STANDARDIZATION LAW

Category	TECHNOLOGICAL CONTROL	Organ of Promulgation	The Standing Committee of the National People’s Congress	Status of Effect	In Force
Date of Promulgation	1988-12-29	Effective Date	1989-04-01

Standardization Law of the People’s Republic of China

Contents
Chapter I  General Provisions
Chapter II  Formulation of Standards
Chapter III  Implementation of Standards
Chapter IV  Legal Responsibility
Chapter V  Supplementary Provisions

(Adopted at the Fifth Meeting of the Standing Committee of the Seventh

National People’s Congress on December 29, 1988, promulgated by Order No. 11
of the President of the People’s Republic of China on December 29, 1988, and
effective as of April 1, 1989)
Contents

Chapter I General Provisions

Chapter II Formulation of Standards

Chapter III Implementation of Standards

Chapter IV Legal Responsibility

Chapter V Supplementary Provisions
Chapter I General Provisions

Article 1 This Law is formulated with a view to developing the socialist
commodity economy, promoting technical progress, improving product quality,
increasing social and economic benefits, safeguarding the interests of the
State and the people and suiting standardization to the needs in socialist
modernization and in the development of economic relations with foreign
countries.

Article 2 Standards shall be formulated for the following technical
requirements that need to be unified:

(1) the varieties, specifications, quality and grades of industrial
products as well as the safety and sanitary requirements for them;

(2) the design, production, inspection, packing, storage, transportation
and methods of operation of industrial products as well as the safety and
sanitary requirements for them in the process of production, storage and
transportation;

(3) technical requirements and testing methods related to environmental
protection;

(4) the designs, construction procedure and safety requirements for
construction projects; and

(5) technical terms, symbols, code names and drawing methods related to
industrial production, project construction and environmental protection.

Major agricultural products and other items that need to be standardized
shall be designated by the State Council.

Article 3 The tasks of standardization shall include the formulation of
standards and organization of and supervision over the implementation of the
standards.

Standardization shall be incorporated in the plan for national economic
and social development.

Article 4 The State shall encourage the active adoption of international
standards.

Article 5 The department of standardization administration under the
State Council shall be in charge of the unified administration of
standardization throughout the country. Competent administrative authorities
under the State Council shall, in line with their respective functions, be
in charge of standardization in their respective departments and trades.

The departments of standardization administration of provinces, autonomous
regions and municipalities directly under the Central Government shall be in
charge of the unified administration of standardization within their
respective administrative areas. Competent administrative authorities under
the governments of provinces, autonomous regions and municipalities directly
under the Central Government shall, in line with their respective functions,
be in charge of standardization in their respective departments and trades
within their respective administrative areas.

The standardization administration departments and the competent
administrative authorities of cities and counties shall, in line with their
respective functions as assigned by the governments of provinces, autonomous
regions and municipalities directly under the Central Government, be in charge
of standardization within their respective administrative areas.
Chapter II Formulation of Standards

Article 6 National standards shall be formulated for the technical
requirements that need to be unified nationwide. National standards shall be
formulated by the department of standardization administration under the State
Council. Where, in the absence of national standards, technical requirements
for a certain trade need to be unified, trade standards may be formulated.
Trade standards shall be formulated by competent administrative authorities
under the State Council and reported to the department of standardization
administration under the State Council for the record, and shall be annulled
on publication of the national standards. Where, in the absence of both
national and trade standards, safety and sanitary requirements for industrial
products need to be unified within a province, an autonomous region or a
municipality directly, under the Central Government, local standards may be
formulated. Local standards shall be formulated by departments of
standardization administration of provinces, autonomous regions and
municipalities directly under the Central Government and reported to the
department of standardization administration and the competent
administrative authorities under the State Council for the record, and shall
be annulled on publication of the national or trade standards.

Where, in the absence of both national and trade standards for products
manufactured by an enterprise, standards for the enterprise shall be
formulated to serve as the criteria for the organization of production. An
enterprise’s standards for its products shall be reported to the
standardization administration department and the competent administrative
authorities under the local government for the record. Where national or
trade standards have been formulated, the State shall encourage enterprises
to formulate their enterprise standards, which are more stringent than the
national or trade standards, to be used in these enterprises.

Where the formulation of standards is otherwise provided for by law, such
legal provisions shall be complied with.

Article 7 National standards and trade standards shall be classified
into compulsory standards and voluntary standards. Those for safeguarding
human health and ensuring the safety of the person and of property and those
for compulsory execution as prescribed by the laws and administrative rules
and regulations shall be compulsory standards, the others shall be voluntary
standards.

The local standards formulated by standardization administration
departments of provinces, autonomous regions and municipalities directly
under the Central Government for the safety and sanitary requirements of
industrial products shall be compulsory standards within their respective
administrative area.

Article 8 The formulation of standards shall be conducive to ensuring
safety and the people’s health, safeguarding consumer interests and
protecting the environment.

Article 9 The standards to be formulated shall be conducive to a
rational use of the country’s resources, a wider utilization of scientific
and technological gains and the enhancement of economic returns, conform to
operation instructions, increase the universality and interchangeability of
products, and be technologically advanced and economically rational.

Article 10 The standards to be formulated shall be coordinated with and
supported by related standards.

Article 11 The standards to be formulated shall help promote economic
and technological cooperation with foreign countries and foreign trade.

Article 12 The roles of trade associations, scientific research
institutions and academic organizations shall be brought into play in the
formulation of standards.

A department engaged in the formulation of standards shall organize a
committee on standardization technology composed of specialists, which shall
be responsible for the drafting of the standards and shall participate in the
examination of the draft standards.

Article 13 After the standards come into force, the department that
formulated them shall, in the light of scientific and technological
developments and the needs in economic construction, make timely reviews of
the current standards to determine if they are to remain effective or are to
be revised or annulled.
Chapter III Implementation of Standards

Article 14 Compulsory standards must be complied with. It shall be
prohibited to produce, sell or import products that are not up to the
compulsory standards. With regard to voluntary standards, the State shall
encourage their adoption by enterprises on an optional basis.

Article 15 With respect to products for which national or trade standards
have been formulated enterprises may apply to the standardization
administration department under the State Council or agencies authorized by
the same department for product quality authentication. For products which
are authenticated to conform to the standards, certificates shall be issued
by the department that made the authentication and the use of the prescribed
authentication marks shall be permitted on such products and the packing
thereof.

If products for which authentication certificates have been granted do
not conform to national or trade standards, or if products have not undergone
authentication or found not up to the standards after the authentication
proceedings, no authentic marks shall be permitted for use on such products
leaving factories for sale.

Article 16 Technical requirements for export products shall comply with
contractual provisions.

Article 17 The development of new products, improvement of products
or technical renovation by an enterprise shall conform to standardization
requirements.

Article 18 Departments of standardization administration under
governments at or above the county level shall be responsible for supervision
over and inspection of the implementation of the standards.

Article 19 Departments of standardization administration under
governments at or above the county level may, in accordance with needs,
establish inspection organizations or authorize inspection organizations of
other units to examine whether products conform to the standards. Where the
laws and administrative rules and regulations provide otherwise on inspection
organizations, such provisions shall apply.

Disputes over whether a product conforms to the standards shall be
handled in accordance with the inspection data provided by the inspection
organizations as specified in the preceding paragraph.
Chapter IV Legal Responsibility

Article 20 Whoever produces, sells or imports products that do not
conform to the compulsory standards shall be dealt with according to law by
the competent administrative authorities as prescribed by the laws and
administrative rules and regulations. In the absence of such prescriptions,
his products and unlawful proceeds shall be confiscated and he shall be
concurrently fined by the administrative authorities for industry and
commerce; where serious consequences are caused and crimes are constituted,
the person directly responsible shall be investigated for criminal
responsibility in accordance with the law.

Article 21 Where authentication marks are used on products leaving a
factory for sale, for which authentication certificates have been issued but
which do not conform to national or trade standards, the enterprise concerned
shall be ordered by the department of standardization administration to stop
the sale and shall be fined concurrently; where the circumstances are serious,
the authentication certificates shall be revoked by the department that made
the authentication.

Article 22 Whoever uses authentication marks, without authorization,
on products leaving a factory for sale, which have not undergone
authentication or have been found not up to the standards after the
authentication proceedings, shall be ordered by the department of
standardization administration to stop the sale and shall concurrently be
fined.

Article 23 A party which refuses to accept the punishment of
confiscation of its products and of its unlawful proceeds and a fine may,
within 15 days of receiving the penalty notice, apply for reconsideration to
the office immediately above the one that made the punishment decision; a
party which refuses to obey the reconsideration decision may, within 15 days
of receiving the reconsideration decision, bring a suit before a people’s
court. The party also may, within 15 days of receiving the penalty notice,
directly bring a suit before a people’s court. If a party neither applies
for reconsideration nor brings a suit before a people’s court within the
prescribed time nor complies with the punishment decision, the office that
made the punishment decision shall apply to a people’s court for compulsory
execution.

Article 24 Personnel responsible for the supervision, inspection and
administration of standardization who violate the law or neglect their
duties, or are engaged in malpractices for personal gains, shall be given
disciplinary sanctions; where crimes are constituted, their criminal
responsibility shall be investigated in accordance with the law.
Chapter V Supplementary Provisions

Article 25 Rules for the implementation of this Law shall be formulated
by the State Council.

Article 26 This Law shall go into effect as of April 1, 1989.

CONSITUTION AMENDMENT

Amendment to the Constitution of the People’s Republic of China

(Effective Date:1988.04.12–Ineffective Date:)

AMENDMENT TO THE CONSTITUTION OF THE PEOPLE’S REPUBLIC OF CHINA

(Adopted at the First Session of the Seventh National People’s Congress on April 12, 1988)

Article 1. Article 11 of the Constitution shall include a new paragraph which reads: “The state permits the private sector of the economy to
exist and develop within the limits prescribed by law. The private sector of the economy is a complement to the socialist public
economy. The state protects the lawful rights and interests of the private sector of the economy, and exercises guidance, supervision
and control over the private sector of the economy.”

Article 2. The fourth paragraph of Article 10 of the Constitution, which provides that ” no organization or individual may appropriate, buy,
sell or lease land or otherwise engage in the transfer of land by unlawful means,” shall be amended as: ” No organization or individual
may appropriate, buy, sell or otherwise engage in the transfer of land by unlawful means. The right to the use of land may be transferred
according to law.”

REGULATIONS FOR CONTROLLING THE REGISTRATION OF ENTERPRISES AS LEGAL PERSONS

Category	ADMINISTRATION FOR INDUSTRY AND COMMERCE	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1988-06-03	Effective Date	1988-07-01

Regulations of the People’s Republic of China for Controlling the Registration of Enterprises As Legal Persons

Chapter I  General Provisions
Chapter II  Registration Authorities
Chapter III  Conditions for Registration and Entities to Apply for
Chapter IV  Items of Registration
Chapter V  Registration for Starting Operations
Chapter VI  Changes in Registration
Chapter VII  Cancellation of Registration
Chapter VIII  Announcement, Annual Check-up and Control of Certificates
Chapter IX Control of the Registration of Business Operations by
Chapter X  Supervision and Control
Chapter XI  Supplementary Provisions

(Adopted by the Fourth Executive Meeting of the State Council on May

13, 1988, promulgated by Decree No. 1 of the State Council of the People’s
Republic of China on June 3, 1988, and effective as of July 1, 1988)
Chapter I  General Provisions

Article 1 In accordance with relevant provisions of the General Principles
of the Civil Law of the People’s Republic of China, the present Regulations
are formulated with a view to establishing a system for controlling the
registration of enterprises as legal persons, confirming their status as such,
safeguarding their legitimate rights and interests, stamping out illegal
business operations, and preserving social and economic order.

Article 2 Any of the following enterprises which are qualified as legal
persons shall register as such in accordance with the relevant provisions of
the present Regulations:

(1) enterprises owned by the whole people;

(2) enterprises under collective ownership;

(3) jointly operated enterprises;

(4) Chinese-foreign equity joint ventures, Chinese-foreign contractual
joint ventures and foreign-capital enterprises established within the territory
of the People’s Republic of China;

(5) privately operated enterprises;

(6) other enterprises required by the law to register as legal persons.

Article 3 Those enterprises applying for registration as legal persons
shall be given Business Licenses for Enterprises as Legal Persons and the
status of legal persons when their applications for registration have been
examined and approved by the authorities in charge of the registration of
enterprises as legal persons and their legitimate rights and interests shall
be protected by laws of the State.

Those enterprises, which are required by law to register as legal persons
but which have not gone through the procedures of examination and approval
registration by the authorities in charge of the registration of enterprises
as legal persons, shall not be allowed to engage in business operations.
Chapter II Registration Authorities

Article 4 The authorities in charge of the registration of enterprises as
legal persons (hereinafter referred to as the registration authorities) are
the State Administration for Industry and Commerce and administrative
departments for industry and commerce at various levels. Registration
authorities at various levels shall perform their functions according to law
under the leadership of higher registration authorities and be free from
unlawful interference.

