEDURES CHAPTER III MANAGEMENT OF BROKERAGE CHAPTER IV PUNISHMENT
PROVISIONS CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 1 These Provisions are formulated in order to develop and standardize the real estate market of this city and strengthen the management
of the broking activities in real estate.

   Article 2 The broking activities in real estate mentioned in these Provisions refers to the business activities for providing such services
as intermediate introduction, agency, consultation, etc. on payment of fees to the clients who are engaged in the development, transference,
mortgage or lease of real estate (hereinafter called the client concerned). But the broking activities for transferring the right
to use state-owned land are excluded.

The real estate agent mentioned in these Provisions refers to an organization or an individual who is qualified as a real estate agent,
has been approved to register at the industry and commerce administration department, and has received the business licence to undertake
broking activities in real estate.

   Article 3 These Provisions shall apply to all the real estate agents undertaking broking activities in real estate in this city.

Real estate agents who have not registered in this city are not allowed to undertake broking activities in real estate in this city.

   Article 4 The Municipal Real Estate Administration and the Municipal Industry and Commerce Administration are competent authorities for administering
broking activities in real estate in this city. The district or county real estate administration and the Pudong New Area real estate
administration department (hereinafter referred to as the district or county real estate administration department) and the district
or county industry and commerce administration are the competent authorities for administering broking activities in their respective
administrative divisions.

The municipal, district or county real estate trading administration departments are in charge of the daily routine in the administration
of real estate agents.

CHAPTER II APPLICATION CONDITIONS AND PROCEDURES

   Article 5 Those who have reached the age of 18, have this city’s registered permanent residence, have acquired the education of senior middle
school or up, and have undergone the unified trainings organized by the Municipal Real Estate Administration, passed its examinations,
and received the “Qualification Certificate for Shanghai Real Estate Agent” issued by the Municipal Real Estate Administration may
apply for undertaking broking activities in real estate. But those who are not allowed to hold concurrent posts according to the
provisions of the State and this city are excluded.

   Article 6 The applicant to establish a real estate broking organization shall have the following qualifications:

1. Having 5 persons or more who have received the “Qualification Certificate for Shanghai Real Estate Agent”;

2. Having a capital of RMB 100,000 or more;

3. Having the articles of association with a definite business aim;

4. Having a fixed place of business.

   Article 7 The applicant to become a private real estate agent shall have the following qualifications:

1. Having received the “Qualification Certificate for Shanghai Real Estate Agent”;

2. Having a capital of RMB 20,000 or more, or the property security worth RMB 20,000 or more provided by his guarantor;

3. Having a fixed place for broking activities;

4. Having had no criminal record in the 3 years previous to his application.

   Article 8 An applicant to become a real estate agent shall apply for registration to the industry and commerce administration department in
his business location. The industry and commerce administration department shall approve his registration if the conditions in these
Provisions are met, and shall grant him the business licence, while for those who do not meet the conditions in these Provisions,
no registration shall be granted.

Within 30 days after receiving the business licence, the real estate agent shall report it for the record to the district or county
real estate trading administration department in the place where the industry and commerce registration organization is located.

   Article 9 The “Qualification Certificate for Shanghai Real Estate Agent” is to be verified by the issuing organization every two years. Those
who fail to pass the verification or do not take part in the verification without any reason must not be allowed to undertake broking
activities in real estate.

CHAPTER III MANAGEMENT OF BROKERAGE

   Article 10 The real estate broking activities of a real estate broking organization must be conducted by its personnel who have received the
“Qualification Certificate for Shanghai Real Estate Agent”.

The personnel who have the “Qualification Certificate for Shanghai Real Estate Agent” must conduct broking activities in real estate
in the name of a real estate agent.

   Article 11 A real estate agent shall sign a real estate brokerage contract with the client concerned when providing the latter with such services
as intermediate introduction, agency, or consultation on entrusted items.

A real estate brokerage contract shall include the following main points:

1. Object (items for brokerage);

2. Requirements and standards for the brokerage items;

3. Time limit of the fulfillment of the contract;

4. The amount of service fee and mode of payment

    






CIRCULAR OF STATE ADMINISTRATION OF FOREIGN EXCHANGES ON ISSUES RELATING TO ADMINISTRATION OF VERIFICATION AND SALES OF COLLECTION OF FOREIGN EXCHANGES UNDER EXPORT FACTORING SERVICES

The State Administration of Foreign Exchanges

Circular of State Administration of Foreign Exchanges on Issues Relating to Administration of Verification and Sales of Collection
of Foreign exchanges Under Export Factoring Services

HuiFa [2003] No.79

July 1, 2003

The branches and the departments of foreign exchange administration (hereinafter referred to as departments) of the State Administration
of Foreign Exchange (SAFE) in the provinces, autonomous regions, and municipalities directly under the Central Government, and the
branches in Shenzhen, Dalian, Qingdao, Xiamen, and Ningbo, as well as banks designated to foreign exchange services:

In order to standardize the verification and sales of foreign exchanges under export factoring, support the development of foreign
trade, and encourage banking innovation, here is to notify you of the matters relating to the verification and sales of foreign exchanges
under export factoring as follows:

1.

