2004

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON PERFORMING CLASSIFIED MANAGEMENT ACCORDING TO COMPANIES ON TAXATION REIMBURSEMENT(EXEMPTION) FOR EXPORTED GOODS

20040601

The State Administration of Taxation

Circular of the State Administration of Taxation on Performing Classified Management According to Companies on Taxation Reimbursement(exemption)
for Exported Goods

GuoShuiFa [1998] No.95

June 8, 1998

Taxation Administrations of provinces, autonomous regions, municipalities directly under the Central Government and municipalities
separately listed on the State plan:

With a view to supporting export companies to earn foreign exchange and promoting the development of China’s national economy, in
conformity with the principle of ensuring timely taxation reimbursement for export in full amount as well as effectively guarding
against and puncturing illegal activities and criminal cases of gaining taxation reimbursement for export by cheating, the State
Bureau of Taxation has decided to perform classified management according to companies on taxation reimbursement (exemption) for
exported goods and to simplify certificates for tax reimbursement report. The circular is hereby given as follows:

1.

Taxation authorities in charge of taxation reimbursement for export should perform classified management on local exporting companies
(including foreign-invested companies) and divide them into four categories, namely, A, B, C, and D, according to their actual situation
of taxation reimbursement (exemption) for export in recent years.

(1)

Companies of category A should be qualified as follows simultaneously:

i.

They must be enterprises which produce boats and ships or large-scale complete sets of electrical machinery whose production periodicity
is longer than one year and which possess power to engage in import and export trade.

ii.

They must be capable of earning foreign exchange of more than USD 30 million per year.

iii.

They never committed cheating in taxation.

iv.

They must possess certain amount of assets so as to be able to raise a mortgage on reimbursed (exempted) tax once cheat in taxation
or improper taxation reimbursement happens.

v.

They must possess a sound financial system.

(2)

Companies of category B should be qualified as follows simultaneously:

i.

They have earned foreign exchanges of more than USD 30 million in the last two consecutive years (USD 20 million is allowed for producing
enterprises).

ii.

They have never committed cheating in taxation and has never been suspected of being involved in cheating in taxation in the last
three years.

iii.

They must possess certain amount of assets so as to be able to raise a mortgage on reimbursement (exempted) tax once cheating in taxation
or improper taxation reimbursement happens.

iv.

They must have a sound financial system.

(3)

Companies of category C should be qualified as follows simultaneously:

i.

They have never committed cheating in taxation in the last three years.

ii.

They must have a sound financial system.

(4)

Companies of category D refer to those which once committed cheating in taxation in the last three years.

2.

To perform a management method of before-verification-and-writing-off taxation reimbursement on companies of category A. On submitting
application reports for taxation exemption, deduction and drawback on self-exported (commission-exported) goods, companies of category
A can apply for taxation reimbursement (exemption) by showing export contracs and sales subsidiary ledgers when the taxation reimbursement
receipts are not fully gathered. After all the taxation reimbursement receipts are gathered, re-audit (including audit by certificates
and counter- audit on electronic information) and verification and writing-off can be carried out. At the end of the year, clearance
should be made on reimbursed (exempted) taxation according to relevant stipulations. Extra reimbursement (exemption) should be returned
to the central taxation bank and insufficient reimbursement (exemption) should be made up.

3.

To perform a management method of report for taxation reimbursement according to simplified certificates on companies of category
B. Companies of category B can apply for taxation reimbursement (exemption) by showing the Customs Declaration Forms for outbound
freight (specified slips of taxation reimbursement for export) and pay-in warrant of value- added tax (specified for export goods)
after the goods have been declared at the customs and exported. Other certificates (that is, verification and writing-off certificates
for export collection, specified invoices for value-added taxation, export invoices and other auxiliary certificates) need not be
sent in monthly, but should be bound up for inspection. After auditing it to be correct (including audit by certificates and counter
audit on electronic information), taxation authorities can conduct formalities of approving for taxation reimbursement (exemption).

