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Order of the Ministry of Commerce of the People’s Republic of China
No. 13
Measures for the Implementation of International Tender Invitation and Bidding for Mechanical and Electrical Products were amended
and adopted at the 11th executive meeting of the Ministry of Commerce of the People’s Republic of China on September 23, 2004, and
the amended Measures for the Implementation of International Tender Invitation and Bidding for Mechanical and Electrical Products
are hereby promulgated and shall enter into force 30 days after the date of promulgation.
Minister of the Ministry of Commerce, Bo Xilai
November 1, 2004
Measures for the Implementation of International Tender Invitation and Bidding for Mechanical and Electrical Products
Contents
Chapter I General Provisions
Chapter II Scope of Bidding
Chapter III Evaluation Experts
Chapter IV Bidding Documents
Chapter V Invitation to Tender and Bidding
Chapter VI Evaluation of Tender
Chapter VII Publication and Challenges
Chapter VIII Winning the Bid
Chapter IX Legal Liabilities
Chapter X Supplementary Provisions
Chapter I General Provisions
Article 1
For the purpose of regulating the international tender invitation and bidding activities for mechanical and electrical products,
safeguarding the state interests, the social public interests and the legitimate rights and interests of the parties involved in
the tender invitation and bidding activities, enhancing the economic performance and the efficiency of capital usage, and ensuring
the quality of bidding and products, and establishing an open, fair, just, good faith and selecting-the-best competition mechanism
and tender evaluation principles for the international tender invitation and bidding, the present Measures are hereby formulated
according to such laws and regulations as the Tender and Bidding Law of the People’s Republic of China (hereinafter referred to as
“the Bidding Law”) and to the rules of the State Council concerning the division of responsibilities of the administrative supervision
over the bidding activities of the relevant departments.
Article 2
The present Measures shall be applicable to the international tender invitation and biding activities of mechanical and electrical
products within the territory of the People’s Republic of China.
Article 3
The Ministry of Commerce shall be the state administrative department which oversees the international tender invitation and bidding
for mechanical and electrical products, and be responsible for supervising and coordinating the international tender invitation and
bidding work of mechanical and electrical products of the whole country, formulating the relevant rules, adjusting and publishing
the scope of international tender invitation and bidding for mechanical and electrical products, examining and approving the qualifications
of international tender invitation and bidding institutions, and undertaking the routine work of the National Tender Evaluation Committee.
The import and export administrative institutions of mechanical and electrical products (hereinafter referred to as “departments in-charge”)
of all provinces, autonomous regions, municipalities directly under the Central Government, cities directly under state planning
and all departments shall be responsible for supervising and coordinating the international tender invitation and biding activities
of mechanical and electrical products within their respective regions and departments.
Article 4
In general, the international tender invitation and bidding for mechanical and electrical products shall be carried out by the way
of open bidding. Where the open tender method is unsuitable according to laws and administrative regulations, the way of invitation
to tender by request may be adopted. Any project that adopted the way of invitation to tender by request shall be reported to the
Ministry of Commerce for archival purpose, and invitation to tender by request shall be carried out pursuant to the handling formalities
as specified in the present Measures.
The international procurement of mechanical and electrical products shall generally be carried out by way of international tender
invitation and bidding. Where the origins of products to be purchased have been confirmed within the territory, the domestic bidding
method may be adopted. Where the international tender invitation and bidding method is necessary for the procurement, no domestic
bidding or any other method may be adopted to evade the international tender invitation and bidding.
Article 5
The National Tender Evaluation Committee shall be responsible for supervision over and inspection of the international tender invitation
and bidding work of the projects which receive loans from international financial institutions, and be responsible for solving the
relevant issues arising from the bidding process through coordination, examining the tender evaluation outcomes and issuing the Notice
of Tender Evaluation Outcomes of the National Tender Evaluation Committee, and ensuring that the bidding activities comply with the
principles of openness, fairness and justness.
Article 6
The Ministry of Commerce shall designate a special bidding website (hereinafter referred to as “the bidding website”) to offer network
services for the international tender invitation and bidding businesses of mechanical and electrical products. For the international
tender invitation and bidding for mechanical and electrical products, such procedures relating to the bidding business as setting
up archives for the bidding project, putting bidding documents on record, announcing bidding notices, selecting evaluation experts,
publishing tender evaluation outcomes as well as handling challenges shall be accomplished at the bidding website.