Article 5 The registration of national corporations, enterprise groups
and corporations handling import-export business set up with the approval of
the State Council or departments authorized by the State Council shall be
examined and approved by the State Administration for Industry and Commerce.
The registration of Chinese-foreign equity joint ventures, Chinese-foreign
contractual joint ventures and foreign-capital enterprises shall be examined
and approved by the State Administration for Industry and Commerce or by local
administrative departments for industry and commerce authorized by the State
Administration for Industry and Commerce.

The registration of son (or branch) companies of national corporations,
enterprises, enterprise groups or companies handling import-export trade
established with the approval of the people’s governments of provinces,
autonomous regions or municipalities directly under the Central Government or
departments authorized by them shall be examined and approved by the
administrative departments for industry and commerce of the provinces,
autonomous regions and municipalities directly under the Central Government.

The registration of other enterprises shall be examined and approved by
the administrative departments for industry and commerce of the cities or
counties (districts) where the enterprises are located.

Article 6 Registration authorities at various levels shall institute a
file of the registration of enterprises as legal persons and a system for
tabulating statistics relating to such registration, and collect basic
information about the registration of enterprises as legal persons so as to
serve the development of a planned commodity economy.

Registration authorities shall offer, in a planned manner and according to
the needs of society, the service of providing the public with data about the
registration of enterprises as legal persons.
Chapter III Conditions for Registration and Entities to Apply for
Registration

Article 7 Entities applying for registration as enterprises as legal
persons must satisfy the following conditions, i.e. having:

(1) name, organization and articles of association;

(2) fixed sites for business operations and essential facilities;

(3) funds and employees in conformity with State regulations and in line
with their scale of production, operation or service;

(4) ability to bear civil liabilities independently;

(5) a scope of business in conformity with the provisions of the relevant
laws, regulations and policies of the State.

Article 8 The application of an enterprise for registration as a legal
person shall be filed by the person responsible for establishing the
enterprise.

The registration as a legal person of a jointly operated enterprise which
bears civil labilities independently shall be applied for by the person
responsible for initiating the said enterprise.
Chapter IV Items of Registration

Article 9 The major items to be registered for an enterprise as a legal
person are: name, residence, site for business operation, legal representative,
economic nature, scope of business, mode of operation, registered capital,
number of employees, duration of operation and subdivisions.

Article 10 An enterprise as a legal person shall use only one name. The
name to be used by the enterprise as a legal person in its application for
registration shall be examined by the registration authorities and, after it
is approved and registered, the enterprise as a legal person shall enjoy the
right to the exclusive use of the registered name within a definite limit.

Those who apply for establishing Chinese-foreign equity joint ventures,
Chinese-foreign contractual joint ventures or foreign-capital enterprises
shall apply to the registration authorities for registering the names of the
enterprises before their contracts and articles of association are examined
and approved.

Article 11 The legal representative of an enterprise as a legal person,
which has been registered after examination and approval by a registration
authority, shall be the signatory who exercises functions and powers on behalf
of the enterprise. The signature of the legal representative shall be
submitted to the registration authority for the record.

Article 12 The registered capital of an enterprise as a legal person
represents the total value of the property the State entrusts to it for
operation and management or that of the property owned by the enterprise
itself.

When an enterprise as a legal person registers for starting operations,
the discrepancy between the sum of capital it applies for registration and the
sum of capital it actually possesses shall be handled in accordance with
specific regulations of the State.

Article 13 The scope of business of an enterprise as a legal person shall
be in harmony, with its capital, sites, equipment, employees and technical
force. It may focus on one line of business as its main operation while
engaging in other operations simultaneously in accordance with relevant
regulations of the State. An enterprise as a legal person shall engage in
operations within the scope of business as approved in registration.
Chapter V Registration for Starting Operations

Article 14 An enterprise as a legal person shall apply to a registration
authority for registration for starting operations within 30 days after the
approval of the department in charge of it or that of an authority for
examination and approval. For an enterprise which does not have a department
in charge or authority for examination and approval, its application for
registration for starting operations shall be examined by a registration
authority. The registration authority shall make a decision of approval or
disapproval of the application for registration within 30 days after receiving
it.

Article 15 An enterprise as a legal person shall submit the following
papers when applying for registration for starting operations:

(1) an application for registration signed by the person responsible for
its establishment;

(2) the document of approval issued by the department in charge or the
authority for examination and approval;

(3) its articles of association;

(4) a certificate of its creditworthiness, a certificate of the
verification of its capital or a guarantee for its capital;

(5) a certificate of the identity of the principal responsible person of
the enterprise;

(6) a certificate of the right to use the residence and site for operation;

(7) other relevant papers and certificates.

Article 16 When the application filed by an entity for starting
operations as an enterprise as a legal person has been examined and approved
by a registration authority and a Business Licenses for Enterprises as a Legal
Person is received, the enterprise shall be considered as established. The
enterprises as a legal person may henceforth have its official seal made, open
a bank account, sign contracts and conduct business operations by dint of its
Business License.

The registration authority may, after a check-up, issue duplicates of the
Business License, if the enterprise as a legal person needs them for its
business operations.
Chapter VI Changes in Registration

Article 17 An enterprise as a legal person shall apply for making changes
in its registration whenever it changes its name, residence, site, legal
representative, economic nature, scrape of business, mode of operation,
registered capital or duration of operation and whenever it increases or
disbands its branches.

Article 18 An enterprise as a legal person shall apply to the registration
authority for making changes in its registration within 30 days after the
changes are approved by the department in charge or by the authority for
examination and approval.

Article 19 An enterprise as a legal person shall apply to the registration
authority for making changes in its registration, or for registration for
starting operations or for cancelling its registration, whenever it is split
up, or merged with others or moved elsewhere, within 30 days after these
changes are approved by the department in charge or by the authority for
examination and approval.
Chapter VII Cancellation of Registration

Article 20 An enterprise as a legal person shall go through the
procedures for cancelling its registration with the registration authority
when it closes down, is dissolved, declares bankruptcy or terminates its
business operations for other reasons.

Article 21 Whenever an enterprise as a legal person is to cancel its
registration, it must submit an application signed by its legal representative,
a document of approval issued by the department in charge or by the authority
for examination and approval, a certificate showing the completion of the
clearing up of its liabilities, or a document showing that a liquidation
organization will be responsible for clearing up its creditor’s rights and
liabilities. The registration authority, after examining and approving the
application, shall recall the Business License for Enterprise as a Legal
Person, duplicates of the License, take over the official seal of the
enterprise, and notify the banks at which it has opened an account of the
cancellation of its registration.

Article 22 An enterprise as a legal person, which fails to start
operations 6 months after receiving its Business License for Enterprise as a
Legal Person or which has ceased its operations for a year, shall be regarded
as having closed down, and the registration authority shall recall its Business
License for Enterprises as a Legal Person, duplicates of the License, take
over its official seal and notify the banks at which it has opened an account
of the cancellation of its registration.
Chapter VIII Announcement, Annual Check-up and Control of Certificates

Article 23 The registration authority shall issue registration
announcements whenever an enterprise as a legal person starts operations,
changes its name or cancels its registration. No other organ shall be enpost_titled
to issue such announcements without the approval of the registration authority.

Article 24 A system for conducting annual check-up shall be instituted to
administer the registration of enterprises as legal persons. An enterprise as
a legal person shall submit its annual check-up report, its balance sheet or
statement of assets and liabilities to the registration authority at the time
it prescribes. The registration authority shall check up the major items
contained in the registration of the enterprise as a legal person.

Article 25 The Business License for Enterprises as a Legal Person issued
by the registration authority is the certificate of an enterprise as a legal
person. Except the registration authority, which may withhold or cancel it in
accordance with the legal procedures, no other organ or individual is enpost_titled
to take over, detain or destroy it.

An enterprise as a legal person, which has lost its Business License
for Enterprise as a Legal Person or duplicates of the License, must announce
the loss in a newspaper before it can apply for a replacement.

The Business License for Enterprise as a Legal Person and its duplicates
may not be forged, altered, leased, lent, sold or reproduced without
permission.

Article 26 An enterprise as a legal person shall pay registration and
annual check-up fees according to the rules when it registers for starting
operations and applies for making changes in its registration and when it
receives the annual check-up. The fees to be charged on registration for
starting operations shall be 1 millesimal of the sum of the enterprise’s
registered capital; in cases where the registered capital exceeds 10 million
yuan, the fees to be charged on the portion in excess of the said sum shall
be 0.5 millesimal of it; in cases where the registered capital exceeds 100
million yuan, no fees shall be charged on the portion in excess of the said sum
. The minimum registration fee shall be 50 yuan. Fees to be charged on making
changes in the registration and conducting the annual check-up shall be
prescribed by the State Administration for Industry and Commerce.
Chapter IX Control of the Registration of Business Operations by
Institutions and Scientific and Technological Public Organizations

Article 27 When institutions or scientific and technological public
organizations establish enterprises qualified as legal persons in line with
relevant regulations of the state, the applications for registration shall be
filed by the enterprises. They may engage in business operations only after
their applications for registration have been approved by the registration
authorities and after they have received their respective Business Licenses
for Enterprise as a Legal Person.

Article 28 Institutions, which are run like enterprises in accordance
with relevant regulations of the State and which no longer receive operating
funds from the State, or scientific and technological public organizations
which are established for business operations, shall apply for registration if
they are qualified to be enterprises as legal persons. They may engage in
business operations only after their applications have been approved by the
registration authorities and they have received their respective Business
Licenses for Enterprise as a Legal Person.
Chapter X Supervision and Control

Article 29 The registration authorities shall exercise the following
functions of supervision and control over enterprises as legal persons
according to law:

(1) supervising the registration for starting operations, the application
for making changes and the cancellation of registration by enterprises as
legal persons according to regulations;

(2) supervising the conduct of business operations by enterprises as legal
persons in line with the items of registrations, articles of association
and contracts;

(3) supervising the compliance of enterprises as legal persons and
their legal representatives with laws, regulations and policies of the State;

(4) stopping, investigating or dealing with illegal business operations
of enterprise as legal persons; protecting their legitimate rights and
interests.

Article 30 The registration authority may, in light of the circumstance,
penalize an enterprise as legal person by warning, fine, confiscation of
illegal earnings, suspension of business for consideration, or withholding or
revoking the Business License for Enterprise as a legal Person, if it is
involved in any of the following case:

(1) concealing the true situation and resorting to deception in the course
of registration or starting operations before the approval of its registration;

(2) altering major items in the registration without permission or
engaging in business operations beyond the scope of business as approved in
registration;

(3) failing to cancel registration according to the rules or failing to
submit the check-up report or receive the annual check-up;

(4) forging, altering, leasing, lending, transferring, selling or
reproducing the Business License for Enterprise as a Legal Person or its
duplicates without permission;

(5) withdrawing or transferring capital, concealing assets or dodging
liabilities;

(6) engaging in illegal business operations.

While penalizing an enterprise as a legal person in line with the above
provisions, the registration authority shall investigate its legal
representative’s administrative and economic responsibilities according to the
seriousness of the violations of the law; judicial organs shall investigate
the criminal responsibilities of those who have violated the criminal law.

Article 31 The registration authority shall ascertain the facts and act
according to law when dealing with the illegal activities of an enterprise as
a legal person and notify the parties concerned of its decision in writing.

Article 32 When an enterprise as a legal person disagrees with the
penalty meted out but by the registration authority, it may appeal within 15
days after receiving the notice of penalty, to the immediate higher
registration authority for reconsideration. The higher registration authority
shall make a reconsideration decision within 30 days after receiving the appeal
for reconsideration. The enterprise may file a suit in a people’s court within
30 days after receiving the notice of reconsideration in it disagrees with the
reconsideration decision. The registration authority may, in accordance with
the prescribed procedures, ask the bank at which the enterprise has an account
to transfer from its account the sum to be fined or confiscated as penatly, if
it fails to appeal or to pay the fine or the confiscated sum at the expiry of
the prescribed period.

Article 33 When an enterprise as a legal person has its business license
revoked, the registration authority shall take over its official seal and
notify the bank at which it has account of the cancellation of its
registration, and the department in charge or a liquidation organization shall
be responsible for settling its creditor’s rights and liabilities.

Article 34 Any functionary of the department in charge, the authority
for examination and approval or of the registration authority, who has violated
the present Regulations, neglected his duties to a serious extent, abused his
powers, practised graft and embezzlement, extorted and taken bribes or
encroached on the legitimate rights and interests of an enterprise as a legal
person, shall be given administrative or economic penalty in light of the
circumstances; the judicial organ shall investigate, according to law, his
criminal responsibility, if he violates the criminal law.
Chapter XI Supplementary Provisions

Article 35 When an enterprise as a legal person establishes a branch
which is incapable of bearing civil liability independently, the registration
of the branch shall be applied for by the enterprise. The branch shall
receive a Business License after the application is approved by the
registration authority and may engage in business operations within the scope
of business as approved in registration.