As far as verification and writing-off certificates of export collection for exported goods of companies of category B is concerned,
total volume management and end-year clearance should be performed. If foreign exchange is not verified and written off when clearance
is made, except for the exported goods with certificates of mid-or long-term exchange settlement issued by authorities in charge,
taxation of unverified and unwritten-off foreign exchange should be drawn back from reimbursed taxation in certain proportion in
the next year.

4.

To perform a management method of applying for taxation reimbursement after all the certificates are gathered on companies of category
C. As far as goods exported by companies of category C are concerned, reports for taxation reimbursement can be made only when, after
the goods have been declared at the customs and exported, the customs declaration forms for outbound freight (specified slips of
taxation reimbursement for export), pay-in warrant of the value-added tax (specified for export goods), verification and writing
off certificates for export collection, specified invoices for the value-added tax and other certificates for taxation reimbursement
are gathered. Taxation authorities in charge should audit and approve taxation reimbursement on the basis of close audit on certificates
for taxation reimbursement and electronic information.

5.

To perform a strict system of report, audit and approving for taxation reimbursement of exported goods of companies of category D.
Except for the management method performed on C, taxation authorities in charge of taxation reimbursement for export should strictly
audit the application materials and, after audit them to be correct, approve taxation reimbursement on the basis of the fact that
payment of goods is made to the seller and certificates for taxation reimbursement and electronic imformation are true and in full.

6.

Lists of companies of category A should be reported to the State Bureau of Taxation by Taxation Administrations of provinces, autonomous
regions, municipalities directly under the Central Government and municipalities separately listed on the State plan, and will be
approved and issued by the State Bureau of Taxation after consulting with MOFTEC. Lists of companies of category B, C and D should
be determined by Taxation Administrations of provinces, autonomous regions, municipalities directly under the Central Government
and municipalities separately listed on the State plan according to local actual situations after consulting with foreign economic
relations and trade departments (commissions, bureaus) at the same level. If, with a province, a city, or an autonomous region, qualified
companies of category B are less than ten, companies with annual export volume of less than USD 30 million can be chosen to make
ten.

7.

The classification of export companies should be carried out once a year. Within one month after the clearance for taxation reimbursement
is finished every year, taxation authorities in charge of taxation reimbursement for export should make adjustment on the classification
of export companies according to the actual situation of taxation reimbursement (exemption) for export in the last year. Lists of
possible companies of category A should be reported by Taxation Administrations of provinces, autonomous regions, municipalities
directly under the Central Government and municipalities separately listed on the State plan by the end of June of the year to the
State Administration for approval.

8.

If export companies of category A or B commit taxation cheating, once found, they will autonomously lose all preferencial treatments
in regard of application for taxation reimbursement. Besides transference into companies of category D, taxation authorities in charge
of taxation reimbursement will punish them according to relevant stipulations.

9.

Once transferred into category D, they should not be transferred back to category B or C within three years.

10.

Taxation authorities in charge of taxation reimbursement for export should adhere to the principle of seeking truth from facts and
perform classified management on export companies according to the qualifications atipulated in this circular. As to those who deliberately
put anqualified companies into category A or B or C, the State Administration will circulate a notice of criticism.

11.

This circular enters into force as of June 1, 1998.



 
The State Administration of Taxation
1998-06-08

 







INTERIM PROCEDURES ON ADMINISTRATION OF SECURITIES AND FUTURES INVESTMENT CONSULTANCY

Interim Procedures on Administration of Securities and Futures Investment Consultancy

     CHAPTER ONE GENERAL PROVISIONS CHAPTER TWO SECURITIES AND FUTURES INVESTMENT CONSULTANCY INSTITUTIONS CHAPTER THREE SECURITIES AND
FUTURES INVESTMENT CONSULTANTS CHAPTER FOUR ADMINISTRATION OF SECURITIES AND FUTURES INVESTMENT CONSULTANCY BUSINESS CHAPTER FIVE
PENALTIES CHAPTER SIX SUPPLEMENTARY PROVISION

   Article 1 This set of procedures is formulated for the strengthening of administration of consultancy services over securities and futures
investment and protecting public interests and the lawful rights and interests of investors.

