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MEASURES GOVERNING THE QUALIFICATION FOR SECURITIES INVESTMENT FUND CUSTODIAN

China Banking Regulatory Commission, China Securities Regulatory Commission

Order of President of China Banking Regulatory Commission and President of China Securities Regulatory Commission

No. 26

Measures Governing the Qualification for Securities Investment Fund Custodian are hereby promulgated and shall come into force as
of January 1, 2005.

President of China Securities Regulatory Commission Shang Fulin

President of China Banking Regulatory Commission Liu Mingkang

November 29, 2004

Measures Governing the Qualification for Securities Investment Fund Custodian

Article 1

The present Measures are formulated according to the Law on Securities Investment Funds, Law on Banking Regulation and other relevant
laws and regulations with a view to standardizing the management of the qualifications as a securities investment fund custodian,
maintaining the competitive order in the securities investment fund custody sector, protecting the legitimate rights and interests
of investors and parties concerned and promoting the healthy development of securities investment funds.

Article 2

To undertake the business of securities investment fund (hereinafter referred to as the “fund”) custody, a commercial bank must obtain
the qualification to perform as a fund custodian after verification and approval by China Securities Regulatory Commission (CSRC)
and China Banking Regulatory Commission (CBRC).

No commercial bank without the qualification as a fund custodian may engage in the business of fund custody.

Article 3

A commercial bank, which applies for the qualification as a fund custodian (hereinafter referred to as “applicant”) must meet the
following requirements:

(1)

during the last three fiscal years, its net assets at the end of the year shall not be lower than 2 billion Yuan and its capital adequacy
ratios shall all be up to the standard as provided for by the regulatory authority;

(2)

having a special fund custody department which shall be independent of its other business departments;

(3)

the person to perform as a senior officer of the fund custody department shall meet the statutory requirements; and there shall be
at least five persons to engage in fund liquidation, accounting, investment supervision, information disclosure and internal auditing
and control, who shall have the qualifications of being employed in the fund sector;

(4)

having the conditions to keep the safety of fund property under it custody;

(5)

having a highly effective clearing and accounting system;

(6)

The fund custody department shall have a fixed place necessary for the conducting of business of and is equipped with an independent
security monitoring system ;

(7)

the fund custody department shall be equipped with an independent technical system for custody business including of network system,
application system and systems for security and protection and data back-up;

(8)

having a sound internal auditing and monitoring system and a risk control system;

(9)

having no record of major illegal or irregular acts during the last three years; and

(10)

other requirements as may be provided for by laws or regulations or by CSRC or CBRC with the approval of the State Council.

Article 4

An applicant, to ensure the safety of the fund property under its custody, must have the following conditions and abilities:

(1)

equipments and facilities required for conducting the fund custody business;

(2)

to open separate account books for each fund and to keep fund assets under its custody integrated and independent;

(3)

to strictly separate and keep its owned assets and fund assets under its custody;

(4)

to supervise the investment operation of fund managers according to law;

(5)

to carry out the instructions of fund managers in disposing of and distributing fund assets according to law;

(6)

to lawfully check and examine the net assets, net value of a fund unit and prices for fund subscription and repurchase as determined
by a fund manager;

(7)

to properly keep the records, account books, statements and other materials concerning its fund custody business; and

(8)

to have a sound internal custody system.

Article 5

The applicant must have a sound clearing and accounting system, which must accord with the following provisions:

(1)

funds involved in the securities transactions occurring in the system must be able to be transferred within two hours;

(2)

it must be able to receive data from relevant stock exchanges in a safe manner;

(3)

it must be able to be connected with the systems of the relevant institutions in a safety manner, such as systems of fund managers,
fund registration institutions and securities registration and clearing institutions; and

(4)

in such system, the liquidation and accounting must be able to be conducted in time through proper implementing of the investment
instructions of the fund managers according to law.

Article 6

The applicant shall have its place, security and precaution facilities and other facilities and relevant systems for its fund custody
business accord with the following provisions:

(1)

the business place of the fund custody department must be relatively independent with an entrance guarding system equipped;

(2)

there must be separate rooms for the posts with access to fund transaction data, where no unconcerned person may enter without permission;

(3)

there must be a sound secret-keeping system for fund transaction data;

(4)

there must be a reliable fund custody data back-up system; and

(5)

there must be a fund custody emergency program to cope with emergencies.

Article 7

The applicant shall submit to CSRC the following application documents with copies thereof to CBRC simultaneously:

(1)

an application;

(2)

special capital verification reports on its net assets and capital adequacy ratio as rendered by an accounting firm with qualifications
for conducting securities-related business;

(3)

a certificate certifying the establishment of a fund custody department;

(4)

provisions concerning the internal structure establishment and post responsibilities;

(5)

basic information of the persons to assume senior officers and staff members of the fund custody department, including the application
materials for assuming senior officers of the persons to assume senior officers , the names, career records, copies of certificates
certifying the qualification of being an employee in the fund sector, professional training and posts of the persons to be the staff
members;

(6)

a report on the conditions for the safety of the fund property under its custody;

(7)

a report on the test of its fund clearing and accounting system;

(8)

a plan for the business place, a design blue print for the security and monitoring system and a report on the installation and test;

(9)

a design blue print for the fund custody business back-up system, an emergency-disposing plan and a report on the test of the ability
to meet emergencies;

(10)

its relevant business rules and regulations, including rules and regulations concerning business management, operation procedures,
fund accounting and auditing, fund liquidation management, information disclosure, internal auditing and monitoring, internal control
and risk management, information system management, security and file management, reporting of major suspicious transactions and
emergency measures and other rules and regulations as may be required for a fund custodian;

(11)

a commercial plan for the development of its fund custody business; and

(12)

other documents as may be required by CSRC and CBRC.

Article 8

CSRC shall, within five working days from the receipt of application documents, make a decision on whether or not to accept the application.
If all application documents have been submitted completely and accord with the legal forms, a certificate of acceptance shall be
issued to the applicant. Otherwise, the applicant shall be notified once for all of those required to be added or corrected.

Article 9

CSRC shall, within 20 working days from acceptance of the application, make a decision on whether or not to grant an administrative
license. In the case of a decision of granting, CSRC shall send the decision to CBRC for its permission; or else, the applicant shall
be notified of the decision accompanied with the reasons explained for such decision indicated, upon which the administrative licensing
procedure shall be terminated.

CBRC shall, within 20 working days from the receipt of the decision sent for its permission, make a decision on whether or not to
permit. In the case of permission, CSRC and CBRC shall jointly sign an approval document and CSRC shall issue a fund custody business
license; or else, the applicant shall be notified of the decision with reasons indicated, upon which the administrative licensing
procedure shall be terminated.

