DECISION CONCERNING THE AMENDMENT TO THE LAW ON SINO-FOREIGN EQUITY JOINT VENTURES

RAILWAY LAW OF THE PEOPLE’S REPUBLIC OF CHINA

The Standing Committee of the National People’s Congress

Order of the President of the People’s Republic of China

No.32

The Railway Law of the People’s Republic of China which has been adopted at the 15th Meeting of the Standing Committee of the Seventh
National People’s Congress on September 7, 1990 is now promulgated and shall enter into force as of May 1, 1991.

President of the People’s Republic of China Yang Shangkun

September 7, 1990

Railway Law of the People’s Republic of China ContentsChapter I General Provisions

Chapter II Railway Transport Business

Chapter III Railway Construction

Chapter IV Safety and Protection of Railway

Chapter V Legal Responsibility

Chapter VI Supplementary Provisions

Chapter I General Provisions

Article 1

This Law is formulated for the purpose of ensuring smooth progress of railway transport and railway construction in order to meet
the demands of socialist modernization and people’s livelihood.

Article 2

Railways as referred to in this Law include State railways, local railways, industrial railways and railway private sidings.

State railways refer to the railways administered by the competent department in charge of railways under the State Council.

Local railways refer to the railways administered by local people’s governments.

Industrial railways refer to the railways administered by enterprises or other units to provide in-house transport services.

Railway private sidings refer to the branch railway lines which are administered by enterprises or other units and are connected to
a State railway line or any other railway line.

Article 3

The competent department in charge of railways under the State Council shall be responsible for railway affairs throughout the country,
implement over the State railway network a transport control system which is highly centralized and under unified command, and shall
provide guidance for, coordination among, supervision over and assistance to local railways, industrial railways and railway private
sidings.

A State railway transport enterprise shall perform the administrative functions as authorized by relevant laws and administrative
rules and regulations.

Article 4

The State shall focus its effort on the development of State railways and provide substantial aid and support to the development of
local railways.

Article 5

A railway transport enterprise must adhere to the socialist orientation in operation and management, pursue the aim of serving the
people, improve operation and management, better the work style, and enhance the transport service quality.

Article 6

Citizens shall have the obligation to take good care of railway installations. Damage to railway installations and disruption of normal
railway traffic shall be prohibited.

Article 7

Local people’s governments at various levels along the railway lines shall assist the railway transport enterprises in ensuring safe
and uninterrupted railway traffic, good social order at stations and on trains, intactness of railway installations, and smooth progress
of railway construction.

Article 8

Regulations governing the technical operations of State railways shall be formulated by the competent department in charge of railways
under the State Council, while rules governing the local railways and industrial railways shall be drawn up with reference to the
regulations governing the technical operations of State railways.

Article 9

The State shall encourage scientific and technological research on railways in order to heighten their scientific and technical level.
Any unit or individual that has achieved outstanding results in such research shall be awarded.

Chapter II Railway Transport Business

Article 10

All railway transport enterprises shall guarantee safe transport of passengers and goods and punctual train arrivals.

Article 11

A railway transport contract shall be an agreement in which the mutual rights and obligations between the railway transport enterprise
and the passenger(s) or shipper(s) are defined.

A passenger ticket, a luggage, parcel or goods consignment note shall represent a contract or a constituent part of a contract.

Article 12

A railway transport enterprise shall ensure the passenger of riding on a train of the number and on the date stated on the passenger’s
ticket, and of arriving at the destination stated on the same ticket. In case of the passenger being unable to ride on the train
of the number and on the date stated on the passenger’s ticket owing to the liability of the railway transport enterprise, the said
enterprise shall, as requested by the passenger, refund the total sum of the ticket fare or make arrangements for the passenger to
ride on another train to the same destination.

Article 13

A railway transport enterprise shall take effective measures to serve the passengers well in a courteous, attentive, warm and cultured
manner, keep the station premises and passenger cars clean and sanitary, provide boiled drinking water and good catering services
on the train.

A railway transport enterprise shall take measures to protect the environment along railway lines from pollution.

Article 14

Any passenger boarding a train shall hold a valid passenger ticket. Any passenger riding on a train without a ticket or with an invalid
ticket shall pay the ticket fare on the train plus such additional charges as specified in relevant railway regulations; the railway
transport enterprise may order any passenger who refuses to do so to leave the train.

Article 15

The State railways and local railways shall plan the goods transport on the principle of promoting production and invigorating circulation.

Priority in transport shall be given to materials for emergency rescue or disaster relief and other goods and materials that warrant
such priority according to relevant regulations of the State.

Where goods and materials to be carried by local railways need to be carried by State railways, the transport plan therefore shall
be incorporated in the transport plan of State railways.

Article 16

A railway transport enterprise shall carry the goods, parcels and luggage to their destinations in observance of the time limit stipulated
in the contract or within the time limit prescribed by the competent department in charge of railways under the State Council. For
any overdue goods, parcel, or luggage, the railway transport enterprise shall be liable to indemnity for breach of contract.

In case a railway transport enterprise fails to deliver the goods, parcels or luggage to their consignee or owner passenger after
thirty days in excess of the time limit, the shipper, consignee or passenger concerned shall be enpost_titled to claim compensation for
loss from the railway transport enterprise.

Article 17

A railway transport enterprise shall be liable to pay compensation for loss, short-delivery, deterioration, contamination, or damage
that might have occurred to the shipped goods, parcels or luggage as of the moment the railway transport enterprise undertakes the
conveyance until the moment of their delivery.

(1)

Any shipper or passenger who has voluntarily applied for insured transport of valued articles shall be enpost_titled to an indemnity on
a par with the actual loss but not exceeding the insured value.

(2)

Indemnity for goods conveyed not in the manner of insured transport of valued articles shall be on a par with the actual loss but
not exceeding the liability limit laid down by the competent department in charge of railways under the State Council. If the loss
is caused by deliberate action or grave fault on the part of the railway transport enterprise, the above-stated liability limit shall
not apply but the indemnity shall be made in conformity with the actual loss.

Any shipper or passenger may, on voluntary basis, buy insurance policy for transport of goods at an insurance agency and the insurance
agency shall be liable for indemnity in conformity with the agreement as stated in the insurance contract.

Any shipper or passenger may, on voluntary basis, enter into insured transport of valued goods or buy insurance policy for transport
of goods, or may do without. No shipper or passenger shall be compelled in any manner to enter into insured transport or buy transport
insurance policy.

Article 18

A railway transport enterprise shall not be liable to indemnity for any loss, in relation to goods, parcels or luggage, caused by
the following reasons:

(1)

Force majeure.

(2)

Natural property of the goods or articles contained in the parcel or luggage, or natural wear and tear.

(3)

Fault on the part of the shipper, consignee or passenger concerned.

Article 19

Any shipper shall truthfully fill in the goods consignment note, and the railway transport enterprise shall be authorized to check
the description, weight and quantity of the goods and parcels as written on the note. Upon check-up, if the reported disagrees with
the real contents, the shipper shall pay for the check-up expenses; if the reported agrees with the real contents, the check-up expenses
shall be borne by the railway transport enterprise, and any damage incurred from the check-up with the contents of the goods or parcels
as a result of the check shall be compensated for by the same enterprise.

Any deficiency in payment of transport charges and other fees as a result of untrue declaration of the goods shipped shall be made
up by the shipper concerned, and the railway transport enterprise shall, according to the relevant regulations of the competent department
in charge of railways under the State Council, collect from the shipper extra transport charges and other fees.

Article 20

Goods consigned for shipment that need packing shall be packed by the shipper in conformity with the national standards for packing
or the trade standards for packing; where both these standards are lacking, the shipper shall pack the goods properly so that the
goods would not suffer any damage due to improper packing.

A railway transport enterprise shall, with regard to the perishable goods and living animals the shipment of which it has undertaken,
in accordance with the relevant regulations of the competent department in charge of railways under the State Council and the contracted
agreement.

Article 21

Upon the arrival of shipped goods, parcels or luggage, the relevant consignee or passenger shall claim them in time in observance
of the time limit set by the competent department in charge of railways under the State Council and at the same time pay any transport
charges and other fees that the shipper has not paid or underpaid; if such time limit is exceeded, the consignee or passenger shall
pay due charges for storage in accordance with relevant regulation.

Article 22

Any shipped goods that are not claimed for thirty days as of the date of issuing the notice of claim for the shipped goods, or that
the consignee has informed the railway transport enterprise in writing of refusing to accept shall be sold off by the railway transport
enterprise on condition that the enterprise has served the shipper a notice about such and received no acknowledgement for thirty
days as of the date of receipt of the notice. The amount of money obtained from the selling, if there is any left after deduction
of storage charges and other deductible fees, shall be refunded to the shipper, or turned over to the state treasury provided it
is not refundable nor claimed by the shipper within one hundred and eighty days as of the date of disposal.

Any parcel not claimed for ninety days as of the date of issuing the notice of claim for such goods by the railway transport enterprise
concerned and any luggage not claimed for ninety days as of its arrival at destination may be disposed of by the said enterprise
provided that the latter has issued a public announcement thereupon and received no claim for the said parcel or luggage ninety days
after the issuance. The amount of money obtained from the selling, if there is any left after deduction of storage charges and other
deductible fees, may be recovered by the shipper, consignee or passenger concerned within one hundred and eighty days as of the date
of the selling, or shall be turned over to the state treasury if no claim for recovery is received within the same time limit.