   Article 2 This set of procedures must be abided by when conducting securities and futures investment consultancy services within the boundaries
of the People’s Republic of China.

Securities and futures investment consultancy referred to in this set of procedures means direct or indirect paid consultancy services
such as securities and futures investment analyses, forecasts or suggestions given by institutions engaged in securities and futures
investment consultancy and their consultants to securities and futures investors or clients through the following means:

(1) Commissioned by investors or clients to provide securities and futures investment consultancy services;

(2) Undertaking lectures, seminars and analyzing meetings in respect of securities and futures investment consultancy;

(3) Publishing articles, commentaries and reports on securities and futures investment in newspapers and magazines, or providing securities
and futures investment consultancy services through radio stations, television stations and other public communications media;

(4) Providing securities and futures investment consultancy services through telephone, facsimile, computer networks and other telecommunications
systems;

(5) Other means as determined by the China Securities Regulatory Commission (hereinafter referred to as the CSRC).

   Article 3 To be engaged in securities and futures investment consultancy business, permission should be obtained from the CSRC in accordance
with the provisions of this set of procedures. Without the permission of the CSRC, no institutions or individuals is allowed to engage
in securities and futures investment consultancy business through the means listed in Article 2 of this set of procedures.

Securities business institutions and futures brokerage institutions and their employees that are engaged in securities and futures
investment consultancy business exceeding the institutions’ business scope should abide by the provisions of this set of procedures.

   Article 4 Securities and futures investment consultancy business should be undertaken in accordance with relevant laws, regulations, rules
and related provisions of the CSRC and the principles of objectivity, fairness, honesty and creditability.

   Article 5 The CSRC and the local securities and futures regulatory departments authorized by the CSRC (referred to hereinafter as local securities
regulatory authorities) shall be responsible for the supervision and administration of securities and futures investment consultancy
business and for the implementation of this set of procedures.

CHAPTER TWO SECURITIES AND FUTURES INVESTMENT CONSULTANCY INSTITUTIONS

   Article 6 To apply for qualification of engagement in securities and futures investment consultancy business, the following requirements should
be met:

(1) For institutions engaged in securities investment consultancy services or futures investment consultancy services separately,
more than five full-time employees who have acquired qualifications for engagement in securities or futures investment consultancy
business should be accommodated; for institutions engaged in securities investment consultancy services and futures investment consultancy
services concurrently, more than 10 full-time employees who have acquired qualifications for engagement in securities or futures
investment consultancy business should be accommodated; among their high-ranking managerial personnel, there shall be at least one
who has acquired qualifications for engagement in securities or futures investment consultancy business;

(2) With more than RMB1 million in registered capital;

(3) In possession of a fixed business site and necessary communications and other information-transmission facilities relevant to
business;

(4) Having formulated articles of association for the company;

(5) Having sound internal management mechanism;

(6) Meeting other conditions as required by the CSRC.

   Article 7 Only securities business institutions and futures brokerage institutions that can meet the requirements as set in Article 6 of this
set of procedures may apply for engaging in consultancy services on investments to securities and futures that are not involved in
the business of such institutions.

Institutions engaging in other consultancy service may apply for engagement in securities and futures consultancy services only if
they can meet the requirements as set in the Article 6 of this set of procedures.

   Article 8 Institutions applying for qualification of engagement in securities and futures investment consultancy business should seek examination
and approval according to the following procedures:

(1) The applicant files application with local securities regulatory authorities authorized by the CSRC (if the local securities regulatory
authorities have not been authorized by the CSRC, the application shall be filed directly with the CSRC, the same hereinafter), and
the local securities regulatory authorities shall, after examination and verification of and consent with the application, give the
initial opinions of the examination;

(2) The local securities regulatory authorities report and sent the application papers that have been examined and approved to the
CSRC. After examination and approval of the CSRC, business license is issued to the applicant, with duplicates of the approval papers
sent to the local securities regulatory authorities;

(3) The CSRC will publish the conditions of the applicants who have acquired business licenses through public notices.