Article 7
The “tenderee” as referred to in the present Measures is a state organ, enterprise, public institution or any other organization
that purchases mechanical and electrical products by way of international tender invitation and bidding method when necessary.
The “tendering agency” as referred to in the present Measures is an enterprise as legal person, which meets certain conditions and
has obtained the qualification for international tender invitation and bidding after applying to the Ministry of Commerce and engages
in the international tendering agency services of mechanical and electrical products.
The “tenderer” as specified in the present Measures refers to a domestic or foreign legal person or any other organization which participates
in the bidding in response to the requirements of the bidding documents.
Chapter II Scope of Bidding
Article 8
The procurement of the following mechanical and electrical products must be conducted by the way of international tender invitation
and bidding:
(1)
the mechanical and electrical products subject to the international procurement and used in such projects as infrastructures and public
undertakings which have a bearing upon the social public interests, public safety. The concrete scope of the products shall be found
in Attachment I;
(2)
the mechanical and electrical products subject to the international procurement and used in the investment projects which entirely
or partly use State capitals;
(3)
the mechanical and electrical products subject to the international procurement and used in the projects financed entirely or partly
by the State;
(4)
the mechanical and electrical products subject to the international procurement and used in the projects which use loans and aid funds
from an international financial institution or foreign government (hereinafter referred to as “foreign loans”);
(5)
the mechanical and electrical products subject to the international procurement and used in the government procurement projects; and
(6)
any other mechanical and electrical product subject to the international procurement according to laws and administrative regulations.
Article 9
The international tender invitation and bidding may be unnecessary for any of the following conditions although it falls within the
scope of bidding as listed by Article 8 :
(1)
the mechanical and electrical products which are given by foreign countries or through gratuitous assistance;
(2)
the parts and components supporting the accessory manufacturing;
(3)
used mechanical and electrical products;
(4)
the estimated price of a one-time product procuring contract being less than 1,000,000 yuan;
(5)
the price of mechanical and electrical products imported by foreign-funded enterprises being within the overall investment amount;
(6)
the samples and prototypes of machines for the use of research and development of productive enterprises and scientific research institutes;
(7)
the special products or special trades as specified by the State Council and the mechanical and electrical products for meeting the
national significant emergencies;
(8)
the amount of preference of mechanical and electrical products being more than 50% of the estimated price of the product procuring
contract when the manufacturer offers discounts;
(9)
the special moulds necessary for the production of productive enterprises;
(10)
the parts and components for the use of maintaining the products; or
(11)
any other mechanical and electrical products unfitting for the international procurement according to laws and administrative regulations.
Chapter III Evaluation Experts
Article 10
The Ministry of Commerce shall establish the national and local two-level system of expert databases at the bidding website, conduct
dynamic administration on the experts of expert database, train them and make adjustments on time.
Article 11
The experts needed for the international tender invitation and biding activities of mechanical and electrical products shall be selected
randomly from the national and local two-level system of expert databases at the bidding website by the tendering agency and owners.
No tendering agency or owner may abandon the experts selected randomly without justifiable reasons, and an expert selected shall
reply to the tendering agency in written form if he can’t participate in the evaluation work of the bidding project due to objective
factors. And the tendering agency shall state the causes on the website and carry out another random selection of experts upon receipt
of the reply. Where the number of times for selecting experts exceeds three times, it shall be reported to the corresponding administrative
department for archival purpose, and then the random re-selection of experts shall be carried out.
Article 12
An expert shall put forward an application by himself and be recommended by the department in-charge or a tendering agency for entering
into the expert database. Any recommended expert shall fill in a “Recommendation Form of Evaluation Experts of International Tender
invitation and bidding for Mechanical and Electrical Products”, which shall be signed or sealed by the recommendation entity and
submitted to the bidding website and be reported to the Ministry of Commerce for archival purpose at the same time.
To serve as an expert, one shall:
(1)
love the bidding undertaking and actively participate in the tender evaluation;
(2)
be familiar with the state laws, regulation and policies relating to bidding;
(3)
have fine political and professional quality, and abide by laws and observe disciplines;
(4)
have an undergraduate degree or the same educational level or above;
(5)
have a senior post_title in technology or economics or the same professional level, and have engaged in the related fields for more than
eight years. For the experts engaging in the fields of new and high technology, the said conditions may be relaxed to some degree;
and
(6)
be familiar with the domestic and overseas technical levels and developmental trends in his professional field.
