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1999

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON QUESTIONS CONCERNING APPLICABLE REGULAR TAX REDUCTION AND EXEMPTION ON INCOME FROM LIQUIDATION BY ENTERPRISE WITH FOREIGN INVESTMENT

The State Administration of Taxation

Circular of the State Administration of Taxation on Questions Concerning Applicable Regular Tax Reduction and Exemption on Income
from Liquidation by Enterprise with Foreign Investment

GuoShuiFa [1993] No.8

June 15, 1993

With regard to the question as to whether or not enterprise with foreign investment which conduct liquidation within the regular tax
reduction and exemption period as stipulated in Article 8 of the Income Tax Law of the People’s Republic of China for Enterprise
with Foreign Investment and Foreign Enterprises (hereinafter referred to as Tax Law) can enjoy enterprise income tax reduction and
exemption, it is hereby clarified as follows:

The stipulation set in Article 8 of the Tax Law which states “Productive enterprise with foreign investment scheduled to operate
for a period over 10 years shall be exempted from enterprise income tax in the first two profit-making years and be granted a 50
percent enterprise income tax reduction in the third to the fifth year” applies only to the income gained during the enterprise’s
operational period. Therefore, income gained from liquidation which is conducted during the above- mentioned tax reduction and exemption
period shall not be granted enterprise income tax reduction and exemption in accordance with Article 8 of the Tax Law.

This Circular shall enter into force as of the day of receipt of the document.



 
The State Administration of Taxation
1993-06-15

 






CIRCULAR OF THE STATE COUNCIL CONCERNING ENFORCING TAX ADMINISTRATION AND STRICTLY CURBING TAX EXEMPTION AND REDUCTION

Category  TAXATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1993-07-23 Effective Date  1993-07-23  


Circular of the State Council Concerning Enforcing Tax Administration and Strictly Curbing Tax Exemption and Reduction



(July 23, 1993)

    This year, based on the foundation of rapid development in national
economy, there is also an increase in tax revenue, but, its increasing
range does not correspond to that of production, one of the important
reasons of which is that, some localities and units violate state tax law,
overstep their competence, provide tax reduction and exemption without
authorization and enlarge the scope of tax exemption and reduction, formulate
policies for tax incentives without authorization, prolong time limit for tax
exemption and reduction, contract turnover tax, even evade state taxation with
illegal means and consequently cause serious loss of taxation. For purpose of
enforcing state tax law, to guarantee the timely and full turning of national
tax which should be submitted into State Treasury, to fulfill the tax task of
this year better and increase financial revenue, to curb the national
financial deficit within the budgeted amount, and promote the development
of national economy in a quicker and better way, some issues relating to
enforcing tax administration and strict curbing of tax exemption and
reduction are hereby notified as follows:

    1. Strictly curbing tax (including tariff) exemption and reduction this
year, the State shall issue no more new policies for tax exemption and
reduction, all provisional and difficulty-caused tax exemption and reduction
shall be stopped for examination and approval. The tax exemption and reduction
regulated by national policy shall be examined and approved strictly according
to tax administrative system, those among which, on expiration of their tax
exemption and reduction period according to related policy, shall resume to
their tax liability immediately. The withholding agency system shall be
strictly applied for Individual Income Regulation Tax, those who do not
perform their withholding liability, shall pay the tax due, otherwise, they
shall be handled according to the provisions in the Law of the People’s
Republic of China on the Administration of Tax Collection. Administration of
the regulation tax on investment orientation for fixed assets shall be
enforced and there shall be no exemption and reduction.

    2. Earnestly clear up tax incentive policies made in illegal and
unauthorized way. All kinds of tax incentive policies (including foreign
related tax policies) made be respective regions and departments which
overstepped their own authority and at their own discretion in violation of
the provisions of the Law on the Administration of Tax Collection and policies
of the State shall be invalidated uniformly. All kinds of economic
development zones with no approval from the State Council shall not benefit
uniformly from respective tax incentive policies provided by the State for
the economic development zones at national level.

    3. Take decisive measures, resolutely correct wrong practice of
contracting turnover tax. Turnover tax being the main tax of the State and
the main source of state revenue, must be collected according to law and
brought into line with budgetary system. No matter what kind of finance
system is followed by respective regions and departments, it is not
permissible to contract turnover tax for enterprises at one’s own discretion.
All whose who have contracted turnover tax by themselves must correct it
immediately.

    4. Clear up delinquent tax in earnest. The system to collect additional
pecuniary penalty for delinquent payment must be strictly applied; For those
in arrears with tax payment, tax departments or customs office shall inform
banks to withhold the tax due and turn it into State Treasury. Banks should
ensure the timely and full submission of tax to the Treasury, it is not
allowed to seize or hold tax, otherwise, leading personnel of the work units
of the seizers and holders shall be investigated for their responsibility.

    5. Enforce administration concerning tax refund for exportation. Strictly
implement `the 2-invoices-and-2-forms` (i.e. specified tax invoice, invoice
of input goods and declaration form for exportation, verification form for
payment receipt) system, no refund is allowed for cases inconsistent with
the provisions. Those who try to obtain refund by fraud shall be severely
dealt with according to law.

    6. Actually enforce administration of tax collection for individual
industrial and commercial households, private-owned enterprises,
collective-owned enterprises and enterprises with foreign investment. To
individual industrial and commercial households, a general adjustment on their
fixed tax amount shall be carried out timely in combination with the
adjustment on business tax rate. Strict administration of tax collection for
large private-owned enterprises shall be enforced vigorously, the book-keeping
and financial system should be set up and the tax should be levied according
to verification. To enterprises with foreign investment, effective measures
should be taken to strengthen the work against tax avoidance and to block
the loopholes of fiscal omission and evasion through transfer of profits by
enterprises with foreign investment, to ensure that the tax due is
collected fully.

    7. Regarding respective kinds of banks, financial, insurance enterprises,
and nonbank financial institutions set up by respective regions and
departments, their income tax liability must be fulfilled in accordance with
the regulations of the State. Henceforth, income tax on respective newly
established banks, financial, insurance enterprises by respective regions and
departments shall be paid uniformly to the central finance.

    8. Strictly enforce administration of tax collection of the `2 funds`
(i.e. the key construction fund for energy and communication and the
budgetary adjustment fund). Respective local governments at all levels and
departments concerned are not allowed to provide tax exemption or reduction
on the `2 funds` without authorization. Those who have overstepped their
authority by granting reduction or exemption must immediately make correction.
For the ones who have omitted or are owing the `2 funds`, a plan of making
the payment due should be worked out and the funds in arrears shall be paid
within a limited time period. For the respective localities who have failed to
perform the task of turning the `2 funds` to the center due to tax exemption
and reduction without authorization, the sharing part of the localities from
the `2 funds` shall be reduced and deducted accordingly by the central finance.

    People’s Governments at all levels should further enforce the leadership
in respect of taxation, vigorously support legal tax collection by tax
organizations. Departments of industrial and commercial administration, public
security, supervision, auditing and judicature should energetically support
and coordinate with tax organizations in the performance of their
responsibilities according to law. Tax organizations at all levels should
strictly enforce the law on tax collection, abide by the principles and
collect tax in accordance with law. Taxable units and individuals should
increase the conscientiousness of having overall point of view and a sense
of legal system, and pay tax spontaneously according to law. With a view to
safeguarding the sanctities of the laws on finance and taxation and to
enhancing macrocontrol and supervision, the State Council has decided that,
starting from August a general nation-wide check on taxation and finance shall
be carried out, with the emphasis that whether respective taxes and the
`2 funds` have been turned to the State Treasury according to national
policies. In the general check respective omitted revenue should be recovered
and turned over to the State Treasury, additionally the units and those
directly responsible who repeatedly break the rules in frequent checks, and
violate laws with full knowledge of them shall be penalized with more
severity in accordance with law.





SETTLEMENT OF LABOUR DISPUTES IN ENTERPRISES REGULATIONS

Regulations of PRC on Settlement of Labour Disputes in Enterprises

     (Effective Date:1993.08.01–Ineffective Date:)

CHAPTER I GENERAL RULES CHAPTER II MEDIATION IN ENTERPRISES CHAPTER III ARBITRATION CHAPTER IV RULES OF PUNISHMENT CHAPTER V SUPPLEMENTARY
PROVISIONS

   Article 1 The present Regulations are drawn up to properly handle labour disputes in enterprises, protect the legitimate rights and interests
of the enterprise and the workers and employees, maintain the order of normal production and management, develop sound labour relations,
and promote the smooth progress of the reform and the implementation of the open policy.

   Article 2 The Regulations are applicable to the following labour disputes between the enterprise and the workers and employees within the territory
of the People’s Republic of China:

(1) Disputes arising out of dismissal, discharge or lay-off of workers and employees by enterprises, or resignation by workers and
employees or leaving their jobs of their own volition;

(2) Disputes concerning implementation of relevant State policies on wages, insurance, welfare, training and labour protection;

(3) Disputes regarding execution of the labour contract;

(4) Disputes that other laws and regulations stipulate should be handled with reference to the regulations.

   Article 3 The enterprise and the worker(s) and employee(s) involved shall be the parties to a case of labour dispute.

   Article 4 Settlement of labour disputes shall observe the following principles:

(1) Emphasis is given to mediation and prompt handling;

(2) Labour disputes shall be dealt with in accordance with law on a fact-finding basis;

(3) The parties involved are equal before applicable laws.

   Article 5 When there are more than three workers and employees with the same grievances as one of the parties, the workers and employees involved
shall nominate their representative to participate in the work of mediation and arbitration.

   Article 6 In case of a labour dispute, the parties shall first find solution through negotiations. If the parties are unwilling to go for negotiations
or negotiations fail, the case may be referred to the mediation committee of the enterprise in which the dispute has occurred; if
mediation fails, the case may be referred to the labour dispute arbitration committee for arbitration. The parties may also petition
directly to the labour dispute arbitration committee for arbitration. When one of the parties or both parties refuse to accept the
arbitration award, he or they may bring a lawsuit before the people’s court.

In the course of handling a labour dispute, neither party shall aggravate the dispute.

CHAPTER II MEDIATION IN ENTERPRISES

   Article 7 An enterprise may set up a labour dispute mediation committee (hereinafter referred to as mediation committee) to be responsible
for mediation of labour disputes within the enterprise.

The mediation committee shall be composed of the following persons:

(1) Representative(s) of workers and employees;

(2) Representative(s) of the enterprise;

(3) Representative(s) of the enterprise trade union.

The workers’ representatives shall be nominated by the congress of workers’ representatives or the workers’ congress, the enterprise
representatives appointed by the enterprise director or manager, and the enterprise trade union representatives appointed by the
enterprise trade union committee.

The number of members to the mediation committee shall be determined through negotiations between workers’ congress and the enterprise
director or manager, at the proposal of the former. The number of enterprise representatives shall not exceed one third of the total.

   Article 8 The post of chairman of the mediation committee shall be taken up by a representative of the enterprise trade union.

The mediation committee shall set up its office at the enterprise trade union committee.

   Article 9 In an enterprise without any trade union organization, the establishment and composition of the mediation committee shall be determined
through negotiations between the workers’ representatives and the enterprise representatives.

   Article 10 Disputes taken up by the mediation committee shall wind up within 30 days starting from the date of application by the parties; otherwise,
mediation shall be considered unsuccessful.

   Article 11 The mediation committee shall observe the policy of voluntariness for both parties during mediation. Agreements reached through mediation
shall be written in a mediation note for voluntary execution by the two parties; if mediation fails, the case may be referred to
the labour dispute arbitration committee within a set time limit.

   Article 12 Counties, cities and city districts shall set up labour dispute arbitration committees (hereinafter referred to as arbitration committees).

   Article 13 The arbitration committee shall be composed of the following persons:

(1) Representatives of the department in charge of labour administration;

(2) Representatives of the trade union council;

(3) Representatives of the department of overall economic administration appointed by the government.