Article 10

Before making a decision to grant an administrative license, CSRC and CBRC shall jointly make a verification on the spot of the preparations
for the establishment of a fund custody department of the applicant.

The verification on the spot shall be carried out by at least two persons.

The time taken for the verification on the spot shall not be calculated into the period of the time mentioned in the preceding article.

Article 11

A commercial bank, which has obtained the qualification as a fund custodian, shall be a fund custodian.

Every fund custodian shall promptly apply for the qualification of being a senior officer for persons to be senior officers of its
fund custody department and the qualification of being employed in the fund sector for persons to be staff members of its fund custody
department, and go through corresponding employment formalities.

Article 12

Every fund custodian shall, in conducting business , keep lawful, honesty and faithful, diligent and devoted, and effectively perform
its statutory and contractual functions and duties.

Article 13

Every fund custodian shall take proper measures according to law to ensure that its fund custody business and selling business on
a commission basis shall be independent of each other and effectively safeguard the integrity and independence of fund assets under
its custody.

Article 14

Fund custodians shall communicate with each other and may not engage in any unfair competition or monopolize the market;

Article 15

Where an applicant conceals relevant facts or provides false application materials, CSRC and CBRC shall not accept its application
or grant any administrative license, and shall give the applicant a warning; and the applicant may not apply for the qualification
as a fund custodian during the period of a year.

Where any applicant has obtained the qualification as a fund custodian by means of fraud or bribery or any other unwarrantable methods,
CSRC shall, in consultation with CBRC, revoke the applicant’s qualification as a fund custodian, and give the applicant a warning
and a fine with its fund custody business license nullified by CSRC; CBRC may, pursuant to different circumstances, charge the applicant
to give a disciplinary sanction to the person in charge who is directly responsible and other persons directly responsible, or give
such persons warnings or fines, or prohibit them from employment in the banking sector for a specified period of time or for their
lifetime; the applicant may not again apply for the qualification as a fund custodian in three years; those suspected of committing
a crime shall be transferred to the judicial organ for investigation for the criminal liabilities.

Article 16

CSRC and CBRC shall make supervision and administration on the fund custody business commercial banksaccording to law.

Article 17

In the case of non-compliance with the requirements as provided for in Articles 3 to 6 of the present Measures, the fund custodian
concerned must promptly report it to CSRC and CBRC and make corrections within a specified time limit.

If the fund custodian fails to report such non-compliance in time, CSRC and CBRC shall charge it to make corrections and give a warning
and fine to the person in charge who is directly responsible and other persons directly responsible; CBRC may charge the fund custodian
to give disciplinary sanctions to the person in charge who is directly responsible and other persons directly responsible; if the
consequences are serious, CSRC may, in addition, suspend or revoke such persons’ qualifications of being senior officers or being
employed in the fund sector, and CBRC may, in addition, prohibit such persons from employment in the banking sector for a specified
period of time or for their lifetime.

Article 18

In the case of non-compliance with the requirements as provided for in Articles 3 to 6 of the present Measures, if the fund custodian
concerned fails to correct such non-compliance, CSRC shall, in consultation with CBRC, suspend or revoke its qualification as a fund
custodian and shall nullify its fund custody business license; as to the person in charge who is directly responsible and other persons
directly responsible, CSRC shall, in consultation with CBRC, give them fines, and may suspend or revoke such persons’ qualifications
of being senior officers or being employed in the fund sector in addition; and CBRC may, in addition, prohibit such persons from
employment in the banking sector for a specified period of time or for their lifetime; those suspected of committing a crime shall
be transferred to the judicial organ for investigation of their criminal liabilities.

Article 19

The present Measures shall be applicable to domestic Chinese-funded commercial banks not to any foreign-funded commercial bank.

Article 20

The present Measures shall come into force as of January 1, 2005.



 
China Banking Regulatory Commission, China Securities Regulatory Commission
2004-11-29

 






MINISTRY OF COMMERCE ANNOUNCEMENT

Ministry of Commerce

Ministry of Commerce Announcement

No. 93 [2004]

In accordance with the Qualifications of Tungsten, Stibium and Silver State Trading Export Enterprises as well as Qualifications of
Supplying Enterprises of Tungsten and Stibium Export (Ministry of Commerce Announcement No. 80), Lists of Tungsten, Stibium and Silver
State Trading Export Enterprises and Lists of Supplying Enterprises of Tungsten and Stibium Export in 2005 are now announced.

Ministry of Commerce

Dec 15, 2004 Appendix:

1.

List of Tungsten State Trading Export Enterprises in 2005(omitted)

2.

List of Stibium State Trading Export Enterprises in 2005(omitted)

3.

List of Silver State Trading Export Enterprises in 2005(omitted)

4.

List of Supplying Enterprises of Tungsten Export in 2005(omitted)

5.

List of Supplying Enterprises of Stibium Export in 2005(omitted)



 
Ministry of Commerce
2004-12-15

 






REPLY OF THE STATE ADMINISTRATION OF TAXATION ON THE ISSUE CONCERNING THE EXPIRY DATE FOR SPECIAL POLICY TAX REFUND

the State Administration of Taxation

Reply of the State Administration of Taxation on the Issue concerning the Expiry Date for Special Policy Tax Refund

Guo Shui Han [2004] No. 1430

December 30, 2004

Shenzhen Municipal office of the State Administration of Taxation,

Your Request for Specifying the Expiry Date for Special Policy Tax Refund for the Year 2003 (No.182 [2004] of Shenzhen Municipal office
of the State Administration of Taxation) has been received. After deliberation, we hereby make the following reply concerning the
expiry date for tax refund on homemade equipments purchased by foreign-funded enterprises and water, electricity and gas consumed
by enterprises in the export processing zones:

I.

In accordance with the relevant provisions in the Supplementary Notice of the State Administration of Taxation on Doing well the Liquidation
Work for Tax Refund or Exemption on Export Goods for the Year 2003 (Letter No.132 [2004] of the State Administration of Taxation),
for homemade equipments purchased by foreign-funded enterprises and water, electricity and gas consumed by enterprises in the export
processing zones, all taxes refundable (exemptible) and taxes that are not yet refunded (exempted) of those value-added tax invoices
as issued prior to December 31, 2004 by the sellers shall be dealt with as accumulatively refundable (exemptible) taxes prior to
the end of 2003.

II.

The tax authorities shall, in accordance with relevant provisions, handle the tax refund of the year 2003 on homemade equipments purchased
by foreign-funded enterprises and water, electricity and gas in export processing zones as declared by export enterprises prior to
March 31, 2004.