Any expert who both complies with the conditions as set forth in the preceding paragraph and possesses any of the following conditions
may be recommended to be an expert of the national expert database:
(1)
having a professional post_title of professor;
(2)
having undertaken any evaluation work of a large-scale national bidding project in the last five years;
(3)
enjoying a state allowance; or
(4)
having ever won a national level scientific prize.
Article 13
An expert shall perform the following duties according to the rules:
(1)
to undertake the work of examining and approving the bidding documents of the international tender invitation and bidding for mechanical
and electrical products;
(2)
to undertake the evaluation work belonging to the Tender Evaluation Committee. The evaluation experts shall fill in the evaluation
opinions respectively and assume the responsibilities for the opinions put forward by themselves;
(3)
to participate in the deliberation work of the issues challenged; and
(4)
to report any problem arising from the process of tender evaluation to the departments concerned, and put forward opinions and suggestions.
The experts shall be responsible for the evaluated items of the international tender invitation and bidding for mechanical and electrical
products, and assume the corresponding responsibilities.
Article 14
The number of experts selected randomly shall be the number of experts actually needed. Where the one-time entrusted bidding amount
of an international tender invitation and bidding project is more than 5 million US Dollars, more than half of the needed experts
shall be selected from the national expert database.
For the same package under the same item of serial number of bidding project, each expert may only participate in one of such two
kinds of work as the examination and approval of bidding documents or the tender evaluation. No external expert who has interests
with the present bidding project or with the tenderee or any manufacturer may be selected as an expert by the tendering agency, and
another selection of experts shall be required.
Article 15
Any expert who is employed to participate in the evaluation work of international tender invitation and bidding for mechanical and
electrical products shall abide by the following work regulations:
(1)
to seriously enforce the state laws, regulations and policies relating to bidding;
(2)
to scrupulously perform duties, strictly keep secrets and be honest and self-disciplined;
(3)
to participate in the evaluation work of the bidding objectively, impartially and fairly; and
(4)
to withdraw on his own initiative if he has any interests with the bidding project or with the tenderee or any manufacturer.
Article 16
If the number of experts in the expert database is insufficient for the necessary number when selecting experts, the tendering agency
and the tenderee may recommend experts by themselves, but the recommendation forms of the experts meeting the conditions shall be
submitted to the bidding website so that they may enter into the national or local expert database as supplementary experts according
to the related rules, and another random selection of the necessary experts shall be carried out.
Article 17
If the category of the bidding project is not included in the categories of trades or majors in the expert database, the tendering
agency may make an application to the bidding website for the addition of such category, and the bidding website may put the recommended
experts in the newly added category.
Article 18
Once the name list of experts is fixed upon selection, it shall be strictly kept secret. Any disclosure of secrets shall be reported
to the corresponding department in-charge and another selection of experts in the expert database shall be carried out in addition
to investigating the liabilities of the parties concerned. Where the disclosure of secrets has an impact upon the tender evaluation,
the former bidding documents or tender evaluation outcomes shall become invalid.
Article 19
After the evaluation work of the specific project undertaken by the employed experts ends, the department in-charge or the tendering
agency shall evaluate the experts in aspects such as the capacity, level and fulfillment of duties. The evaluation outcomes shall
be divided into excellent, competent or incompetent, and be filed for archival purposes on the bidding website.
Chapter IV Bidding Documents
Article 20
A tenderee may, according to the commercial and technical requirements of mechanical and electrical products to be purchased, compile
bidding documents by itself, or entrust a tendering agency or consulting service institution to compile bidding documents. The bidding
documents mainly include the following:
(1)
the written invitation to tenders;
(2)
general instructions to tenderers;
(3)
names, quantities and technical specifications of the products under bidding;
(4)
contract clauses;
(5)
contract format; and
(6)
attachments:
(a)
the format of a tender letter;
(b)
a table for opening tenders;
(c)
a tender quotation by different items;
(d)
a table of product descriptions;
(e)
a deviation chart of technical specifications;
(f)
a deviation chart of commercial clauses;
(g)
the format of letter of guarantee of tender bond;
(h)
the format of power of attorney of legal representative;
(i)
the qualification certificate format;
(j)
the format of letter of guarantee of performance bond;
(k)
the format of letter of guarantee of advance payment of the bank;
(l)
a sample of letter of credit; and
(m)
other materials needed.
Article 21
In addition to the items as prescribed in Article 20 of the present Measures, the bidding documents shall contain the performance
requirements and evaluation basis for the tenderers and the manufacturers.