The export factoring services herein (export factoring) refer to comprehensive settlement and financing services of minimum two items
of receivable management and credit risk control, collection services, bad account guarantee and trade financing provided by designated
banks of foreign exchanges (merchants of export factoring) for the short-term credit sales of export units (exporters).

2.

Under export factoring, if the merchant of export factoring has not provided the exporters with financing services or provided financing
services with recourse, the merchant of export factoring shall handle with the formalities for settlement or entry of foreign exchanges
and issue to the exporters the duplicate for verification and sales of foreign exchanges from export according to the relevant provisions
upon collection of the commodity prices from outside China.

3.

Under export factoring, if the merchant of export factoring has provided the exporters with financing services without recourse, the
merchant of export factoring may provide the exporters with the financed fund and shall issue to the exporters the duplicate for
verification and sales of foreign exchanges from export based on the financed amount according to the relevant provisions upon handling
with the formalities for settlement and entry of the financed amount, thus formulating the special code for verification and sales
of foreign exchanges on the special duplicate (for detailed formulating code, please refer to the Circular of the State Administration
of Foreign Exchanges on the Issues Relating to the Management of the Special Duplicate for Verification and Sales of Foreign Exchanges
from Export (HuiFa [2003] No. 11). At the same time, the Special Duplicate for Verification and Sales of Foreign Exchanges from Export
shall be indicated as “export factoring financing services”.

Upon the collection of the commodity prices by the merchant of export factoring from outside China on behalf of the exporter, the
merchant of export factoring will deduct the financed fund and the interests and issue the special duplicate for verification and
sales of foreign exchanges of export for the balance. Meanwhile, the Special Duplicate for Verification and Sales of Foreign Exchanges
from Export shall be indicated as “balance from export factoring”, the relevant expenses under the item of factoring, the financing
interests, the code of submission of foreign-related incomes, and the original special code for verification and sale of foreign
exchanges of exports.

Upon the collection of the commodity prices by the merchant of export factoring from outside China on behalf of the exporter, the
merchant of export factoring and the exporter shall handle with the submission for statistics of international payment according
to Article 28 and the relevant provisions of the Procedures for business Operation of Submission for Statistics of International
Payment Through Financial Institutions.

4.

Under the export factoring, the exporter shall handle with the formalities for verification and sales of foreign exchanges of export
with the branches and sub-branches of the state administration of foreign exchanges (hereinafter referred to as the administration
of foreign exchanges) against the export factoring contract and the specified vouchers of verification and sales within the time
specified according to the Measures for the Management of Verification and Sales of Foreign Exchanges of Export and the Implementation
Rules and the relevant provisions.

When handling with the formalities for the verification and sales of foreign exchanges of export under export factoring for an exporter,
if the difference between the collection of foreign exchanges and the total transaction price indicated on the Customs declaration
bill for export commodities exceeds USD500 (inclusive), the administration of foreign exchanges may handle with the verification
and sales of the difference based on the factoring fees indicated on the factoring contract and the special duplicate for verification
and sales of foreign exchanges o0f export, and issue the exporter the special duplicate for tax refund of the bill of verification
and sales of foreign exchanges of export.

5.

In case the merchant of export factoring fails to collect the foreign exchanges from outside china due to the disputes over the trade
parties to the trade when the merchant of export factoring provides the exporter with the financing services without recourse, the
merchant of export factoring shall notify the exporter when deducing the amount, and within ten business days upon receipt of such
notice, the exporter shall provide the merchant of export factoring with the Certificate on Set-off of Verification and Sales of
Foreign Exchanges of Export issued by the administration of foreign exchanges. In case the exporter fails to provide such certificate,
the merchant of export factoring shall send a written report to the administration of foreign exchanges, and shall not issue for
such enterprise any special duplicate for verification and sales of foreign exchanges under export factoring in the future.

6.

Under export factoring, when providing the exporter with financing services or in case of losses from the operation of export factoring
services, the merchant of export factoring shall make use of its own fund of foreign exchanges or against its operation capital,
and shall not buy foreign exchanges at its own discretion or set off any amount with the capital settled by the clients.

In case of insufficient capital of foreign exchange or operation capital of foreign exchanges, the merchant of export factoring may
make up for them by applying for purchase of foreign exchanges with the administration of foreign exchanges according to the relevant
provisions.

7.

The merchant of export factoring shall set up the ledger for registration of each item of export factoring services undertaken for
check and review by the administration of foreign exchanges.

8.

The Circular will come into force as of the date of its promulgation.

Upon receipt of the Circular, the branches shall distribute them to their subordinate sub-branches and banks designated to foreign
exchange services (inclusive of foreign-invested banks) as soon as possible, and Chinese-invested banks designated to foreign exchange
services shall distribute them to their subordinate branches and sub-branches. In case of any problems in execution, please immediately
feedback to the Management Department of Current Accounts of the State Administration of Foreign Exchanges.



 
The State Administration of Foreign Exchanges
2003-07-01

 







CONSTITUTION ACT, 1982 – page 22

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