III.

In case an export enterprise fails to declare the tax refund of the year 2003 on homemade equipments purchased by foreign-funded enterprises
and water, electricity and gas consumed by enterprises in export processing zones prior to March 31, 2004, the tax authorities shall
not handle tax refund declaration formalities in accordance with relevant provisions in the Notice of the State Administration of
Taxation on Doing well the Liquidation Work for Tax Refund or Exemption on Export Goods for the Year 2003 (Letter No. 1303 [2003]
of the State Administration of Taxation).



 
the State Administration of Taxation
2004-12-30

 






PROVISIONS ON ADMINISTRATION OF FOREIGN INVESTMENT IN INTERNATIONAL MARITIME TRANSPORTATION

Provisions on Administration of Foreign Investment in International Maritime Transportation

     (Promulgated by Decree No. 1 of the Ministry of Communications and the Ministry of Commerce on March 2nd, 2004, and effective as of
June 1st, 2004)

   Article 1 These Provisions are formulated in accordance with the Regulations of the People s Republic of China on International Maritime
Transportation (hereinafter referred to as the Maritime Transportation Regulations) and the relevant laws and administrative regulations
of the People s Republic of China on foreign investment, for the purposes of regulating the establishment of foreign-funded enterprises
by foreign investors to engage in international maritime transportation business and auxiliary business relating thereto and safeguarding
the lawful rights and interests of Chinese and foreign investors.

   Article 2 These Provisions are applicable to the investment in and operation of international maritime transportation business and auxiliary
businesses relating thereto (hereinafter referred to as international maritime transportation) by foreign investors within the territory
of China.

   Article 3 The Ministry of Communications and the Ministry of Commerce of the People s Republic of China as well as their authorized agencies
are responsible for the approval and administration of the establishment of foreign-funded enterprises within the territory of the
People s Republic of China by foreign investors to engage in international maritime transportation.

   Article 4 With the approval of the Ministry of Communications and the Ministry of Commerce, a foreign investor may invest in and operate international
maritime transportation in the following forms:

(1) to establish a Chinese-foreign equity joint venture or a Chinese-foreign contractual joint venture to engage in international
shipping services, international shipping agency services, international ship management services, loading and unloading of international
shipments and international maritime container freight station and container yard services;

(2) to establish a Chinese-foreign equity joint venture, a Chinese-foreign contractual joint venture or a wholly foreign-owned enterprise
to engage in international maritime cargo warehousing services;

(3) to establish a Chinese-foreign equity joint venture, a Chinese-foreign contractual joint venture or a wholly foreign-owned enterprise
to offer routine services for the vessels owned or operated by the investor.

   Article 5 A foreign-funded international shipping enterprise to be established shall meet the following conditions:

(1) having vessels suitable for employment in international maritime transportation, among which there must be vessels of Chinese
nationality;

(2) vessels under employment shall be in compliance with the technical standards for maritime traffic safety as set forth by the State;

(3) having bills of lading, passenger tickets or multimodal transportation documents;

(4) having senior executives with the professional qualifications as set forth by the Ministry of Communications;

(5) in case of establishing a Chinese-foreign equity joint venture or a Chinese-foreign contractual joint venture, the proportion
of investment made by foreign investors shall not exceed 49%;

(6) the chairperson of the board of directors and the general manager shall be appointed by the Chinese side after consultation between
the both sides;

(7) other conditions specified by laws or administrative regulations.

   Article 6 Where anyone is to establish a foreign-funded enterprise to engage in international shipping services, it shall firstly make an
application to the Ministry of Communications in accordance with the provisions of the Maritime Transportation Regulations and the
Implementing Rules of the Regulations of the People s Republic of China on International Maritime Transportation (hereinafter referred
to as the Implementing Rules of the Maritime Transportation Regulations); if such application is approved by the Ministry of Communications,
the applicant shall, in accordance with the laws and administrative regulations on foreign investment of the State and on the strength
of the approval document issued by the Ministry of Communications, go through the approval procedures for establishing a foreign-funded
enterprise with the Ministry of Commerce by submitting the documents specified in Article 15 of these Provisions and obtain the Approval
Certificate for Foreign-funded Enterprise.

The applicant shall, by presenting the approval document issued by the Ministry of Communications, the Approval Certificate for Foreign-funded
Enterprise issued by the Ministry of Commerce and other relevant documents, go through the industrial and commercial registration
formalities with the administrative department for industry and commerce according to law and obtain the business license.

After the establishment of a foreign-funded international shipping enterprise, the applicant shall, by presenting the business license
issued by the administrative department for industry and commerce, apply to the Ministry of Communications for obtaining the Permit
for Operation of International Shipping Services. Only those that have obtained such Permit may engage international shipping services.

Aticle 7 A foreign-funded international shipping agency enterprise to be established shall meet the following conditions:

(1) having at least two senior executives with no less than three years experience in international maritime transportation business
operations. The term senior executives refers to Chinese citizens who have secondary or higher technical or academic post_titles and
serve as department managers or above in enterprises engaging in international maritime transportation business or the auxiliary
business relating thereto;

(2) having a fixed place of business and necessary business facilities, including the ability to have electronic data interchange
(EDI) with ports, the Customs and other departments;

(3) in case of establishing a Chinese-foreign equity joint venture or a Chinese-foreign contractual joint venture, the proportion
of investment made by foreign investors shall not exceed 49%;

(4) other conditions specified by laws or administrative regulations.

   Article 8 Where anyone is to establish a foreign-funded enterprise to engage in international shipping agency services, it shall firstly make
an application to the Ministry of Communications in accordance with the provisions of the Maritime Transportation Regulations and
the Implementing Rules of the Maritime Transportation Regulations; if such application is approved by the Ministry of Communications,
the applicant shall, in accordance with the laws and administrative regulations on foreign investment of the State and on the strength
of the approval document issued by the Ministry of Communications, go through the approval procedures for establishing a foreign-funded
enterprise with the Ministry of Commerce by submitting the documents specified in Article 15 of these Provisions and obtain the Approval
Certificate for Foreign-funded Enterprise.

The applicant shall, by presenting the approval document issued by the Ministry of Communications, the Approval Certificate for Foreign-funded
Enterprise issued by the Ministry of Commerce and other relevant documents, go through the industrial and commercial registration
formalities with the administrative department for industry and commerce according to law and obtain the business license.

After the establishment of a foreign-funded international shipping agency enterprise, the applicant shall, by presenting the business
license issued by the administrative department for industry and commerce, apply to the Ministry of Communications for obtaining
the Registration for Operation of International Shipping Agency Services. Only those that have obtained such Registration may engage
international shipping agency services.