In accordance with relevant State regulations, administrative institutions
depending on State funding or scientific and technological social bodies must
apply for registration if they engage in business operations or establish
enterprises not qualified; as legal persons. They shall receive Business
Licenses after their applications are approved by the registration authorities
and may engage in business operations within the scope of business as approved
in registration.

The specific control of the registration involved shall be enforced with
reference to the provisions of the present Regulations.

Article 36 For new enterprises to be established with the approval of
relevant departments of the State Council or planning departments at various
levels, if their preparations have been under way for more than 1 year,
applications for the registration of the establishment shall be filed
according to specific regulations.

Article 37 Enterprises qualified as legal persons, whose registration
was approved by the registration authorities before the present Regulations
are put into effect, are not required to go through the formalities again for
registration as enterprises as legal persons.

Article 38 The State Administration for Industry and Commerce shall be
responsible for interpreting the present Regulations; and the rules for their
implementation shall also be formulated by the State Administration for
Industry and Commerce.

Article 39 The present Regulations shall enter into force on July 1,
1988. The Regulations for Controlling the Registration of Chinese-Foreign
Equity Joint Ventures promulgated by the State Council on July 26, 1980, the
Regulations for Controlling the Registration of Industrial and Commercial
Enterprises promulgated by the State Council on August 9, 1982, and the
Interim Provisions for Controlling the Registration of Companies approved by
the State Council on August 14, 1985 and promulgated by the State
Administration for Industry and Commerce on August 25, 1985 shall all be
abrogated on the same date.

INTERIM REGULATIONS ON STAMP TAX

Category	TAXATION	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1988-08-06	Effective Date	1988-10-01

Interim Regulations of the People’s Republic of China on Stamp Tax (Note 1.)

Appendix: Stamp Tax Schedule of Tax Items and Tax Rates
Note:

(Adopted by the Ninth Executive Meeting of the State Council on June 24,

1988 and promulgated by Decree No.11 of the State Council of the People’s
Republic of China on August 6, 1988, and become effective as of October 1,
1988)

Article 1 All units and individuals who execute or receive, within the
territory of the People’s Republic of China, documents in the categories
specified in these Regulations shall be taxpayers subject to stamp tax
(hereinafter referred to as “taxpayers”), and shall pay stamp tax in
accordance with the provisions of these Regulations.

Article 2 The following categories of documents shall be taxable
documents:

(1) contracts or documents in the nature of a contract with regard to:
purchases and sales, the undertaking of processing, contracting for
construction projects, property leasing, commodity transport, warehousing,
loans, property, insurance, technology;

(2) documents for transfer of property rights;

(3) business account books;

(4) certificates evidencing rights or licences; and

(5) other documents that are taxable as determined by the Ministry of
Finance.

Article 3 According to the nature of the taxable document, taxpayers
shall calculate the amount of tax due on the basis of a flat tax rate or a
fixed amount per document. Determination the specific tax rate or amount of
tax shall be made with reference to the Schedule of Tax Items and Tax Rates
accompanying these Regulations.

No stamp tax shall be due where the amount of tax payable does not exceed
one jiao.

Where the amount of tax payable is one jiao or more, an odd amount not
exceeding five fen shall not be counted; where the odd amount is five fen or
more, the tax shall be calculated as one jiao.

Article 4 The following documents shall be exempt from stamp tax:

(1) duplicates or copies of documents on which stamp tax has already been
paid;

(2) documents executed for the donation of property to the government,
social welfare establishments or schools by the property owner;

(3) other documents which are exempt from stamp tax with the approval of
the Ministry of Finance.

Article 5 Measures for the payment of stamp tax shall be implemented
whereby taxpayers shall, in accordance with the provisions, calculate the
amount of tax payable and purchase and affix at one time the full
corresponding amount of tax stamps (hereinafter referred to as “stamping”).

In order to simplify the stamping procedures where the amount of tax to be
paid is relatively large or where frequent stamping is necessary, taxpayers
may apply to the tax authorities to use a tax payment account instead of
stamping, or a periodic payment method.

Article 6 “Fax stamps shall be affixed to taxable documents; taxpayers
shall cancel each stamp along its border with a seal or a drawn line. Tax
stamps that have already been affixed may not be reused.

Article 7 Tax stamps shall be affixed to taxable documents at the time
of execution or upon receipt.

Article 8 Where the same document is executed by two or more parties
and each party holds a copy, each party shall be responsible for affixing on
its own copy the full amount of tax stamps due.

Article 9 Where a document on which tax stamps have already been affixed
is amended, resulting in an increase in the value thereof, additional tax
stamps shall be affixed on the document in accordance with the amount of such
increase.

Article 10 The tax authorities shall be responsible for the
administration of the collection of stamp tax.

Article 11 The State Taxation Bureau shall supervise the printing of the
tax stamps. The face value of tax stamps shall be denominated in Renminbi.

Article 12 Units issuing or processing taxable documents shall be
responsible for the supervision to taxpayers in respect of the payment of
stamp tax in accordance with the law.

Article 13 Where taxpayers are found to have engaged in any of the
following, the tax authorities shall impose penalties in light of the
seriousness of the case:

(1) in the case of a failure to affix tax stamps, or to affix an
insufficient amount of tax stamps, on taxable documents, the tax authorities
may, in addition to ordering taxpayers to make up the tax stamps, impose a
fine equal to twenty times or less the amount of tax stamps due;

(2) in the case of a violation of the provisions of Paragraph 1 of Article
6 of these Regulations, the tax authorities may impose a fine equal to ten
times or less the amount of the tax stamps that have not been cancelled by a
seal or a drawn line; and

(3) in the case of a violation of the provisions of Paragraph 2 of Article
6 of these Regulations, the tax authorities may impose a fine equal
to thirty times or less the amount of the tax stamps that have been reused.

In a case where tax stamps have been forged, the tax authorities shall
submit the matter to the judicial authorities for investigation into criminal
liability in accordance with the law.

Article 14 The collection and administration of stamp tax shall, in
addition to the provisions of these Regulations, be administered in accordance
with the pertinent provisions of the Interim Regulations of the People’s
Republic of China for Tax Administration.

Article 15 The Ministry of Finance shall be responsible for the
interpretation of these Regulations. The rules for the implementation of these
Regulations shall be formulated by the Ministry of Finance.

Article 16 These Regulations shall become effective as of October 1, 1988.

Appendix: Stamp Tax Schedule of Tax Items and Tax Rates

AUDIT REGULATIONS

Audit Regulations of the People’s Republic of China

(Promulgated 21 October 1988 by the State Council)

CONTENTS

CHAPTER I GENERAL PRINCIPLES

CHAPTER II AUDIT OFFICES AND AUDITORS

CHAPTER III PRINCIPAL TASKS OF AN AUDIT OFFICE

CHAPTER IV PRINCIPAL POWERS AND FUNCTIONS OF AN AUDIT OFFICE

CHAPTER V AUDIT WORK PROCEDURE

CHAPTER VI INTERNAL AUDITING

CHAPTER VII SOCIAL AUDITING

CHAPTER VIII LEGAL LIABILITY

CHAPTER IX SUPPLEMENTARY PRINCIPLES

CHAPTER I GENERAL PRINCIPLES

Article 1. These Regulations are formulated to improve the audit supervision of financial income and expenditure and
related economic activities, to enforce financial and economic law and discipline, to increase economic
performance, to strengthen overall control and administration and to ensure the smooth implementation of the socialist
modernisation programme.

Article 2. The State shall establish audit offices to implement an audit supervisory system.

An audit office shall undertake audit supervision of the various people’s government departments at an equivalent level
to itself, lower level people’s government authorities, State finance organs, State-owned enterprises and
institutional units and other State-funded units to ascertain the authenticity, legality and performance of their
financial income and expenditure.

Article 3. An audit office shall undertake audit supervision in accordance with the provisions of State laws, statutory
regulations and policies.

An audit office shall exercise independent supervisory rights in accordance with the law and no other administrative
organ, social group or individual shall be permitted to interfere.

The audit conclusions and decisions of an audit office must be implemented by the units under audit and the relevant
personnel. If an audit conclusion or decision involves another related unit, this unit shall assist in the implementation
process.

Article 4. An audit office shall operate under a dual leadership system. It shall be responsible to and shall submit work
reports to its equivalent level people’s government authority and superior level audit office. Priority shall be given
to audit work assigned by the leaders of its superior level audit office.

Article 5. An area under State audit jurisdiction where an audit office has yet to establish an agency may, in accordance with
requirements, establish an internal audit body or provide auditors to implement an internal audit system.

Article 6. Social audit organisations established in accordance with the law may accept commissions to develop account auditing
and to provide consultancy services.

CHAPTER II AUDIT OFFICES AND AUDITORS

Article 7. The State Council shall establish an Audit Administration. The Audit Administration shall be the State’s supreme
audit office and, under the leadership of the Premier of the State Council, shall organise the leadership of the
entire State’s audit work and shall be responsible for audit mattes which come within its audit scope.

Article 8. The various levels of people’s governments at county level and above shall establish audit offices. Under the
leadership of the provincial head, autonomous region chairman, mayor, prefecture head, county head or district head respectively,
and its superior level audit office, a local audit office at any of the various levels shall organise the leadership
of its own administrative district’s audit work and shall be responsible for all audit matters which come within
the audit scope of its own audit office level.

Article 9. An audit office may, in line with work requirements, establish an agency in a key district or department to
undertake audit supervision.

Article 10. The leaders of audit offices at the various levels shall be appointed or dismissed in accordance with the provisions governing
cadre administrative jurisdiction. The appointment or dismissal of persons in charge of local audit offices at the
various levels (including the leader and deputy leader) shall be subject to prior approval by their superior level audit
office.

Article 11. Auditors shall conduct their auditing work in accordance with the law and shall be dedicated to their work, adhere to
principles, be objective and impartial, honest when performing their official duty and maintain confidentiality.

Auditors shall exercise their functions and powers in accordance with the law and shall receive the protection of the
law. Retaliation by any person is not allowed.

CHAPTER III PRINCIPAL TASKS OF AN AUDIT OFFICE

Article 12. An audit office shall conduct audit supervision of the financial income and expenditure of the following units:

(1) the various people’s government departments at its equivalent level and lower level people’s government authorities;

(2) State financial institutions;

(3) State-owned enterprises, institutional units and capital construction units;

(4) other units which receive State fund allocations or allowances;

(5) Sino-foreign joint equity enterprises, Sino-foreign cooperative enterprises, domestic affiliated enterprises
and other enterprises with State assets;

(6) other units which the provisions of State laws and statutory regulations stipulate as requiring audit supervision.

Article 13. An audit office shall conduct audit supervision of the aforesaid units in the following areas:

(1) financial budget implementation and final financial accounts;

(2) credit plan implementation and the results;

(3) financial plan implementation and final accounts;

(4) financial income and expenditure relating to capital construction and transformation projects;

(5) administration of State assets;

(6) non-budgetary fund income and expenditure;

(7) financial income and expenditure relating to projects which are funded through foreign capital loans or which are the
recipients of international assistance;

(8) various economic activities and other areas of economic performance which are income and expenditure related;

(9) acts which seriously infringe upon State assets or which, through serious damage, waste, etc., adversely harm
the economic interests of the State;

(10) auditing matters relating to the contract liabilities of State-owned enterprises;

(11) other matters which require auditing in accordance with the provisions of State laws and statutory regulations.

Article 14. Audit scope shall be determined by audit offices at the various levels in accordance with the State’s financial system
and the jurisdictional framework pertaining to the financial affairs of the units under audit.

A superior level audit office may empower a matter which comes within its audit scope to a lower level audit
office and may directly undertake the auditing of a matter of major importance which comes within the audit scope of a lower
level audit office.

An audit office may commission an internal audit body or social audit organisation to audit matters which come
within the audit scope of the office.

CHAPTER IV PRINCIPAL POWERS AND FUNCTIONS OF AN AUDIT OFFICE

Article 15. During the audit process an audit office shall have the following supervisory and investigative powers:

(1) power to request a unit under audit to submit its financial budget, finance plans, final accounts, accounting
statements and other relevant information;

(2) power to inspect the relevant accounts and assets of a unit under audit, to consult relevant documents and information
and to attend any relevant meeting held by the unit under audit;

(3) power to investigate the relevant organs, groups, enterprises, institutional units or personnel involved
with matters relating to an audit, with the aforesaid units or personnel being required to provide the audit office with
all relevant information and testimonial material;

(4) power to request the relevant department in charge to enact an interim stay ruling in a case where an act that
is seriously damaging State interests or violating financial or economic legislation is currently occurring
and, if the stay proves ineffectual, power to notify the relevant financial department or bank to temporarily suspend
access to the relevant funds.

(5) power to adopt interim measures, such as sealing up or confiscation accounts, assets, etc., should the
unit under audit obstruct or disrupt auditing work.