To the important commercial and technical clauses (parameters) in the bidding documents, an asterisk “*” shall be added and it shall
also be stated that if any of the clauses (parameters) with an asterisk “*” has not been satisfied, it will result in the annulment
of the bid.
The evaluation basis not only constitutes the important commercial and technical clauses (parameters) which will result in the annulment
of the bid, but also includes the maximum permissive deviation scope and largest number of terms in general commercial and technical
clauses (parameters) and the calculation methods for adjusting the evaluated price within the permissive scope of deviation and number
of clauses. The rate for raising the deviation price of general parameters shall commonly be 0.5% and the maximum shall be not more
than 1%. No discriminatory clause or unreasonable requirement may be written down in the bidding document to exclude potential tenderers.
Article 22
The lowest evaluation method shall commonly be adopted for the international tender invitation and bidding for mechanical and electrical
products. Due to special factors, a comprehensive evaluation method (method for giving marks) may be used for the tender evaluation
of a bidding project. Under this circumstance, its bidding documents shall explicitly prescribe the scoring methods and standards
for all commercial requirements and technical parameters and shall be reported to the Ministry of Commerce for archival purpose through
the bidding website. All scoring methods and standards shall be an indivisible part of the bidding documents and be made public to
the tenderers.
Article 23
The tendering agency shall send the bidding documents to the evaluation expert panel for examination and approval after their compilation,
and report them to the corresponding department in-charge for archival purpose through the bidding website. The number of the members
of the evaluation expert panel undertaking the work of examining and approving the bidding documents shall be an odd number of three
or more experts.
The tendering agency may only mark the serial number of the bid and may not state the tenderee or the project name when it sends the
bidding documents to the evaluation expert panel for examination and approval.
Article 24
When the evaluation expert panel examines and approves the bidding documents, they shall mainly examine and approve whether the commercial
and technical clauses are discriminatory or unreasonable and whether the compiled contents in the bidding documents will cause more
than three potential tenderers to compete, and shall fill its examination and approval opinions in the experts’ opinion forms concerning
the examination and approval of bidding documents (see Attachment II).
Article 25
The tendering agency shall, after the bidding documents are examined and approved by the evaluation expert panel, send all the examination
and approval opinions and the final revisions of the bidding documents to the corresponding department in-charge for archival purpose
through the bidding website, and shall report the original examination and approval opinions of the evaluation expert panel and the
opinions of the tendering agency to the corresponding department in-charge for archival purpose. The opinions of the tendering agency
shall include the explicit reasons for adopting or not adopting the opinions of the experts.
The department in-charge shall reply to the tendering agency through the bidding website within three days upon receipt of the said
archival materials. The said time limit may be extended if coordination is required.
Article 26
The tendering agency shall report the revisions and reasons to the corresponding department in-charge for archival purpose through
the bidding website 15 days before the date for opening the bid in case it needs to revise the bidding documents which have been
put on sale, in accordance with the tenderee’s demands. The tendering agency shall inform all those that have received the bidding
documents of the revisions in written form. The revisions shall be one part of the bidding documents.
Chapter V Invitation to Tender and Bidding
Article 27
The tenderee or the tendering agency may make a bid announcement in other medias besides the mediae and the bidding website designated
by the State upon receipt of the reply concerning putting on the bidding documents record.
The period of announcement for the bidding documents is also the period for putting on sale, which may not be less than 20 days beginning
from the announcement date of the bid documents to the expiry day for the bidding, and may not be less than 50 days for large-scale
equipment or complete sets of equipment.
Article 28
A tenderer shall compile the tender documents in accordance with the requirements of the bidding documents, and indicate article
by article whether it meets the requirements and conditions as put forward by the bidding documents pursuant to its own commercial
capabilities and technical level. As for the technical parameters with an asterisk (“*”), technical supporting materials shall be
provided in the tender documents, otherwise the tender documents will not be recognized when evaluation is made on them.
Article 29
Where any tenderer believes that the bidding documents that have been put on sale contain discriminatory clauses or unreasonable
requirements, he shall put forward his objections to the corresponding department in-charge in writing five days before the date
for opening the bidding, and shall submit the corresponding certificates at the same time.
The tendering agency or the department in-charge shall deal with objections put forward by the tenderers prior to the bid opening
and inform the corresponding tenderers of the settlement results.
Article 30
A tenderer shall register at the bidding website free of charge and send the tender documents to the bidding site before the specified
deadline for the bid. The tenderer may supplement, revise, or withdraw the tender documents submitted prior to the specified deadline
for the bidding. The supplements and revisions shall be part of the tender documents. Any tenderer may not supplement or revise the
tender documents after the deadline for the bidding.