Dangerous goods and articles the transport of which is restricted according to relevant regulations shall be handed over to the public
security authority or department concerned for disposition and shall not be sold off by the railway transport enterprise itself.

For articles which are not suitable for storage over a long period of time, the deadline for their disposal may be shortened in accordance
with relevant provisions set down by the competent department in charge of railways under the State Council.

Article 23

Passengers, shippers or consignees who are held responsible for any loss of property of a railway transport enterprise shall be liable
to compensation for the loss.

Article 24

The State shall encourage industrial railways to take up also public passenger and goods transport services on a commercial basis;
the State shall promote shared use of railway private sidings by related units on the basis of agreed terms.

Any industrial railway which will take up also public passenger or goods (or both) transport services on commercial basis shall report
such to and obtain approval from the people’s government of the relevant province, autonomous region or municipality directly under
the Central Government.

To any industrial railway undertaking commercial public passenger or goods transport, the provisions governing railway transport enterprises
stipulated in this Law shall apply.

Article 25

Passenger fares and tariffs for goods, parcels and luggage shall be worked out by the competent department in charge of railways under
the State Council and submitted by the latter to the State Council for approval. The items and rates of miscellaneous charges for
passenger and goods transport on State railways shall be laid down by the competent department in charge of railways under the State
Council. Tariffs applicable to specified operating lines, specified goods and provisional operating lines of the State railways shall
be worked out by the competent department in charge of railways under the State Council by agreement with the competent department
in charge of prices under the State Council.

Passenger fares, goods tariffs and the items and rates of miscellaneous charges for passenger and goods transport on local railways
shall be laid down by the competent department in charge of prices under the people’s government of the relevant province, autonomous
region or municipality directly under the Central Government in conjunction with the agency authorized by the competent department
in charge of railways under the State Council.

Passenger fares, goods tariffs and the items and rates of miscellaneous charges for passenger and goods transport on industrial railways
which also run public passenger and goods transport on a commercial basis, and the rates of charges for sharing the use of railway
private sidings, shall be laid down by the competent department in charge of prices under the people’s government of the relevant
province, autonomous region or municipality directly under the Central Government.

Article 26

Passenger fares, tariffs for goods, parcels and luggage, and the items and rates of miscellaneous charges for passenger and goods
transport, must be announced by public notice; the same shall not go into effect before being so announced.

Article 27

Counterfeiting or alterations of tickets or other certificates which are printed and used in relation to passenger and goods transport
by State railways, local railways and industrial railways shall be prohibited.

Reselling of passenger tickets or other railway transport certificates for profit shall be prohibited.

Article 28

Relevant regulations of the State concerning articles the transport of which is prohibited or restricted must be observed in consigning
shipment and carrying goods, parcels or luggage.

Article 29

Domestic through transport of passenger and goods between railway transport enterprises and highway, air or waterway transport enterprises
must be handled in accordance with relevant provisions laid down by the State, or in the absence of such provisions, in accordance
with the agreement reached by all parties concerned.

Article 30

Participation of State or local railways in international through transport must obtain approval from the State Council.

Article 31

Military transport on railways shall be handled in accordance with relevant provisions laid down by the State.

Article 32

In the event of dispute over a railway transport contract, the railway transport enterprise and the involved shipper, consignee or
passenger may settle the dispute by way of mediation; or if a party does not wish to settle the dispute by mediation or the mediation
proves unsuccessful, the railway transport enterprise and the involved shipper, consignee or passenger may, in accordance with relevant
provisions on arbitration included in the contract or with the written agreement on arbitration reached afterwards, apply for arbitration
to an arbitration agency designated by the State.

Where a party does not perform the award of the arbitration agency within the prescribed time limit, the other party may apply to
a people’s court for compulsory execution.

Where no provision on arbitration is made in the contract and no written agreement on arbitration has been reached afterwards, either
of the parties may bring a suit in a people’s court.

Chapter III Railway Construction

Article 33

Planning for the expansion of railway network shall be based on the demands of national economy, social development and the building
up of national defence and shall be coordinated with the development plans of other modes of transport.

Article 34

The construction plan of local railways, industrial railways or railway private sidings must conform to the national railway development
plan and must obtain approval from the competent department in charge of railways under the State Council or an agency authorized
by this department.

Article 35

The planning of any railway track, station, junction area an other related facilities within a planned urban area of a city shall
be brought in line with the overall plan of this city.

The land-use plan for railway construction shall be incorporated in the relevant overall land-use plan. Land needed for future expansion
or construction of new railway lines shall be allotted by the people’s government at or above the county level in its overall land-use
plan.

Article 36

The use of land for railway construction shall be handled in accordance with provisions of relevant laws and administrative rules
and regulations.

The relevant local people’s government shall support railway construction and assist the railway transport enterprise to carry out
land requisition for railway construction, to dismantle or move any structures or inhabitants thereon and make due arrangements for
them.

Article 37

Any railway transport enterprise shall, having acquired the right to use any land for railway construction, use the land for the approved
purpose and shall not use the land for any other purposes without proper authorization; no other unit or individual may occupy or
seize the said land.

The department of land administration under the local people’s government at or above the county level shall order any unit or individual
that has occupied or seized the land appropriated for railway construction to stop doing so and to compensate the railway transport
enterprise concerned for the loss.

Article 38

The standard railway gauge shall be 1435mm. Standard gauge must be adopted in the construction of a new State railway.

For narrow-gauge railways, the gauge shall be 762mm or 1000mm.

Other technical requirements for new railways and reconstructed railways shall conform to relevant national standards or trade standards.

Article 39

A railway line, after its completion of construction, may, in accordance with the procedures laid down by the State for capital construction,
be put into operation only after it has been duly examined and accepted as satisfactory.

Article 40

At the crossing point of a railway and a highway, priority shall be given to the installation of a grade separation structure; at
a crossing where a grade separation structure is not installed, a level crossing or a pedestrian cross-walk may be laid in conformity
with relevant provisions of the State. The setting up of a level crossing or a pedestrian cross-walk within a planned urban area
shall be decided by the railway transport enterprise, or the relevant enterprise owning the relating industrial railways or private
sidings, or any other relevant unit jointly with the department in charge of city planning.

The removal of an established level crossing or pedestrian cross-walk shall be decided by the railway transport enterprise, or the
relevant enterprise owning the relating industrial railway or private siding, or any other relevant unit by agreement with the local
people’s government.

Article 41

Any railway bridge to be built across a water course shall conform to the requirements for flood prevention, navigation and flow of
current as laid down by the State in relevant regulations.

Chapter IV Safety and Protection of Railways

Article 42

A railway transport enterprise must strengthen the control and protection of railways, regularly inspect and repair railway transport
facilities so as to ensure intactness of these facilities and guarantee safe conveyance of passengers and goods.

Article 43

The railway security organ and the local security authority shall jointly keep the public order along railway lines, in stations and
on trains, while dividing up the work in such a way that the public order in stations as well as on trains shall be under the charge
of the railway security organ, and the public order along railway lines shall be under the joint charge of the local security authority
and the railway security organ, with the local security authority in the main.

Article 44

The competent department in charge of electric power shall guarantee the power supply for railway traction and critical loads arising
in railway operation. The scope of power supply for critical loads arising in railway operation shall be defined by the competent
department in charge of railways under the State Council through consultation with the competent department in charge of electric
power under the State Council.

Article 45

Hill slopes beyond the right-of-way of and flanking the railway line shall be conditioned as key territories for water and soil conservation
by the relevant local people’s government. Slopes on top of railway tunnels shall be conditioned by the local people’s government
with due assistance of the relevant railway transport enterprise. Hill slopes within the railway line’s right-of-way shall be conditioned
by the railway transport enterprise.

Article 46

In case there is any such activity as building an uphill pond, a reservoir, or a dyke or dam; excavating a water course, a trunk channel
or other waterway; stone-quarrying; sand-fetching; or digging a well for water, which is carried out within a specific distance from
both sides of a railway line, bridge or culvert, and which might cause adverse effects on the stability of the railway subgrade or
endanger the railway bridge or culvert, the relevant local people’s government at or above the county level shall order such activities
to be ceased, and set a time limit for restoring the site to its original state or to take necessary safety and protection measures.

Unless the approval of the relevant railway transport enterprise is obtained and proper safety and protection measures are provided,
the erecting of power or communications lines over or across a railway line, the laying of buried cables or pipes along a railway
subgrade, and the digging of tunnels through or under a railway embarkment shall not be allowed.

Building of any structures or planting of any trees which might hinder a good watch from the driver’s cabin over the railway line
shall not be allowed at the inner side of a curve or at a place close to a level crossing or a pedestrian cross-walk. In case any
building, such as afore-mentioned, has been erected, the local people’s government at or above the county level shall order the builder
to remove the building, and if any tree, such as afore-mentioned, has been planted, the said government shall order the relevant
unit or individual to remove, trim or cut down the tree within a specified period of time.