Article 16. An audit office may handle a violation of financial or economic legislation by a unit under audit in accordance with
the following provisions:

(1) issue a warning or circulate a notice of criticism;

(2) order any income or expenditure related matters involved with a violation of State regulations to be rectified;

(3) order the return or confiscation of any illegal earnings;

(4) recover misappropriated State assets;

(5) issue a direction to temporarily suspend access to funds or suspend bank loans in a case where the unit
under audit violates regulations through the use of funds or a bank loan, resulting in serious damage to State interests;

(6) issue a fine in accordance with the provisions of the relevant statutory regulations.

If a unit under audit refuses to return illegal funds or to pay fines, etc., the audit office may notify the bank
to withhold the relevant amount of money.

Article 17. If, in the case of a unit under audit which has violated the law as described in the previous Article, the audit office
thinks that the persons directly responsible or the persons in charge of the unit should be issued
with an administrative penalty, it may hand over the matter for investigation or to the relevant departments
for handling. If the circumstances are serious enough to constitute a crime, a judicial organ may be requested to
pursue criminal liability in accordance with the law.

CHAPTER V AUDIT WORK PROCEDURE

Article 18. Audit offices at the various levels shall determine the focal point of their audit work and shall formulate audit
project plans, in accordance with State policies and the requirements of their superior level audit offices and equivalent
level government authorities.

Article 19. After an audit office has clarified an audit matter, it shall notify the unit under audit.

A unit under audit shall co-operate with the work of the audit office and shall provide the necessary conveniences
to facilitate the work of the audit office.

Article 20. An auditor shall conduct an audit based on such means as inspection of credentials and accounts, consultation of documents
and information, examination of cash and material goods and investigation of the relevant units and personnel and shall
acquire testimonial material.

Testimonial material shall bear the signature or seal of the person providing it.

Article 21. After an auditor has conducted an audit, an auditor’s report shall be presented to affiliated audit offices.

The opinion of the unit under audit shall be sought regarding an auditor’s report. The unit under audit shall submit a
written response within 10 days of receipt of the report.

Article 22. After an audit office has examined and approved an auditor’s report and made audit conclusions and decisions,
it shall notify the unit under audit and any other relevant units to implement its rulings.

An audit office shall seek the opinion of the relevant departments when making audit conclusions and decisions
on an important matter.

The finance department or another relevant competent department shall ratify final accounts or handle them in the
following year, based on the audit conclusions and decisions given on these final accounts.

Article 23. If a audit under audit disagrees with the audit office’s audit conclusions or decisions, it may, within 15 days of receipt
of notice of the said conclusions and decisions, apply to the superior level audit office for a review of the
case. The superior level audit office shall issue a reassessed audit conclusion and decision within 30 days of receipt of
the review application. In special circumstances the time limit for reviewing audit conclusions and decisions may
be extended appropriately.

The original audit conclusions and decisions shall be implemented as usual during an audit review.

Article 24. The reassessed audit conclusions and decisions of a superior level audit office or the audit conclusions and decisions
of the Arbitration Administration shall be regarded as final judgements.

If an audited unit disagrees with a final audit conclusion or decision, it may submit a complaint to the audit office
which made the final judgement or to its superior level audit office.

Article 25. Audit offices shall investigate the implementation of audit conclusions and decisions.

Article 26. Audit offices at the various levels shall establish audit records of all audit items they handle and shall carry out
administration in accordance with regulations.

CHAPTER VI INTERNAL AUDITING

Article 27. State financial institutions, large and medium scale State-owned enterprises, construction units which undertake large
scale capital construction projects and State institutional units which handle relatively large amounts of
income and expenditure, as well as government departments, etc., within which audit offices have yet to establish
agencies, may establish internal audit bodies or provide auditors.

Article 28. Internal audit bodies and auditors shall, under the leadership of their own unit leaders, conduct internal audit
supervision of the financial income and expenditure and economic performance of their own unit and subordinate
units, in accordance with the provisions of State laws, statutory regulations and policies.

Internal audit bodies and auditors shall accept professional guidance from audit offices.

Article 29. An internal audit body or auditor shall carry out internal audit supervision within its own unit and subordinate units
on the following matters:

(1) implementation of and final accounts relating to financial plans or a unit’s budget;

(2) economic activities relating to financial income and expenditure and related economic performance;

(3) administration of the assets of the State and units;

(4) acts in violation of State financial and economic legislation.

(5) other audit matters which its unit leader has assigned for handling.

Internal audit bodies and auditors shall be responsible for directing the internal audit work of subordinate units.

CHAPTER VII SOCIAL AUDITING

Article 30. Social audit organisations shall be institutional units which independently undertake audit investigations and
consultancy pursuant to the law, receive payment for their services, are themselves responsible for their own income
and expenditure, conduct independent accounting and pay tax in accordance with the law.

Article 31. The establishment of a social audit organisation shall be subject to approval by the Audit Administration or an audit
office at provincial, autonomous region or directly administered municipality level.

A social audit organisation which has had its establishment approved shall begin operation only after registering
with the local administration for industry and commerce and obtaining a business licence.

Article 32. A social audit organisation may accept commissions from State organs, enterprises, institutional units or individuals
to undertake the following types of work:

(1) financial income and expenditure related audit investigations;

(2) authentication of economic cases;

(3) verification and annual examinations of registered funds;

(4) establishment of accounts and financial accounting system and providing consultancy in such areas as finance,
accounting, tax and economic management;

(5) training of audit, finance and accounting personnel.

If a social audit organisation accepts a commission from a foreign investment enterprise to undertake investigative
services, the matter shall be handled in accordance with the provisions of the Regulations of the People’s Republic
of China on Certified Public Accountants.

A social audit organisation shall maintain strict confidentiality in respect of information and knowledge
acquired in the process of its professional work.

Article 33. A social audit organisation shall accept administrative and professional guidance form audit office.

An audit report produced by a social audit organisation as the result of audit work commissioned by an audit
office shall be submitted to the audit office for examination and approval.

CHAPTER VIII LEGAL LIABILITY

Article 34. An audit office may issue a warning, circulate a notice of criticism and, depending on the circumstances, may also impose
a fine on a unit or persons directly responsible, the persons in charge of a unit or other related persons
if these Regulations are violated in any of the following ways:

(1) refusing to provide the relevant documents, books of account, certificates, accounting statements,
information or testimonial material;

(2) obstructing an auditor from performing his duty or resisting or disrupting supervisory or investigative work;

(3) practising fraud or concealing the truth;

(4) refusing to implement audit conclusions or decisions;

(5) retaliating against audit or inspection personnel.

Article 35. An audit office may impose fines at its discretion and, in accordance with provisions on cadre administrative jurisdiction,
may also issue an administrative penalty or recommend that an administrative penalty be imposed, if an auditor violates
these Regulations in any of the following ways:

(1) using his powers of office to seek personal gain;

(2) practising fraud, favouritism or other irregularities;

(3) neglecting his duties, thereby causing the State or the unit under audit to incur significant losses;

(4) revealing State secrets;

Article 36. If a unit or individual who has been penalised under the provisions of Article 34 or 35 disagrees with the penalty decision,
it may appeal to the body above the decision issuing organ.

Article 37. If any act as outlined in Article 34 or 35 is serious enough to constitute a crime, the audit office shall request
that the judicial organ pursue the criminal liability of the persons directly responsible, the people in charge of
the unit, the auditor or other related people in accordance with the law.

CHAPTER IX SUPPLEMENTARY PRINCIPLES

Article 38. Detailed provisions for audit work relating to the Chinese People’s Liberation Army shall be formulated elsewhere by the
Military Commission of the Central Committee of the Communist Party of China.

Article 39. The Audit Administration shall be responsible for interpreting these Regulations and shall formulate detailed
implementing rules.

Article 40. These Regulations shall take effect from 1 January 1989. The Provisional Regulations of the State Council on Auditing,
promulgated 29 August 1985, shall be annulled simultaneously.

Source:Ministry of Foreign Trade and Economic Cooperation

CHINESE-FOREIGN CONTRACTUAL JOINT VENTURES

Law of the PRC on Chinese-Foreign Contractual Joint Ventures

(Adopted at the First Session of the Seventh National People’s Congress and promulgated by Order No. 4 of the
President of the People’s Republic of China on April 13, 1988, and effective as of the date of promulgation)

Article 1. This Law is formulated to expand economic cooperation and technological exchange with foreign countries and to
promote the joint establishment, on the principle of equality and mutual benefit, by foreign enterprises and other
economic organizations or individuals (hereinafter referred to as the foreign party) and Chinese enterprises or other
economic organizations (hereinafter referred to as the Chinese party) of Chinese-foreign contractual
joint ventures (hereinafter referred to as contractual joint ventures) within the territory of the People’s Republic
of China.

Article 2. In establishing a contractual joint venture, the Chinese and foreign parties shall, in accordance with the provisions
of this Law, prescribe in their contractual joint venture contract such matters as the investment or conditions
for cooperation, the distribution of earnings or products, the sharing of risks and losses, the manners of operation
and management and the ownership of the property at the time of the termination of the contractual joint venture.

A contractual joint venture which meets the conditions for being considered a legal person under Chinese law, shall
acquire the status of a Chinese legal person in accordance with law.

Article 3. The state shall, according to law, protect the lawful rights and interests of the contractual joint ventures and of the
Chinese and foreign parties.

A contractual joint venture must abide by Chinese laws and regulations and must not injure the public interests of
China.

The relevant state authorities shall exercise supervision over the contractual joint ventures according to law.

Article 4. The state shall encourage the establishment of productive contractual joint ventures that are export-oriented or technologically
advanced.

Article 5. For the purpose of applying for the establishment of a contractual joint venture, such documents as the agreement,
the contract and the articles of association signed by the Chinese and foreign parties shall be submitted for examination
and approval to the department in charge of foreign economic relations and trade under the State Council or to the
department or local government authorized by the State Council (hereinafter referred to as the examination and approval authority).
The examination and approval authority shall, within 45 days of receiving the application, decide whether or not to
grant approval.

Article 6. When the application for the establishment of a contractual joint venture is approved, the parties shall, within 30 days
of receiving the certificate of approval, apply to the administrative authorities for industry and commerce
for registration and obtain a business license. The date of issuance of the business license of a contractual joint
venture shall be the date of its establishment.

A contractual joint venture shall, within 30 days of its establishment, carry out tax registration with the tax authorities.

Article 7. If the Chinese and foreign parties, during the period of operation of their contractual joint venture, agree through consultation
to make major modifications to the contractual joint venture contract, they shall report to the examination and approval
authority for approval, if the modifications include items involving statutory industry and commerce registration or
tax registration, they shall register the modifications with the administrative authorities for industry and commerce
and with the tax authorities.

Article 8. The investment or conditions for cooperation contributed by the Chinese and foreign parties may be provided in cash
or in kind, or may include the right to the use of land, industrial property rights, non-patent technology or other
property rights.

Article 9. The Chinese and foreign parties shall, in accordance with the provisions of the laws and regulations and the
agreements in the contractual joint venture contract, duly fulfil their obligations of contributing full investment
and providing the conditions for cooperation. In case of failure to do so within the prescribed time, the administrative
authorities for industry and commerce shall set another time limit for the fulfilment of such obligations; if such obligations
are still not fulfilled by the new time limit, the matter shall be handled by the examination and approval authority and
the administrative authorities for industry and commerce according to relevant state provisions.

The investments or conditions for cooperation provided by the Chinese and foreign parties shall be verified
by an accountant registered in China or the relevant authorities, who shall provide a certificate after verification.

Article 10. If a Chinese or foreign party wishes to make an assignment of all or part of its rights and obligations prescribed in the
contractual joint venture contract, it must obtain the consent of the other party or parties and report to the examination
and approval authority for approval.

Article 11. A contractual joint venture shall conduct its operational and managerial activities in accordance with the approved
contract and articles of association for the contractual joint venture. The right of a contractual joint venture
to make its own operational and managerial decisions shall not be interfered with.

Article 12. A contractual joint venture shall establish a board of directors or a joint managerial institution which shall, according
to the contract or the articles of association for the contractual joint venture, decide on the major issues concerning
the venture. If the Chinese or foreign party assumes the chairmanship of the board of directors or the directorship
of the joint managerial institution, the other party shall assume the vice-chairmanship of the board or the deputy
directorship of the joint managerial institution. The board of directors or the joint managerial institution may
decide on the appointment or employment of a general manager, who shall take charge of the daily operation
and management of the contractual joint venture. The general manager shall be accountable to the board of directors
or the joint managerial institution.

If a contractual joint venture, after its establishment, chooses to entrust a third party with its operation and
management, it must obtain the unanimous consent of the board of directors or the joint managerial institution,
report to the examination and approval authority for approval, and register the change with the administrative authorities
for industry and commerce.