   Article 9 Institutions applying for qualification of engagement in securities and futures investment consultancy business, should submit the
following documents:

(1) Application form printed by the CSRC on a unified basis;

(2) The company’s articles of association;

(3) Business license of the enterprise’s legal person;

(4) Name-list of the institution’s high-ranking managerial personnel and full-time employees engaged in securities and futures investment
consultancy business and their education background, work experience and employment qualification certificates;

(5) Modes of engagement in investment consultancy business and the internal administration regulations and rules;

(6) Testimonial documents on the use of business sites, the institution’s mailing address, telephone and facsimile numbers;

(7) Asset evaluation reports as furnished by certified public accountants; and

(8) Other documents as required by the CSRC.

   Article 10 Whereas there are changes in the securities and futures investment consultancy institutions’ mode of business, business sites, major
persons in charge and professional employees with qualification certificates for engagement in securities and futures investment
consultancy business, the changes should be filed with the local securities regulatory authorities within five business days since
the occurrence of such changes so as to register the changes.

   Article 11 Securities and futures investment consultancy institutions shall apply for annual inspections between January 1 and April 30 of each
year. When file for annual inspections, the following documents shall be subimtted:

(1) Application report for annual inspection;

(2) Annual business report; and

(3) Annual financial balance sheets audited by certified public accountants;

The local securities regulatory authorities shall provide examination and verification opinions within 20 business days since receipt
of the documents mentioned above; if approved after examination and verification, the documents shall then be sent to the CSRC for
examination and approval.

Securities and futures investment consultancy institutions that fail to submit annual inspection reports of fail to pass annual inspections
after examination and verification shall not continue to be engaged in securities and futures investment consultancy business.

CHAPTER THREE SECURITIES AND FUTURES INVESTMENT CONSULTANTS

   Article 12 Persons engaged in securities and futures investment consultancy business should obtain qualification certificates for engagement
in securities and futures investment consultancy business and join a securities and futures investment consultancy institution with
business qualifications and then be engaged in securities and futures investment consultancy business.

Failure to obtain qualification certificates for securities and futures investment consultancy business, or though having acquired
qualification certificates for securities and futures investment consultancy business, but fails to join a securities and futures
investment consultancy institution, are not allowed to be engaged in securities and futures investment consultancy business.

   Article 13 Securities and futures investment consultants applying for qualification for engagement in securities and futures investment consultancy
business shall meet the following requirements:

(1) Having citizenship of the People’s Republic of China;

(2) Having full capacity for civil conduct;

(3) Having good integrity, being honest and excellent in work ethics;

(4) Having not been penalized for criminal offenses or major violations in the field of securities and futures business;

(5) Having educational background of above colleges;

(6) Securities investment consultants having over two years of experience in securities business; futures investment consultants have
over two years of experience in futures business;

(7) Having passed examinations for qualification organized by the CSRC on a unified basis for people engaged in securities and futures
business; and

(8) Other requirements as stipulated by the CSRC.

   Article 14 Securities and futures investment consultants applying for qualification for engagement in securities and futures investment consultancy
business should seek examination and approval according to the following procedures:

(1) The applicant files application with local securities regulatory authorities authorized by the CSRC (if the local securities regulatory
authorities have not been authorized by the CSRC, the application shall be filed directly with the CSRC, the same hereinafter), and
the local securities regulatory authorities shall, after examination and verification of and consent with the application, give the
initial examination opinions; and

(2) The local securities regulatory authorities report and send the application papers that have been examined and approved to the
CSRC. After examination and approval of the CSRC, business license is issued to the applicant, with duplicates of the approval papers
sent to the local securities regulatory authorities.