   Article 9 A foreign-funded international ship management enterprise to be established shall meet the following conditions:

(1) having at least two senior executives with no less than three years experience in international maritime transportation business
operations;

(2) having staff members in possession of master s or chief engineer s documents of competence that are commensurate with the types
of vessels under their management and the navigation zones;

(3) having the equipment or facilities commensurate with the international ship management services.

   Article 10 Where anyone is to establish a foreign-funded enterprise to engage in international ship management services, it shall firstly make
an application to the Ministry of Communications in accordance with the provisions of the Maritime Transportation Regulations and
the Implementing Rules of the Maritime Transportation Regulations; if such application is approved by the Ministry of Communications,
the applicant shall, in accordance with the laws and administrative regulations on foreign investment of the State and on the strength
of the approval document issued by the Ministry of Communications, go through the approval procedures for obtaining the Approval
Certificate for Foreign-funded Enterprise with the competent commerce administration department of the people s government of the
province where such enterprise is to be located by submitting the documents specified in Article 15 of these Provisions.

After the establishment of a foreign-funded international ship management enterprise, the applicant shall, by presenting the business
license issued by the administrative department for industry and commerce, apply to the competent communications administration department
of the people s government of the province where such enterprise is located for obtaining the Registration for Operation of Auxiliary
Businesses Relating to International Maritime Transportation. Only those that have obtained such Registration may engage in international
ship management services.

   Article 11 Where anyone is to establish a foreign-funded enterprise to engage in international maritime container freight station and container
yard services or international maritime cargo warehousing services, it shall firstly make an application to the Ministry of Communications
in accordance with the provisions of the Maritime Transportation Regulations and the Implementing Rules of the Maritime Transportation
Regulations; if such application is approved by the Ministry of Communications, the applicant shall, in accordance with the laws
and administrative regulations on foreign investment of the State and on the strength of the approval document issued by the Ministry
of Communications, go through the approval procedures for obtaining the Approval Certificate for Foreign-funded Enterprise with the
competent commerce administration department of the people s government of the province where such enterprise is to be located by
submitting the documents specified in Article 15 of these Provisions.

After the establishment of a foreign-funded enterprise engaging in international maritime container freight station and container
yard services or international maritime cargo warehousing services, the applicant shall, by presenting the business license issued
by the administrative department for industry and commerce, apply to the competent communications administration department of the
people s government of the province where such enterprise is located for obtaining the Registration for Operation of Auxiliary Businesses
Relating to International Maritime Transportation. Only those that have obtained such Registration may engage in the relevant services.

The establishment of a foreign-funded enterprise engaging in loading and unloading of international shipments shall be governed by
the relevant provisions of the State.

   Article 12 Where an established foreign-funded enterprise applies to add international maritime transportation business or the auxiliary business
relating thereto to its business scope, it shall go through the corresponding formalities in accordance with the procedures for establishing
a foreign-funded enterprise engaging in specific international maritime transportation businesses set forth in these Provisions.

Where an established foreign-funded enterprise engaging in international maritime transportation is to establish branches, it shall
go through the corresponding formalities with the Ministry of Communications and the Ministry of Commerce or their authorized agencies
in accordance with the laws and administrative regulations on foreign investment of the State, the Maritime Transportation Regulations
and the Implementing Rules of the Maritime Transportation Regulations.

Where an established foreign-funded enterprise engaging in international maritime transportation is to modify the essential contents
such as investment contribution, structure of the shares or scope of business of its contact of joint venture or articles of association,
it shall go through the corresponding formalities with the Ministry of Commerce or its authorized agencies in accordance with the
laws and administrative regulations on foreign investment of the State. Any modification to the matters specified in Article 21 of
the Implementing Rules of the Maritime Transportation Regulations shall be filed with the Ministry of Communications for the record.

   Article 13 A foreign company engaging in shipping may establish a Chinese-foreign equity joint venture, Chinese-foreign contractual joint venture
or wholly foreign-owned enterprise to offer such routine services as canvassing of cargoes, issuance of bills of lading, settlement
of freight and signing of service contracts for the vessels owned or operated by investors. The procedures for establishment application
of such an enterprise shall be governed by the relevant provisions jointly issued by the Ministry of Communications and the Ministry
of Commerce on approval of establishment of wholly foreign-owned shipping companies.

   Article 14 Where a foreign-funded enterprise within the territory of China is to engage in non-vessel-operating services, it shall, in accordance
with the provisions of the Maritime Transportation Regulations and the Implementing Rules of the Maritime Transportation Regulations,
make an application to the Ministry of Communications for registration and obtaining the Registration of Non-vessel-operating Services
Qualification, and go through the approval formalities with the Ministry of Commerce in accordance with the relevant laws and administrative
regulations on foreign investment of the State.

   Article 15 Where an applicant makes an application to the Ministry of Communications, it shall submit the documents specified in the Maritime
Transportation Regulations and the Implementing Rules of the Maritime Transportation Regulations. Where an applicant makes an application
to the Ministry of Commerce or its authorized agencies, he shall submit the following documents:

(1) the letter of application;

(2) the feasibility study report;

(3) the contract of the joint venture and the articles of association of the company (in case of a wholly foreign-owned company, the
articles of association of the company only);

(4) the registration certificate and credit-standing certificate of investors;

(5) the identity certification of the chairperson of the board of directors and the general manager of the enterprise to be established;

(6) other documents required by laws or administrative regulations.

   Article 16 These Provisions are mutatis mutandis applicable to the establishment of enterprises engaging in international maritime transportation
and the auxiliary services relating thereto in other provinces, autonomous regions or municipalities directly under the Central Government
by the investors form Hong Kong Special Administrative Region, Macao Special Administrative Region or Taiwan region.

   Article 17 In accordance with the relevant provisions of the Mainland and Hong Kong Closer Economic Partnership Arrangement, the Mainland and
Macao Closer Economic Partnership Arrangement and their Annexes, from January 1st, 2004, service suppliers from Hong Kong or Macao
may established a wholly Hong Kong or Macao-owned enterprise in Chinese mainland to engage in international ship management services,
international maritime cargo warehousing, international maritime container freight station and container yard services, and non-vessel-operating
services; they may also establish a wholly Hong Kong or Macao-owned shipping company in Chinese mainland to offer such routine services
as canvassing of cargoes, issuance of bills of lading, settlement of freight and signing of service contracts for their owned or
operated vessels.

   Article 18 The Ministry of Communications and the Ministry of Commerce are responsible for the interpretation of these Provisions.

   Article 19 These Provisions shall take effect as of June 1st, 2004.