The members to the arbitration committee must be in odd numbers, and the post of chairman is to be taken up by an official in charge
of the department of labour administration.

The labour dispute settlement section of the department of labour administration shall ensure the secretarial work of the arbitration
committee, and be responsible for dealing with its day-to-day routine.

   Article 14 The system of arbitrators and arbitration tribunals shall be adopted by the arbitration committee in the settlement of labour disputes.

   Article 15 The arbitration committee may engage personnel from the department in charge of labour administration or from other relevant government
departments, trade union officials, experts and scholars, and lawyers as full-time or part-time arbitrators.

Part-time and full-time arbitrators shall enjoy equal rights in discharging their duties of arbitration.

In executing their duties of arbitration, part-time arbitrators shall receive the support of their own work units.

   Article 16 In handling a labour dispute, the arbitration committee shall form an arbitration tribunal which shall be composed of three arbitrators.

A simple labour dispute may be handled by a single arbitrator appointed by the arbitration committee.

The arbitration tribunal may submit major or complicated labour dispute cases to the arbitration committee for deliberation and decision.
The arbitration tribunal must implement the decisions of the arbitration committee.

   Article 17 The arbitration committees set up in counties, cities and city districts shall be in charge of handling labour disputes in their
respective administrative areas.

The scope of jurisdiction of the arbitration committees in cities with districts and in such districts in handling labour disputes
shall be decided by the people’s governments of the provinces and autonomous regions.

   Article 18 When the enterprise and the worker(s) involved in a dispute are not located in areas under the jurisdiction of the same arbitration
committee, the dispute shall be handled by the arbitration committee located at the place where the worker(s) in question has wage
relations.

   Article 19 Any party may mandate one to two lawyers or other agents to act for him in arbitration. The party that mandates others to act for
him in arbitration shall submit to the arbitration committee a Power of Attorney bearing his signature or seal. The Power of Attorney
shall specify clearly the terms and powers of the mandate.

   Article 20 A worker with limited capacity to take part in civil cases or without such capacity, or a deceased worker, may be represented in
arbitration proceedings by his legal representative. The arbitration committee may appoint an agent for a worker without a legal
representative.

   Article 21 The two parties in dispute may reach a compromise on their own.

   Article 22 A third party whose personal interest will be affected by the outcome of a labour dispute may file a petition to participate in the
proceedings or may participate when so notified by the arbitration committee.

   Article 23 A party to a labour dispute should petition for arbitration to the arbitration committee in writing within 6 months from the date
when he knows or should know that his rights have been infringed upon.

The arbitration committee shall accept a petition when a party fails to observe the time limit stipulated in the aforesaid clause
due to force majeure or other justifiable reasons.

   Article 24 When a party petitions for arbitration to the arbitration committee, the petition shall be submitted to the arbitration committee,
and copies of the petition shall also be submitted in accordance with the number of respondents.

The petition shall specify the following:

(1) the name, occupation, address and work unit of a worker who is a party to the case, or, if the party is an enterprise, its name,
address and legal representative’s name and position;

(2) the claim of arbitration and the facts and grounds on which it is based; and

(3) any evidence as well as the names and addresses of witnesses.

   Article 25 Within seven days from the date of receipt of a petition, the arbitration committee shall decide whether to accept it or not. If
the decision is in the affirmative, the arbitration committee shall send a copy of the petition to the respondent and form an arbitration
tribunal. If it is in the negative, the committee shall make the reasons clear.

The respondent shall within 15 days after receipt of the copy of the petition file a bill of defence with related evidence. Delay
or failure by the respondent to file a bill of defence shall not prevent the case from being heard by the committee.

The arbitration committee shall have the authority to request the parties to provide or supplement their evidence.

   Article 26 The arbitration tribunal shall notify the parties in dispute four days in advance and in writing the start of its time and place
of hearing. If a party has received the notice in writing but refuses to appear at the hearing without justifiable reasons or walks
out in the course of deliberations without permission of the arbitration tribunal, and if he is the claimant, the arbitration tribunal
may decide that the case is withdrawn; and if it is the respondent, the arbitration tribunal may make an award by default.

   Article 27 In handling disputes, the tribunal shall firstly mediate and try to bring the two parties involved together to reach an agreement
on their own on a fact-finding basis. The contents of the agreement shall not contradict existing laws and regulations.

   Article 28 In case an agreement is reached through mediation, the arbitration tribunal shall produce a mediation note in accordance with the
contents of the agreement. The note is legally binding as from the date of receipt by the parties.

If no agreement is reached through mediation or if one party retracts before the note is delivered, the arbitration tribunal shall
proceed promptly with a ruling.

   Article 29 The arbitration tribunal shall hand out its rulings under the principle of the minority of its members submitting to the majority.
Differing views shall be placed on record.

After the tribunal has made a ruling, an arbitration award shall be produced and sent to the parties in dispute.

   Article 30 If a party refuses to accept the arbitration award, he may bring a lawsuit before the people’s court within 15 days from receiving
the arbitration award. Otherwise, the arbitration award shall come into force legally.

   Article 31 The legally effective mediation note and arbitration award shall be implemented within the set time limit by both parties. In case
one party fails to implement the note or the award upon expiration of the time limit, the other party may petition with the people’s
court for enforcement of the note or the award.

   Article 32 All disputes handled by an arbitration tribunal shall be concluded within 60 days from the date of its setting up. If a case is complicated
requiring an extension of its mandate, it shall be submitted to the arbitration committee for approval, and the extension shall not
exceed 30 days.

   Article 33 In the course of handling a labour dispute, the arbitration committee has the authority to consult files, documents and other evidences
pertaining to the case from the units concerned, and also to investigate insiders. Such units and persons shall not refuse.

The arbitration committees may entrust each other with the work of investigation.

If in investigating labour disputes certain information involves secrets or private affairs, the arbitration committee and its personnel
shall keep them confidential.

   Article 34 When a party involved in a labour dispute applies for arbitration, he shall pay arbitration fees according to the relevant rules
set by the State.

Arbitration fees include an acceptance fee and a fee for dealing with the case. The rates and procedures for charging arbitration
fees shall be determined by the department in charge of labour administration under the State Council jointly with the departments
in charge of finance administration and commodity prices administration under the State Council.

   Article 35 Any member of the arbitration committee and any arbitrator shall himself request withdrawal from his office, and the parties to the
dispute also have the right to request, orally or in writing, that he be withdrawn from his office, in any one of the following circumstances:

(1) if he is one of the parties, or a close relative of a party to the dispute;

(2) if he has a personal interest in the labour dispute; or

(3) if he has some other relations with a party to the labour dispute that might affect the impartial handling of the case.

   Article 36 The arbitration committee shall make a prompt decision on a request of withdrawal, and notify the parties orally or in writing.

   Article 37 If in the course of handling a labour dispute a party or any related person commits any of the following acts, the arbitration committee
may criticize and admonish him, or order him to correct his mistakes; if the case is serious, he shall be punished according to relevant
provisions of the Regulations of the People’s Republic of China on Administrative Penalties for Public Security; in case of a crime,
he shall be dealt with for his criminal liabilities according to law:

(1) if he interferes with mediation and arbitration, and hinders the arbitration personnel from performing their duties;

(2) if he provides false information;

(3) if he refuses to provide relevant documents, materials and other evidences; or

(4) if he retaliates against the arbitration personnel, assistants, witnesses or assistant executive personnel.

   Article 38 If any of the arbitration personnel in the course of handling a labour dispute bends the law for his own benefit, takes bribes, abuses
his powers, or reveals secrets and private affairs of individuals, he shall be dealt disciplinary sanction by his work unit or its
superior organ; if he is an arbitrator, he shall be discharged by the arbitration committee; in case of a crime, he shall be dealt
with for his criminal liabilities according to the law.

CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 39 Labour disputes between state organs, institutions and social organizations and their workers, or disputes between individual businesses
and their assistants or apprentices shall be handled with reference to the present Regulations.

   Article 40 The Rules of Organization and the Procedure Rules of the arbitration committee shall be formulated by the department in charge of
labour administration under the State Council jointly with relevant departments.

   Article 41 The people’s governments of the provinces, autonomous regions and municipalities may formulate their own measures of application
in accordance with the present Regulations.

   Article 42 The department in charge of labour administration under the State Council shall be responsible for the interpretation of the Regulations.

   Article 43 The present Regulations shall come into force from August 1, 1993. The Provisional Regulations on Settlement of Labour Disputes in
State-Owned Enterprises promulgated by the State Council on July 31,

    





NOTICE OF THE STATE COUNCIL ON THE APPROVAL AND TRANSMISSION OF THE VIEWS ON FURTHER ENHANCING TELECOM SERVICE MARKET MANAGEMENT BY THE MINISTRY OF POSTS AND TELECOMMUNICATIONS

Category  POSTS AND TELECOMMUNICATIONS Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1993-08-03 Effective Date  1993-08-03  


Notice of the State Council on the Approval and Transmission of the Views on Further Enhancing Telecom Service Market Management
by the Ministry of Posts and Telecommunications


VIEWS ON FURTHER ENHANCING TELECOM SERVICE MARKET MANAGEMENT

(August 3, 1993)

    The State Council has endorsed the “Views on Further Enhancing Telecom
Service Market Management” by the Ministry of Posts and Telecommunications, which is hereby
transmitted to you for conscientious implementation.
VIEWS ON FURTHER ENHANCING TELECOM SERVICE MARKET MANAGEMENT

    To adapt to the needs of reform, openness and socialist modernization
drive, facilitate and serve the central task of economic construction, the
Ministry of Posts and Telecommunications (MPT) must work hard to build a
unified, complete and advanced national communications network, while fully
tapping the potential of all the dedicated networks and bringing into play the
initiative of all sectors, in an effort to expedite the development of
communications.

    China has in recent years opened to public some of the telecom services
which include radio paging, 800 MHz trunking telephone service, 450 MHz radio
mobile communications, domestic VSAT communications, telephone information
service, computer information service, E-mail, electronic data interchange,
videotex and other telecom services approved by the State Council or the MPT.

    It is necessary to enhance the management over the market of the telecom
services opened to competitive operation, in order to safeguard the normal
order of communications, ensure the communications security and service
quality of the state and users and create an environment of fair competition.
For this purpose, the following views are proposed:

    1.Application and operation license systems shall be introduced for the
deregulated telecom services. All the applications for services operated
within provinces, autonomous regions and municipalities directly under the
Central Government shall be handled and approved by the local P&T
administrations which will verify and issue operation licenses and enter them
into the records of the MPT. The MPT is responsible for the application
handling and approval as well as license issuance for the inter-provincial
operations, inter-autonomous regional, inter-municipality operations directly
under the Central Government. No institutions and individuals are permitted to
operate the above services on their own without verification and
authorization. The MPT will formulate and promulgate detailed regulations
governing the enforcement of the application and operation license systems in
accordance with the above views. The institutions already engaged in the
operations of the above-mentioned services shall retroactively go through
relevant formalities as stipulated.

    2.The institutions applying for the operation of radio communications
services shall apply to the MPT or the local P&T administrations within the
terms of reference whichever is appropriate as stipulated, for the operation
licenses with which they will obtain the frequencies from the radio
administrations before the start of operation.

    3.Not permitted to establish regional blockade, the departments and
institutions with permission to operate above services shall abide by the
state policies and regulations on communications and be subject to the sector
management, supervision and examination exercised by the state communications
administration to ensure service quality. They should strictly follow the
state tariff policies and relevant standard on charges, pay taxes according to
law and safeguard the legitimate rights and interests of the users. Their
operations shall not impede the normal operations of the state public telecom
networks and communications construction, nor shall they hamper the normal
operations of other dedicated communications networks.