Any unit or individual that violates the provisions stated in the preceding three paragraphs shall be liable to compensation for any
loss thereby suffered by the relevant railway transport enterprise.

Article 47

It shall be prohibited to install a level crossing or a pedestrian cross-walk without proper authorization.

Necessary signs and protective installations must be provided at level crossings or pedestrian cross-walks in conformity with relevant
regulations.

Pedestrians and vehicles must, when passing a railway level crossing or a pedestrian cross-walk, observe the relevant regulations
governing passage over crossings.

Article 48

Transport of dangerous goods must be handled in conformity with the regulations formulated by the competent department in charge of
railways under the State Council. It shall be forbidden to consign for shipment any dangerous article under the name of a non-dangerous
article.

Passengers shall be prohibited from carrying any dangerous article into a railway station or a train. Railway security personnel or
any such railway worker designated by the competent department in charge of railways under the State Council shall, for the safety
of transher have the right to inspect the article or articles carried by any passenger. Any railway worker when carrying out transport
safety inspection shall bear an on-duty identification sign.

A list of the descriptions of dangerous articles shall be specified and promulgated by the competent department in charge of railways
under the State Council.

Article 49

Any railway worker shall have the right to stop any person who is about to damage or destroy, or cause to move or shift, any railway
signalling installation or other facilities for traffic operation, and any person who is about to place obstacle(s) on the railway
track. The railway worker may catch such a person and hand him over to the public security authorities.

Article 50

It shall be forbidden for anybody to make a covert ride on a goods train, to climb up or hang on to a train in motion, or to hit or
strike a train. Any railway worker shall have the right to stop such a person.

Article 51

It shall be forbidden to walk, sit or lie on a railway track. Any railway worker shall have the right to stop such conduct.

Article 52

It shall be forbidden to graze livestock within twenty metres of either side of a railway track. Any railway worker shall have the
right to stop such conduct.

Article 53

Any railway worker shall have the right to stop persons who have gathered up to intercept a train, or to assault a railway traffic
control office. The responsible public security personnel on site shall have the right to order those persons who refuse to stop
such action to disperse; and if such a demand is refused, the responsible public security personnel on site shall, according to relevant
regulations established by the State, choose to force them to disperse by necessary means. Those who refuse to obey shall be taken
away from the site by force or detained.

Article 54

Any railway worker shall have the right to stop those persons who try to start a riot and rob goods and materials being transported
on railways and may seize them and hand them over to the public security authorities; the public security personnel on site may detain
them.

Article 55

Any railway worker shall have the right to stop any person who is picking quarrels and stirring up troubles on board a train causing
public disorder or jeopardizing the physical being or property of other passengers; the railway security personnel may detain such
person.

Article 56

If a certain kind of infectious disease which demands quarantine as stated in legal provisions is discovered in a railway station
or on board a passenger train, the railway sanitation and quarantine authority shall carry out the necessary quarantine process;
the local sanitation and quarantine authority shall render assistance to the former upon request.

The quarantine of goods in transport shall be carried out in accordance with relevant regulations of the State.

Article 57

In case of any railway traffic accident, the railway transport enterprise shall act in accordance with relevant provisions about the
investigation and handling of accidents stipulated by the State Council and its relevant competent department, and ensure the timely
restoration of normal traffic; no unit or individual shall hinder the re-opening of the railway track and train operation.

Article 58

A railway transport enterprise shall be liable to compensation for any personal injury or fatality due to traffic accident or other
operational accident. It shall hold no liability for compensation for any personal injury or fatality due to force majeure or due
to the fault of the aggrieved person oneself.

Personal injury or fatality resulting from passing the railway track at a level crossing or via a pedestrian cross-walk in violation
of relevant regulations or from walking, sitting or lying on the railway track shall be deemed injury or fatality caused by the fault
of the aggrieved person one-self.

Article 59

Major bridges and tunnels of State railways shall be guarded by the Chinese People’s Armed Police Forces.

Chapter V Legal Responsibility

Article 60

Any person who, in violation of relevant provisions of this Law, has carried any dangerous article into a railway station or on board
a train or has consigned for shipment any dangerous article under a name of a non-dangerous article thus causing a grave accident,
shall be investigated for criminal responsibility in accordance with Article 115 of the Criminal Law. Any enterprise, institution,
State organ, or public organization which commits the crime as specified in this Article shall be imposed a fine, and the person
in charge of any of the aforesaid unit and the person or persons immediately responsible for the offence shall be investigated for
criminal responsibility.

Any person who carries dynamite or detonator or who illegally carries firearms, bullets or controlled knives into a railway station
or on board a train shall be investigated for criminal responsibility with reference to Article 163 of the Criminal Law.

Article 61

Any person who intentionally damages or destroys or causes to move or shift any railway signalling installation, or places on the
railway track obstacle(s) that might lead to the overturning of a train without having caused serious consequences shall be investigated
for criminal responsibility in accordance with Article 108 of the Criminal Law; any person who acts in the aforesaid manner causing
serious consequences shall be investigated for criminal responsibility in accordance with Article 110 of the Criminal Law.

Article 62

Any person who steals spare

CUSTOMS REGULATIONS FOR THE SUPERVISION OF INBOUND AND OUTBOUND TRAINS AND THE GOODS AND COMMODITIES THEREON

Customs Regulations of the PRC for the Supervision of Inbound and Outbound Trains and the Goods and Commodities Thereon

(Effective Date:1990.03.01–Ineffective Date:)

Article 1 In order to promote foreign economic and trade scientific, technological and cultural exchanges, and strengthen customs supervision
and management, these Regulations are made in keeping with the Customs Law of the People’s Republic of China, and the relevant regulations
governing railways, and in the light of the actual situation of railway transportation.

Article 2 The “inbound and outbound trains” in these Regulations refer to the locomotives, passenger trains, goods trains, mail trains, baggage
trains, electricity generating trains, guard’s trains, and track trains that pass through the Customs on the border.

The “goods and commodities” in these Regulations refer to the goods, baggage, packages, mail and other items carried on trains passing
through the Customs on the border.

The word “inter-customs transportation” in these Regulations refers to the fact that when goods and commodities have been transported
into the country they will be sent, under the supervision of the Customs, into another customs station for entry formalities, or
to the goods and commodities allowed through the Customs under the supervision of the Customs for which export formalities have been
complied with at the place of shipment, or to the goods and commodities that are transported from one customs station on another
in the country and that should be supervised by the Customs.

Article 3 Outbound or inbound trains must stay at departure or entry stations for customs supervision and examination.

Form the time an inbound train arrives at an entry station to the time when the Customs has finished its examination, or from the
time the Customs begins examining an outbound train to the time Customs allows it to pass through, it cannot move, be disintegrated
(except for wheel replacement for passenger cars), or leave the entry or departure station without permission.

Article 4 During the Custom’s examination of an inbound or outbound train, no personnel are allowed to board and alight it except for those
personnel from relevant port examination and quarantine departments or railway service personnel who carry out their duties.

Article 5 The goods, commodities and passengers carried on an inbound or outbound train should be supervised by the Customs. When goods and
commodities have been loaded or unloaded, the railway station should hand documents and business records to the Customs, which attest
to the actual situation.

If the Customs finds inbound or outbound goods or commodities to have been smuggled or if it suspects them to have been smuggled,
it can inform the railway station by letter to unload them at a place designated by the Customs or transfer the relevant cars to
a designated place for further handling.

Article 6 The goods and commodities under the supervision of the Customs should be supervised by the Customs whether they are stored in the
Customs supervision area or outside it.

The personnel sent by the Customs to a railway station, a warehouse of a freight supervision area, or a cargo transshipment area should
abide by relevant railway regulations and must produce their credentials when needed. All railway departments should play a supportive
role.

Article 7 When an inbound or outbound train leaves a departure or entry station, the railway station should notify in advance the Customs of
the departure time, number, and the place where the train stays at and leaves from.

For each inbound and outbound goods train, a railway station should hand to the Customs a list of the orderly grouping of trains and
a goods hand-over note.

Article 8 When the Customs finishes examining a train, it should immediately notify a departure or entry station. If it cannot finish the examination
during the stay of an inbound passenger train, it can continue the examination by sending its personnel onto the train, and the head
of the entry station must provide them round-trip tickets enabling them to come to a station nearest to the front station and provide
them working conditions.

Article 9 For the goods and commodities carried on an inbound or outbound train, the departure or entry railway station must hand the following
documents to the Customs:

(1) a goods delivery note, or a baggage or package hand-over note and supplementary documents.

(2) a goods hand-over note, or a baggage or package hand-over note.

(3) other relevant documents as required by the Customs.

Article 10 When proceeding with formalities for the import and export of goods, the recipient of imported goods (including packages) or the
sender of exported goods, or the agents should declare their goods by filling out goods declaration forms and handing in the following
as required:

(1) a goods delivery note (including package declaration) and supplementary documents;

(2) the license for imported or exported goods; and

(3) other documents as required by the Customs.

The owner of inbound reclaimed baggage and outbound checked baggage must complete relevant customs formalities.