Article 31
Where there are less than three tenderers when the bidding expires, the bid opening shall be called off and another invitation to
tender in accordance with the present Measures shall be carried out.
As for the bidding products of two or more tenderees being produced by the same manufacturer or integrator, they will be computed
as one tenderee. As for two or more integrators using the products of the same manufacturer for one part of their integrated products,
they will be counted as different integrators.
Article 32
The tendering agency shall open the bid at the specified time and site, and invite the tenderee, terderers and the relevant persons
to participate in it.
The tender scheme and tender announcement (announcement of changing prices and other announcements) of the tenerers shall be called
out altogether when opening the tenders, otherwise they will not be recognized when tenders are evaluated. The tender sum shall not
include the products or services other than those as required by the bidding documents, otherwise it may not be reduced when tenders
are evaluated.
The tenderee or the tendering agency shall make records for the opening of the tenders when opening tenders, and make records through
the bidding website within two days after the opening of the tenders.
Chapter VI Evaluation of Tender
Article 33
A tender evaluation committee established in light of the present Measures shall be responsible for the tender evaluation. The number
of members of the tender evaluation committee shall be an odd number of more than 5 persons and it shall be composed of the experts
with senior professional post_titles or with corresponding professional level in related fields such as technology, economics, the tenderee
and the representative of the tendering agency. Among them, no less than two thirds shall be the experts in the technology and economics
fields.
Any tendering agency or any other person may not disclose the contents of the bidding project that are about to be evaluated and the
circumstances relating to the tenderee and tenderers to any tender evaluation expert before the opening of the tenders.
Article 34
The name list of the members of the tender evaluation committee shall be kept confidential before the tender evaluation outcomes
are made public. The tenderee and the tendering agency shall take measures to ensure that the tender evaluation be carried out in
a strictly confidential manner. No entity or individual may interfere in or influence the process or outcomes of the evaluation of
tender.
Article 35
The tender evaluation committee shall evaluate the tender documents in strict compliance with the commercial and technical clauses
as stipulated in the bidding documents, and no criterions other than those as specified in the bidding documents may be the basis
for tender evaluation, unless it is otherwise prescribed by the laws and administrative regulations. Each member of the tender evaluation
committee shall separately fill in the evaluation opinion form of the tender evaluation committee (see Attachment III) when the tender
evaluation ends. The evaluation opinion forms shall be an indispensable part of the tender evaluation report.
Where the lowest evaluation method is adopted, the person with the lowest evaluated price will be the recommended bid winner. Where
the comprehensive evaluation method is adopted, the person with the highest comprehensive marks will be the recommended bid winner.
Article 36
During the process of commercial tender evaluation, the bidding shall be annulled and the technical tender evaluation shall be called
off upon occurrence of any of the following conditions:
(1)
the tenderer fails to provide the tender bond or the tender bond is insufficient, or the validity period of the letter of guarantee
is not enough, or the tender bond form or the bank issuing the letter of guarantee doesn’t conform to the requirements of the bidding
documents;
(2)
the tender documents have not been signed page by page according to the requirements;
(3)
the tenderer and its manufacturer have interests with the tenderee or the tendering agency ;
(4)
the tenderer fails to offer the letter of tender or the qualification certificate, or those offered do not conform to the requirements
of bidding documents;
(5)
the tender documents have not been signed by the legal representative, or the person that signed on them doesn’t have the valid power
of attorney of the legal representative;
(6)
the performance of the tenderer can’t meet the requirements of the bidding documents;
(7)
the validity period for the bidding is insufficient; or
(8)
the tender documents conform to other commercial clauses in the bidding documents stipulating the annulment.
Unless it is otherwise prescribed by the present Measures, the documents as listed in the preceding paragraph shall be offered in
originals, and no clarification or supplement may be conducted prior to the opening of the tenders, otherwise it will result in the
annulment of the bid.
Article 37
During the process of technical tender evaluation, the bid shall be annulled upon occurrence of any of the following conditions:
(1)
the tender documents fail to comply with the requirements of the main parameters with an asterisk (“*”) in the technical specifications
of the bidding documents, or the main parameters marked with an asterisk (“*”) are not supported by the technical materials;
(2)
the general parameters in technical specifications of the bidding documents exceed the permissible maximum scope of deviation or the
highest number of terms;
(3)
the re
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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.
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