    4.The state communications administration shall create an environment of
fair competition between the P&T enterprises and other enterprises also
engaged in communications services. Following the principle of use on a paid
and mutually beneficial and reciprocal basis, the P&T enterprises at all
levels should cooperate with each other in the light of supply and demand,
providing the institutions with telecom service operation licenses approved
and issued by the state communications administration with the basic trunking
equipment, lines, etc. necessary for service provision, in a bid to ensure
that they supply good telecom services to society at large.

    5.Foreign enterprises are not allowed to operate or participate in the
operation of communications services within China. No organizations,
enterprises and individuals outside China nor the enterprises operating solely
with foreign investment, Sino-foreign joint ventures and cooperative
enterprises inside China are permitted to operate and participate in the
operation of wired and wireless communications services on the public and
dedicated communications networks within China. Neither shall foreign capital
be introduced in any way into the operation on a shareholding basis.

    6.Supervision and inspection shall be conducted by the MPT and the P&T
administrations of all provinces, autonomous regions and municipalities
directly under the Central Government. The P&T enterprises and other telecom
service operators which violate the above regulations shall be given such
punishment as a warning, a notice of criticism, a deadline to correct the
wrong doing, an order to suspend operation, confiscation of the income from
illegal operations, an administrative fine and finally revocation of operation
licenses. The P&T administrations at all levels are by no means allowed to
take advantage of the right of license issuance for private gains and
back-door dealings which will result in stern punishment once discovered.





PROVISIONS FOR THE ADMINISTRATION OF CIVIL AIR TRANSPORT SALES AGENCIES

Category  CIVIL AVIATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1993-08-03 Effective Date  1993-08-03  


Provisions for the Administration of Civil Air Transport Sales Agencies

Chapter I  General Provisions
Chapter II  Conditions for Establishment
Chapter III  Examination, approval and Registration Procedures
Chapter IV  Control of Operation
Chapter V  Penalty
Chapter VI  Supplementary Provisions

(Approved by the State Council on July 5, 1993 and promulgated in

Directive No.37 by the General Administration of Civil Aviation of China on
August 3, 1993)
Chapter I  General Provisions

    Article 1  These Provisions are formulated in order to maintain the market
order of civil air transport and safeguard the lawful rights and interests of
the public, civil air transport enterprises and civil air transport sales
agencies.

    Article 2  These Provisions are applicable to civil air transport sales
agencies engaged in the sale of passenger and cargo transport on behalf of
civil air transport enterprises in the territory of the People’s Republic of
China.

    Article 3  In these Provisions,

    (1) Civil air transport sales agency (hereinafter referred to as ‘air
transport sales agency’) refers to a profit-making undertaking appointed by a
civil air transport enterprise to be engaged in the sale of air passenger and
cargo transport and related business operations for and on behalf of the
principal within the agreed scope of authority;

    (2) Civil air transport enterprise refers to an enterprise engaged in the
carriage of passengers, baggages, cargo and mail with civil aircraft;

    (3) Civil air transport sales agent (hereinafter referred to as ‘sales
agent’) refers to an enterprise engaged in air transport sales agency;

    (4) Competent administrative organ of civil air transport of the People’s
Republic of China (hereinafter referred to as ‘civil aviation competent
administrative organ’) refers to the General Administration of Civil Aviation
of China;

    (5) Regional administrative organ of civil air transport of the People’s
Republic of China (hereinafter referred to as ‘civil aviation regional
administrative organ’) refers to the regional administration of civil aviation
of China.

    Article 4  Air transport sales agencies are divided into the following two
categories in accordance with the scope of agency service:

    (1) Category-I air transport sales agency, engaged in the sales agency
service of civil air transport on international routes or regional routes
leading to Hongkong, Macao and Taiwan;

    (2) Category-II air transport sales agency, engaged in the sales agency
service of civil air transport on domestic routes excluding regional routes
leading to Hongkong, Macao and Taiwan.

    Article 5  Air transport sales agencies are administered in accordance
with the following principles:

    (1) Meeting social demand, making things convenient for the public and
distributing the network of sales agencies rationally;

    (2) Protecting just competition and promoting service quality.

    Article 6  Sales agents must observe the laws and regulations of China and
subject themselves to the supervision and administration of civil aviation
competent administrative organ or civil aviation regional administrative
organ, as appropriate.
Chapter II  Conditions for Establishment

    Article 7  A sales agent shall obtain the corporate capacity of an
enterprise of the People’s Republic of China according to law.

    Article 8  The amount of registered capital of a sales agent shall conform
to the following requirements:

    (1) The registered capital of a category-I air transport sales agent shall
not be less than RMB 1,500,000 yuan;

    (2) The registered capital of a category-II air transport sales agent
shall not be less than RMB 500,000 yuan.

    The registered capital of a sales agent shall be increased by RMB 500,000
yuan for the addition of every branch office or business point.

    For a sales agent concurrently engaged in the sale of air transport, its
capital used specifically for such sale shall meet the above requirements.

    Article 9  A sales agent shall have available the following conditions for
business operation:

    (1) fixed independent business location;

    (2) telecommunications facilities and other necessary business facilities;

    (3) civil air transport regulations and material corresponding to its
sales agency service;

    (4) at least three people possessing appropriate qualification
certificates of air transport sales personnel.

    Article 10  A foreign legal person or a foreigner, who has set up a
Chinese-foreign joint venture or a Chinese-foreign cooperative enterprise in
accordance with the relevant laws of the People’s Republic of China and is
qualified for the conditions stipulated in these Provisions, may be engaged in
category-I air transport sales agency in the territory of the People’s
Republic of China after being approved by the civil aviation competent
administrative organ; and may be engaged in the cargo sales of category-II air
transport sales agency in the territory of the People’s Republic of China
after being approved by the civil aviation regional administrative organ.
Chapter III  Examination, approval and Registration Procedures

    Article 11  An air transport sales agency shall be applied for in
accordance with the following procedures:

    (1) For category-I air transport sales agency, a written application shall
be submitted to the civil aviation competent administrative organ;

    (2) For category-II air transport sales agency, a written application
shall be submitted to the civil aviation regional administrative organ of the
place where the business location of the applicant is situated.

    Article 12  In applying for air transport sales agency, the following
documents and materials shall be submitted:

    (1) application in writing;

    (2) articles of association of the enterprise;

    (3) name, post and resume of the principal person in charge and the
namelist of sales personnel;

    (4) business facilities and telecommunications equipment available;

    (5) capital credit certificate;

    (6) proof of financial guarantee;

    (7) photocopy of the appropriate qualification certificates of air
transport sales personnel;

    (8) intention letter of agency appointment issued by a civil air transport
enterprise;

    (9) other documents and material for submission as required.

    An applicant applying for category-I air transport sales agency to be
engaged in cargo sales shall also submit a photocopy of ‘Confirmation of
International Cargo Transport Agency of the People’s Republic of China’.

    Article 13  The civil aviation competent administrative organ or civil
aviation regional administrative organ shall make a decision of approval or
disapproval in accordance with these Provisions within 30 days beginning from
the day of accepting the application.

    The civil aviation competent administrative organ or civil aviation
regional administrative organ shall verify and issue appropriate certificate
of approval for the operation of air transport sales agency to applicants
conforming to the conditions for engaging in such agency.

    The period of validity of the certificate of approval for the operation of
air transport sales agency is three years.

    Article 14  The sales agent shall apply for registration with the
administration of industry and commerce at the place of its business location
against the certificate of approval for the operation of air transport sales
agency issued by the civil aviation competent administrative organ or civil
aviation regional administrative organ.

    Article 15  A sales agent operating an air transport sales agency may
apply for setting up branch offices or business points in case its annual sales
volume was more than double the minimum level prescribed in Article 28 of
these Provisions for two consecutive years, and it was not subject to the
penalty of fine or suspension of business for rectification during these two
years.

    Article 16  A sales agent to set up branch offices or business points to
operate air transport sales agency shall apply for separate certificates of
approval for the operation of air transport sales agency for its branch
offices or business points in accordance with these Provisions.

    A sales agent shall be responsible for the business behavior of its branch
offices or business points.

    Article 17  The civil aviation competent administrative organ may decide
to suspend the acceptance of applications for air transport sales agency
within prescribed period in the light of the macro supply and demand of civil
air transport market.

    The decision made by the civil aviation competent administrative organ in
accordance with the preceding paragraph shall be announced.
Chapter IV  Control of Operation

    Article 18  In the appointment and operation of agency the civil air
transport enterprise and sales agent shall comply with the regulations of the
civil aviation competent administrative organ, prevent error in business and
man-made accident in transport, and safeguard public interest.

    Article 19  A sales agent shall perform civil air transport sales agency
within the scope of approved agency category.

    Article 20  A sales agent may sign air transport sales agency agreement
with any civil air transport enterprise having the right of operation in the
territory of the People’s Republic of China within the scope of approved
agency category so as to perform civil air transport sales agency.

    In the appointment and operation of agency the civil air transport
enterprise or sales agent must not practise any unjust act of competition.

    Article 21  The sales agent and civil air transport enterprise shall
determine through consultation the standard of air transport sales agent
commission in accordance with the principle of equality and mutual benefit,
except the legal standard prescribed by the civil aviation competent
administrative organ and competent price department.

    The sales agent shall publish the standard of business charges at its
business location and submit such charges to the civil aviation competent
administrative organ or civil aviation regional administrative organ which
issued the certificate of approval for the operation of air transport sales
agency for file.

    Article 22  The sales agent and civil air transport enterprise shall
strictly carry out the air transport sales agency agreement signed between the
two parties.

    The sales agent shall submit the air transport sales agency agreement to
the civil aviation competent administrative organ or civil aviation regional
administrative organ which issued the certificate of approval for the
operation of air transport sales agency for file.

    Article 23  The sales agent shall use special invoices for air transport
sales agency while carrying out passenger sales of category-I air transport
sales agency.

    Article 24  The sales agent shall submit an annual report of its operation
to the civil aviation competent administrative organ or civil aviation
regional administrative organ which issued the certificate of approval for the
operation of air transport sales agency for file.

    A sales agent concurrently engaged in air transport sales agency shall
maintain separate account numbers and account books for the revenue and
expenditure accrued in the operation of air transport sales agency.

    Article 25  The sales agent must observe the regulations concerning air
transport price and air transport sales agency service charges of China.

    Article 26  The sales agent must not transfer air transport documents to
others for sale, or complete air transport documents at a business location
not registered.

    Article 27  A sales agent who continues the operation of sales agency
after the expiration of its certificate of approval for the operation of air
transport sales agency shall apply in writing for renewing the certificate to
civil aviation competent administrative organ or civil aviation regional
administrative organ one month before the expiration of such certificate.

    In case a sales agent fails to apply for the renewal of the certificate of
approval for operation in accordance with the provision in the preceding
paragraph, it shall automatically forfeit its qualification for air transport
sales agency at the time of expiration of such certificate.

    Article 28  The certificate of approval for the operation of air transport
sales agency shall not be renewed if the annual average sales volume of a
sales agent fails to reach the following minimum standard:

    (1) For a category-I air transport sales agent, the sale of transportation
of 2,000 passengers or 100 tons of cargo;

    (2) For a category-II air transport sales agent, the sale of
transportation of 5,000 passengers or 200 tons of cargo.

    The provision of the preceding paragraph shall not apply if in the opinion
of the civil aviation competent administrative organ or civil aviation
regional administrative organ it is still necessary to maintain a sales agent
because the sales agent is the sole sales agent in the area where such agent
is situated and the service quality of such agent is good.

    Article 29  A civil air transport enterprise must not sign an air
transport sales agency agreement with a unit or an individual under one of the
following circumstances:

    (1) a unit or an individual not in possession of a certificate of approval
for the operation of air transport sales agency;

    (2) the business scope of the business license of the unit or individual
does not include air transport sales agency.