Article 13. The employment, dismissal, remuneration, welfare, labour protection and labour insurance, etc. of the staff members and workers
of a contractual joint venture shall be specified in contracts concluded in accordance with law.

Article 14. The staff and workers of a contractual joint venture shall, in accordance with law, establish their trade union organization
to carry out trade union activities and protect their lawful rights and interests.

A contractual joint venture shall provide the necessary conditions for the venture’s trade union to carry out its activities.

Article 15. A contractual joint venture must establish its account books within the territory of China, file its accounting
statements according to relevant provisions and accept supervision by the financial and tax authorities.

If a contractual joint venture, in violation of the provisions prescribed in the preceding paragraph, does not establish
its account books within the territory of China, the financial and tax authorities may impose a fine on it,
and the administrative authorities for industry and commerce may order it to suspend its business operations or may
revoke its business license.

Article 16. A contractual joint venture shall, by presenting its business license, open a foreign exchange account with a bank
or any other financial institution which is permitted by the exchange control authorities of the state to
conduct transactions in foreign exchange.

A contractual joint venture shall handle its foreign exchange transactions in accordance with the provisions of the
state on foreign exchange control.

Article 17. A contractual joint venture may obtain loans from financial institutions within the territory of China and may also
obtain loans outside the territory of China.

Loans to be used by the Chinese and foreign parties as investment or conditions for cooperation, and their guarantees,
shall be provided by each party on its own.

Article 18. The various kinds of insurance coverage of a contractual joint venture shall be furnished by insurance institutions
within the territory of China.

Article 19. A contractual joint venture may, within its approved scope of operation, import materials it needs and export products it
produces. A contractual joint venture may purchase, on both the domestic market and the world market, the raw
and processed materials, fuels, etc. within its approved scope of operation.

Article 20. A contractual joint venture shall achieve on its own the balance of its foreign exchange receipts and expenditures. If a
contractual joint venture is unable to achieve the balance of its foreign exchange receipts and expenditures on its
own, it may, in accordance with state provisions, apply to the relevant authorities for assistance.

Article 21. A contractual joint venture shall, in accordance with state provisions on tax, pay taxes and may enjoy the preferential
treatment of tax reduction or exemption.

Article 22. The Chinese and foreign parties shall share earnings or products, undertake risks and losses in accordance with
the agreements prescribed in the contractual joint venture contract.

If, upon the expiration of the period of a venture’s operation, all the fixed assets of the contractual joint
venture, as agreed upon by the Chinese and foreign parties in the contractual joint venture contract, are to belong
to the Chinese party, the Chinese and foreign parties may prescribe in the contractual joint venture contract
the ways for the foreign party to recover its investment ahead of time during the period of the venture’s operation.
If the foreign party, as agreed upon in the contractual joint venture contract, is to recover its investment
prior to the payment of income tax, it must apply to the financial and tax authorities, which shall examine
and approve the application in accordance with state provisions concerning taxes.

If, according to the provisions of the preceding paragraph, the foreign party is to recover its investment ahead of
time during the period of the venture’s operation, the Chinese and foreign parties shall, as stipulated by the relevant
laws and agreed in the contractual joint venture contract, be liable for the debts of the venture.

Article 23. After the foreign party has fulfilled its obligations under the law and the contractual joint venture contract, the profits
it receives as its share, its other legitimate income and the funds it receives as its share upon the termination of the
venture, may be remitted abroad according to law.

The wages, salaries or other legitimate income earned by the foreign staff and workers of contractual joint ventures,
after the payment of the individual income tax according to law, may be remitted abroad.

Article 24. Upon the expiration or termination in advance of the term of a contractual joint venture, its assets, claims and debts
shall be liquidated according to legal procedures. The Chinese and foreign parties shall, in accordance with the agreement
specified in the contractual joint venture contract, determine the ownership of the venture’s property.

A contractual joint venture shall, upon the expiration or termination in advance of its term, cancel its registration
with the administrative authorities for industry and commerce and the tax authorities.

Article 25. The period of operation of a contractual joint venture shall be determined through consultation by the Chinese and foreign
parties and shall be clearly specified in the contractual joint venture contract. If the Chinese and foreign parties
agree to extend the period of operation, they shall apply to the examination and approval authority 180 days prior to
the expiration of the venture’s term. The examination and approval authority shall decide whether or not to grant
approval within 30 days of receiving the application.

Article 26. Any dispute between the Chinese and foreign parties arising from the execution of the contract or the articles of association
for a contractual joint venture shall be settled through consultation or mediation. In case of a dispute which
the Chinese or the foreign party is unwilling to settle through consultation or mediation, or of a dispute which
they have failed to settle through consultation or mediation, the Chinese and foreign parties may submit it to a Chinese
arbitration agency or any other arbitration agency for arbitration in accordance with the arbitration clause
in the contractual joint venture contract or a written agreement on arbitration concluded afterwards.

The Chinese or foreign party may bring a suit in a Chinese court, if no arbitration clause is provided in the contractual
joint venture contract and if no written agreement is concluded afterwards.

Article 27. The detailed rules for the implementation of this Law shall be formulated by the department in charge of foreign economic
relations and trade under the State Council and reported to the State Council for approval before implementation.

Article 28. This Law shall come into force as of the date of its promulgation.

WATER LAW

Water Law of the People’s Republic of China

(Adopted at the 24th Meeting of the Standing Committee of the Sixth National People’s Congress and promulgated by Order No. 61 of
the President of the People’s Republic of China on January 21, 1988, and effective as of July 1, 1988)

CONTENTS

CHAPTER I GENERAL PROVISIONS

CHAPTER II DEVELOPMENT AND UTILIZATION

CHAPTER III PROTECTION OF WATER, WATER AREAS AND WATER PROJECTS

CHAPTER IV MANAGEMENT OF THE USE OF WATER

CHAPTER V FLOOD PREVENTION AND FLOOD FIGHTING

CHAPTER VI LEGAL LIABILITY

CHAPTER VII SUPPLEMENTARY PROVISIONS

CHAPTER I GENERAL PROVISIONS

Article 1. This Law is formulated for the rational development and utilization of water resources and the protection of such resources, for
the prevention and control of water disasters, and for the full derivation of comprehensive benefits from water resources in order
to meet the needs in national economic development and in the livelihood of the people.

Article 2. The ” water resources ” referred to in this Law includes surface water and groundwater. This Law must be observed in the development,
utilization, protection and management of water resources and in the prevention and control of water disasters within the territory
of the People’s Republic of China.

Provisions for the development, utilization, protection and management of sea water shall be stipulated separately.

Article 3. Water resources shall be owned by the state, that is, by the whole people.

The waters of ponds and reservoirs belonging to agricultural collective economic organizations shall be owned by the collectives.

The state shall protect the lawful rights and interests of units and individuals engaged in the development and utilization of water
resources in accordance with law.

Article 4. The state shall encourage and support various undertakings for the development and utilization of water resources and for the prevention
and control of water disasters.

The development and utilization of water resources and the prevention and control of water disasters shall be carried out by comprehensive
planning with all factors taken into consideration, and with emphasis on multipurpose use and on achieving maximum benefits so as
to give full play to the multiple functions of water resources.

Article 5. The state shall protect water resources and adopt effective measures to preserve natural flora, plant trees and grow grass, conserve
water sources, prevent and control soil erosion and improve the ecological environment.

Article 6. All units shall strengthen the prevention and control of water pollution so as to protect and improve water quality. People’s governments
at various levels shall, in accordance with the provisions of the Law on the Prevention and Control of Water Pollution, strengthen
supervision over, and management of, the prevention and control of water pollution.

Article 7. The state shall carry out planning and require strict economy in the use of water.

People’s governments at various levels shall strengthen the management of the economical use of water. All units shall adopt advanced
technology for the economical use of water, reduce water consumption and raise the frequency of the reuse of water.

Article 8. Units and individuals that have made outstanding achievements in the development, utilization, protection and management of water
resources, in the prevention and control of water disasters, in the economical use of water and in related scientific and technological
research shall be awarded by the people’s governments at the corresponding level.

Article 9. The state shall, with respect to water resources, adopt a system which combines unified administration with administration at various
levels and by various departments.

The department of water administration under the State Council shall be in charge of the unified administration of water resources
throughout the country.

Other relevant departments under the State Council shall, in accordance with the duties assigned to them by the State Council, be
in charge of the administration of water resources related to them in coordination with the department of water administration under
the State Council.

The departments of water administration and other relevant departments of the local people’s governments at or above the county level
shall be in charge of the administration of water resources related to them in accordance with the duties assigned to them by the
people’s governments at the corresponding level.

CHAPTER II DEVELOPMENT AND UTILIZATION

Article 10. In order to develop and utilize water resources, a comprehensive scientific survey and an investigation and assessment must be undertaken.
The comprehensive scientific survey and the investigation and assessment of water resources throughout the country shall be carried
out by the department of water administration under the State Council jointly with other departments concerned.

Article 11. The development and utilization of water resources as well as the prevention and control of water disasters shall be planned in
a unified way on the basis of river basins or regions. The plans are divided into comprehensive plans and special plans.

Comprehensive plans for major river basins designated by the state shall be formulated by the department of water administration under
the State Council jointly with the relevant departments and with the people’s governments of the relevant provinces, autonomous regions
or municipalities directly under the Central Government, and shall be submitted to the State Council for approval. Comprehensive
plans for other river basins or regions shall be formulated by the departments of water administration of local people’s governments
at or above the county level jointly with the relevant departments and local authorities, and shall be submitted to the people’s
governments at the corresponding level for approval and to the departments of water administration at the next higher level for the
record. Comprehensive plans shall be coordinated with the National Land Plan and take into consideration the needs in various regions
and trades.

Special plans for the prevention of floods, the control of water-logging, irrigation, navigation, urban and industrial water supply,
hydro-electric power generation, bamboo or log rafting, fishery, water quality protection, hydrologic surveys, the general prospecting
and dynamic monitoring of groundwater, etc., shall be formulated respectively by the competent departments of the people’s governments
at or above the county level and shall be submitted to the people’s governments at the corresponding level for approval.

The approved plans shall serve as the bases for the development and utilization of water resources as well as the prevention and control
of water disasters. Any amendment to an approved plan must be examined and approved by the organ that originally approved the plan.

Article 12. No unit or individual shall, while channeling, storing or discharging water, infringe upon public interests or the lawful rights
and interests of other people.

Article 13. The development and utilization of water resources shall conform to the overall arrangement for the prevention of floods, follow
the principle of promoting benefits while eliminating disasters, and take into consideration the interests of upstream and downstream
areas, of the left and right banks and of all regions concerned, so as to give full play to the comprehensive benefits of water resources.

Article 14. The development and utilization of water resources shall first satisfy the need of the urban and rural inhabitants in their domestic
use of water and give overall consideration to the agricultural and industrial need for water as well as to the need of navigation.
In areas where the water sources are insufficient, the scale of the urban area and the development of industrial and agricultural
undertakings which use a large amount of water shall be restricted.

Article 15. All areas shall, according to their respective water and soil resources, develop irrigation, drainage and water and soil conservation
to bring in stable and high agricultural yields.

In areas where the water sources are insufficient, any irrigation method which makes for an economical use of water shall be adopted.

In areas which are prone to salinization-alkalization and water-logging, measures shall be taken to control and lower the groundwater
level.

Article 16. The state shall encourage the development and utilization of hydraulic power potentials. On rivers rich with hydraulic power potentials,
multipurpose cascade development shall be effected in a planned way.

In the development of hydropower stations, the ecological environment shall be protected, and the needs for flood control, water supply,
irrigation, navigation, bamboo and log rafting, fishery, etc. shall be taken into account.

Article 17. The state shall protect and encourage the development of water transport resources. When permanent dams and sluice-gates are built
on rivers which are navigable or suitable for bamboo and log rafting, the construction unit must at the same time build facilities
for the passage of ships and for bamboo and log rafting or, after approval by a department authorized by the State Council, take
other remedial measures. The construction unit must also make adequate arrangements for navigation and bamboo and log rafting during
the construction period and the initial water-filling period, and bear the expenses incurred thereby.

Where a non-navigable river or man-made waterway becomes navigable after a dam or sluice-gate is built, the construction unit shall
at the same time build facilities for the passage of ships or reserve sites for such facilities. The expenses needed for such facilities
shall, except as otherwise provided for by the state, be borne by the transport department concerned.

Where any existing dam or sluice gate hinders navigation, the people’s government at or above the county level shall order the original
construction unit to take remedial measures within a prescribed time limit.

Article 18. Where the building of a dam or sluice gate on the migration route of fish, shrimp or crabs has a serious impact on fishery resources,
the construction unit shall build facilities for their passage or adopt other remedial measures.

Article 19. The building of any dam and sluice gate, bridge, wharf or any structure which blocks, crosses or borders a river channel, and the
laying of a pipeline or a cable which crosses a river, must be in conformity with the standards for the prevention of floods and
navigation and other related technical requirements set by the state.