Article 11 When the Customs is examining goods, the departure and entry railway station should send its personnel to break the seals in the
cars, open car doors, or remove the tarpaulin in accordance with customs requirements. The recipient or sender of the goods, or their
agents should remove, load, or unload goods, and open or re-pack them. When the Customs deems necessary, it can, at its discretion,
open them for examination or re-examination, or take samples. The Customs should produce evidence for the name and amount of each
item taken as a sample.

Article 12 For the goods and commodities that are returned by the Customs because they do not meet China’s entry control regulation, the railway
station should complete the formalities for their return upon production of a written notice of rejection issued by the Customs.
For those goods that are rejected as they contravene the international railway transportation regulation, the Customs must allow
the return upon production of the railway department’s record of rejection.

Article 13 Only after the Customs has stamped a seal on the goods delivery note, or baggage or package declaration, can the railway station
deliver or transport the relevant goods and commodities out of the country.

Article 14 Prior to the transportation of “inter-customs transportation” goods, the Customs should stamp a seal on the goods delivery note with
words Goods Under Customs Supervision after checking that the relevant documents, goods and commodities are correct. It then returns
the delivery note to the railway station together with the customs seal for their transportation. The customs seal must be handed
to the responsible person of a train by the railway station. It then will be sent together with a delivery note to the designated
place or to the customs of the departure station.

Article 15 For the goods under customs supervision, if there is any change in the station of arrival in the country or a station of departure
in the country, the railway station that arranges for the change should notify the customs of such a change. The designated station
or departure station that has been changed must be a customs station. The relevant railway station should hand the customs seal to
the responsible person of a train together with the delivery note to the designated place or the customs of the departure station
that has been changed. In case there is no customs house at the designated place, the applicant for the change will have to obtain
the consent of the customs near the designated delivery station before the entry station will proceed with the change.

Article 16 The goods carried by passengers that have gone through customs and approved by the customs at the station of arrival in the country
will be sealed by the Customs, and then the Customs seal will be handed to the responsible person of the train, which will then be
brought to the Customs at the place of arrival.

Article 17 The materials, spare parts, tools, wheel, and bogies for the repair of an inbound or outbound train will be exempted from customs
duties and product taxes (or value-added taxes) when they are confirmed to be used for the repair of an inbound or outbound car under
the supervision of the Customs.

For the materials used for sealing cars and tools for railway transportation (including tarpaulin), the railway station should declare
in good faith to the Customs, and the Customs will inspect them and let them pass tax-free.

Article 18 The goods for public use and the daily necessities for personal use within a reasonable amount carried by the personnel at the departure
and entry station and by stewards on trains (including food such as grain and vegetables), and the drink and food used by passengers
on an inbound and outboard train, will be inspected by the Customs and then allowed through tax-fee.

For the return of tarpaulin and empty containers, the recipient and sender or their agents should fill out the “tax-exemption certificate
for the returned of goods” for the tarpaulin and containers of recipients or senders. It then must be handed to Customs of the entry
or departure station in the country for signature and stamping before being returned to the railway station for the tax-free return
of these items.

DECISION OF THE NATIONAL PEOPLE’S CONGRESS APPROVING THE PROPOSAL BY THE DRAFTING COMMITTEE FOR THE HONG KONG SPECIAL ADMINISTRATIVE REGION ON THE ESTABLISHMENT OF THE COMMITTEE FOR THE BASIC LAW OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION UNDER THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS BASIC LAW

Category	SPECIAL ADMINISTRATIVE REGION	Organ of Promulgation	The National People’s Congress	Status of Effect	In Force
Date of Promulgation	1990-04-04	Effective Date	1990-04-04

Decision of the National People’s Congress Approving the Proposal by the Drafting Committee for the Basic Law of the Hong Kong Special Administrative Region on the Establishment of the Committee for the Basic Law of the Hong Kong Special Administrative Region under the Standing Committee of the National People’s Congress

The Decision
Appendix

(Adopted at the Third Session of the Seventh National People’s Congress on

April 4, 1990)
The Decision

The Third Session of the Seventh National People’s Congress decides:

1. to approve the proposal by the Drafting Committee for the Basic Law of
the Hong Kong Special Administrative Region on the Establishment of the
Committee for the Basic Law of the Hong Kong Special Administrative Region
under the Standing Committee of the National People’s Congress; and

2. to establish the Committee for the Basic Law of the Hong Kong Special
Administrative Region under the Standing Committee of the National People’s
Congress when the Basic Law of the Hong Kong Special Administrative Region of
the People’s Republic of China is put into effect.
Appendix

Proposal by the Drafting Committee for the Basic Law of the Hong Kong
Special Administrative Region on the Establishment of the Committee for the
Basic Law of the Hong Kong Special Administrative Region Under the Standing
Committee of the National People’s Congress

1. Name: The Committee for the Basic Law of the Hong Kong Special
administrative Region Under the Standing Committee of the National People’s
Congress.

2.Affiliation: To be a working committee under the Standing Committee of
the National People’s Congress.

3.Function: To study questions arising from the implementation of Articles
17, 18, 158 and 159 of the Basic Law of the Hong Kong Special Administrative
Region and submit its views thereon to the Standing Committee of the National
People’s Congress.

4.composition: Twelve members, six from the mainland and six from Hong
Kong, including persons from the legal profession, appointed by the Standing
Committee of the National People’s Congress for a term of office of five
years. Hong Kong members shall be Chinese citizens who are permanent residents
of the Hong Kong Special Administrative Region with no right of abode in any
foreign country and shall be nominated jointly by the Chief Executive,
President of the Legislative Council and Chief Justice of the Court of Final
Appeal of the Region for appointment by the Standing Committee of the National
People’s Congress.

CIRCULAR OF THE MINISTRY OF FOREIGN ECONOMIC RELATIONS AND TRADE AND THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE ON ISSUING THE PROVISIONS FOR CONTRACTED OPERATION OF CHINESE-FOREIGN EQUITY JOINT VENTURES

The Ministry of Foreign Economic Relations and Trade, the State Administration for Industry and Commerce

Circular of the Ministry of Foreign Economic Relations and Trade and the State Administration for Industry and Commerce on Issuing
the Provisions for Contracted Operation of Chinese-foreign Equity Joint Ventures

WaiJingMaoFaFa [1990] No.22

September 13, 1990

(Circular omitted) Attachment:Provisions for Contracted Operation of Chinese-foreign Equity Joint Ventures

The following regulations on contracted operation of Chinese-foreign equity joint ventures (hereinafter referred to as joint ventures)
are aimed at guaranteeing the normal development of these enterprises.

Article 1

Definition of contracted operation

The contracted operation mentioned in these regulations is meant for joint ventures which, by signing contracts, offer the whole or
part of their operational rights to contractors for a certain period of time while those joint ventures are managed by the contractors.
Such forms of contracted operation are but supplementary measures to help those poorly managed and loss-making joint ventures. During
the contracting term, the contractor takes on the risks of operation while gaining part of the joint venture’s profits.

Article 2

Requirements for contracted operation of joint ventures

A joint venture shall fulfill the following requirements to practice contracted operation:

That it is a project in an industry encouraged or permitted by State policy. However, key state projects, those in energy or communications
in particular, shall not practice contracted operation.

That the Chinese and foreign partners of the joint venture have fully provided the investment required by contract and the payment
has been verified-but the joint venture is hardly likely to survive because of poor management.

Article 3

Contractors’ qualifications

A contractor must have the following qualifications:

That it is a Chinese or foreign corporation or enterprise with the qualification of a legal person, and has engaged in business operation
for at least 3 years;

That is belongs to the same industry as the joint venture and can work out a concrete plan to effectively help the business make up
deficits and return to normal development; and

That it is able to provide adequate risk deposit and a letter-of-guarantee for the risk-guaranty money.

Article 4

Basic requirements for contracted operation

The contractor can be chosen through public bidding (i.e., the joint venture conducts public bidding in accordance with the conditions
worked out by the board of directors); alternatively, the joint venture can sign directly an agreement on contracted operation with
the contractor (either partner of the venture or a third party) in accordance with the decision made by the board of directors.

The legal-person status, name and business scope of the joint venture shall not be changed because of contracted operation.

As the operator and manager of the joint venture’s property, the contractor shall strictly carry out the contract and be under the
supervision of the venture’s board of directors. The contractor has no right to dispose of the joint venture’s property, such as
transfer, selling off, removing, mortgaging, leasing or giving out as a present. The contractor shall regularly submit factual financial
reports to the joint venture’s board of directors.

The contracting term is usually set at 1 to 3 years. The maximum shall be no more than 5 years. The contractor shall see to it that
the joint venture becomes profitable or at least its performance is improved remarkably when the contracting term expires.

Contracting shall only cover the joint venture’s after-tax profits. Both parties to such contracts shall decide on the annual profit
during the contracting term base in accordance with relevant targets defined in the feasibility study report worked out when the
joint venture was launched.

During the contracting term the contractor shall, in the first quarter of each year, submit to the joint venture risk guaranty money,
letter of guarantee or risk deposit. No securities shall be made for the deposit, which shall not come from the investment by the
joint venture’s partners. The risk guaranty money and the letter of guarantee shall be irrevocable and unilaterally drawable to the
joint venture. Whatever the form the sum shall be not less than 50 percent of the contracted annual profit.