    Article 30  In case the certificate of approval for the operation of air
transport sales agency of a sales agent is withdrawn or expires, the civil air
transport enterprise shall immediately terminate its performance of the air
transport sales agency agreement signed with such agent.
Chapter V  Penalty

    Article 31  A sales agent in violation of these Provisions shall be
penalized by the civil aviation competent administrative organ or civil
aviation regional administrative organ as follows:

    (1) Violation of Article 21, paragraph 2 of Article 22 and Article 24 of
these Provisions shall be penalized by warning and instruction to correct
within prescribed time; failure to correct within the prescribed time or a
second violation within six months shall be penalized by suspension of
operation for rectification for 3 to 15 days.

    (2) Violation of Article 19 and Article 23 shall be penalized by
instruction to correct within prescribed time and imposition of a fine of over
RMB 1,000 yuan but below 10,000 yuan; failure to correct within prescribed
time or a second violation within six months shall be penalized by suspension
of operation for rectification for 7 to 30 days.

    (3) Violation of Article 18, paragraph 2 of Article 20, Article 25 and
Article 26, shall be penalized by the imposition of a fine of over RMB 3,000
yuan but below 30,000 yuan or the suspension of operation for rectification
for 15 to 90 days at the same time in addition to instructing the sales agent
to indemnify the victim for economic loss; serious cases resulting in adverse
influence or the recurrence of same violation for three times within two years
shall be penalized by the withdrawal of the certificate of approval for the
operation of air transport sales agency.

    Article 32  In case the certificate of approval for the operation of air
transport sales agency of a sales agent is withdrawn, the civil aviation
competent administrative organ or civil aviation regional administrative organ
shall suggest that the administration of industry and commerce revoke or
change the business license of the sales agent.

    Article 33  In the case of unlawful operation of civil air transport sales
agency without the certificate of approval for the operation of air transport
sales agency, the civil aviation competent administrative organ or civil
aviation regional administrative organ, as appropriate, shall ban the unlawful
operation of such sales agent, confiscate its unlawful earnings and impose a
fine to the amount of over RMB 30,000 yuan but below 100,000 yuan.

    Article 34  In the case of violation of Article 18, the second paragraph
of Article 20, Article 29 and Article 30 by a civil air transport enterprise,
the civil aviation competent administrative organ or civil aviation regional
administrative organ, as appropriate, shall instruct the enterprise to correct
immediately and impose a fine of over RMB 10,000 yuan but below 100,000 yuan.

    Article 35  In the case of gross violation of these Provisions
constituting a crime, criminal responsibility shall be investigated and
affixed in accordance with the law.

    Article 36  If a party refuses to comply with the specific administrative
act performed by the civil aviation competent administrative organ or civil
aviation regional administrative organ in accordance with these Provisions, it
may apply for reconsideration of the case to the civil aviation competent
administrative organ and may also initiate administrative proceedings directly
to the people’s court within 15 days beginning from the day on which the
specific administrative act comes to its knowledge.
Chapter VI  Supplementary Provisions

    Article 37  Rules for the implementation of these Provisions shall be
formulated by the General Administration of Civil Aviation of China.

    Article 38  The General Administration of Civil Aviation of China shall be
responsible for the interpretation of these Provisions.

    Article 39  These Provisions shall go into effect on the day of their
promulgation.





PROCEDURES OF SHANGHAI MUNICIPALITY ON ENDOWMENT INSURANCE FOR TOWN EMPLOYEES

Procedures of Shanghai Municipality on Endowment Insurance For Town Employees

     CHAPTER I GENERAL PROVISIONS CHAPTER II ORGANIZATION CHAPTER III PAYMENT OF ENDOWMENT INSURANCE PREMIUMS CHAPTER IV ENJOYMENT OF ENDOWMENT
INSURANCE TREATMENT CHAPTER V USE AND ADMINISTRATION OF ENDOWMENT INSURANCE FUND CHAPTER VI SETTLEMENT OF DISPUTES AND PUNISHMENT
CHAPTER VII SUPPLEMENTARY PROVISIONS

   Article 1 In order to guarantee the basic needs of life after retirement for town employees, these Procedures are formulated in accordance
with the Plan of Shanghai Municipality for the Implementation of Reform of Endowment Insurance System for Town Employees.

   Article 2 The endowment insurance as defined in these Procedures refers to the social security system, set up through legal procedures, organized
and controlled by the competent government department, under which units and employees have the mutual obligation to pay endowment
insurance premiums, and retirees enjoy basic endowment insurance treatment according to the payment of premiums for endowment insurance.

   Article 3 These Procedures shall apply to town administrative agencies, enterprises and institutions (hereinafter referred to as units), and
employees and retirees of these units.

These Procedures shall not apply to aliens in foreign-invested enterprises or units and personnel otherwise stipulated by the State.

   Article 4 The endowment insurance follows the principles of sharing expenses among the State, units and individuals, combining individual savings
with unified planning and mutual aid, and combining guaranty of the basic needs of life for retirees with stimulation of the initiative
of employees.

Units have the obligation to pay endowment insurance premiums for their employees while employees have the obligation to pay insurance
premiums for themselves.

An employee’s rights to have his/her unit pay endowment insurance premiums and to enjoy endowment insurance treatment after retirement
are protected by the law and no infringement of these rights by any unit or individual is allowed.

   Article 5 The reform of this Municipality’s endowment insurance system aims at phasing in a multi-layer endowment insurance system. In addition
to the endowment insurance stipulated in these Procedures, unit supplementary endowment insurance shall be phased in units whose
conditions permit, and the employees who can afford it shall be encouraged to carry individual savings endowment insurance.

   Article 6 This Municipality shall set up the Municipal Social Insurance Committee that is responsible for the examination of the development
plan of endowment insurance, the study and decision of major policies on endowment insurance, and the plan for maintaining or raising
the value of endowment insurance fund.

   Article 7 The Municipal Social Insurance Administration is responsible for the administration of endowment insurance of this Municipality.
Its functions are:

1. To organize the implementation of endowment insurance system;

2. To prepare the development plan of endowment insurance;

3. To draft local laws and regulations on endowment insurance;

4. To formulate, jointly with relevant departments, the financial, accounting, statistical and internal auditing systems for endowment
insurance fund;

5. To supervise the collection of endowment insurance premiums, the disbursement of pensions, and the operation of endowment funds
for its appreciation;

6. To direct the work of endowment insurance management centers at the municipal, district and county levels; and

7. To execute the decisions of the Municipal Social Insurance Committee.

   Article 8 Endowment insurance industry management centers are the agencies that undertake the routine business about endowment insurance. Their
functions are:

1. To take charge of the collection of endowment insurance premiums and the payment of pensions;

2. To manage individual endowment insurance accounts;

3. To answer inquiries about endowment insurance from units, employees and retirees; and

4. To handle other matters commissioned or authorized by the Municipal Social Insurance Administration.

CHAPTER III PAYMENT OF ENDOWMENT INSURANCE PREMIUMS

   Article 9 All units referred to in Paragraph 1, Article 3 of these Procedures shall register endowment insurance for the units and their employees
in the endowment insurance administrative center designated by the Municipal Social Insurance Administration. Newly-established units
shall complete the procedures of endowment insurance registration within 1 month from the date of their establishment.

When a unit is divided or merged, goes bankrupt or is shut down, and recruits or dismisses employees (including resignation, unauthorized
quit, discharge, and removal), the unit shall, within 1 month, go through the formalities for alteration or cancellation of the endowment
insurance registration with the endowment insurance management center that handled the registration.

When registering endowment insurance, the endowment insurance management center shall set endowment insurance codes for units, open
individual endowment insurance accounts for employees and issue Endowment Insurance Books.

   Article 10 An employee’s individual endowment insurance account shall remain unchanged for life. The Endowment Insurance Book must be used for
recording the employee’s successive working years before the implementation of these Procedures and the savings amount in his individual
endowment insurance account after the implementation of these Procedures, which are the basis for computing pensions granted upon
retirement.

When an employee changes his/her work unit, the Endowment Insurance Book must be transferred with the employee accordingly.

   Article 11 Units and employees shall pay monthly endowment insurance premiums within the prescribed time limit. No delay or failure of payment
nor underpayment is allowed.

   Article 12 A unit shall pay endowment insurance premium at the rate of 25.5% of the total amount of wages paid to all its employees in the preceding
month.

An employee shall pay endowment insurance premiums at the rate of 3% of his/her monthly average wage in the previous year, which is
to serve as the payment base. If an employee’s monthly average wage in the previous year is over 200% of those of the employees of
the whole city in the previous year, the excess above the 200% shall not be included in the base for premium payments. In case the
average monthly wage of an employee in the previous year is below 60% of those of the employees in the whole city in the previous
year, 60% of the monthly average wages of the employees in the whole city in the previous year shall be used as the payment base.

The same approach must be taken to computing the payment base of endowment insurance premium for units and for employees.

The adjustment of the rates of endowment insurance premium paid by units and employees shall be proposed by the Municipal Social Insurance
Administration and reported to the Municipal Social Insurance Committee for decision.

   Article 13 The endowment insurance premiums paid by units shall be entered as expenditures through the following channels:

1. Entered as expenditures before tax for enterprises and institutions that balance their revenue and expenditures by themselves;
or

2. Entered as administrative expenses or operating expenses for administrative agencies and institutions with total or differential
budget.

   Article 14 The endowment insurance premiums shall be paid in the following ways:

1. A unit shall withhold the endowment insurance premiums to be paid by employees from their monthly wages. The deduction from an
employee’s wages for endowment insurance premium may be exempt from individual income tax.

2. A unit shall go to the endowment insurance management center at regular time every month to verify the endowment insurance premiums
to be paid by the unit and its employees and pay the full amount as verified.

   Article 15 The endowment insurance management center shall settle the savings amount in the individual endowment insurance account each year
and issue to each employee a statement of the endowment insurance premiums paid.

   Article 16 The endowment insurance premium to be entered in the individual endowment insurance account shall include:

1. The endowment insurance premium paid by the individual; and

2. The portion of endowment insurance premium paid by the unit, which is to be entered in the individual account;

a. The amount to be entered at certain rates (8% for enterprises and institutions that balance revenue and expenditures by themselves,
10% for administrative agencies and institutions with full budget and 9% for institutions with differential budget) of the employee’s
individual payment base (not more than 150% of the monthly average wages of the employees in the whole city in the previous year);
and

b. The amount to be entered at 5% of the monthly average wages of the employees in the whole city in the previous year.

The portion of the endowment insurance premiums paid by the unit, which is to be entered in the individual account, shall be adjusted
in proportion to the rise of the individual payment rate.

   Article 17 All the endowment insurance premiums paid by units must be used for social unified plannings except for the portion entered in the
individual endowment insurance account.

   Article 18 The interest on the savings amount entered in the individual endowment insurance account shall be computed at a rate not lower than
the bank interest rate for residents’ time deposits mature in one year’s time in the same period.

   Article 19 The endowment insurance fund shall be channeled to the financial special account under the city treasury for the independent social
security fund. The fund shall operate on two separate lines, the line of receipts and that of disbursement, which are to be put under
specialized management with the fund earmarked and used exclusively for its specified purpose.

CHAPTER IV ENJOYMENT OF ENDOWMENT INSURANCE TREATMENT

   Article 20 A retiree who is enpost_titled to endowment insurance treatment shall satisfy the following requirements at the same time:

1. The employee has reached the retirement age stipulated by the State or this Municipality;

2. The unit and the employee have paid endowment insurance premiums as stipulated; and

3. The employee employed before the implementation of these Procedures has 10 successive working years (including premium payment
years) or the employee employed after the implementation of these Procedures and has paid premiums for fifteen years.

The retiree who meets the above requirements may go through the formalities for drawing pensions with the endowment insurance management
center and draw pensions monthly upon verification and determination by the endowment insurance industry management center.

   Article 21 A jobless person who meets the requirement in Section 1 of Article 20 of these Procedures may go through the formalities for drawing
monthly pensions with the endowment insurance center.