    





CIRCULAR OF THE MINISTRY OF FINANCE AND STATE ADMINISTRATION OF TAXATION ON THE RELEVANT POLICIES OF INDIVIDUAL INCOME TAX CONCERNING GRANTING AWARDS TO SALES STAFF OF ENTERPRISES IN THE FORM OF FREE TOUR

Ministry of Finance, State Administration of Taxation

Circular of the Ministry of Finance and State Administration of Taxation on the Relevant Policies of Individual Income Tax concerning
Granting Awards to Sales Staff of Enterprises in the Form of Free Tour

CaiShui [2004] No.11

January 20, 2004

The finance offices or bureaus and the local taxation bureaus of all provinces, autonomous regions, municipalities directly under
the Central Government, and cities directly under state planning, and the finance bureau of Xinjiang Production and Construction
Corps:

Recently, we have heard from the finance departments of some regions that it has become a widespread phenomenon that some enterprises
and entities would grant awards to their employees with outstanding achievements in marketing by organizing training classes, proseminars,
and work visits free of charge at home or abroad, and they ask the State to further clarify the policy of individual income tax on
these kinds of awards. Upon deliberation, we hereby clarify the relevant individual income tax policy concerning the granting of
awards to marketing personnel for their outstanding achievements by an enterprise or entity in the form of free training classes,
proseminars, or work visits:

According to the relevant provisions of the existing individual income tax laws and regulations of our country, the awards (including
the material form and securities, etc.) for an individual’s outstanding achievements in marketing, which are granted by enterprises
or entities through organizing tourism activities in the name of training classes, proseminars or work visits by exempting him/her
from travel or touring expenses, shall be reckoned in the taxable income of the sales staff member in full amount on the basis of
the expenses occurred, and the individual income tax shall be collected in accordance with the law and be withheld by the enterprises
or entities that bear the foregoing expenditures. The awards enjoyed by the employees of an enterprise shall be included into the
wages and salaries of the current term, and the individual income tax shall be collected on the item of “income from wages and salaries”.
The awards enjoyed by other persons shall be regarded as the labor income of the current term, and the individual income tax shall
be collected on the item of “income from labor remunerations”.

The above prescriptions shall be implemented as of the date of the promulgation of this Circular.



 
Ministry of Finance, State Administration of Taxation
2004-01-20

 






NOTICE OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON STRICTLY IMPLEMENTING THE STANDARDS FOR EXPENSES EXEMPTED FROM INDIVIDUAL INCOME TAX AND NON-TAXABLE ITEMS

the ministry of finance, the state administration of taxation

Notice of the Ministry of Finance and the State Administration of Taxation on Strictly Implementing the Standards for Expenses Exempted
from Individual Income Tax and Non-Taxable Items

CaiShui [2004] No.40

February 6, 2004

Finance offices or bureaus and administrations of local taxation of all provinces, autonomous regions, and municipalities directly
under the Central Government, and cities directly under state planning, and finance bureau of Xinjiang Production and Construction
s:

Recently, some regions have, in violation of tax laws and the national uniform provisions, increased the standard for expenses exempted
from “income from wages and salaries” of individual income tax without permission, and enlarged the application scope for non-taxable
items. These violations have breached the principle of administering taxation according to law, and are harmful for achieving uniform
tax policies, equitable tax burdens and normalized taxation systems, and have brought about very negative influence on the adjustment
of income distribution , the organization of the revenue from individual income tax, and the rectification and normalization of taxation
order. In order to implement the policy and strategy of managing state affairs according to law, and genuinely materialize the requirements
for administration by law, and maintain the seriousness, authority and unity of the tax law, we hereby give the following Notice
on issues concerning the regulation of the standard for expenses exempted from individual income tax and non-taxable items:

I.

To administer taxation according to law and unify tax policies is the embodiment of implementing the basic policy of managing state
affairs by law and administration by law, and is also an important measure for perfecting the system of socialist market economy,
and rectifying and regulating the order of market economy. As was pointed out in the Decision of the Central Committee of the Communist
Party of China on Some Issues Concerning the Improvement of the Socialist Market Economy, which was adopted by the third Plenary
Session of the 16th CPC Central Committee, efforts shall be made to enhance law enforcement and to improve the capabilities and levels
of administrative law enforcement, so as to guarantee the effective implementation of laws and regulations and to safeguard the unity
and dignity of the legal system. The Law of the People’s Republic of China on the Administration of Tax Collection and its detailed
implementation rules prescribe that “No departments, entities or individuals are permitted to make without authorization, by violating
laws or administrative regulations, decisions regarding the collection of tax or the cessation thereof, the reduction, exemption
or refund of tax, the payment of tax evaded or overdue or other decisions in conflict with tax laws or administrative regulations”.
“Any decision conflicting with the tax laws and administrative regulations, made by whatever department, entity or individual, is
void without exception, and the tax authorities shall not execute such a decision and shall report to the higher tax authorities.”
And the Individual Income Tax Law of the People’s Republic of China is the tax law formulated by the National People’s Congress,
and all the regions, departments, entities and individuals shall have the duty to maintain the seriousness, integrity and uniformity
of the Individual Income Tax Law consciously, and have no right to change the provisions of the tax law at will.

II.

For the ten years since the implementation of the existing Individual Income Tax Law. The construction of socialist market economy
of our country has seen great developments, and the conditions of national economy and individual income have changed greatly. As
a result, some provisions of the existing Individual Income Tax Law cannot fully meet the requirements for such developments and
changes, and indeed needs to be revised and further perfected according to the new changes. Therefore, the Central Committee of the
Communist Party of China and the State Council have attached high importance to it, and the requirement for “improving individual
income tax” has been put forward in the Decision of the Central Committee of the Communist Party of China on Some Issues Concerning
the Improvement of Socialist Market Economy, and on this basis the state legislative departments have listed the revision of Individual
Income Tax Law into the lawmaking plan. But, before the completion of the revision on Individual Income Tax Law, the existing provisions
must be abided by. No district, department or entity may be permitted to improve the standards for deduction of expenses for Individual
Income Tax without authorization of the National People’s Congress and the Standing Committee of the National People’s Congress,
nor shall they enlarge the application scope for non-taxable items in any disguised form or exceeding their power. According to the
state law for the administration on tax collection, all levels of taxation authorities shall not implement the provisions of documents
concerning the improvement of standard for expenses exempted from individual income tax without permission or enlarging the application
scope for non-taxable items by some regions in violation of the uniform policy, and the provisions having been implemented shall
be stopped.

III.