During the contracting term the contractor shall get approval from the board of directors before applying for any loan in the name
of the joint venture. The debt of the joint venture during the contracting term shall not exceed the total amount of the contracted
profit for the year.

During the contracting term, the joint venture shall continue to implement State laws, regulations and accounting rules.

In accordance with law, the contractor shall pay income tax on its earnings from contracting.

The financial, accounting and tax affairs related to the contracted operation shall be handled in accordance with relevant regulations
adopted by the financial and taxation departments.

If the contractor fails, for two years in succession, to fulfill contracted-profit obligations, besides the joint venture shall, at
the end of a fiscal year, take over the contractor’s risk deposit or draw the risk guaranty money according to the bank’s letter
of guarantee, or the contractor shall pay for the loss according to contract, the examination and approval authority may annual the
approval. Consequently, the contract shall cease to be in force, the contractual relationship shall automatically be renounced, while
the administration for industry and commerce shall recall the certificate of registration for the contracted operation and register
the changed operational status of the joint venture.

The joint venture shall be dissolved according to the law and the joint venture contract if, after the contracted operation has ceased,
the venture still fails to change its loss-making situation.

10.

Before the contracted operation, and when the contracted operation is terminated during the contracting term or when the contracting
term expires, the joint venture shall make an inventory of property and capital and transfer management from one to another. The
inventory is valid only when it has been certified by accountants registered in China.

Article 5

Contract on contracted operation

To contract the operation of a joint venture, the contractor shall sign a contract with the joint venture. Contracts on contracting
profit between partners of the venture are not permitted to sign.

The contract shall be concluded in accordance with relevant Chinese laws, in keeping with the purposes and principles of the original
contract of the joint venture and without changing the items of the original contract that have nothing to do with the contracted
operation.

The contract shall include the contracting term, the rights and restrictions on the rights, and duties and responsibilities of the
contractor, the form and content of the contracted operation, the distribution pattern of income, risk guaranty money, letter of
guarantee and risk deposit, liability for breach of contract, ways to settle disputes over contract, responsibilities on losses and/or
debt owed by the joint venture prior to the contracted operation, the principles of making an inventory of property and capital and
the transferring procedures as well as the method of evaluating, production targets and profit, target for technological upgrading,
the debt safety line, the arrangements for the workers of the joint venture, labour management, wages, welfare and insurance, and
the party which shall handle and be responsible for the disputes with other corporations, enterprises and individuals in the course
of implementing the contract on contracted operation.

If the contractor severely violates the contract during the contracting term, the joint venture’s board of directors has the right
to terminate the contract and demand corresponding compensation for loss from the contractor.

The revision, postponement, termination or expiration of the contract shall be approved by the original authorities that approved
the joint venture.

Article 6

Application, examination and approval and registration of contracted operation

The joint venture shall apply for contracted operation and submit the following documents to the examination and approval authority:

(1)

an application on contracted operation of the joint venture;

(2)

the decision of the joint venture’s board of directors on contracted operation;

(3)

a report containing concrete measures to turn the joint venture from loss-making to profitable, measures worked out by the contractor
and approved by the joint venture’s board of directors:

(4)

the contractor’s legal business license, articles of association of the corporation, and a balance sheet covering the past 3 years
operations;

(5)

the contract on contracted operation;

(6)

the original contract of the joint venture and report on feasibility studies;

(7)

opinions of the government department in charge and financial and taxation departments on contracted operation of the joint venture;
and

(8)

other documents required by the examination and approval authority.

The examination and approval authority, within 30 days of receiving all the above-mentioned documents, shall decide to approve or
not approve the contracted operation in accordance with these regulations. The authority shall, within a specified time, demand revision
of illegal or obviously unfair contents in the contract. Otherwise the application shall not be approved.

Within 30 days from the date when the examination and approval authority issued documents of approval for the contracted operation,
the contractual parties shall, with the certificate on the delivery of risk deposit or letter of guarantee and risk guaranty money,
go through the formalities of registration with the administration for industry and commerce. The approval of the examination and
approval authority shall automatically cease to be effective if registration is not done in 30 days. The administration for industry
and commerce shall handle registration within 30 days of receiving the application.

The term of contracted operation begins from the date on which the administration for industry and commerce issues registration documents.

The registration of the opening and alteration of contracted operation and cancellation of registration shall be handled in accordance
with the regulations of the administration for industry and commerce.

Article 7

Supplementary rules

Joint ventures which are already under contracted operation must, within 90 days from the date these regulations are published, retroactively
go through procedures of the examination and approval and registration for contractual operation. Contracts already concluded may
be revised by referring to these regulations. The joint ventures and contractors who fail to retroact formalities within the time,
may be ordered jointly by the examination and approval authority and the administration for industry and commerce to terminate their
contract, and even their business license of the joint venture may be taken over and the contractor’s profit may be frozen.

The examination and approval authority and administration for industry and commerce may penalize joint ventures and contractors who
conceal their contracted operations without applying for approval and going through the registration formalities.

The Circular on the Examination, Approval and Registration of Enterprises from Foreign Countries or Regions Entrusted to Manage Chinese-foreign
Joint Ventures, published on July 11, 1988 by the State Administration for Industry and Commerce and the Ministry of Foreign Economic
Relations and Trade is still valid for those joint ventures which entrust foreign enterprises with management and administration.

Contracted operators of Chinese-foreign contractual joint ventures may refer to these regulations.

These Provisions shall enter into force as of the day of promulgation.

The Ministry of Foreign Economic Relations and Trade, the State Administration for Industry and Commerce
1990-09-13

PROVISIONS ON THE ADMINISTRATION OF MARITIME INTERNATIONAL CONTAINER TRANSPORT

Category	COMMUNICATIONS AND TRANSPORT	Organ of Promulgation	The State Council	Status of Effect	With An Amendment Existing
Date of Promulgation	1990-12-05	Effective Date	1990-12-05

Provisions of the People’s Republic of China on the Administration of Maritime International Container Transport

Chapter I  General Provisions
Chapter II  Procedures for the Examination and Approval of Applications
Chapter III  Management of Freight Transportation
Chapter IV  Hand-Over Procedures and Responsibilities
Chapter V  Provisions on Penalties
Chapter VI  Supplementary Provisions

(Promulgated by Decree No. 68 of the State Council of the People’s

Republic of China on December 5, 1990, and effective as of the date of
promulgation)(Editor’s Note: For the revised text, see the Decision of the
State Council Regarding Amending the Provisions of the People’s Republic of
China on the Administration of Maritime International Container Transport
promulgated on April 18, 1998)
Chapter I  General Provisions

Article 1 These Provisions are formulated in order to strengthen the
administration of maritime international container transport, to clearly
define the responsibilities of the various parties concerned, and to meet
the State’s needs in handling foreign trade.

Article 2 These Provisions shall apply to those enterprises that are
established within the territory of the People’s Republic of China for the
handling of maritime international container transport, and also to units
and individuals that are involved in the operations of maritime international
container transport.

Article 3 The Ministry of Communications of the People’s Republic of
China shall be responsible for the administration of the operations of
maritime international container transport throughout the country.

Article 4 In conducting maritime international container transport, the
principles of safety, accuracy, speed, economy, and civilized services must
be followed and door-to-door transportation shall be actively developed.
Chapter II Procedures for the Examination and Approval of Applications
for the Establishment of Enterprises That Handle Maritime International
Container Transport

Article 5 “Enterprises for the operations of maritime international
container transport” refers to those shipping enterprises that are engaged in
maritime international container transport, and also to those enterprises
that are engaged in port handling, with their inland transshipment stations
and freight stations that undertake maritime international container
transport.

Article 6 The applications for the establishment of enterprises that
are engaged in the operations of maritime international container transport
shall be submitted to the competent departments for communications of the
provinces, autonomous regions, or municipalities directly under the Central
Government for examination and verification, and then to the Ministry of
Communications for examination and approval.

Article 7 The applications for the establishment of enterprises that
are engaged in port handling of international containers shall be submitted
to the competent departments for communications of the provinces, autonomous
regions, or municipalities directly under the Central Government for
examination and approval, and then to the Ministry of Communications for the
record.

After the promulgation of these Provisions, the applications for the
establishment of new inland transshipment stations and freight stations that
undertake the transport of maritime international containers shall be
submitted first to the competent department that has established the said
enterprise for examination, verification, and consent; and then to the
competent departments for communications of the provinces, autonomous
regions, or municipalities directly under the Central Government for
examination and approval; and finally to the Ministry of Communications for
the record.

The procedures for the examination and approval of the applications for
the establishment of new transshipment stations and freight stations that
undertake the transport of maritime international containers shall be
formulated separately by the Ministry of Communications in conjunction with
the Ministry of Foreign Economic Relations and Trade.

Article 8 The applications for the establishment of Chinese-foreign
equity joint ventures and Chinese-foreign contractual joint ventures that
handle maritime international container transport shall be submitted to the
Ministry of Communications for examination, verification, and consent; and
shall then, in accordance with the provisions of the pertinent laws and
regulations, be submitted to the Ministry of Foreign Economic Relations and
Trade for examination and approval.