   Article 22 A person who got employment before the implementation of these Procedures and has been working for more than 5 but less than 10 successive
years (including payment years) by the retirement age shall quit working. An employee who has 5 successive working years and is incapacitated
by illness or non-working related injury may quit working after being ascertained by the Labor Appraisal Committee as having totally
lost working ability.

A person who has quit working for the above reasons is enpost_titled to corresponding pension treatment as stipulated.

   Article 23 A person who got employment before the implementation of these Procedures with less than 5 successive years (including premium payment
years) or who got employment after the implementation of these Procedures and has paid premiums with less than 15 payment years may,
at the retirement age, apply to the endowment insurance industry management center for the payment of the total savings amount in
his/her individual endowment insurance account to be made to him/her and for the termination of his/her endowment insurance at the
same time.

   Article 24 The person who meets the pension-drawing requirements may draw pensions for life. When the savings amount in his/her individual endowment
insurance account is exhausted, the pension may be paid from the pool of unified social security funds.

   Article 25 After the death of an employee or retiree, the balance of the savings amount in his/her individual endowment insurance account paid
by himself/herself may be given in one lump sum to his/her heir determined through legal procedures.

   Article 26 The Municipal Social Insurance Administration may require pensioners to go through the check-up formalities with the endowment insurance
industry management center at regular time. The payment of pension may be suspended for failure to complete the check-up formalities.

When a retiree can not go through the check-up formalities because of going abroad, or out of border or for other reasons, he/she
must produce a certificate of his/her survival in accordance with relevant provisions of the State.

When a retiree can not draw his/her pension in person because of going abroad or out of border or for other reasons and has to entrust
someone else to draw pensions for him/her, a notarized power of attorney shall be presented.

   Article 27 The formula for computing the pension of the person who got employment after the implementation of these Procedures is:

Monthly pension = total savings in individual endowment insurance account/120

   Article 28 The monthly pension the person who got employment before the implementation of these Procedures and retired or quit working before
the end of 1995 shall first be computed by the said formula and then augmented with a certain percentage of the individual accumulated
payment. The augmentation shall be determined according to the following provisions:

1. The monthly pension shall be augmented with 11% for the person who retired and whose payment years plus his/her successive working
years before the implementation of these Procedures are 10 or more years but less than 15 years. On this base, a further increase
of every 5 years shall bring in a rise of 1 percentage point accordingly, but the augmentation shall not exceed the limit of 16%.

2. The monthly pension shall be augmented with 2% for the person who retired from an administrative agency or institution and whose
payment years plus his/her successive working years before the implementation of these Procedures are 10 or more years but less than
15 years. On this base, an increase of every 5 years shall bring in a rise of 1 percentage point accordingly, but the augmentation
shall not exceed the limit of 7%.

3. The monthly pension shall be augmented by 10% for the person who quits working from an enterprise and 1% for the person who quits
working from an administrative agency or institution.

The above-mentioned person who reaches retirement age in any month of the year shall pay the premium for 12 months in the current
year of his/her retirement and the pension shall be augmented according to the provisions in the preceding Section.

The preferential treatment enjoyed by retired veteran cadres, model workers, senior experts and those who can have an early retirement
as stipulated by the State shall be carried out according to the original provisions as before.

   Article 29 The savings amount in the individual endowment insurance account multiplied by a definite coefficient makes the savings amount for
the total working years for the person who got employment before the implementation of these Procedures and retires after January
1, 1996. The formula for computing his/her monthly pension is:

Monthly pension = savings amount in individual endowment insurance account x coefficient/120

When the pension computed according to the provision in the preceding Section is lower than the standard computed according to the
measure in Article 28 of these Procedures, the measure in Article 28 may be adopted to compute the pension instead.

   Article 30 The savings amount in the individual endowment insurance account must only be used to pay monthly retirement pensions and must not
be diverted to any other purposes.

When a pension is paid to an retiree, a corresponding deduction must be made from the savings amount in the individual endowment insurance
account according to the proportion of the amount paid by the individual to the amount paid by the unit.

   Article 31 The Municipal Social Insurance Committee shall set the lowest standard of retirement pension. In case the pension drawn by according
to the provisions is lower than the lowest standard, the pension may be granted according to the lowest standard.

The lowest standard of pension shall be adjusted with the economic development and the rising consumer price index of local residents.

   Article 32 The retirement pension shall be adjusted every year according to the extent of rise in the local residents’ consumer price index
in the previous year, which becomes effective on April 1 of the current year. The pension of the person who retires in the current
year shall be adjusted the following year. No adjustment is made when the local residents’ consumer price index drops from the previous
year.

   Article 33 This Municipality shall grant living allowances to retirees from time to time according to the national economic development and
the receipts and disbursement of the endowment insurance fund, and with reference to the employees’ actual wages. A special living
allowance may be granted additionally to retirees in special difficulties.

   Article 34 After the death of a retiree, a funeral allowance, grants for lineal dependents and relief benefits shall be paid according to the
relevant provisions of the State and this Municipality.

CHAPTER V USE AND ADMINISTRATION OF ENDOWMENT INSURANCE FUND

   Article 35 The sources of endowment insurance funds shall include:

1. Endowment insurance premiums paid by units and employees;

2. Income from the interest earned by endowment insurance fund;

3. Income from the operation of endowment insurance fund for its appreciation; and

4. Overdue fines collected according to the provisions of these Procedures.

   Article 36 The endowment insurance fund shall be mainly used to pay retirement pensions. When the fund is not enough to make payment, it shall
be subsidized by the local finance.

The endowment insurance fund shall be put under the centralized management of the Municipal Social Insurance Administration and be
earmarked and used exclusively for its specified purpose and must not be drawn on arbitrarily by any unit or individual.

   Article 37 The payments that can be made from the endowment insurance fund are:

1. Retirement pensions;

2. Funeral allowances, grants for lineal dependents, and relief benefits paid after the death of retirees according to the relevant
provisions of the State and this Municipality;

3. The balance of the part attributable to individual payment in the individual endowment insurance account to be given to the legal
inheritor(s) of the deceased employee or retiree; and

4. Living allowances granted under Article 33 of these Procedures.

The endowment insurance industry management center may draw a certain percentage of the endowment insurance premiums actually collected
as management fees upon approval by the Municipal Social Insurance Committee.

The management fees drawn according to the above Section shall be exempt from taxes or fees.

   Article 38 The endowment insurance fund may be put into operation for its appreciation on condition that the regular payment and its safety
are secured, but must not be used to make investment with long recovery period, great risks or of a speculative nature. The increment
included in the endowment insurance fund after operation shall be exempt from taxes or fees.

   Article 39 The Municipal Social Insurance Administration shall timely summarize, verify and report the use and management of the endowment insurance
fund to the Municipal Social Insurance Committee on regular basis or at the request of the latter.

   Article 40 A budget and final accounts must be made annually for the collection, payment and operation of the endowment insurance fund for its
appreciation.

   Article 41 The collection, payment and operation of the endowment insurance fund for its appreciation shall be supervised concurrently by the
public finance, and auditing departments and the financial regulatory departments.

   Article 42 The Municipality shall set up the endowment insurance fund supervisory organization, consisting of the governmental department concerned
and representatives of the social public, to supervise the collection, payment and management of the endowment insurance fund. The
specific measures shall be separately formulated.

CHAPTER VI SETTLEMENT OF DISPUTES AND PUNISHMENT

   Article 43 Disputes between an employee and his/her unit over the payment of endowment insurance premiums or disputes between an employee or
retiree or a unit and the endowment insurance management center may be referred to the Municipal Social Insurance Administration
for adjudication.

   Article 44 An employee or retiree or a unit may ask the endowment insurance management center to check the payment of endowment insurance premiums
made by the individual or the unit and the payment of pensions. The endowment insurance management center shall provide free services.

   Article 45 The endowment insurance management center may examine the payment of endowment insurance premiums. The Municipal Social Insurance
Administration shall instruct the unit that makes no payment of, or fails to make of, or makes underpayment of endowment insurance
premiums to pay the premiums within a prescribed time limit. If the payment is not made within the deadline, the Municipal Social
Insurance Administration may ask the bank to withhold the payment and may impose a fine 1 to 2 times as much as the unpaid amount.
The fine, however, shall not exceed 30,000 yuan.

   Article 46 The endowment insurance management center shall impose an overdue fine equal to 0.2% of the payable amount for each day in arrears
on the unit that fails to make the payment of endowment insurance on time.

Income from overdue fines shall be included in the endowment insurance fund.

   Article 47 When a retiree who enjoys the endowment insurance treatment dies, his/her lineal relative(s) or the unit concerned shall go through
the endowment registration cancellation formalities with the endowment insurance management center in good time.

If any person violates the above Section, overdraws or falsely claims pension by forging documents or by other means, the endowment
insurance management center shall recover the amount overdrawn or falsely claimed. If the case is serious, the Municipal Social Insurance
Administration may impose a fine one to five times as much as the amount overdrawn or falsely claimed. However, such fine shall not
exceed 30,000 yuan for a unit and 1,000 yuan for an individual.

   Article 48 If the party concerned refuses to accept as final the specific administrative act of the Municipal Social Insurance Administration,
it may apply for administrative review according to the Regulations on Administrative Review or institute legal proceedings according
to the Administrative Litigation Law of the People’s Republic of China.

If the party concerned does not apply for review or institute legal proceedings within the prescribed period of time, nor does it
comply with the specific administrative decision, the administrative department that made the decision may apply to the people’s
court for enforcement according to the provisions of the Administrative Procedure Law of the People’s Republic of China.

   Article 49 The public security organs shall inflict penalty on those who disturb the normal working order of endowment insurance agencies according
to the Regulations of the People’s Republic of China on Public Security Administration and the Imposition of Punishment.

CHAPTER VII SUPPLEMENTARY PROVISIONS

   Article 50 The interim measures on endowment insurance for employees in foreign-funded enterprises and the measures on endowment insurance for
employees in privately-owned enterprises and individual industrialists and businessmen shall be separately formulated according to
the principles of these Procedures.

   Article 51 The procedures on unit supplementary endowment insurance and individual savings endowment insurance in this Municipality shall be
separately formulated.

   Article 52 The Municipal Social Insurance Administration shall be responsible for the interpretation of the specific application of these Procedures.

   Article 53 These Procedures shall become effective on June 1, 1994.

Any unit or individual that failed to execute the Plan of Shanghai Municipality for the Implementation of Reform of Endowment Insurance
System for Town Employees during the period from January 1, 1993 until the time of implementation of these Procedures shall fulfill
the obligations under the Plan within 3 months starting from the date of implementation of these Procedures.

    





DECISION OF THE NATIONAL PEOPLE’S CONGRESS ON THE METHOD FOR THE FORMATION OF THE FIRST GOVERNMENT, THE FIRST LEGISLATIVE COUNCIL AND THE FIRST JUDICIARY OF THE MACAO SPECIAL ADMINISTRATIVE REGION

Category  SPECIAL ADMINISTRATIVE REGION Organ of Promulgation  The National People’s Congress Status of Effect  In Force
Date of Promulgation  1993-03-31 Effective Date  1993-03-31  


Decision of the National People’s Congress on the Method for the Formation of the First Government, the First Legislative Council
and the First Judiciary of the Macao Special Administrative Region



(Adopted at the First Session of the Eighth National People’s

Congress on March 31, 1993)

    1. The First Government, the First Legislative Council and the
First Judiciary shall be formed in accordance with the principles
of state sovereignty and  smooth transition.

    2. The National People’s Congress shall establish  a
Preparatory Committee for the Macao Special Administrative Region,
which shall be responsible for preparing the establishment of the
Region and shall prescribe the specific method for forming the
First Government, the First Legislative Council and the First
Judiciary in accordance with this Decision. The Preparatory
Committee shall be composed of mainland members and of Macao
members who shall constitute not less than 50 percent of its
membership. Its Chairman and members shall be appointed by the
Standing Committee of the National People’s Congress.