   Article 15 Securities and futures investment consultants applying for qualification for engagement in securities and futures investment consultancy
business should submit the following documents:

(1) Application form uniformly printed by the CSRC;

(2) Identification cards;

(3) Academic certificates;

(4) Applicants’ score reports of qualification examinations for persons engaged in securities and futures business;

(5) Statements on the applicants’ past conduct provided by the unit where the applicants work or the subdistrict offices of the applicants’
registered permanent residence; and

(6) Other documents as required by the CSRC.

   Article 16 For those who have acquired qualification for engagement in securities and futures investment consultancy business, when they are
applying for practice in the business, the application shall be filed by the securities and futures investment consultancy institutions
that they join with the local securities regulatory authorities where the institutions are located. The local securities regulatory
authorities, after examining, verifying and approving, shall report the application to the CSRC for further examination and approval;
if allowed to practice in the business, business practice certificate will be issued by the CSRC.

   Article 17 For those who have acquired qualification for engagement in securities and futures investment consultancy business shall undergo
business annual inspections when the securities and futures investment consultancy institutions they are serving undergo annual inspections.
For those who have acquired qualification for engagement in securities and futures investment consultancy business but failed to
practice in such a business for 18 months since the date of acquisition of the qualifications, their qualifications shall be automatically
out of effect.

   Article 18 Persons who are engaged in securities and futures investment consultancy business are not allowed to serve with two or more securities
and futures investment consultancy institutions at the same time.

CHAPTER FOUR ADMINISTRATION OF SECURITIES AND FUTURES INVESTMENT

   Article 19 Securities and futures investment consultancy institutions and their investment consultants should abide by the established principles
of prudence, honesty and diligence in the business and provide securities and futures investment consultancy services to investors
and clients.

   Article 20 Securities and futures investment consultancy institutions and their investment consultants should use related information and data
objectively, precisely and completely in providing investment analyses, forecasts and suggestions to investors and clients. They
are not allowed to quote related information and data out of their context or tamper with the related information and data. When
quoting related information and data, the sources and copyright holders shall be noted.

   Article 21 Securities and futures investment consultancy institutions and their investment consultants are not allowed to provide investors
or clients with investment analyses, forecasts and suggestions based on false information, market talks or inside information.

   Article 22 Securities and futures investment consultants, when publishing articles, delivering lectures or giving suggestions in newspapers,
magazines, on radio and television broadcasts or through other communications media, should clearly mark the name of the securities
and futures investment consultancy institutions where they serve and their own real name, and fully explain the investment risks
involved. Securities and futures investment consultancy institutions, when transmitting facsimile messages concerning securities
and future investment consultancy to investors and clients, should clearly mark the institutions’ name, address, telephone number
and persons for contact.

   Article 23 Securities and futures investment consultancy institutions, when jointly running special columns, programs on securities and futures
investment consultancy with newpapers, magazines, radio stations and television stations, or when conducting business cooperation
with telecommunications services providers, should report to the local securities regulatory authorities for the record. When they
file with the local securities regulatory authorities, the following data should be included: content of cooperation, starting and
termination, column arragngements, times when the programs will be aired, persons responsible for the projects, etc., with seals
of both units affixed.

   Article 24 Securities and futures investment consultancy institutions and their investment consultants are banned from the following activities:

(1) Buying and selling securities and futures on behalf of investors;

(2) Making pledges on profits for securities and futures investment to investors;

(3) Making agreements with investors to share investment profits or losses;

(4) Buying stocks or securities that have the nature and funcions of securities, and futures for themselves;

(5) Capitalizing on consultancy services to collaborate with others in manipulating the market or engagement in inside trading; and

(6) other frauds concerning securities and futures banned by laws, regulations and rules.

   Article 25 Investment analyses, forecasts and suggestions given by securities and futures investment consultancy institutions on the same topic
should be consistent when sending to different clients.