Article 9 The establishment of enterprises that are engaged in the
operations of maritime international container transport must satisfy the
following conditions;

(1) to have transport vessels, transport motor vehicles, transport
equipment and other relevant facilities that correspond to theft scope of
business and to the needs of their customers;

(2) to have the necessary organizational structure, site for setting up
their business office, and specialized administrative personnel;

(3) to have the registered capital and their own working capital that
meets the requirements of their business operations;

(4) to meet other conditions as stipulated by State laws, decrees and
regulations governing the establishment of enterprises.

Article 10 The competent department for communications shall examine,
verify and approve the scope of business operations of the enterprises that
have applied for the permission to handle maritime international container
transport in light of their sources of funds, the conditions of equipment and
facilities, the standard of administration, and the sources of cargoes.

Article 11 The competent department of communications shall issue the
approving documents to those enterprises, which have obtained the approval to
handle maritime international container transport. The units that have
received the approving documents shall apply and go through the registration
procedures by presenting the aforesaid approving documents to the
administrative department for industry and commerce, which shall issue the
business licences after checking and approving the enterprises’ application;
and only then shall the enterprises be permitted to start business operations.

Cases concerning the establishment of inland transshipment stations and
freight stations that undertake the transport of maritime international
containers shall also be submitted to the Customs for the completion of the
registration procedures.
Chapter III Management of Freight Transportation

Article 12 The containers used in maritime international container
transport shall conform to the provisions and technical standards of the
international organization for the standardization of containers, and also
to the provisions of the pertinent international containers convention.

The owners and operators of containers shall do a good job in the
management and maintenance of containers and carry out regular inspections, in
order to guarantee the provision of containers that are suitable for the
transportation of cargoes.

In case that the provisions in the second paragraph of this Article have
been violated, and, as a result, goods are damaged or short in number or
quantity, the person(s) who is (are) held responsible for this shall bear the
liability, for compensation in accordance with the pertinent provisions.

Article 13 Shippers and enterprises that are engaged in port handling,
shall guarantee that the vessels, motor vehicles, handling machinery and
tools are kept in a good technical condition, thereby ensuring the
transportation and safety of containers.

In case that shippers and enterprises that are engaged in port handling
have violated the provisions in the first paragraph of this Article, and, as
a result, goods are damaged or short in number or quantity, they shall bear
the liability for compensation in accordance with the pertinent provisions.

Article 14 Shippers and enterprises that are engaged in port handling
shall use the container shipping documents.

Article 15 Shippers may directly organize the contracting of the
transportation of container goods, and consignors may directly hold business
talks with shippers or commission shipping agents for the consignment of
import and export container goods.

Article 16 Consignors shall submit an accurate report on the names of
goods, and their property, quantity, weight, and specifications. The goods
shipped by consignment in containers must conform to the requirements of
container transport, and marks on the goods should be obvious and clear.

Article 17 Consignors or shippers shall, before vanning, carry out a
careful inspection of containers, and containers that might cause an adverse
effect on to the transportion and vanning of goods may not be used.

Article 18 Containers which are used for shipping such perishables as
grains, edible oils, and frozen food, shall be inspected by the department for
commodity inspection and found to be up to the standard before they are used
for shipping.

Article 19 As soon as container goods have reached their destination,
the shipper shall promptly send a cargo delivery notice to the consignee; and
the consignee shall, upon receiving the notice, take delivery of goods on the
strength of the bill of lading.

In case that the consignee fails to clear the goods when the prescribed
time limit is overdue, or that the consignee fails to return the containers
according to the prescribed time limit, the said consignee shall be required
to pay in accordance with the pertinent stipulations or with the agreement
set forth in the contract, the demurrage charge for the extended use of
containers.

Article 20 The freight charges for maritime international container
transport and other expenses shall be calculated and collected in accordance
with the State provisions concerning shipping charges and charge rates. In the
absence of State provisions, the freight charges shall be calculated and
collected in accordance with the prices agreed upon by both parties. No units
shall be permitted to collect charges at random.

Article 21 Shippers and enterprises that are engaged in port handling,
shall submit periodical statistical statements on transportion to the
competent department for communications.

Article 22 Various parties that are involved in maritime international
container transport shall, in good time, provide each other with information
concerning container transport.
Chapter IV Hand-Over Procedures and Responsibilities

Article 23 Shippers and consignors or consignees shall, in accordance
with the hand-over method stipulated, in the bill of lading, handle the
hand-over operations of containers and container goods at marshalling yards,
freight stations, or other places agreed upon by the two parties concerned.

Article 24 Shippers and enterprises that are engaged in port handling,
which take part in maritime international container transport, shall handle
the hand-over operations in accordance with the following provisions:

(1) maritime shippers shall handle the hand-over operations alongside
vessel through the tally companies and enterprises that are engaged in port
handling;

(2) with respect to containers transported by waterways through nodal
points, the enterprises that engaged in port handling and waterway carriers
shall handle the hand-over operations alongside vessel;

(3) with respect to containers transported by highways through nodal
points, the enterprises that engaged in port handling and highway carriers
shall handle the hand-over operations at the gate of the container terminal;

(4) with respect to containers transported by railway through nodal
points, the enterprise that engaged in port handling or highway carriers and
railway carriers shall handle the hand-over operations at the site of handing.

Article 25 While handling the hand-over operations of containers, the
two handling parties shall check the container numbers, the bodies of
containers and the containers’ marking seals. The loaded containers shall be
handed over by their marking seals and by the condition of container body; and
the empty containers shall be handed over by condition of container body.

After checking the container numbers, the bodies of containers and the
marking the two handling parties shall make a record and confirm it by
appending their signatures to the record.

Article 26 With respect to the liabilities of shippers and enterprises
that are engaged in port handling for the damage and loss of containers and
container goods, before the hand-over operations, the liabilities shall be
taken up by the handing-over party; after the hand-over operations, the
liabilities shall be taken up by the receiving party. However, if, within 180
days immediately after the hand-over operations, the receiving party is able
to produce evidence to testify to the fact that the damage of the containers,
or the damage and loss of container goods, were caused by the handing-over
party, then the handing-over party shall take up the liabilities for
compensation, unless otherwise provided by law.

Article 27 Unless otherwise provided by law, shippers and consignors
shall, in accordance with the following provisions, take up the liabilities
for the damage or loss of container goods:

(1) With respect to those goods, the vanning of which is done by the
shippers, if the goods in the containers are damaged or are short in number
or quantity during the period of time from the day the shippers receive the
goods to the day when the goods reach their destination but before they are
handed over to the consignees, the shippers shall take up the liabilities for
the damage or shortage.

(2) With respect to those goods, the vanning of which is done by the
consignors, if the container bodies and the marking seals have remained intact
but the goods (in the containers) have been damaged or are short in number or
quantity during the period of time from the completion or the vanning and the
completion of the procedures for consignment to the day before the containers
are handed over to the consignees, the consignors shall take up the liabilities
for the damage or shortage; if the container bodies are damaged or the marking
seals broken, and the goods in the containers are also damaged or are short
in number or quantity, the shippers shall take up the liabilities for the
damage or shortage.

The time limits for shippers and consigness or consignees to raise
claims of compensation shall be limited to no more than 180 days, beginning
from the day when container goods are handed over, unless otherwise provided
by law.

Article 28 In case that the consignors’ inaccurate or false declaration
on container goods has resulted in injuries and death of personnel, or in the
loss of means of transport of the goods proper and the containers, or of other
goods, the consignors shall bear the liabilities for the consequences
arising therefrom.

Article 29 In case that the fault of the person in charge of the vanning
has resulted in injuries and death of personnel, or in the loss of means of
transport, of other goods, or containers, the aforesaid person shall bear the
liabilities for the consequences arising therefrom.

Article 30 In case that the damage or shortage in number or quantity
of container goods involves a claim for compensation from a foreign unit,
which necessitates an appraisal and the issue of the relevant certificate by
the administrative department for commodity inspection, the case shall be
handled in accordance with the provisions in the Law of the People’s Republic
of China on the Inspection of Import and Export Commodities. In case that the
shortage in number or quantity of containers or container goods involves a
claim for compensation from a foreign unit, which necessitates the issue of
the relevant certificate by the tally department, the case shall be handled in
accordance with the pertinent provisions.
Chapter V Provisions on Penalties

Article 31 With respect to those who are engaged in container transport
business without a business licence for handling transport business, the
competent department for communications shall order them to cease business
operations, and penalties shall be imposed on them by the administrative
department for industry and commerce.

Article 32 With respect to those who have received shipping charges in
violation of these Provisions and the relevant laws and regulations of the
State on commodity prices, they shall be penalized by the department for the
control of commodity prides.

Article 33 With respect to those who have violated the administration
of transport documents, they shall be given an administrative warning or a
pecuniary penalty by the competent department for communications in light of
the seriousness of the cases.

Article 34 With respect to those who have disturbed the normal order of
transportation or have expanded their scope of business without authorization,
they shall be ordered by the competent department for communications to carry
out rectification of their business, and shall be penalized by the
administrative department for industry and commerce.