    3. The Preparatory Committee for the Macao Special
Administrative Region shall be responsible for preparing the
establishment of the Selection Committee for the First Government
of the Macao Special Administrative Region (“the Selection
Committee”).

    The Selection Committee shall be composed entirely of permanent residents of Macao and must be broadly representative.
It
shall include Macao deputies to the National People’s Congress,
representatives of Macao members of the National Committee of the
Chinese People’s Political Consultative Conference, persons with
practical experience who have served in Macao’s executive,
legislative and advisory organs prior to the establishment of the
Macao Special Administrative Region, and persons representative of various strata and sectors of society.

    The Selection Committee shall be composed of 200 members,
among whom:

        Industrial, commercial and financial sectors:      60

        Cultural and educational sectors and other

        professions:                                      
50

        Labor, social services, religious and

        other sectors:                                    
50

        Former political figures, Macao deputies

        to the National People’s Congress, and

        representatives of the Macao members of the

        National Committee of the Chinese People’s

        Political Consultative Conference:                
40

    4. The Selection Committee shall recommend the candidate for
the first Chief Executive through local consultations or through
nomination and election after consultation, and report the
recommended candidate to the Central People’s Government for
appointment. The term of office of the first Chief Executive shall
be the same as the regular term.

    5. The Chief Executive of the Macao Special Administrative
Region shall be responsible for preparing the formation of the
first Government of the Region in accordance with this Law.

    6. The first Legislative Council of the Macao Special
Administrative Region shall be composed of 23 members, with 8
members returned through direct elections, 8 members returned
through indirect elections, and 7 members appointed by the Chief
Executive. If the composition of the last Macao Legislative Council
before the establishment of the Macao Special Administrative Region
is in conformity with the relevant provisions of this Decision and
the Basic Law of the Macao Special Administrative Region, those of the elected members who uphold the Basic Law of the Macao Special
Administrative Region of the People’s Republic of China and pledge
allegiance to the Macao Special Administrative Region of the
People’s Republic of China, and who meet the requirements set forth
in the Basic Law of the Region may, upon confirmation by the
Preparatory Committee, become members of the First Legislative
Council of the Region. Any vacancy in the first Legislative Council
of the Region shall be filled by a decision of the Preparatory
Committee.

     The term of office of members of the first Legislative Council
of the Macao Special Administrative Region shall last until 15
October 2001.

    7. The Preparatory Committee of the Macao Special
Administrative Region shall be responsible for organizing the Court
of the Macao Special Administrative Region in accordance with the
Basic Law of the Region.





PROPOSALS OF THE SECURITIES COMMITTEE OF THE STATE COUNCIL ON PROCEDURES OF ISSUING, SELLING AND SUBSCRIBING STOCKS FOR

Proposals of the Securities Committee of the State Council on Procedures of Issuing, Selling and Subscribing Stocks for 1993

     (Effective Date:1993.08.18–Ineffective Date:)

CHAPTER ONE THE BASIC PRINCIPLES FOR ISSUING, SELLING AND SUBSCRIBING STOCKS. CHAPTER TWO METHODS OF UNLIMITED ISSUING OF APPLICATION
FORMS. CHAPTER THREE METHODS OF ISSUING STOCKS ACCORDING TO BAND DEPOSITS. CHAPTER FOUR FUNCTIONS AND RESPONSIBILITIES OF UNDERWRITING
ORGANIZATIONS.

The Securities Committee of the State Council has made the following proposals on the procedures of issuing, selling of and subscribing
stocks for the year of 1993 with a view to ensuring the smoothgoing of stock deals according to the “Circular on Further Strengthening
the Macro-Control of the Securities Markets” issued by the State Council and “The Interim Provisions on the Management of the Issuing
and Trading of Stocks”:

CHAPTER ONE THE BASIC PRINCIPLES FOR ISSUING, SELLING AND SUBSCRIBING STOCKS.

   Article 1.1 The issuing and selling of stocks must be made under a greater transparency to achieve the principles of openness, fair and just
and prevent malpractices for personal gains to ensure social stability.

   Article 1.2 The trans-regional issuing of stocks must be submitted to the Securities Committee of the State Council for approval.

   Article 1.3 For selling the stocks, the application forms for subscribing may be issued unlimitedly with the limited amount of real stocks to
be distributed through drawing at a later time or limitedly according to the amounts of bank deposits of the subscribers. The use
of other methods of distribution which are deemed as better than the first two is subject to the approval by the Securities Committee
of the State Council.

   Article 1.4 The stocks should be issued in financial developed cities which are accommodated with telecommunications, computer and transport
facilities, a certain number of financial organizations (including securities management organizations) and member organizations
of the Shanghai and Shenzhen stock exchanges.

   Article 1.5 The people’s governments of various provinces autonomous reigons, municipalities under the direct administration of the central
government and cities covered by central planning should formulate concrete plans for executing these proposals and work out actual
scheme of execution.

   Article 1.6 Places which have not fulfilled the purchasing of treasury bonds are not allowed to sell application forms or issue stocks.

CHAPTER TWO METHODS OF UNLIMITED ISSUING OF APPLICATION FORMS.

   Article 2.1 After the issuing is completed within a limited time, drawing of actual stocks should be made openly according to the amount of
application forms that has been issued and the actual amount of stocks planned to be sold. Those who win the lots will then go through
the actual stock subscription procedures according to regulations.

   Article 2.2 To avoid long lining-up and paper waste, the application forms may be sold over the counter designated by the governments at various
levels to facilitate people of various communities or through pre-registration in certain working units at the same time.

   Article 2.3 Each application form can only buy stocks issued by an enterprise or at most the stocks of several enterprises issued in the same
locality and the same year, and the forms must be enpost_titled with the name or names of the stock issuing enterprises.

   Article 2.4 Costs of the application forms which cover expenses for printing and commissions for underwriters must be charged to the buyers
and accounted for independently by the underwriting organizations. The balance in the sales of application forms must be turned over
to the State coffer for use in social welfare undertakings.

   Article 2.5 Amount of stocks contained in each application form should not be less than 500 or more than 1,000 in integer multiples of 100.
No unit or individual is allowed to transfer or resell the forms at prices higher than the actual value subscribed therein.

CHAPTER THREE METHODS OF ISSUING STOCKS ACCORDING TO BAND DEPOSITS.

   Article 3.1 Through consultation between the governments and branches of the People’s Bank at all levels, application forms may be allocated
according to a certain ratio of the bank deposits of residents with the real amount of stocks to be sold through drawing and winners
of lots will go through the subscription procedures according to regulations. If special accounts for deposits are served, the drawing
can also be made on the numbers of the special accounts. Other methods may also be employed.

   Article 3.2 In adopting the method according to bank deposits, effective measures should be taken to prevent the movement of large amount of
funds from area to area.

CHAPTER FOUR FUNCTIONS AND RESPONSIBILITIES OF UNDERWRITING ORGANIZATIONS.

   Article 4.1 Before the date of selling stock applications forms, underwriting organizations should be responsible for making public in newspapers
or magazines the outline prospectus and matters concerning the date and place of the selling of the application forms.

   Article 4.2 During the period of selling the applications forms, the underwriting organizations should make public the prospectus at all selling
points or in other forms.

   Article 4.3 Underwriting organizations are not allowed to sell application forms before the prescribed date or to reserve by any form application
forms for their own units during or after the selling period.

Neither are they allowed to sell application forms in places other than approved (people outside the city are not restricted to buy
application forms in places where the application forms are sold).

They are not allowed to entrust organizations which have no right to act as agents to sell application forms.

   Article 4.4 If an underwriting organization violates the above provisions and relevant laws and regulations during the process of underwriting,
it will be punished or even be disqualified for further underwriting business according to the seriousness of the case.

   Article 4.5 Drawing of application forms should be made openly in prescribed date and procedures and under the supervision of notary public.

After the period of issuing of stocks ends, the application forms remaining unsold should be recovered and destroyed by the underwriting
organizations. After the period of underwriting ends, the stocks remaining unsold shall be handled according to the provisions of
the underwriting agreement.

    

Source:Xinhuanet

EDITOR:Victor





PROTECTION OF CONSUMER RIGHTS AND INTERESTS

_

Category  PROTECTION OF CITIZENS’ RIGHTS AND INTERESTS Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  In Force
Date of Promulgation  1993-10-31 Effective Date  1994-01-01  


Law of the People’s Republic of China on the Protection of Consumer Rights and Interests

Contents
Chaper I  General Provisions
Chapter II  Rights of Consumers
Chapter III  Obligations of Businees Operators
Chapter IV  Protection of the Legitimate Rights and Interests of        
Chapter V  Consumer Organizations
Chapter VI  Settlement of Disputes
Chapter VII  Legal Responsibility
Chapter VIII  Supplementary Provisions

(Adopted at the Fourth Meeting of the Standing Committtee

of the Eighth National People’s Congress on October 31, 1993,
promulgated by Order No.11 of the President of the People’s
Republic of China, and effective as of January 1, 1994)
Contents

    Chapter I     General Provisions

    Chapter II    Rights of Consumers

    Chapter III   Obligations of Bussiness Operators

    ChapterIV     Protection of Legitimate Rights and Interests of      

                  Consumers by the State

    Chapter V     Consumer Organizations

    Chapter VI    Settlement of Disputes

    Chapter VII   Legal Responsibility

    Chapter VIII  Supplementary Provisions
Chaper I  General Provisions

    Article 1  The present Law is formulated for the protection of the legitimate rights and interests of consumers, maintenance of
the socio-economic order and promotion of the healthy development
of socialist market economy.

    Article 2  The rights and interests of consumers in purchasing
and using commodities or receiving services for daily consumption
shall be under the protection of the present Law, or under the
protection of  other relevant laws and regulations in absence of stipulations in this Law.

    Article 3  Business operators shall, in their supply of commodities produced and sold by them or services to consumers,
abide by the present Law, or abide by other relevant laws and
regulations in absence of stipulations in the present law.

    Article 4  In transactions between business operators and
consumers a principle of voluntariness, equality, fairness, honesty
and credibility shall be followed.

    Article 5  The State shall protect the legitimate rights and
interests of consumers from infringement.

    The State shall adopt measures to safeguard consumers’
exercise of their rights in accordance with the law and to maintain
the legitimate rights and interests of consumers.

    Article 6  It is the common responsibility of the whole society
to protect the legitimate rights and interests of consumers.

    The State shall encourage and support all organizations and
individuals to exercise social supervision over acts infringing
upon consumer rights and interests.

    Mass media shall conduct propaganda defending the legitimate
rights and interests of consumers and, through public opinion,
exercise supervision over acts infringing upon the legitimate
rights and interests of consumers.
Chapter II  Rights of Consumers

    Article 7  Consumers shall, in their purchasing and using
commodities or receiving services, enjoy the right of the
inviolability of their personal and property safety.

    Consumers shall have the right to demand business operators to
supply commodities and services up to the requirements of personal
and property safety.

    Article 8  Consumers shall enjoy the right to obtain true
information of the commodities they purchase and use or the
services they receive.

    Consumers shall have the right to demand business operators,
in light of the different conditions of commodities or services, to
provide their prices, origin, manufacturers, usage, functions,
standards, grades, main ingredients, date of production, term of validity, certificates of inspection, operation instructions,
aftersale services or information relating to contents, standards
and costs of the services.

    Article 9  Consumers shall enjoy the right of free choice of commodities or services.

    Consumers shall have the right to make a free choice of business operators for supply of commodities or services,
select
freely among varieties of articles or forms of services and decide
independently to buy or not to buy any kind of commodities, or to
accept or not to accept any item of services.

    Consumers shall have the right to make comparisons,
differentiations and selections when they make a free choice of commodities or services.