Since the implementation of the new taxation system in 1994, in order to meet the requirements for economic development and the continuous
deepening the reform of economic system, the Ministry of Finance and the State Administration of Taxation have, according to their
power for taxation administration, distributed documents concerning items exempt from individual tax. The policies prescribed in
these documents have clearly specified the contents, standards and application scope (object). The taxation authorities at all levels
shall strictly abide by the provisions as required in their implementation, and shall not enlarge the application scope (objects)
or improve standards without permission, nor shall they enlarge these provisions to a uniform standard applicable to all individuals.

IV.

The finance and taxation authorities at all levels shall perform their functions resolutely in accordance with the provisions of the
law on the administration of tax collection, and propose opinions of administering taxation according to law when the local governments
are making research and planning to make provisions not in conformity with the Individual Income Tax Law. And they shall elaborate
on the relevant provisions of tax law to the respective government, and report to the upper level finance and taxation authorities
according to the provisions of law on the administration of tax collection. After receiving this Notice, the finance and taxation
authorities at all levels shall report to the local Party and government leaders in time, and do a good job in publicizing and explaining
this to the Party and government leaders and all circles of the society as well as the vast taxpayers, so as to ensure the accurate
implementation of the Individual Income Tax Law and promote the overall, coordinated and healthy development of socialist economy.



 
the ministry of finance, the state administration of taxation
2004-02-06

 






THE SUPERVISION AND INSPECTION PROGRAM FOR THE REVIEW AND EXAMINATION OF PREFERENTIAL TAX POLICIES FOR DEVELOPMENT ZONES

State Administration of Taxation

Circular of the State Administration of Taxation concerning the Distribution of the Supervision and Inspection Program for the Review
and Examination of Preferential Tax Policies for Development Zones

GuoShuiHan [2004] No.349

State tax and local tax bureaus of all provinces, autonomous regions, municipalities directly under the Central Government and municipalities
with independent budgetary status:

The State Administration of Taxation formulated the Supervision and Inspection Program for the Review and Examination of Preferential
Tax Policies for Development Zones (hereinafter referred to as the “Supervision and Inspection Program”) in order to further implement
the Circular of the State Administration of Taxation concerning the Review and Examination of Preferential Tax Policies for Development
Zones (Guo Shui Fa No.9 2004) and earnestly ensure that the review and inspection work achieve actual effects and expected goals.
All localities are required to organize supervision and inspection groups to carry out work in this regard according to uniform principles,
scopes and methods of supervision. The Supervision and Inspection Program is herewith circulated for your implementation. All localities
shall submit the written supervision report to the State Administration of Taxation (Department of Policies and Regulations) before
the end of March. The State Administration of Taxation will organize supervisory group for selective examination in the first ten
days of April.

State Administration of Taxation

March 10th, 2004

The Supervision and inspection Program for the Review and examination of Preferential Tax Policies for Development Zones

This program is formulated with a view to further implementing the Circular of the State Administration of Taxation concerning the
Review and Examination of Preferential Tax Policies for Development Zones (Guo Shui Fa [2004] No. 9, hereinafter referred to as the
“Circular”), strengthening the review and examination of the preferential tax policies for development zones and guiding self-examination
and self-correction of local tax authorities.

1.

Principles of Supervision

(1)

Upholding the law and relevant norms. Supervision and inspection shall, on the basis of current taxation laws, regulations and rules,
be carried out in accordance with the requirements of the Circular with reference to the state uniform preferential tax policies
for development zones.

(2)

Upholding objectivity and impartiality. The materials collected and the situation reflected in the course of supervisions should be
true and valid; the subjective and objective reasons for the identified problems should be analyzed in great detail and shall not
be exaggerated or understated.

(3)

Upholding stress on key points. The supervision shall be carried out with priority in accordance with the scopes of supervision and
the different taxation preferential policies applied in development zones at state level and at or below provincial level. The review
and examination shall be conducted thoroughly instead of being conducted as a mere formality so as to achieve actual effects.

2.

Organization of Supervision

The leaders in charge of tax authorities in various regions shall head the supervisory groups in person. The legal departments shall
facilitate the organizing of the supervisory groups with involvement of other relevant departments. The supervisory groups shall
supervise more than two tax authorities at prefecture and municipal level chosen with pertinence in the light of the actual situation
of different places.

The supervision work shall be carried out for around ten days during the middle ten days of March.

3.

Scope of Supervision

The scope of supervision is the implementation of the Circular of the State Administration of Taxation and self-examination and self-correction
by various local authorities, including:

(1)

The application of preferential tax policies for development zones, including the application of preferential tax policies for the
economic and technological development zones, the coastal economic open zones, the high tech industrial development zones established
under the approval of the State Council as well as other state-level parks and various development zones established under the approval
of the governments at or below the provincial level.

(2)

The implementation of preferential tax policies for the development zones. Whether such problems exist in state-level development
zones as enterprises outside the development zones enjoying the preferential tax policies for those inside, enterprises registered
within but operated outside the zones enjoying the preferential tax policies for the zones, the preferential tax policies being granted
to the newly-established enterprises without strict examination of their qualification or development zones by itself expanding the
scope of application of preferential tax policies, increasing the preferential tax rates and extending the preferential period. Whether
such problems exist for the development zones at or below the provincial level to enact preferential tax policies beyond their taxation
jurisdiction or enjoy preferential tax policies applied for the state-level development zones.

(3)

Specific opinions and suggestions put forward by various localities in the light of the status quo of various development zones at
all levels as well as the implementation of the preferential tax policies inside the development zones.

4.

Methods of Supervision

(1)

Listening to Reports

The supervisory groups shall listen to the reports on the review of preferential tax policies for development zones presented by the
tax authorities at prefecture and municipal level, which shall cover the following contents:

The understanding by leaders of the tax authorities at prefecture and municipal level of the importance of the review and examination
of preferential tax policies for development zones; progress of the transmission of the Circular to the state and local tax authorities
at municipality and county level; progress of organizing and arranging the review and examination of preferential tax policies for
development zones in compliance with the Circular, whether concrete implementation program has been formulated and whether self-examination
and self-correction have been carried out.

(2)

Holding Symposia

The supervisory groups shall, on the basis of listening to the reports, hold symposia attended by relevant personnel from development
zones of different kinds at all levels to further find out the application and implementation of preferential tax policies for development
zones as well as problems and suggestions arising from the course of implementation.

(3)

On-the-spot Inspection

The supervisory groups shall, on the basis of the information in hand, carry out on-the-spot investigation and inspection in selected
tax authorities of the development zones at state level and at or below provincial level. The inspection shall focus on issues such
as whether the preferential tax policies are enacted without authorization, whether the application scope of preferential tax policies
is enlarged and whether the preferential tax rates are increased and the period extended. During the on-the-spot supervision and
inspection, the supervisors shall fill in the original copy of the work memo of review and examination of preferential tax policies
for development zones in line with the actual situations.