Where the building of any of the structures or facilities referred to in the preceding paragraph requires the extension, modification,
removal or destruction of the original structures or facilities, the unit constructing the new project shall bear the expenses for
extension or modification and the expenses for the compensation of losses, unless the original structures or facilities were built
in violation of the relevant regulations.

Article 20. Where the building of any water project or any other construction project has an adverse effect on the current use of water for
irrigation, the existing source of water supply or the present flow of the navigation channel, the unit constructing the project
shall adopt remedial measures or otherwise make compensation.

Article 21. Where an interbasin diversion project is to be built, an overall plan and a scientific justification must be provided, and consideration
given to the demand for water in the basin which supplies the water and in the basin which receives it, while adverse effects on
the ecological environment shall be avoided.

Article 22. The building of any water project must conform with the capital construction procedures and the other relevant provisions stipulated
by the state. Where a project involves the interests of other regions and trades, the construction unit must first solicit opinions
from the regions and departments concerned and, in accordance with the relevant provisions, report the project to the people’s government
at the higher level or the competent department concerned for approval.

Article 23. Where a water project to be built by the state requires the resettlement of inhabitants, the local people’s government shall be
responsible for making proper arrangements for the livelihood and production of the inhabitants to be resettled. The funds needed
for the resettlement of inhabitants shall be included in the investment plan for the project, and the resettlement shall be completed
within the construction stage on schedule.

CHAPTER III PROTECTION OF WATER, WATER AREAS AND WATER PROJECTS

Article 24. In any river, lake, reservoir or canal, no person may abandon or pile objects which block navigation or the passage of flood water,
or plant trees or grow crops of a long-stalk variety which block the passage of flood water.

In any navigable channel, no person may abandon any sunken boat, lay any fishing gear which blocks navigation, or grow aquatic plants.

No person may erect any building in a riverbed or in flood land without the approval of the competent department concerned.

Anyone who wishes to mine for sand and gravel or placer gold within the extent of a river course through which flood water passes
or into which water from water-logged areas is drained, or within the extent of a navigable river, must apply to the department of
river administration for approval, and must conduct his mining within the approved confines and in conformity with the approved operation
procedures. Where the mining relates to a navigable river, it shall be subject to approval by the department of river administration
and the department of navigation.

Article 25. The drawing of groundwater must be carried out by a unified plan based on the findings of a survey and assessment of water resources,
and the supervision and management of the drawing must be strengthened. In areas where too much groundwater has been drawn, a strict
control shall be imposed on the drawing and effective measures taken to protect the groundwater resources and to prevent the subsidence
of the ground.

Article 26. Where mining or the construction of underground projects, because of water drainage, results in a lowering of the groundwater level,
the depletion of groundwater or the subsidence of the ground and causes losses to the livelihood and production of units or individuals,
the mining unit or the construction unit shall take remedial measures and compensate for the losses.

Article 27. Reclaiming parts of a lake for use as farmland shall be prohibied. Reclaiming parts of a river for use as farmland shall also be
prohibited. Where reclamation is necessary, a scientific justification must be provided and approval obtained from a people’s government
at or above the provincial level.

Article 28. The state shall protect water projects and related facilities such as dikes and bank revetments, and shall protect flood prevention
facilities, hydrologic monitoring facilities, hydrogeologic monitoring facilities, and navigation facilities and aids. No unit or
individual may seize or destroy these facilities.

Article 29. Any state-owned water project shall have a zone for its management and protection, to be delimited by a people’s government at or
above the county level in accordance with the approved design and state provisions.

Any collectively-owned water project shall have a zone for its protection, to be delimited in accordance with stipulations made by
the people’s government of the relevant province, autonomous region or municipality directly under the Central Government.

Within the protection zone for a water project, any act of blasting, sinking a well, quarrying rock, and collecting earth, which endangers
the safety of the water project, shall be prohibited.

CHAPTER IV MANAGEMENT OF THE USE OF WATER

Article 30. The long-term plan for the demand for and supply of water of the entire country and those of regions covering different provinces,
autonomous regions and municipalities directly under the Central Government shall be formulated by the department of water administration
jointly with the other relevant departments under the State Council and submitted to the planning department under the State Council
for approval. A local long-term plan for the demand for and supply of water shall, on the basis of the long-term plan for the demand
for and supply of water made by the department of water administration of the people’s government at the next higher level and the
actual local conditions, be formulated by the department of water administration jointly with the other relevant departments of a
local people’s government at or above the county level, and shall be submitted to the planning department of the people’s government
at the corresponding level for approval.

Article 31. The regulation and storage of the run-off and the allocation of water shall take into account the demand for water in upstream and
downstream areas and on both banks of a river and also the need for navigation, bamboo and log rafting and fishery and for the protection
of the ecological environment.

A plan for the allocation of water covering different administrative divisions shall be formulated by the department of water administration
of the people’s government at the next higher level after soliciting the opinions of the local people’s governments concerned, and
shall be executed after approval by the people’s government at the corresponding level.

Article 32. The state shall put into practice a license system for drawing water directly from subterranean streams, rivers or lakes. However,
it shall not be necessary to apply for a license if water is drawn for household use or for livestock and poultry to drink, or if
a small amount of water is drawn for other purposes.

The steps, the scope and the measures for implementing a system of water-drawing licenses shall be stipulated by the State Council.

Article 33. Where it is necessary to apply for a water-drawing license for a new construction project, an extension project or a reconstruction
project, the construction unit shall, while submitting the design for the project, enclose written comments from the organ in charge
of examining applications for the drawing of water.

Article 34. Anyone who uses water provided by a water-supply project shall pay a water fee to the supplying unit in accordance with the relevant
provisions.

Any unit which directly draws groundwater in an urban area shall be charged a water resources fee. The collection of such fees from
other units or individuals drawing water directly from subterranean streams, rivers or lakes shall be decided by the people’s governments
of provinces, autonomous regions or municipalities directly under the Central Government.

Measures for the collection of water fees and water resources fees shall be stipulated by the State Council.

Article 35. Any dispute concerning water between different districts shall be handled through consultation in the spirit of mutual understanding
and mutual accommodation as well as the spirit of solidarity and cooperation. Where consultations are unsuccessful, the dispute
shall be handled by the people’s government at the next higher level. Pending a settlement of the dispute, no party may build any
project to drain, block, divert or store water within a certain area on either side of the common boundary defined by the state,
and no party may unilaterally alter the existing water regime, unless an agreement is reached between the parties concerned or an
approval is granted by the people’s government at the next higher level.

Article 36. Any dispute concerning water between units, between individuals or between units and individuals shall be resolved through consultation
or mediation. Where a party is unwilling to have the dispute resolved through consultation or mediation, or the consultation or
mediation is unsuccessful, he may request the people’s government at or above the county level or the competent department authorized
by such a government to handle the dispute, or may directly institute legal proceedings in the people’s court. Where a party is
dissatisfied with the decision made by the people’s government concerned or the competent department authorized by such a government,
he may institute legal proceedings in the people’s court within fifteen days of receiving the notification on the decision. Pending
a settlement of the dispute, no party may unilaterally alter the existing water regime.

Article 37. When handling any dispute concerning water, the people’s government at or above the county level, or the competent department authorized
by such a government, shall have the power to take temporary measures with which the parties must comply.

CHAPTER V FLOOD PREVENTION AND FLOOD FIGHTING

Article 38. The people’s governments at all levels shall strengthen their leadership and take effective measures to prevent and fight floods.
It is the duty of every unit and individual to participate in the prevention of and the fight against floods.

Article 39. The flood prevention headquarters under the people’s governments at or above the county level shall exercise unified command over
the work of preventing and fighting floods.

In case of a flood emergency, the flood prevention headquarters shall have the power to requisition materials and equipment and employ
personnel within their jurisdiction, which shall be returned or adequately compensated for without delay after the flood subsides.

Article 40. The people’s governments at or above the county level shall, on the basis of river basin plans and in accordance with the principle
of ensuring defence at the major points and giving consideration to ordinary ones, formulate schemes for the prevention of floods,
in which the standards and measures for the prevention of floods shall be specified. The schemes for the prevention of floods along
major rivers throughout the country shall be formulated by the Central Flood Prevention Headquarters and submitted to the State Council
for approval.

After a scheme for the prevention of floods is approved or formulated, the people’s governments concerned must execute it.

Article 41. Along floodways and in flood detention basins and flood storage basins, the utilization of land and the various construction projects
must meet the requirements for the prevention of floods.

Article 42. People in a downstream area may not hinder by blocking the flow of the flood water or excess water discharged according to the natural
flow trend or the design standards of flood prevention or flood drainage projects, or an approved flood fighting plan, or reduce
the carrying capacity of the river, while people in an upstream area may not increase without authorization the flow discharged downstream.

Article 43. In case of a flood emergency, flood prevention headquarters at different levels may, within their jurisdiction, take measures to
divert or detain the flood pursuant to the approved plans. Where these measures are detrimental to the adjoining districts, the
adoption of such measures must be reported to the flood prevention headquarters at the next higher level for approval, and the districts
concerned shall be notified in advance.

The State Council and the people’s governments of provinces, autonomous regions and municipalities directly under the Central Government
shall separately formulate special administrative measures for the safety, evacuation, livelihood, production, rehabilitation, compensation
for losses, etc. for the inhabitants in the flood detention basins and the flood storage basins within their respective jurisdiction.

CHAPTER VI LEGAL LIABILITY

Article 44. Whoever, in violation of this Law, draws, intercepts, blocks or discharges water and thereby causes obstruction or losses to others
shall stop his acts of infringement, remove the obstruction and compensate for the losses.

Article 45. Whoever, in violation of this Law, commits any of the following acts shall be ordered, by the department of water administration
or another competent department concerned of the relevant local people’s government at or above the county level, to stop his illegal
act and clear away the obstacles or take other remedial measures within the specified time limit, and may be concurrently fined;
the person who is responsible may be given administrative sanctions by the unit to which he belongs or by the competent authority
at a higher level:

(1) abandoning or piling objects which obstruct navigation or the passage of flood, or planting trees and growing crops of a long-stalk
variety which obstruct the passage of flood in any river, lake, reservoir or canal, or abandoning sunken vessels, laying fishing
gear which obstructs navigation, or growing aquatic plants in any navigable river;

(2) erecting buildings in any riverbed or flood land without approval;

(3) mining for sand and gravel or placer gold in any river course or navigable river without approval or not in conformity with the
approved scope and operation procedures; or

(4) reclaiming parts of any lake or river for use as farmland in violation of the provisions of Article 27 of this Law.

Article 46. Whoever, in violation of this Law, commits any of the following acts shall be ordered, by the department of water administration
or another competent department concerned of the relevant local people’s government at or above the county level, to stop his illegal
act and take remedial measures and may be concurrently fined; the person who is responsible may be given administrative sanctions
by the unit to which he belongs or by the competent authority at a higher level and, where a crime is constituted, he shall be prosecuted
for criminal responsibility in accordance with the Criminal Law:

(1) constructing any water project or realigning any river or course of navigation without authorization; or

(2) in violation of the provisions of Article 42 of this Law, increasing the discharge of flood or drainage of excess water downstream
or hindering the discharge of flood or drainage of excess water from upstream without authorization.

Article 47. Whoever, in violation of this Law, commits any of the following acts shall be ordered, by the department of water administration
or another competent department concerned of the relevant local people’s government at or above the county level, to stop his illegal
act, compensate for the losses caused and take remedial measures, and may be concurrently fined; where a penalty for violation of
public security should be given, the person shall be given a penalty in accordance with the Regulations on Administrative Penalties
for Public Security; where a crime is constituted, the person shall be prosecuted for criminal responsibility in accordance with
the Criminal Law:

(1) damaging any water project or related facilities such as dikes and bank revetments, damaging any flood prevention facilities,
hydrologic monitoring facilities, hydrogeologic monitoring facilities, or navigation facilities or aids; or

(2) carrying out, within the protection zone for a water project, any act of blasting, sinking a well, quarrying rock, or collecting
earth, etc., which endangers the safety of the project.

Article 48. If any party is not satisfied with the decision on an administrative penalty, he may, within fifteen days of receiving the notification
on the penalty, file an application for reconsideration with the department at the level next higher to the department that made
the decision on the penalty. If the party is not satisfied with the decision made after such reconsideration, he may institute legal
proceedings in the people’s court within fifteen days of receiving the decision on the reconsideration. The party may also directly
institute legal proceedings in the people’s court within fifteen days of receiving the notification on the penalty. If the said
party neither applies for reconsideration nor institutes legal proceedings in the people’s court within the time limit nor complies
with the decision on the penalty, the department that made the decision on the penalty shall apply to the people’s court for compulsory
execution.

If any party is not satisfied with a penalty for violation of public security, the case shall be handled according to the Regulations
on Administrative Penalties for Public Security.