    Article 10  Consumers shall enjoy the right of fair deal.

    Consumers shall, in their purchasing commodities or receiving
services, have the right to obtain fair deal prerequisites such as
guarantee of quality, reasonable prices and correct measurement,
and have the right to refuse any compulsory transaction of business
operators.

    Article 11  Consumers suffering from personal injury or
property damage resulting from their purchasing or using of commodities or receiving of services shall have the right to demand
compensations in accordance with the law.

    Article 12  Consumers shall have the right to form public
organizations for the maintenance of their own legitimate rights
and interests according to law.

    Article 13  Consumers shall have the right to acquire knowledge
concerning consumption and protection of consumer rights and
interests.

    Consumers shall make efforts to master the knowledge of their
necessary commodities or services and the skill in operation
thereof, apply the commodities in a correct way and raise their
consciousness of self-protection.

    Article 14  Consumers shall, in their purchasing and using
commodities or receiving services, have the right that their  human
dignity, national customs and habits are respected.

    Article 15  Consumers shall have the right to exercise
supervision over commodities, services as well as the work of protection of consumer rights and interests.

    Consumers shall have the right to inform and charge against
the infringement upon consumer rights and interests and the breach
of law or neglect of duty on the part of State organs and their
functionaries in the work of protection of consumer rights and
interests, and have the right to raise criticism of or proposals
for the work of protection of consumer rights and interests.
Chapter III  Obligations of Businees Operators

    Article 16  Business operators shall, in their supply of commodities and services to consumers, fulfill their obligations
stipulated in the Law of the People’s Republic of China on Product
Quality and other laws and regulations concerned.

    In case an agreement is reached between business operators and
consumers, the business operators shall fulfill the obligations
agreed upon in the agreement; but the agreement between the two
parties shall not contravene the provisions of laws and
regulations.

    Article 17  Business operators shall listen to the consumers’
opinions  on the commodities and services they supply and accept
consumers’ supervision.

    Article 18  Business operators shall guarantee that the
commodities and services they supply meet the requirements for
personal or property safety. As to commodities and services liable
to harm personal or property safety, business operators shall
give the consumers truthful explanation and clearout warnings, and
shall explain or indicate the correct ways of using the commodities
or receiving services as well as the methods of preventing damage.

    Business operators shall, upon discovery of serious defects of the commodities or services they supply which
are liable to harm
personal or property safety even though the commodities are
correctly applied or services are received in a correct way,
immediately report to the administrative departments concerned and
inform the consumers, and adopt measures to prevent damage.

    Article 19  Business operators shall provide consumers with
authentic information concerning their commodities or services, and
may not make any false and misleading propaganda.

    Business operators shall give truthful and definite replies to
inquiries from consumers about the qualities of the commodities or
services they supply and the operation methods thereof.

    Shops shall mark clearly the prices of the commodities they
supply.

    Article 20  Business operators shall indicate their real names
and marks.

    Business operators who lease counters or grounds from others
shall indicate their own real names and marks.

    Article 21  Business operators who supply commodities or services
shall make out for consumers invoices for purchases or documents of
services in accordance with relevant regulations of the State or
commercial practices; business operators must produce such invoices or
documents in case consumers so demand.

    Article 22  Business operators shall guarantee the quality,
functions, usage and term of validity which the commodities or
services they supply should possess under normal operation or
acceptance, except that consumers are aware of the defects before
they buy the commodities or receive the services.

    Business operators who employ advertisements, product
instructions, samples or other ways to display the quality state of their commodities or services shall guarantee that the actual
quality of the commodities or services they supply is in conformity
with that demonstrated.

    Article 23  Business operators who are under the obligation of repair or caveat venditor, or other responsibilities in accordance
with regulations of the State or agreements with consumers shall
carry out such obligations correspondingly according to such
regulations or agreements, and may not delay deliberately or refuse
unreasonably to do so.

    Article 24  Business operators may not, through format
contracts, notices, announcements, entrance hall bulletins and so
on, impose unfair or unreasonable rules on consumers or reduce or
escape their civil liability for their infringement of the
legitimate rights and interests of consumers.

    Format contracts, notices, announcements, entrance hall
bulletins and so on with contents mentioned in the preceding
paragraph shall be invalid.

    Article 25  Business operators may not insult or slander
consumers, may not search the body of consumers or the articles
they carry with them, and may not violate the personal freedom of consumers.
Chapter IV  Protection of the Legitimate Rights and Interests of        
Consumers by the State

    Article 26  The State shall heed to the opinions and demands
from consumers when making laws, regulations and policies
concerning consumer rights and interests.

    Article 27  People’s governments at various levels shall
strengthen their leadership, and organize, coordinate and supervise
the administrative departments concerned to do their work well in
the protection of the legitimate rights and interests of consumers.

    People’s governments at various levels shall strengthen
supervision to prevent occurrence of acts damaging to the personal
or property safety of consumers and promptly check any such acts.

    Article 28  Departments for industry and commerce of people’s
governments at various levels and other administrative departments
concerned shall adopt measures to protect the legitimate rights and
interests of consumers within the scope of their respective
functions and duties in accordance with the provisions of the laws
and regulations.

    Administrative departments concerned shall listen to the
complaints of consumers and their public organizations as to the
transactions of business operators and the quality of their
commodities and services, and carry out timely investigation and
disposition.

    Article 29  State organs concerned shall, in accordance with
the provisions of laws and regulations, punish any law-breaking or
criminial activities of business operators infringing upon the
legitimate rights and interests of consumers in their supplying
commodities or services.

    Article 30  The people’s courts shall adopt measures to
facilitate consumers to take legal proceedings and must entertain
and handle without delay cases of disputes over consumer rights and
interests that meet the conditions for a lawsuit specified in the
Civil Procedure Law of the People’s Republic of China.
Chapter V  Consumer Organizations

    Article 31  Consumer associations and other consumer
organizations are public organizations formed according to law to
exercise social supervision over commodities and services and to
protect the legitimate rights and interests of consumers.

    Article 32  Consumer associations shall perform the following
functions:

    (1) to afford consumption information and consultative
services to consumers;

    (2) to participate in supervision over or inspection of commodities and services conducted by relevant administrative
departments;

    (3) to make reports, inquiries and suggestions to relevant
administrative departments about issues relating to the legitimate
rights and interests of consumers;

    (4) to accept and hear complaints of consumers and offer
investigations and mediations with respect to points of complaints;

    (5) in case quality of commodities or services is involved,
to submit for appraisement the points of complaints to appraisal
departments which shall inform them of the expert conclusions;

    (6) to render support to victims in their legal proceedings
against infringement upon the rights and interests of consumers;

    (7) to expose and criticize through mass media the acts
infringing upon the legitimate rights and interests of consumers.

    People’s governments at various levels shall give support to
consumer associations in the performance of their functions.

    Article 33  Consumer organizations may not be engaged in
commodity transactions or profit-making services, and may not
recommend to the society commodities or services for the purpose of making profits.
Chapter VI  Settlement of Disputes

    Article 34  In case of disputes with business operators over
consumer rights and interests, consumers may settle the disputes
through the following approaches:

    (1) to consult and conciliate with business operators;

    (2) to request to consumer associations for mediation;

    (3) to appeal to relevant administrative departments;

    (4) to apply to arbitral organs for arbitration according to
the arbitral agreements with business operators;

    (5) to institute legal proceedings in the people’s court.

    Article 35  Consumers whose legitimate rights and interests are
infinged upon in their purchasing or using commodities may demand
compensation from the sellers concerned. In case the liability is
on the manufacturers or other sellers who supply the commodities to
the said sellers, the said sellers shall, after paying the
compensations, have the right to recover the compensations from the
manufacturers or the other sellers.

    Consumers or other victims suffering personal injuries or
property damage resulting from defects of commodities may demand
compensations either from the sellers or from the manufacturers. If
the liability is on the manufacturers, the sellers shall, after
paying the compensations, have the right to recover the
compensations from the manufacturers; if the liability is on the
sellers, the manufacturers shall, after paying the compensations,
have the right to recover the compensations from the sellers.  

    Consumers whose legitimate rights and interests are infringed
upon in receiving services may demand compensations from suppliers
of the services.

    Article 36  Consumers whose legitimate rights and interests are
infringed upon in purchusing or using commodities or receiving
services may, if the enterprises supplying the commodities or
services have been split-up or merged, demand compensations from
the enterprises succeeding to the rights and obligations of the
original ones after the modifications.

    Article 37  In case a business operator unlawfully uses
another’s business license to supply commodities or services and
infringes upon the legitimate rights and interests of consumers,
the consumers may demand compensations either from such business
operator or from the holder of the business licence.

    Article 38  Consumers whose legitimate rights and interests are
infringed upon in purchasing commodities or receiving services at
trade fairs or leased counters may demand compensations from the
sellers or suppliers of the services. In case the fairs are over or
the lease of counters expires, they may also demand compensations
from organizers of the fairs or lessors of the counters.
Organizers of the fairs and lessors of the counters shall, after
paying the compensations, have the right to recover the
compersations from the sellers or suppliers of the services.

    Article 39  Consumers whose legitimate rights and interests are
infringed upon on account of commodities or services supplied by
business operators by means of false advertisement may demand
compensations from the business operators. Consumers may demand
the competent administrative departments to punish the advertising
agents who make false advertisements. Advertising agents who cannot
provide the real names and addresses of the business operators
shall bear the responsibility for compensations.
Chapter VII  Legal Responsibility

    Article 40  Business operators shall, if the commodities and
services they supply involve any of the following circumstances,
bear civil liability in accordance with the provisions of the Law
of the People’s Republic of China on Product Quality and other
relevant laws and regulations, except as otherwise provided in the
present Law:

    (1) there existing defects in the commodities;

    (2) not possessing the properties for use they should possess
and no declaration thereabout is made at the time of sale;

    (3) not conforming to the standards indicated on the
commodities or on the packaging thereof;

    (4) not conforming to the quality indicated by the product
description or by physical samples;

    (5) producing commodities that have been formally declared by
the State to be sbsolete or selling commodities that are no longer
effective or deteriorated;

    (6) commodities sold being short of weight or quantity;

    (7) contents and costs of services being not in conformity
with the agreements;

    (8) deliberately delaying or unreasonably refusing consumers’
requests for repair, remanufacture, replacement, return of goods,
makeup for the short commodity, return of payment for goods or
services, or compensation for losses;

    (9) other circumstances infringing upon consumer rights and
interests as specified by laws and regulations.

    Article 41  Business operators shall, if the commodities or
services they supply have caused personal injuries to consumers or
other victims, pay for the victims’medical expenses, nursing
expenses during medical treatment, the reduced income for loss of working time and other expenses. And business operators shall,
if
the commodities or services they supply have disabled the
consumers, also pay for the victims’ expenses on self-help devices,
living allowances, compensations for disability and the necessary
living cost of the persons supported by the disabled. Business
operators shall, if the case constitutes a crime, be investigated
for criminal responsibility according to law.

    Article 42  Business operators shall, if the commodities or
services they supply have caused death of consumers or other
victims, pay for the victims’ funeral expenses, compensations for
death and the necessary living cost of the persons supported by the
deceased during their lifetime. Business operators shall, if the
case constitutes a crime, be investigated for criminal
responsibility according to law.

    Article 43  Business operators who violate the provisions of Article 25 of the present Law and violate the human dignity or
personal freedom of consumers shall stop the violations, restore
consumers’ reputation, dliminate the bad effects, make apologies,
and make compensations therefor.

    Article 44  Business operators shall, if the commodities or
services they supply have caused damage to the properties of consumers, bear civil liabilities  by repair, remanufacture,
replacement, return of goods, make-up for the short commodity,
return of payment for goods and services, or compensation for
losses and so on as demanded by consumers. If consumers and
business operators have otherwise agreed upon, such agreements
shall be fulfilled.