(4)

Paying Visits to Enterprises

When carrying out investigations into matters such as applying inside policies of various development zones by outside enterprises
and enterprises registered with the zones but running business operated outside, as well as other matters found out during the inspection,
on which an investigation is needed to be extended to enterprises, visits to these enterprises shall be conducted in order to get
a clearer picture and ascertain the matters.

5.

Requirements of Supervision

All local tax authorities shall deepen their understanding, strengthen their leadership, carry out the supervision and inspection
work conscientiously and ensure the problems are identified. Going through the motions is strictly prohibited.



 
State Administration of Taxation
2004-03-10

 






CIRCULAR OF THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE ON CARRYING OUT THE SPECIAL CAMPAIGN CONCERNING SEVERE CRACKDOWN ON PYRAMID SELLING AND DISGUISED PYRAMID SELLING

State Administration for Industry and Commerce

Circular of the State Administration for Industry and Commerce on Carrying out the Special campaign concerning Severe Crackdown on
Pyramid Selling and Disguised Pyramid Selling

Gong Shang Ming Dian [2004] No.16

April 5, 2004

The administration for industry and commerce in all provinces, autonomous regions, municipalities directly under the Central Government
and the cities specifically designated in the state plan,

In the recent years, upon the unified arrangement of the State Council, the administrative departments of industry and commerce at
all level have regarded crackdown on pyramid selling and disguised pyramid selling as an important task of rectifying and standardizing
the order of the market economy, and under the leadership of the CCP committees and people’s departments at all levels and in close
cooperation with other relevant departments, obvious effects have been obtained. However, since this year pyramid selling and disguised
pyramid selling have risen to some extent so the situation is still serious in cracking down on pyramid selling and disguised pyramid
selling. A new situation appeared that in-school students in some regions gathered to participate in the pyramid selling activities;
some illegal organizations, under various banners, by expanding members and organizing networks, are engaged in pyramid selling and
disguised pyramid selling; even in some non-focus regions appears the situation that pyramid sellers gathered and carried out illegal
activities. Recently, with regard to the activities of pyramid selling and disguised pyramid selling which appeared in Guangdong
Maoming, Hubei Wuhan, Jiangsu Wuxi and Chongqing, leaders of the State Council attached much importance and explicitly indicated
that once found, pyramid selling and disguised pyramid selling shall be clamped down. For the purpose of implementing the spirits
of the instruction of the leaders of the State Council, the State Administration for Industry and Commerce has decided that as of
the issuance date of this Circular till July 30, a special campaign shall be organized and carried out to severely crack down on
pyramid selling and disguised pyramid selling. Relevant issues are hereby notified as follows:

1.

Guiding thoughtWe shall take the important thought of the “Three Represents” as our guide and seriously put into practice the guidelines
of the 16th National Party Congress and the Third Plenary Congress and the Central Economic Working Conference. We shall lay emphasis
on politics, overall situation and stability and further strengthen the sense of political responsibility and mission. We shall take
every effective measure to severely crack down on pyramid selling and disguised pyramid selling and continuously consolidate the
progress achieved.

2.

FocusThe focus of special campaign shall be: to continue the full swing implementation of crackdown on pyramid selling, ban all kinds
of pyramid selling and disguised pyramid selling behavior, investigate and treat major cases of pyramid selling and disguised pyramid
selling, firmly prevent the surge of large-scale pyramid selling and disguised pyramid selling activities. We shall focus on clamping
down on hideouts and severely crack down on pyramid selling and disguised pyramid selling which mainly employs the method of “counting
the number of people”. We shall ban the use of Internet for pyramid selling and disguised pyramid selling. We shall investigate and
treat in a strict manner the illegal activities by both domestic and overseas enterprises that participate in pyramid selling and
disguised pyramid selling. We shall strictly punish in accordance with the law those enterprises situated at the intersection of
transformation, who are engaged in pyramid selling and training activities against the regulation.

3.

Major regions and targeted enterprisesThe major regions in special campaign are Guangxi, Guangdong, Hebei, Henan, Jilin, Liaoning,
Shandong, Shanxi, Jiangsu, Sichuan, Chongqing and Beijing. We shall also allocate personnel in other regions and concentrate both
the personnel and time to launch a powerful and dynamic special campaign in a nationwide scale. During the action, we shall resolutely
ban the illegal activities of a group of pyramid selling and disguised pyramid selling organizations, such as “Wuhan Xintian”, “Shenzhen
Wenbin”, “Elite 88”, “US Distance Learning” and “US Internet Fund”, once it is found that they take part in those activities.

4.

Specific measures

(1)

We shall crack down on every sign of activities and continue to remain highly alert. Each region shall start with implementing the
responsibility system and fault-prosecution system. They shall strengthen daily oversight and management and improve the market inspection
system, improve the early-warning mechanism and emergency handling mechanism, and gradually establish administrative oversight and
management system to crack down on pyramid selling and disguised pyramid selling. We shall further strengthen the supervision and
control of the joining area between cities and rural areas and regions with high density of migrant population. These regions are
all characterized by greater potential and higher ratio of cases. The steps taken above are aimed at wiping out pyramid selling and
disguised pyramid selling at their embryonic stage and preventing them from becoming a trend.

(2)

We shall lay emphasis on the key points and keep a firm hand on investigating and treating major cases. We shall make full-scale examination
of the regions which have turned out a relatively strong response towards pyramid selling and disguised pyramid selling activities.
We shall organize and unify the investigation and treatment of trans-regional pyramid selling, cooperate with relevant departments
like public security bureau in investigation and treatment of major cases of pyramid selling and disguised pyramid selling and concerned
organizations, which have brought great impact on the society and involved wide scope of areas and seriously endangered social stability
and damaged the economic order. We shall punish severely the organizers of pyramid selling and disguised pyramid selling and transfer
them to judicial organ for criminal liabilities , if they constitute crimes. We shall resolutely clamp down on those enterprises
who are engaged in illegal activities of pyramid selling and disguised pyramid selling.

(3)

We shall increase the strength of supervision on enterprises situated at the intersection of transformation. It is important to learn
thoroughly the operation of those enterprises within the area under one’s jurisdiction, improve every item of supervision system,
and to rectify and standardize those enterprises in strict accordance with the state regulation. It is also important to investigate
and treat according to the law those engaged in illegal activities like pyramid selling, training in violation of the regulation
and trans-regional operation. We shall make public the typical cases and urge the enterprises situated at the intersection of transformation
to regulate their business conduct in accordance with the state regulations.