Article 49. Whoever steals or forcibly seizes the supplies for the prevention of floods or materials and equipment for the building of water
projects, or whoever embezzles or misappropriates state funds and materials for the relief of disasters, for use in flood emergencies,
for the prevention of floods or for the resettlement of inhabitants, shall be prosecuted for criminal responsibility in accordance
with the Criminal Law.

Article 50. Any functionary of a department of water administration, of another competent department or of a unit managing a water project,
who neglects his duty, abuses his power, engages in malpractices for personal gains or commits fraudulent acts, shall be given administrative
sanctions by the unit to which he belongs or by the competent department at a higher level; whoever causes heavy losses to public
property or to the interests of the state and the people shall be prosecuted for criminal responsibility in accordance with the Criminal
Law.

CHAPTER VII SUPPLEMENTARY PROVISIONS

Article 51. Where any international treaty or agreement relating to international or border rivers or lakes, concluded or acceded to by the
People ‘s Republic of China, contains provisions differing from those in the laws of the People’s Republic of China, the provisions
of the international treaty or agreement shall apply, unless the provisions are ones on which the People’s Republic of China has
made reservations.

Article 52. The State Council may, in accordance with this Law, formulate rules for its implementation.

The standing committees of the people’s congresses of provinces, autonomous regions and municipalities directly under the Central
Government may, in accordance with this Law, formulate measures for its implementation.

Article 53.

DECISIONS ON PERSONNEL MANAGEMENT OF FOREIGN INVESTMENT ENTERPRISES

STATE COUNCIL’S OFFICIAL REPLY CONCERNING THE RENAMING OF THE MARITIME ARBITRATION COMMISSION AS THE CHINA MARITIME ARBITRATION COMMISSION AND THE AMENDMENT OF ITS ARBITRATION RULES

Category	ARBITRATION	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1988-06-21	Effective Date	1989-01-01

THE State Council’s Official Reply Concerning the Renaming of the Maritime Arbitration Commission As the China Maritime Arbitration Commission and the Amendment of Its Arbitration Rules

The Official Reply
CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES (Adopted on
Chapter I  General Provisions
Chapter II  Arbitration Proceedings
CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES
Chapter I  General Provisions
Chapter II  Arbitration Proceedings
Chapter III  Summary Proceedings
Chapter IV  Supplementary Provisions

(June 21, 1988)

The Official Reply

China Council for the Promotion of International Trade:

The State Council approves the renaming of the Maritime Arbitration
Commission of your Council as the China Maritime Arbitration Commission. The
existing relationship of its subordination remains unchanged.

The Arbitration Rules of the China Maritime Arbitration Commission shall
be amended by your Council in accordance with China’s laws and the
international treaties concluded or acceded to by China and with reference to
international practice, and then promulgated for implementation after adoption
by your Council. Hereafter, any amendments to the Arbitration Rules shall be
made by your Council’s own decision.

CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES (Adopted on
September 12, 1988 at the Third Session of the First National Congress of the
China Council for the Promotion of International Trade (China Chamber of
International Commerce))
Chapter I General Provisions

Section 1 Jurisdiction

Article 1 The China Maritime Arbitration Commission (hereinafter referred
to as the Arbitration Commission) independently and impartially settles
maritime disputes by means of arbitration so as to protect the justified
rights and interests of the parties and promote shipping industry and foreign
economic and trade development.

Article 2 Upon receiving written application of one of the disputing
parties and in accordance with written agreement concluded between the
parties, prior or subsequent to the occurrence of dispute, to refer their
dispute to the Arbitration Commission for arbitration, the Arbitration
Commission takes cognizance of:

(1) disputes regarding remuneration for salvage services rendered by
sea-going vessels to each other or by a sea-going vessel to a river craft and
vice versa;

(2) disputes arising from collisions between sea-going vessels or between
sea-going vessels and river craft or from damages caused by sea-going vessels
to harbour structures or installations;

(3) disputes arising from chartering, agency, towage, raising, sale,
repairing and building of or in respect of sea-going vessel, carriage by sea
in virtue of contracts of affreightment, bills of lading or other shipping
documents, and marine insurance;

(4) disputes regarding pollution damages to marine environmcnt;

(5) other maritime disputes submitted for arbitration by agreement between
the parties.

An arbitration agreement means the arbitration clause stipulated by the
parties in their contract, or agreements in writing concluded in other forms
to submit disputes for arbitration.

The Arbitration Commission has power to decide on the validity of
arbitration agreement and the jurisdiction over arbitration cases.

Section 2 Organization

Article 3 The Arbitration Commission is composed of Chairman,
Vice-Chairmen and Commission members.

The Chairman performs functions and duties given by these Rules and any
Vice-Chairman, if authorized by the Chairman, may perform the functions and
duties of the Chairman.

Under the Arbitration Commission, a Secretariat is established to handle
the day-to-day work of the Arbitration Commission.

Article 4 The Arbitration Commission maintains a panel of arbitrators.
The arbitrators are selected and appointed by the China Council for the
Promotion of International Trade (China Chamber of International Commerce)
from among Chinese and foreign persons with relevant expertise and practical
experience.

Article 5 The Arbitration Commission is located in Beijing. The
Arbitration Commission may, according to the requirement of development of
arbitration business, establish sub-commissions in other places within the
territory of China.
Chapter II Arbitration Proceedings

Section 1 Application for Arbitration, Defence and Counterclaims

Article 6 The Claimant must submit his Application for Arbitation to the
Arbitration Commission in accordance with the following requirements:

(1) an Application for Arbitration in writing must be submitted to the
Arbitration Commission. The following must be specified in the Application for
Arbitration:

(a) the name and address of the Claimant and those of the Respondent;

(b) the arbitration agreement relied upon by the Claimant;

The Application for Arbitration shall be signed by the Claimant and/or the
attorney authorized by the Claimant.

(2) when submitting an Application for Arbitration to the Arbitration
Commission, relevant documentary evidence on which the Claimant’s claim is
based shall accompany the Application for Arbitration.

(3) the Claimant shall appoint an arbitrator from among the Panel of
Arbitrators of the Arbitration Commission or authorize the Chairman of the
Arbitration Commission to make an appointment on his behalf.

(4) the Claimant shall pay an arbitration fee in advance to the
Arbitration Commission according to the Arbitration Fee Schedule attached to
these Rules.

Article 7 After receipt of the Application for Arbitration and its
attachments and when the Arbitration Commission, after examination, deems that
the Claimant has completed the formalities required for arbitration, the
Arbitration Commission shall immediately mail to the Respondent one copy each
of the Claimant’s Application for Arbitration and its attachments as well as
the Arbitration Rules and the Panel of Arbitrators of the Arbitration
Commission.

Article 8 The Respondent shall, within 20 days after receipt of the
Application for Arbitration, appoint an arbitrator from among the Panel of
Arbitrators of the Arbitration Commission, or authorize the Chairman of the
Arbitration Commission to make an appointment on his behalf and shall, within
45 days after receipt of the Application for Arbitration, submit his defence
and relevant documentary evidence to the Arbitration Commission.

Article 9 The Respondent shall file with the Arbitration Commission his
counter-claim, if any, in connection with the case taken cognizance of by the
Arbitration Commission, within the time limit as specified in Article 8 for
the submission of his defence. The Respondent must state, in his
counter-claim, his claim and the facts and evidence on which his claim is
based and attach relevant documentary evidence to his counter-claim.

When filing a counter-claim, the Respondent must pay an arbitration fee in
advance according to the Arbitration Fee Schedule attached to these
Arbitration Rules.

Article 10 The Arbitration Commission has discretion to ask the
Respondent to pay in advance a part of arbitration fees when it deems it
necessary.

Article 11 When submitting an Application for Arbitration, defence,
counter-claim, relevant documentary evidence and other documents to the
Arbitration Commission, the parties shall provide duplicate copies as many as
the number of the other party/parties and the arbitrators, of whom the
arbitration tribunal is composed.

Article 12 The parties may authorize attorneys to confer with the
Arbitration Commission on matters relating to arbitration. Such attorneys may
be citizens of China or foreign citizens. The authorized attorney must produce
a Power of Attorney to the Arbitration Commission.

Article 13 The Arbitration Commission may, pursuant to the request of the
parties and in accordance with the Chinese law, apply to the Chinese court in
the place where the property of the Respondent(s) is or in the place where the
arbitration institution is located for a decision in respect of taking
preservative measures.

Section 2 Composition of Arbitration Tribunal

Article 14 After each of the two parties has chosen one arbitrator from
among the Panel of Arbitrators of the Arbitration Commission or the Chairman
of the Arbitration Commission has made such an appointment under the
authorization by the party/parties, the Chairman of the Arbitration Commission
shall appoint a third arbitrator from among the Panel of Arbitrators of the
Arbitration Commission as the presiding arbitrator to form an arbitration
tribunal to hear the case.

Article 15 Both parties may jointly appoint or authorize the Chairman of
the Arbitration Commission to appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission as a sole arbitrator to form an
arbitration tribunal to hear the case alone.

If both parties have agreed on the appointment of a sole arbitrator to
hear their case alone but failed to agree on the choice of such a sole
arbitrator within 20 days as from the date on which the Respondent receives
the Application for Arbitration or as from the date on which both parties
reach an agreement to have their case heard by a sole arbitrator, the Chairman
of the Arbitration Commission shall appoint the sole arbitrator.

Article 16 If the Respondent fails to appoint and fails to authorize the
Chairman of the Arbitration Commission to appoint an arbitrator according to
Article 8 of these Rules, the Chairman of the Arbitration Commission has the
power to appoint an arbitrator for the Respondent.

Article 17 When there are two or more Claimants and/or Respondents in an
arbitration case, the Claimants’ side and/or the Respondents’ side shall each,
through consultation, appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission. If the Claimants’ side fails to
make such appointment at the time when the Claimants submit their Application
for Arbitration and/or Respondenls’ side is unable to appoint one arbitrator
within 20 days as from the date on which the last Respondent receives the
Application for Arbitration, the appointment shall be made by the Chairman of
the Arbitration Commission.

Article 18 Any appointed arbitrator having personal interest in the case
shall himself request the Arbitration Commission for withdrawal from his
office and the parties have the right to make a request in writing to the
Arbitration Commission for a withdrawal of the arbitrator from his office.

Article 19 A party who intends to challenge an arbitrator must put
forward his challenge before the first oral hearing of the case. If the
grounds for challenge come out or become aware of after the first oral
hearing, the challenge may be raised before the conclusion of the last hearing.

Article 20 The Chairman of the Arbitration Commission shall decide on the
challenge.

Article 21 If an arbitrator cannot perform his duty due to withdrawal or
other reasons, a substituted arbitrator shall be appointed in accordance with
the procedure pursuant to which the original arbitrator was appointed.

Section 3 Hearing

Article 22 The arbitration tribunal shall hold oral hearings to hear the
case. However, at the request of the parties or with their consent, oral
hearings may be omitted and the arbitration tribunal may examine the case and
make an award on the basis of documents only.

Article 23 The date of oral hearing shall be decided by the arbitration
tribunal in consultation with the Secretariat of the Arbitration Commission
and the notice of hearing shall be communicated to the parties 30 days before
the date of hearing. A party having justified reasons may request for
postponement of the date of hearing. But his request must be communicated to
the Secretariat of the Arbitration Commission 12 days before the date of
hearing unless unforeseeable special circumstances occur. The Seretariat shall
inform the arbitration tribunal of his request and the arbitration tribunal
shall decide thereon, in consultation with the Secretariat.

Article 24 The cases taken cognizance of by the Arbitration Commission
shall be heard in the place where the Arbitration Commission is located and
may, with the approval of the Chairman of the Commission, be heard in other
places.

Article 25 The arbitration tribunal shall not hear cases in open
sessions. If both parties request hearings in open sessions, the arbitration
tribunal shall decide thereon.

Article 26 The parties shall give evidence for the facts on which their
claim or defence is based. The arbitration tribunal may, if it deems it
necessary, make investigation and collect evidence on its own initiative.

Article 27 The evidence shall be examined and approved by the arbitration
tribunal.

Article 28 The arbitration tribunal may consult experts or appoint
appraisers for the clarification of special questions relating to the cases.
Such experts and appraisers may be Chinese or foreign organizations or
citizens.

Article 29 Should one of the parties or his attorney fail to appear at
the hearing, the arbitration tribunal may proceed with the hearing and make an
award by default.

Article 30 During hearings, the Secretariat of the Arbitration Commission
shall take records in writing and/or tape-recordings and the arbitration
tribunal may, if it deems it necessary, order the parties and/or their
attorneys, witnesses and/or other persons involved to sign the records taken.

Article 31 If both parties reach a settlement by themselves of a case
under the cognizance of the Arbitration Commission, the Claimant shall timely
request for withdrawal of the case. Dismissal of the case shall be decided by
the Chairman of the Arbitration Commission before an arbitration tribunal is
formed and by the arbitration tribunal after the arbitration tribunal is set
up.

If the party or the parties refer the dismissed case again to the
Arbitration Commission for arbitration, the Chairman of the Arbitration
Commission shall decide whether to accept the reference or not.