    Article 45  Business operators shall be responsible for repair,
replacement or return of goods, if repair, replacement or return of goods is guaranteed by provisions of the State or agreed upon
between business operators and consumers. Business operators shall
be responsible for replacement or return of goods if the
commodities still malfunction after being repaired twice within the
term of guaranteed repair.

    As to large-sized commodities guaranteed for repair,
replacement or return, business operators shall bear the
reasonable costs such as expenses for carriage if consumers demand
repair, replacement or return.

    Article 46  Business operators who supply commodities by
mail-order shall provide their commodities according to the
agreements. Business operators who fail to provide their
commodities according to the agreements shall fulfil the agreements
or return the consumers’ payment for the commodities on the demand
of the consumers, and bear the reasonable expenses that the
consumers must bear.

    Article 47  Business operators who supply commodities or
services in the form of advance payment shall provide their
commodities or services according to the agreements. Business
operators who fail to provide their commodities or services
according to the agreements shall fulfil the agreements or return
the advance payment on the demand of the consumers, and shall also
bear the interests of the advance payment and other necessary
expenses that the consumers must bear.

    Article 48  Business operators shall, on the demand of the
consumers, be responsible for return of goods determined to be
substandard commodities by administrative departments concerned
according to law.

    Article 49  Business operators engaged in fraudulent activities
in supplying commodities or services shall, on the demand of the
consumers, increase the compensations for victims’ losses; the
increased amount of the compensations shall be two times the costs
that the consumers paid for the commodities purchased or services
received.

    Article 50  If business operators are under any of the
following circumstances and the Law of the People’s Republic of China on Product Quality and other laws and regulations have
provided for punitive organs and forms therefor, the provisions of the laws or regulations shall be applied; in absence of such
provisions in the laws or regulations, administrative departments
for industry and commerce shall order them to make corrections, and
may, in light of the circumstances, punish the offenders
exclusively or concurrently the offenders with warning,
confiscation of unlawful earings, or imposition of a fine no less
than one time but not more than five times the value of the
unlawful earnings; in case there involves no unlawful earnings, the
offenders shall be punished with a fine of 10,000 Yuan or less, and
if the circumstances are serious, they shall be ordered to suspend
business for rectification, and their business licences shall be
revoked:

    (1) producing or selling commodities failing to meet the
requirements for the protection of personal and property safety;

    (2) mixing adulterations into their commodities, or passing
fake commodities off as genuine ones, or passing defective
commodities off as good ones, or passing substandard commodities
off as standard ones;

    (3) producing commodities which have been formally declared by
the State to be obsolete, or selling commodities no longer
effective or deteriorated;

    (4) forging the origin of commodities, forging or
counterfeiting the names and addresses of other factories, and
forging or counterfeiting the anthentication marks or
famous-and-excellent-product marks;

    (5) selling commodities not inspected or quarantined against
the requirement therefore, or forging the result of inspection or
quarantine;

    (6) making false or misleading propaganda about their
commodities or services;

    (7) deliberately delaying or unreasonably refusing consumers’
demand for repair, remanufacture, replacement, return of goods,
make-up for the short commodity, refundment of payment for goods
or services, or compensations for losses;

    (8) violating human dignity or personal freedom of consumers;

    (9) other circumstances wherein punishment shall be given for
infringement of consumer rights and interests as stipulated by laws
or regulation..

    Article 51  Any business operator who is not satisfied with the
decision on punishment may apply to the organ at the next higher
level for reconsideration within 15 days from the date of receipt
of the decision; and he who is still not satisfied with the
reconsideration decision may bring a lawsuit in the people’s court
within 15 days from the date of receipt of the reconsideration
decision; or he may take legal proceedings directly in the people’s
court.

    Article 52  Anyone who, by means of violence or threats,
hinders functionaries of the administrative departments concerned
from performing their duties according to law, shall be
investigated for criminal responsibility according to law; and
those who refuse or hinder functionaries of the administrative
departments concerned from performing their duties according to
law, without resorting to violence or threats, shall be punished by
public security organs in accordance with the stipulations of the
Regulations of the People’s Republic of China on the Administrative
Penalties for Public Security.

    Article 53  Any functionary of the State organs, who neglects
his duties or shields any business operator guilty of infringement
of the legitimate rights and interests of consumers, shall be given
administrative sanctions by the unit he b

PROVISIONAL REGULATIONS ON BUSINESS TAX

Provisional Regulations of the People’s Republic of China on Business Tax

     (State Council: 13 December 1993)

Whole Doc.Article 1

All units and individuals engaged in the provision of services asprescribed in these Regulations (hereinafter referred
to as ‘taxableservices’), the transfer of intangible assets or the sale of immovableproperties within the territory of the
People’s Republic of China shall betaxpayers of Business Tax (hereinafter referred to be ‘taxpayers’), andshall pay Business Tax
in accordance with these Regulations.Article 2

The taxable items and tax rates of Business Tax shall be determinedin accordance with the attached to these Regulations.

Any adjustments to the taxable items and tax rates shall bedetermined by the State Council.

The specific tax rates applicable to taxpayers engaged inentertainment businesses shall be determined by the People’s
governmentsof the provinces, autonomous regions and municipalities directly under thecentral government within the range prescribed
by these Regulations.Article 3

For taxpayers engaged in taxable activities under different taxitems, the turnover, transfer and sales amounts (hereinafter
referred toas ‘turnover’) under different taxable items shall be accounted forseparately. If the turnover has not been
accounted for separately, thehigher tax rate shall apply.Article 4

For taxpayers providing taxable services, transferring intangibleassets on selling immovable properties, the tax payable
shall be computedaccording to the turnover and the prescribed tax rates. The formula forcomputing the tax payable is as follows:

Tax payable = Turnover x Tax rate

The tax payable shall be computed in Renminbi, The turnover of thetaxpayer settled in foreign currencies shall be converted
into Renminbiaccording to the exchange rate prevailing in the foreign exchange market.Article 5

The turnover of the taxpayers shall be the total consideration andall other changes receivable from the payers for the provision
of taxableservices transfer of intangible assets or sales of immovable properties bythe taxpayers, except for the following situations:

(1) For transportation enterprises which carry passengers or cargoesfrom the territory of the People’s Republic of China
to over seaslocations and trans-ship passengers or cargoes to other transportationenterprises overseas, the turnover shall
be the balance of transportcharges for the whole journey less the transport charges paid to thesub-contracted transportation
enterprises.

(2) For travel enterprises which organize tourist groups to traveloutside the territory of the People’s Republic of China
and sub-contractto other travel enterprises overseas, the turnover shall be the balance ofthe tourist charges for the whole journey
less the payments made to thosesub-contracted travel enterprises.

(3) For the main contractors in the construction business whosub-contract work to others, the turnover shall be the
balance of thetotal contract sum less the payments made to the sub- contractors.

(4) For re-lending businesses, the turnover shall be the balance ofinterest on lending less the interest on borrowing.

(5) For businesses buying and selling foreign currencies, marketablesecurities and futures, the turnover shall be the balance
of the sellingprices less the buying prices.

(6) Other situations as regulated by the Ministry of Finance.Article 6

The following items shall be exempt from Business Tax:

(1) Nursing services provided by nurseries, kindergartens, homes forthe aged, welfare institutions for the handicapped,
matchmaking andfuneral services.

(2) Services provided on individual basis by the disabled.

(3) Medical services provided by hospitals, clinics and other medicalinstitutions.

(4) Educational services provided by schools and other educationalinstitutions; and services provided by students
participating inwork-study programs.

(5) Agricultural mechanical ploughing, irrigation and drainage,prevention and treatment of plant diseases and insect
pests, plantprotection, insurance for farming and animal husbandry, and relatedtechnical training services; breeding and
the prevention and treatment ofdiseases of poultry, livestock and aquatic animals.

(6) Admission fees for cultural activities conducted by memorialhall, museum, cultural centre, art gallery, exhibition
hall, academy ofpainting and calligraphy, library and cultural protective units; admissionfees for cultural and religious
activities conducted at places ofreligious worship.

Except as stipulated in the above paragraphs, the Business Taxexemption and reduction items shall be regulated by the
State Council.Local governments or departments shall not regulate any tax exemption orreduction items.Article 7

For taxpayers engaged in tax exempt or tax reduced items, theturnover shall be accounted for separately. if the turnover
has not beenseparately accounted for, no exemption of reduction is allowed.Article 8

For taxpayers whose turnover has not reached the Business Tax minimumthreshold stipulated by the Ministry of Finance, the Business
Tax shall beexempt.Article 9

The time at which a liability to Business Tax arises shall be thedate on which the business proceeds are received or documented
evidence ofright to collect business proceeds is obtained by the taxpayer.Article 10

Business Tax shall be collected by the tax authorities.Article 11

Business Tax withholding agents are as follows:

(1) For financial institutions entrusted to grant loans, theentrusted financial institutions shall be the withholding
agents.

(2) For sub-contracting of construction and installation business,the main contractors shall be the withholding agents.

(3) Other withholding agents as stipulated by the Ministry ofFinance.Article 12

The place for the payment of Business Tax is as follows:

(1) Taxpayers providing taxable services shall report and pay tax tothe local competent tax authorities where the taxable services
take place.Taxpayers engaged in the transportation business shall report and pay taxto the local competent tax authorities where
the business establishment islocated.

(2) Taxpayers transferring land use rights shall report and pay taxto the local competent tax authorities where the
land is located.Taxpayers transferring other intangible assets shall report and pay tax tothe local competent tax authorities where
the establishment is located.

(3) Taxpayers selling immovable properties shall report and pay taxto the local competent tax authorities where the immovable
properties arelocated.Article 13

The Business Tax assessable period shall be five days, ten days,fifteen days or one month. The actual assessable period
of taxpayers shallbe determined by the competent tax authorities according to the magnitudeof the tax payable of the taxpayers;
tax that cannot be assessed inregular periods may be assessed on a transaction-by-transaction basis.

Taxpayers that adopt one month as an assessable period shall reportand pay tax within ten days following the end of the
period. If anassessable period of five days, ten days or fifteen days is adopted, thetax shall be prepaid within five days following
the end of the period anda monthly tax return shall be filed with any balance of tax due settledwithin ten days from the first
day of the following month.

The tax payment deadlines for withholding agents shall be determinedwith reference to the stipulations of the above two paragraphs.Article
14

The collection and administration of Business Tax shall be conductedin accordance with the relevant regulations of the and theseRegulations.Article 15

The collection of Business Tax from foreign investment enterprisesand foreign enterprises shall be conducted in accordance
with theresolutions of the Standing Committee of the National People’s Congress.Article 16

The Ministry of Finance shall be responsible for the interpretationof these Regulations and for the formulation of the Detailed
Rules andRegulations for the Implementation of these Regulations.Article 17

These Regulations shall come into effect from January 1, 1994, Thepromulgated by the State Council on September 18, 1984 shall be repealedon the same date.

BUSINESS TAX TAXABLE ITEMS AND TAX RATES TABLE

———————————————————————–

Taxable

items Scope of charge Tax Rate %

———————————————————————–

1. Communications

and transportation Transportation by land, water, 3

air and pipeline, loading

unloading and delivery

2. Construction Construction, installation,

repair, decoration and other

engineering work 3

3. Finance and insurance 5

4. Posts and

telecommunications 3

5. Culture and sports 3

6. Entertainment Singing bars, dance halls, 5-20

karaoke lounges, commercial

music halls, musical tea

houses, billiards, golf,

bowling and amusement

facilities

7. Servicing Agency, hotel, catering, 5

tourism, warehousing,

leasing, advertising and

other services

8. Transfer of

intangible assets Transfer of land-use rights, 5

patent rights, unpatchted

technologies, trade marks,

copyrights and goodwill

9. Sale of immovable

properties Sale of buildings and other 5

attachments to land

———————————————————————–

    





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CONSTITUTION ACT, 1982 – page 22

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

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

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