(4)

We shall strengthen publicity and guidance and increase the strength of supervision by the society. We shall take various effective
steps to publicize greatly the relevant state regulation and make public and unveil the harm and cheating of pyramid selling and
disguised pyramid selling, make public the typical cases, so that the general public can better identify and voluntarily resist them.
We shall strengthen the cooperation with relevant departments and do a good job directed at the public consisting college and university
students, youth, women, farmers and laid-off workers. We shall mobilize the whole society to take part in crackdown on pyramid selling
and disguised pyramid selling, thus forming a favorable trend where the whole society make a joint effort to combat and crack down
on illegal activities.



 
State Administration for Industry and Commerce
2004-04-05

 






REPLY OF THE DEPARTMENT OF GENERAL AFFAIRS OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE CONCERNING APPROVING TO AUTHORIZE THE DESIGNATED FOREIGN EXCHANGE BANKS TO EXAMINE THE TRANSFER OF FOREIGN EXCHANGE FUNDS IN THE NON-RESIDENT INDIVIDUAL FOREIGN EXCHANGE ACCOUNTS TO THE CAPITAL ACCOUNTS OF FOREIGN-FUNDED ENTERPRISES

Reply of the Department of General Affairs of the State Administration of Foreign Exchange Concerning Approving to Authorize the Designated
Foreign Exchange Banks to Examine the Transfer of Foreign Exchange Funds in the Non-resident Individual Foreign Exchange Accounts
to the Capital Accounts of Foreign-funded Enterprises

Hui Zong Fu [2004] No. 27
May 17, 2004

Shanghai Bureau of the State Administration of Foreign Exchange:

Your Bureau’s Request for Instructions about the Authorization to the Designated Foreign Exchange Banks to Examine the Transfer of
Foreign Exchange Funds in the Non-resident Individual Foreign Exchange Accounts to the Capital Accounts of Foreign-funded Enterprises
(Shanghai Hui Fa [2004] No.40) has been received. An official reply is hereby given as follows:

1.

Under the relevant provisions in Paragraph 2 of Article 1 of the Notice of the State Administration of Foreign Exchange on the Relevant
Issues regarding the Improvement of Foreign Exchange Administration of Direct Investments by Foreign Investors (Hui Fa [2003] No.
30), we hereby consent your Bureau to authorize the appointed foreign exchange banks within your jurisdiction to verify the transfer
of foreign exchange funds in the non-resident individual foreign exchange accounts to the capital accounts of foreign-funded enterprises.

2.

Your Bureau shall conduct the relevant business in the designated foreign exchange banks according to the Operational Procedures for
the Designated Foreign Exchange Banks to Transfer the Foreign Exchange Funds in the Non-resident Individual Foreign Exchange Accounts
to the Capital Accounts of Foreign-funded Enterprises as established by your Bureau.

3.

Your Bureau shall strengthen the inspection of the conducting such kind of business by the designated foreign exchange banks, and
shall seriously cope with any problem as suffered by virtue of the relevant provisions.



 
State Administration of Foreign Exchange
2004-05-17

 






OFFICIAL REPLY OF THE MINISTRY OF COMMERCE ON SEVERAL ISSUES CONCERNING THE LIQUIDATION TERMINATION AND OPERATION RESUMPTION OF FOREIGN FUNDED ENTERPRISES IN THE COURSE OF THEIR LIQUIDATION

Ministry of Commerce

Official Reply of the Ministry of Commerce on Several Issues Concerning the Liquidation Termination and Operation Resumption of Foreign
Funded Enterprises in the Course of Their Liquidation

Shang Fa Han [2004] No.45

Guangzhou Foreign Trade and Economic Cooperation Bureau:

In response to your Request for Instructions to Several Issues Concerning the Application Filed by the Guangzhou Anwang Rubber Tyre
Co., Ltd for Continuous Operation (Hui Wai Jing Mao Zi [2004] No. 28), related issues are hereby replied as follows:

Where a foreign funded enterprise goes through such formalities as to during its operation period apply for early termination of its
contract and articles of association followed by its dissolution, then to enter a liquidation procedure after approved by the examination
and approval authority, and lastly to apply to the said authority for liquidation termination and operation resumption in the course
of its liquidation, the said authority shall, without prejudice to the interests of any creditor of the enterprise, third person
or the public and in no violation of policies concerning the utilization of industries with foreign investment, approve the said
enterprise under the liquidation to terminate its liquidation and resume operation.

An enterprise applying for termination of liquidation and resumption of operation must comply with relevant Chinese laws and regulations
and meet the following requirements:

1.

Its investors unanimously agree to terminate its liquidation and resume the operation;

2.

Its authoritative organ decides to terminate its liquidation and resume the operation;;

3.

The liquidation committee agrees on the termination of liquidation and resumption of operation and submits statements to the progress
of liquidation activities;

4.

It hasn’t nullified its registration with the administration for industry and commerce;

5.

Its period of operation hasn’t expired;

6.

It satisfies all requirements of laws and regulations in terms of the business premise of a legal person;

7.

It hasn’t have its property distributed yet or a shareholder having shared the said property has returned or undertakes to return
such property within a specified period; and

8.

Neither investors nor it has any committed act in violation of laws, regulations and rules.

Whereas, the examination and approval authority shall demand an applicant submit the following documents:

1.

an application letter signed and sealed by all the investors with respect to the termination of liquidation and resumption of operation;

2.

a resolution adopted by the enterprise authoritative organ in terms of the termination of liquidation and resumption of operation;

3.

a letter of the liquidation committee on approving the termination of liquidation and resumption of operation;

4.

statements of the liquidation committee on the progress of liquidation activities;

5.

the articles of association, contract, approval certificates and business license of the enterprise;

6.

a certificate showing any shareholder having shared the property of the enterprise has returned such property or a letter of such
shareholder undertaking to return the enterprise’s property in the possession of him within a specified period; and

7.

other documents as required by departments of commerce.

An official reply is hereby given that the examination and approval authority may, after the aforesaid documents undergo its examination
and are found correct, directly reply to whether or not approve the application filed by an enterprise for its liquidation termination
and operation resumption. Should the liquidation termination and operation resumption be granted, a prior official reply on approving
an application for early termination of the contract and articles of association and the dissolution of the enterprise shall not
be required to be revoked. The approval reply shall be copied to enterprise’s department in charge, the Customs, authorities for
foreign exchange control, authorities responsible for the registration of enterprises and tax authorities at the same time.

Ministry of Commerce of the People’s Republic of China

July 15, 2004



 
Ministry of Commerce
2004-07-15

 






1...131415...29Page 14 of 29

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...

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

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