Securities business institutions that conduct securities transactions themselves, when being engaged in securities investment consultancy
business exceeding their normal business scope, should provide consistent suggestions on the same topic to both the general public
and the institutions’ own departments that manage securities transactions. They are not allowed to mislead the public for the benefit
of their own business profits.

   Article 26 Brief reports, bulletins, development reports and information systems on securities and futures compiled and distributed by securities
business institutions and futures brokerage institutions for internal use should be restricted to uses within the institutions themselves
and are not allowed to be provided to the general public through any channels.

Underwriters of companies approved by the CSRC to issue stocks publicly, or stock placement recommenders and the securities investment
consultancy institutions where they serve, are not allowed to publish investment value analysis reports compiled for their clients
in public communications media.

   Article 27 The CSRC and the local securities regulatory authorities have the right to conduct inspections on business activities of securities
and futures investment consultancy institutions and securities and futures investment consultants. Securities and futures investment
consultancy institutions and securities and futures investment consultants being inspected should cooperate and not interfere in
or obstruct the inspections. The CSRC and the local securities regulatory authorities and their personnel, when conducting inspections,
should pay attention to protection of the trade secrets of those involved.

   Article 28 Securities and futures investment consultancy institutions should preserve for two years the investment consultancy data they provided
to investors or the general public.

   Article 29 The local securities regulatory authorities, when acting on complaints and tip-offs from investors or the public, have the right
to demand securities and futures investment consultancy institutions and their investment consultants to make explanations and provide
related data.

   Article 30 Any units or individuals who found violations of this set of procedures by securities and futures investment consultancy institutions,
investment consultants or other institutions or individuals can lodge complaints with or give tip-offs to the local securities regulatory
authorities.

   Article 31 The local securities regulatory authorities shall place acts of violation of this set of procedures on file for investigation and
report the results of the investigations to the CSRC for the record.

   Article 32 Unauthorized engagement in securities and futures investment consultancy business as described in Article 2 of this set of procedures
without the approval of the CSRC shall be ordered by the local securities regulatory authorities to cease, and is subject to confiscation
of illicit gains and fines below the amount of illicit gains.

   Article 33 Securities and futures investment consultancy institutions that are engaged in one of following acts shall be fined of more than
RMB10,000 but less than RMB50,000 by the local securities regulatory authorities; should the circumstances be serious enough, the
local securities regulatory authorities shall report to the CSRC and the CSRC hands out penalties of suspension or revocation of
the institution’s business qualifications:

(1) Documents and data submitted to securities regulatory departments contain false statements or major omissions;

(2) Failure to meet the obligations of reporting and annual inspections as stipulated in this set of procedures;

(3) Failure to register changes in the related matters of the institutions in accordance with provisions of this set of procedures;

(4) Securities and futures investment consultants employed by the institutions received administrative penalties for violations of
this set of procedures; and

(5) Interference in and obstruction of inspections, investigations conducted by the local securities regulatory authorities, or the
concealment, destruction of evidence.

   Article 34 Whereas securities and futures investment consultancy institutions violate Articles 18, 19, 20, 21, 22, 23, 24, 25 and 28 of this
set of procedures, the local securities regulatory authorities shall given them individually or concurrently a warning, confiscation
of illegal income, or a fine of more than RMB10,000 but less than RMB50,000. If the circumstances are serious, the local securities
regulatory authorities shall report to the CSRC and the CSRC hands out penalties of suspension or revocation of the institutions’
business qualifications. If a crime is constituted, criminal sanctions will be given.

   Article 35 Whereas securities and futures investment consultancy institutions violate Article 26 of this set of procedures, the local securities
regulatory authorities shall order them to make corrections, and give them a warning or a fine of more than RMB10,000 but less than
RMB50,000.