Article 35 In the event that the person concerned does not accept the
decision on penalties, he/she may, within 15 days as of the first day after
the receipt of the notice of the decision on penalties, appeal to the
competent department immediately above the punishing department for
reconsideration of the aforesaid decision on penalties. The competent
department that has received the appeal for reconsideration shall, within
30 days (after receiving the appeal), make the decision on reconsideration.
If the person concerned still does not accept the decision of the
reconsideration, he/she may within 15 days immediately after receiving the
decision on reconsideration, bring a suit before a people’s court. If the
person concerned neither appeal for reconsideration, nor bring a suit before
the people’s court, nor execute the decision on penalties or the decision of
the reconsideration within the prescribed period of time, the department that
has made the decision on penalties may apply to the people’s court for
enforcement.
Chapter VI Supplementary Provisions

Article 36 The right to interpret these Provisions resides in the
Ministry of Communications.

The Ministry of Communications may formulate the rules for implementation
in accordance with these Provisions.

Article 37 These Provisions shall go into effect as of the date of
promulgation.

NATIONAL FLAG LAW

Category	NATIONAL FLAG, NATIONAL EMBLEM, CAPITAL, NATIONAL ANTHEM AND NATIONAL DAY	Organ of Promulgation	The Standing Commettee of the National People’s Congress	Status of Effect	In Force
Date of Promulgation	1990-06-28	Effective Date	1990-10-01

Law of the People’s Republic of China on the National Flag

Appendix: Directions for the Making of the National Flag

(Adopted at the 14th Meeting of the Standing Committee of the Seventh

National People’s Congress on June 28, 1990, promulgated by Order No.28 of the
President of the People’s Republic of China on June 28, 1990, and effective
as of October 1, 1990)

Article 1 This Law is enacted in accordance with the Constitution with a
view to defending the dignity of the National Flag, enhancing citizens’
consciousness of the State and promoting the spirit of patriotism.

Article 2 The National Flag of the People’s Republic of China shall be a
red flag with five stars.

The National Flag of the People’s Republic of China shall be made
according to the Directions for the Making of the National Flag promulgated by
the Presidium of the First Plenary Session of the Chinese People’s Political
Consultative Conference.

Article 3 The National Flag of the People’s Republic of China is the
symbol and hallmark of the People’s Republic of China.

All citizens and organizations shall respect and care for the National
Flag.

Article 4 The local people’s governments at various levels shall exercise
supervision over and administration of the display and use of the National
Flag within their respective administrative areas.

The Ministry of Foreign Affairs, the competent department in charge of
communications under the State Council and the General Political Department of
the Chinese People’s Liberation Army shall exercise supervision over and
administration of the display and use of the National Flag within their
respective jurisdiction.

The National Flag shall be made by enterprises designated by the people’s
governments of provinces, autonomous regions and municipalities directly under
the Central Government.

Article 5 The National Flag shall be displayed daily in the following
places or premises of institutions:

(1) Tiananmen Square and Xinhuamen in Beijing;

(2) The Standing Committee of the National People’s Congress, the State
Council, the Central Military Commission, the Supreme People’s Court and the
Supreme People’s Procuratorate;

The National Committee of the Chinese People’s Political Consultative
Conference;

(3) The Ministry of Foreign Affairs;

(4) Airports, harbours and railway stations of entry or exit and other
frontier ports, frontier stations and coastal defence stations.

Article 6 Departments under the State Council, the standing committees of
the local people’s congresses, the people’s governments, the people’s courts,
the people’s procuratorates and the local committees of the Chinese People’s
Political Consultative Conference at various levels shall display the National
Flag during working days.

Full-time schools shall display the National Flag daily, except during
winter vacations, summer vacations and Sundays.

Article 7 State organs at all levels and mass organizations shall display
the National Flag on National Day, International Labour Day, New Year’s Day
and the Spring Festival; the National Flag may be displayed, when conditions
permit, in premises of enterprises, institutions, villagers’ committees and
residents’ committees, in urban residential compounds (buildings) and in
public places such as squares and parks.

In minority nationality areas where the Spring Festival is not a
traditional festival, whether the National Flag is displayed during the Spring
Festival shall be prescribed by the authorities practising self-government in
the national autonomous areas.

In a national autonomous area, the National Flag may be displayed on the
anniversary of the founding of the national autonomous area and during major
traditional festivals of the minority nationalities.

Article 8 The National Flag may be displayed when important celebration
and commemorative activities, large-scale cultural and sports activities and
major exhibitions are held.

Article 9 Measures for the display and use of the National Flag in
diplomatic activities and by the Chinese embassies and consulates stationed in
foreign countries and other diplomatic representative agencies shall be
prescribed by the Ministry of Foreign Affairs.

Article 10 The National Flag shall be displayed by military organs at
barracks and on military vessels in accordance with the relevant provisions of
the Central Military Commission.

Article 11 Measures for the display of the National Flag by civilian
vessels or foreign vessels entering Chinese territorial waters shall be
prescribed by the competent department in charge of communications under the
State Council.

Measures for the display of the National Flag by public security vessels
on frontier defence, security or fire control duties shall be prescribed by
the departments in charge of public security under the State Council.

Article 12 The National Flag, when displayed under Articles 5, 6 and 7 of
this Law, shall be hoisted in the morning and lowered in the eve- ning.

Where the National Flag shall be displayed under this Law, when the
weather is inclement, it is permissible that the Flag not be displayed.

Article 13 When the National Flag is displayed, a Flag-hoisting ceremony
may be held.

When a Flag-hoisting ceremony is held, persons present shall face the Flag
and stand at attention to salute the Flag, and the National Anthem may be
played or sung while the National Flag is being hoisted.

A full-time middle school or primary school shall hold a Flag-hoisting
ceremony once a week, except during vacations.

Article 14 The National Flag shall be lowered to the half staff as at
token of mourning when the following persons pass away:

(1) President of the People’s Republic of China, Chairman of the Standing
Committee of the National People’s Congress, Premier of the State Council and
Chairman of the Central Military Commission;

(2) Chairman of the National Committee of the Chinese People’s Political
Consultative Conference;

(3) Persons who have made outstanding contributions to the People’s
Republic of China;

(4) Persons who have made outstanding contributions to world peace or the
cause of human progress.

When unfortunate events causing especially serious casualties occur or
when serious natural calamities have caused heavy casualties, the National
Flag may be flown at half staff as a token of mourning.

The half-staffing of the National Flag in accordance with the provisions
of (3) and (4) in the first paragraph and of the second paragraph of this
Article shall be decided by the State Council.

Dates and places for the half-staffing of the National Flag under this
Article shall be decided by the funeral organ established by the State, or
shall be decided by the State Council.

Article 15 When the National Flag is displayed, it shall be placed in a
prominent position.

The National Flag, when raised or carried in a procession with another
flag or flags, shall be in front of the other flag or flags.

The National Flag, when displayed with another flag or flags, shall be
either at the center, above the other flag or flags, or in a position of
prominence.

When the National Flags of two or more nations are displayed in foreign
affairs activities, relevant provisions of the Ministry of Foreign Affairs or
the international practice shall be followed.

Article 16 The National Flag, when hoisted or lowered from a vertical
staff, shall be hoisted or lowered slowly. When hoisted, the National Flag
must reach the peak of the staff; when lowered, it may not touch the ground.

The National Flag, when flown at half staff, shall be first hoisted to the
peak of the staff and then lowered to a point where the distance between the
top of the Flag and the peak of the staff is one third of the length of the
staff; the Flag, when lowered, shall be again hoisted to the peak before it is
lowered.

Article 17 No damaged, defiled, faded or substandard National Flag shall
be displayed.

Article 18 The National Flag and the design thereof shall not be used as
a trade mark or for advertising purposes, and shall not be used in private
funeral activities.

Article 19 Whoever desecrates the National Flag of the People’s Republic
of China by publicly and wilfully burning, mutilating, scrawling on, defiling
or trampling upon it shall be investigated for criminal responsibilities
according to law; where the offence is relatively minor, he shall be detained
for not more than 15 days by the public security organ in reference to the
provisions of the Regulations on Administrative Penalties for Public Security.

Article 20 This Law shall enter into force as of October 1, 1990.

Appendix: Directions for the Making of the National Flag
(Promulgated by the Presidium of the First Plenary Session of the Chinese
People’s Political Consultative Conference on September 28, 1949)

The shape and colour of either side of the National Flag shall be
identical, whereas the five stars on both sides of the Flag shall be opposite
to each other. For convenience’s sake, these directions shall take the
circumstances where the staff is on the left as the basis for illustration.
Where the staff is on the right, the word “left” used in these directions
shall all be changed to “right”, while the word “right” referring to direction
shall all be changed to “left”.

(1) The face of the Flag shall be red and rectangular; the proportion of
its length and height shall be 3 to 2. The upper left of the face of the Flag
shall be studded with five yellow five-pointed stars. One of the stars shall
be bigger than the others, with its circumcircle’s diameter being three-tenth
of the height of the Flag, and shall be placed in the left; the four other
stars shall be smaller, with their circumcircle’s diameter being one-tenth of
the height of the Flag, encircling the big star on its right in the shape of
an arch. The cover of the staff shall be white.