Section 4 Award

Article 32 The arbitration tribunal shall render an arbitral award within
45 days after the closing of examination and hearing.

Article 33 Where a case is heard by an arbitration tribunal composed of
three arbitrators, the arbitral award shall be decided by the majority of the
arbitrators and the minority opinion can be written down in the record and
docketed into the file.

Article 34 The arbitration tribunal shall state the reasons upon which
the arbitral award is based unless the award is made in accordance with the
Article 37. The arbitral award shall be signed by all or majority of the
arbitrators sitting in the arbitration tribunal and shall contain the date and
place on and in which the arbitral award is made.

Article 35 The arbitration tribunal may, if it deems it necessary or the
parties so request and it agrees, make an interim, interlocutary or partial
award on any issue of the case at any time in the process of arbitration.

Article 36 The arbitral award is final and neither party may bring a suit
before a law-court or make a request to another organization for revising the
arbitral award.

Article 37 The Arbitration Commission and the arbitration tribunal may
conciliate cases under their cognizance. In case a settlement agreement is
reached through conciliation, the arbitration tribunal shall make an award in
accordance with the contents of the settlement agreement reached by and
between both parties.

Article 38 The parties must automatically execute the arbitral award
within the time limit specified in the award. If no time limit is specified in
the award, the parties shall carry out the award immediately.

In case either party fails to execute the award, the other party may,
pursuant to the Chinese law, apply to the Chinese court for enforcement of the
award or, according to the 1958 Convention on the Recognition and Enforcement
of Foreign Arbitral Awards or other international treaties that China has
concluded or acceded to, apply to the foreign court which has jurisdiction for
enforcement of the award.

Chapter III Supplementary Provisions

Article 39 The Chinese language is the official language of the
Arbitration Commission. At the hearing, if the parties or their attorneys or
witnesses are not familiar with the Chinese language, the Secretariat of the
Arbitration Commission may provide them or the parties may bring with them
their interpreters.

The Secretariat of the Arbitration Commission may, if it deems it
necessary, ask the parties to hand in corresponding translation copies in
Chinese or other languages of the various documents and evidential materials
submitted by the parties.

Article 40 Any written communication from the Arbitration Commission to
the parties is deemed to have been received if it is delivered to the
addressee personally or if it is delivered at his place of business, habitual
residence or mailing address; or if none of these can be found after making a
reasonable inquiry, a written communication is deemed to have been received if
it is sent to the addressee’s last known place of business, habitual residence
or mailing address by registered letter or by any other means which provides
a record of the attempt to deliver it.

Article 41 Apart from charging arbitration fees from the parties
according to the Arbitration Fee Schedule attached to these Rules, the
Arbitration Commission may collect from the parties other actual expenses
including arbitrators’ remuneration and their travel and boarding expenses for
dealing with the case and the fees and expenses for expert, apraisers and
interpreters appointed by the arbitration tribunal, etc.

Certain fees and actual expenses incurred may be collected by the
Arbitration Commission if a case is withdrawn after the parties have reached
by themselves a settlement agreement.

Article 42 These Rules shall also apply to the cases of dispute taken
cognizance of by the Sub-Commissions of the Arbitration Commission. In the
arbitration proceedings conducted by the Sub-Commissions of the Arbitration
Commission, the functions and duties of the Chairman and the Secretariat of
the Arbitration Commission under these Rules shall be performed by the
Chairmen and the Secretariats of the Sub-Commissions.

Article 43 These Rules shall come into force as of January 1, 1989.

Arbitration Fee Schedule

Amount of Claim (RMB)
Amount of Fee (RMB)

100,000 Yuan or less 6%
of the amount of claim, minimum 2,000

Yuan

100,000 Yuan to 500,000 Yuan 6,000 Yuan plus 4% of the excess over

100,000 Yuan

500,000 Yuan to 1,000,000 Yuan 22,000 Yuan plus 3% of the excess over

500,000
Yuan

1,000,000 Yuan to 5,000,000 Yuan 37,000 Yuan plus 1.5% of the excess over

1,000,000
Yuan

5,000,000 Yuan or more 97,000 Yuan
plus 0.7% of the excess over

5,000,000
Yuan

If no amount of claim is stated when applying for arbitration, the amount
of arbitration fees shall be determined by the Secretariat of the Arbitration
Commission.

If the arbitration fee is charged in foreign currency, an amount of
foreign currency equivalent to the corresponding RMB value specified in this
Schedule shall be paid.

CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES
(Revised and adopted by China Council for the Promotion of International Trade
on September 4, 1995)

Chapter I General Provisions

Section 1 Jurisdiction

Article 1 These Rules are formulated in accordance with the Arbitration
Law of the People’s Republic of China, the provisions of relevant laws, and
the Decision, Circular and Official Reply of the State Council.

Article 2 The China Maritime Arbitration Commission (formerly known as
Maritime Arbitration Commission of China Council for the Promotion of
International Trade, hereinafter referred to as the Arbitration Commission),
by means of arbitration, independently and impartially settles maritime
disputes arising from transportation, production and navigation conducted in
oceans, coastal waters and water areas adjacent to sea, either contractual or
non-contractual, so as to protect the justified rights and interests of the
parties and promote shipping industry at home and abroad and foreign economic
and trade development.

The Arbitration Commission takes cognizance of the following cases of
maritime disputes:

(1) disputes arising from salvage of vessels and general average;

(2) disputes arising from collisions of vessels or from damages caused by
vessels to structures or installations at sea, in water areas adjacent to sea
or in harbours, or to sea-bed or underwater installations;

(3) disputes arising from management, operation, chartering, mortgage,
agency, towage, raising, sale, repairing, building and dismantling of or in
respect of sea-going vessel/vessel on water, carriage by sea/water in virtue
of contracts of affreightment, bills of lading or other documents, and
marine/water insurance;

(4) disputes regarding exploitation and utilization of marine resources
and pollution damages to marine environment;

(5) disputes arising from agency contracts for carriage of goods,
contracts for the supply of vessel materials, contracts of employment of
foreign crew or contracts of fishing production or fishery;

(6) other maritime disputes submitted for arbitration by agreement between
the parties.

Article 3 The Arbitration Commission takes cognizance of cases upon
receiving written application of one of the disputing parties and in
accordance with written agreement concluded between the parties, prior or
subsequent to the occurrence of dispute, to refer their dispute to the
Arbitration Commission for arbitration.

An arbitration agreement means the arbitration clause stipulated by the
parties in their contract, or an agreement in writing concluded in other forms
to submit disputes for arbitration.

Article 4 The Arbitration Commission has power to decide on the existence
and validity of arbitration agreement and the jurisdiction over arbitration
cases. If the parties dispute over the validity of the arbitration agreement,
the people’s court shall decide on the validity when one of the parties applies
to the Arbitration Commission for decision on the validity and another party
applies to the people’s court for decision.

Article 5 An arbitration clause in a contract should be deemed as a
clause separate and independent from other clauses of the contract, and an
arbitration agreement attached to a contract also be deemed as one part
separate and independent from other clauses of the contract. The
modification, rescission, termination, annulment or invalidity, existence or
not of such a contract cannot prejudice the effect of the arbitration clause
or arbitration agreement.

Article 6 Defence to the arbitration agreement and/or the jurisdiction
over an arbitration case shall be submitted prior to the first hearing of the
arbitration tribunal; defence to the jurisdiction over a case examined on the
basis of documents only shall be submitted prior to the first substantial
defence.

Article 7 If any party agrees to refer his dispute to the Arbitration
Commission, he is deemed to accept the arbitration under these Rules.

Section 2 Organization

Article 8 The Arbitration Commission has one Honorary Chairman and
Consultants.

Article 9 The Arbitration Commission is composed of Chairman,
Vice-Chairmen and Commission members. The Chairman performs functions and
duties given by these Rules and any Vice-Chairman, if authorized by the
Chairman, may perform the functions and duties of the Chairman.

Under the Arbitration Commission, a Secretariat is established to handle
the day-to-day work of the Arbitration Commission under the leadership of the
Secretary of the Arbitration Commission.

Article 10 The Arbitration Commission maintains a panel of arbitrators.
The arbitrators are selected and appointed by the Arbitration Commission from
among Chinese and foreign persons with expertise and practical experience in
navigation, carriage by sea, foreign trade, insurance, law and other fields.

Article 11 The Arbitration Commission is located in Beijing. The
Arbitration Commission may, according to the requirement of development of
arbitration business, establish sub-commissions in other places within the
territory of China.
Chapter II Arbitration Proceedings

Section 1 Application for Arbitration, Defence and Counterclaim

Article 12 The arbitration proceedings commence from the date on which
the Arbitration Commission issues the Arbitration Notice.

&nbsp

CIRCULAR OF THE STATE COUNCIL CONCERNING THE EXTENSION OF THE LIMITS OF POWER VESTED WITH THE INLAND PROVINCES, AUTONOMOUS REGIONS, MUNICIPALITIES SEPARATELY LISTED IN THE STATE PLAN AND THE DEPARTMENTS CONCERNED UNDER THE STATE COUNCIL IN EXAMINING AND APPROVING FOREIGN INVESTMENT ABSORPTION

Category	FOREIGN ECONOMIC RELATIONS AND TECHNOLOGICAL COOPERATION	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1988-07-03	Effective Date	1988-07-03

Circular of the State Council Concerning the Extension of the Limits of Power Vested With the Inland Provinces, Autonomous Regions, Municipalities Separately Listed in the State Plan and the Departments Concerned under the State Council in Examining and Approving Foreign Investment Absorption

(July 3, 1988)

With a view to further implementing the policy of opening to the outside
world and to promoting the all-round development of the national economy, the
State Council has decided to appropriately extend the limits of power vested
with the inland provinces, autonomous regions, and municipalities separately
listed in the state plan, the relevant ministries and commissions under the
State Council, and the State Bureau of Building Materials Industry, the State
Administration for Medicine, the State Bureau of Technology Supervision, the
State Administration for Environmental Protection, the Civil Aviation
Administration of China, the National Tourism Administration, the National
Bureau of Oceanography, the National Meteorological Bureau, the State
Seismological Bureau, and the Chinese Academy of Sciences in examining and
approving foreign investment. With respect to productive projects developed
by absorbing foreign investments, provided these projects are in conformity
with the investment orientation stipulated by the state, their conditions of
construction and productive operations as well as their foreign exchange
income and expenditure do not require comprehensive balance to be conducted
by the state, and the export of their products does not involve export quota
or administration of export licences, the present limits of authority vested
with the aforesaid localities and departments in examining and approving
projects with a total amount of investment of five million U.S. dollars or
below each shall be extended to ten million U.S. dollars or below each. After
approval, the projects shall be reported to the State Planning Commission for
the record.

Where enterprises with foreign investments are set up by people’s
organizations, their applications shall be examined and approved by the
province, autonomous region, municipality directly under the Central
Government, or municipality separately listed on the state plan, where the
said enterprises are located.

This Circular shall become effective as of the date of promulgation.?

1...345...7 Page 4 of 7

1994

REGULATIONS GOVERNING MANAGEMENT OF HIGHWAYS IN THE PRC

REGULATIONS FOR THE MANAGEMENT OF FOUNDATIONS

STANDARDIZATION LAW

CONSITUTION AMENDMENT

REGULATIONS FOR CONTROLLING THE REGISTRATION OF ENTERPRISES AS LEGAL PERSONS

INTERIM REGULATIONS ON STAMP TAX

AUDIT REGULATIONS

CHINESE-FOREIGN CONTRACTUAL JOINT VENTURES

WATER LAW

DECISIONS ON PERSONNEL MANAGEMENT OF FOREIGN INVESTMENT ENTERPRISES

STATE COUNCIL’S OFFICIAL REPLY CONCERNING THE RENAMING OF THE MARITIME ARBITRATION COMMISSION AS THE CHINA MARITIME ARBITRATION COMMISSION AND THE AMENDMENT OF ITS ARBITRATION RULES

CIRCULAR OF THE STATE COUNCIL CONCERNING THE EXTENSION OF THE LIMITS OF POWER VESTED WITH THE INLAND PROVINCES, AUTONOMOUS REGIONS, MUNICIPALITIES SEPARATELY LISTED IN THE STATE PLAN AND THE DEPARTMENTS CONCERNED UNDER THE STATE COUNCIL IN EXAMINING AND APPROVING FOREIGN INVESTMENT ABSORPTION

CONSTITUTION ACT, 1982 – page 22

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

CONSTITUTION ACT, 1982 – page 17

CONSTITUTION ACT, 1982 – page 16

CONSTITUTION ACT, 1982 – page 12

CONSTITUTION ACT, 1982 – page 11

CONSTITUTION ACT, 1982 – page 10

CONSTITUTION ACT, 1982 – page 9

CONSTITUTION ACT, 1982 – page 8

CONSTITUTION ACT, 1982 – page 7