(2) The five stars shall be positioned and drawn as follows:

a. To determine the position of the five stars, the face of the Flag shall
be first folded both ways to form four equal rectangles; then the rectangle on
the upper left shall be vertically divided into ten equal sections and
horizontally divided into fifteen equal sections.

b. The central point of the big five-pointed star shall be at a point in
the rectangle where the fifth line from above (or the fifth line from below),
and the fifth line from the left (or the tenth line from the right) meet. The
method of drawing shall be: taking this point as the centre and the length of
three such equals as the radius to make a circle. On the circumference of this
circle, five points with equal distances from each other shall be determined,
one of the points must be in the right above position of the circle. Then
connect each of the five points with every other point to form a straight line
respectively. The outline formed by these five straight lines shall be the
required big five-pointed star. An angle of the five-pointed star shall point
in the right above direction.

c. The centres of the four small five-pointed stars shall be as follows:
the first shall be at a point, in the rectangle, where the second line from
above (or the eighth line from below), and the tenth line from the left (or
the fifth line from the right) meet; the second shall be at a point where the
fourth line from above (or the sixth line from below), and the twelfth line
from the left (or the third line from the right) meet; the third shall be at a
point where the seventh line from above (or the third line from below), and
the twelfth line from the left (or the third line from the right) meet; the
fourth shall be at a point where the ninth line from above (or the first line
from below), and the tenth line from the left (or the fifth line from the
right) meet. The method for drawing shall be: taking each of the above four
points as the centre and the length of one such equal as the radius to make
four circles. On each circle, five points with equal distances from each other
shall be determined. One of such points must be on the line linking the
centre of the circle with the centre of the big five-pointed star. Then the
same methods used in forming the big five-pointed star shall be used to form
the small five-pointed stars. The four small five-pointed stars shall
respectively have an angle pointing right at the centre of the big
five-pointed star.

(3) The measurement in common use for the National Flag, from which people
from various circles may choose at their discretion shall be as follows:

a. 288 cm. in length, 192 cm. in height;

b. 240 cm. in length, 160 cm. in height;

c. l92 cm. in length, 128 cm. in height;

d. 144 cm. in length, 96 cm. in height;

e. 96 cm. in length, 64 cm. in height.

DECISION OF THE NATIONAL PEOPLE’S CONGRESS REGARDING THE REVISION OF THE CHINESE-FOREIGN EQUITY JOINT VENTURES

Category	FOREIGN ECONOMIC RELATIONS AND TECHNOLOGICAL COOPERATION	Organ of Promulgation	The National People’s Congress	Status of Effect	In Force
Date of Promulgation	1990-04-04	Effective Date	1990-04-04

Decision of the National People’s Congress Regarding the Revision of the Law of the People’s Republic of China on Chinese-foreign Equity Joint Ventures

(Adopted at the Third Session of the Seventh National People’s Congress on

April 4, 1990, promulgated by Order No. 27 of the President of the People’s
Republic of China and effective as of the date of promulgation)

The Third Session of the Seventh National People’s Congress, having
considered the proposal of the State Council regarding the Amendment to the Law
of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures
(Draft), decides to make the following revisions to the Law of the People’s
Republic of China on Chinese-Foreign Equity Joint Ventures:

1. A new paragraph shall be added to Article 2 as paragraph 3: “The state
shall not nationalize or requisition any equity joint venture. Under special
circumstances, when public interest requires, equity joint ventures may be
requisitioned by following legal procedures and appropriate compensation shall
be made.”

2. Article 3 shall be amended as: “The equity joint venture agreement,
contract and articles of association signed by the parties to the venture shall
be submitted to the state’s competent department in charge of foreign economic
relations and trade (hereinafter referred to as the examination and approval
authorities) for examination and approval. The examination and approval
authorities shall decide to approve or disapprove the venture within three
months. When approved, the equity joint venture shall register with the state’s
competent department in charge of industry and commerce administration,
acquire a business license and start operations”.

3. Paragraph 1 of Article 6 shall be amended as: “An equity joint venture
shall have a board of directors; the number of the directors thereof from each
party and the composition of the board shall be stipulated in the contract and
articles of association after consultation among the parties to the venture;
such directors shall be appointed and replaced by the relevant parties. The
chairman and the vice-chairman (vice-chairmen) shall be determined through
consultation by the parties to the venture or elected by the board of
directors. If the Chinese side or the foreign side assumes the office of the
chairman, the other side shall assume the office(s) of the vice-chairman
(vice-chairmen). The board of directors shall decide on important issues
concerning the joint venture on the principle of equlity and mutual benefit.”

4.Paragraph 2 of Article 7 shall be amended as: “An equity joint venture
may, in accordance with provisions of the relevant laws and administrative
rules and regulations of the state on taxation, enjoy preferential treatment
for reduction of or exemption from taxes.”

5. Paragraph 1 of Article 8 shall be amended as: “An equity joint venture
shall, on the strength of its business license, open a foreign exchange account
with a bank or any other financial institution which is permitted by the state
agency for foreign exchange control to handle foreign exchange transactions.”

Paragraph 1 of Article 10 shall be amended as: “The net profit which a
foreign joint venturer receives as its share after performing its obligations
under the laws, and the agreements or the contract, the funds it receives upon
the expiration of the venture’s term of operation or its early termination, and
its other funds may be remitted abroad in accordance with foreign exchange
control regulations and in the currency or currencies specified in the contract
concerning the equity joint venture.”

Article 11 shall be amended as: “The wages, salaries or other legitimate
income earned by a foreign worker or staff member of an equity joint venture,
after payment of the individual income tax under the tax laws of the People’s
Republic of China, may be remitted abroad in accordance with foreign exchange
control regulations.”

6. Article 12 shall be amended as: “Based on different lines of trade and
different circumstances, arrangements for the duration of equity joint ventures
may be made differently through agreement by the parties to the venture.
Equity joint ventures engaged in certain lines of trade shall specify their
duration in the contracts, while equity joint ventures engaged in certain other
lines of trade may choose to or not to specify their duration in the contract.
Where an equity joint venture has had its duration specified and the parties
to the venture agree to extend the duration, the venture shall file an
application for the purpose with the examination and approval authorities six
months before its expiration. The examination and approval authorities shall,
within one month after receipt of the application, decide on its approval or
disapproval.”

7. Article 13 shall be amended as: “In case of heavy losses, failure of a
party to perform its obligations under the contract and the articles of
association, or force majeure etc., the parties to the joint venture may
terminate the contract through their consultation and agreement, subject to
approval by the examination and approval authorities and to registration with
the state’s competent department in charge of industry and commerce
administration. In case of losses caused by a breach of contract, the financial
responsibility shall be borne by the party that has breached the contract.”

This Decision shall enter into force as of the date of promulgation.

The Law of the People’s Republic of China on Chinese-Foreign Equity Joint
Ventures shall be republished after being correspondingly amended according to
this Decision.?

1996

REGULATIONS ON ADMINISTRATIVE RECONSIDERATION

INTERIM PROCEDURES FOR THE ADMINISTRATION OF FOREIGN INVESTMENT IN THE DEVELOPMENT AND MANAGEMENT OF WHOLE AREAS OF LAND

DECISION CONCERNING THE AMENDMENT TO THE LAW ON SINO-FOREIGN EQUITY JOINT VENTURES

RAILWAY LAW OF THE PEOPLE’S REPUBLIC OF CHINA

CUSTOMS REGULATIONS FOR THE SUPERVISION OF INBOUND AND OUTBOUND TRAINS AND THE GOODS AND COMMODITIES THEREON

CIRCULAR OF THE MINISTRY OF FOREIGN ECONOMIC RELATIONS AND TRADE AND THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE ON ISSUING THE PROVISIONS FOR CONTRACTED OPERATION OF CHINESE-FOREIGN EQUITY JOINT VENTURES

PROVISIONS ON THE ADMINISTRATION OF MARITIME INTERNATIONAL CONTAINER TRANSPORT

NATIONAL FLAG LAW

DECISION OF THE NATIONAL PEOPLE’S CONGRESS REGARDING THE REVISION OF THE CHINESE-FOREIGN EQUITY JOINT VENTURES

PROVISIONS CONCERNING REDUCTION OF AND EXEMPTION FROM ENTERPRISE INCOME TAX AND CONSOLIDATED INDUSTRIAL AND COMMERCIAL TAX FOR THE ENCOURAGEMENT OF FOREIGN BUSINESSMEN TO INVEST IN THE SHANGHAI PUDONG NEW ZONE

DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON THE PUNISHMENT OF CRIMINALS WHO SMUGGLE, PRODUCE, SELL OR DISSEMINATE PORNOGRAPHIC ARTICLES

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

Category	TAXATION	Organ of Promulgation	The State Council	Status of Effect	In Force
Date of Promulgation	1990-09-11	Effective Date	1990-10-01

Category	CRIMINAL LAW	Organ of Promulgation	The Standing Committee of the National People’s Congress	Status of Effect	In Force
Date of Promulgation	1990-12-28	Effective Date	1990-12-28