   Article 36 Whereas securities and futures investment consultants violate Articles 18, 19, 20, 21, 22 and 24 of this set of procedures, or fail
to meet their obligations of reporting and annual inspections in accordance with this set of procedures, the local securities regulatory
authorities shall give them individually or concurrently a warning, confiscation of illegal income, or a fine of more than RMB10,000
but less than RMB30,000. If the circumstances are serious, the local securities regulatory authorities shall report to the CSRC and
the CSRC hands out penalties of suspension or revocation of their business qualifications. If a crime is constituted, criminal sanctions
will be given.

   Article 37 Staff members of the CSRC and the local securities regulatory authorities who neglect their duties, abuse their power, play favoritism
and commit irregularities will be given criminal sanctions whereas crimes are involved. Whereas no crimes are involved, administrative
penalties will be given in accordance with the law.

CHAPTER SIX SUPPLEMENTARY PROVISION

   Article 38 This set of procedures shall enter into force as of April 1,1998.

    






PROVISION OF THE STATE ADMINISTRATION FOR THE QUARANTINE OF IMPORT AND EXPORT COMMODITIES, THE STATE IMPORT & EXPORT OFFICE FOR MECHANICAL AND ELECTRICAL PRODUCTS ON THE IMPORTATION AND INSPECTION OF USED MECHANICAL AND ELECTRICAL PRODUCTS

The State Administration for the Quarantine of Import and Export Commodities, the State Import & Export Office for Mechanical and
Electrical Products

Provision of the State Administration for the Quarantine of Import and Export Commodities, the State Import & Export Office for Mechanical
and Electrical Products on the Importation and Inspection of Used Mechanical and Electrical Products

GuoJianJianLian [1998] No.26

February 8, 1998

Commodity Inspection Bureaus of Various Localities, Mechanical and Electrical products import and export Offices of Various Localities
and Departments:

In light of the spirit of the Circular on Enhancing the Management of the Importation of Used Mechanical and Electrical Products jointly
issued by the State Economic and Trade Commission, the Ministry of Foreign Trade and Economic Cooperation, the General Administration
of Customts and the State Administration for the Quarantine of Import & Export Commodities, and for the purpose of protecting environment
and safeguarding the people’s health and ensuring the safety of production, the relevant matters concerning the importation and inspection
of used mechanical and electrical products are hereby stipulated as follows:

1.

The State Import & Export Office for Mechanical and Electrical Products shall not approve the importation of and the State Commodity
Inspection Bureau shall not put on file used mechanical and electrical products listed in the Catalogue for Imports under the Safety
and Quality Licensing System (see attachment 1). The exceptions go to those especially required by the State to be imported.

2.

In signing a contract or a binding agreement, any unit which has been permitted to import used mechanical and electrical products
shall, in accordance with legal requirements of the State concerning security, sanitation and environmental protection, etc. set
up inspection clauses stipulating the imspection basis and all the technique indicators, etc. For the said products; and for those
used mechanical and electrical products and large-scale “second-hand” plant equipment related to the security of the State, environmental
protection and people’s health, the import unit concerned shall formulate clauses in the foreign trade contract stipulating that
preliminary inspection and supervision of shipment shall be conducted before shipment is made in the export country.

3.

Within 30 days after the contract or agreement taking effect, the unit to import used mechanical and electrical products (or the consignee)
shall go to register with the commodity inspection organ in the place where the imports are going to be used, taking along with it
the contract or agreement as well as duplicates of the relevant import certificates issued by the State Import & Export Office for
Mechanical and Electrical Products.

If it is stipulated in the contract that preliminary inspection and shipment-supervision before shipping shall be conducted, the commodity
inspection organ shall, if necessary, send out inspectors to participate in or organize the preliminary inspection and the shipment-supervision
before shipping.

4.

Before declaring the used mechanical and electrical products to be imported at the customs, the import unit (or the consignee) shall
take along with it the relevant original import certificate issued by the State Import & Export Office for Mechanical and Electrical
Products and the relevant foreign trade documents to apply to the commodity inspection organ at the port where the imports are arriving
for the Filing Form for Importation of the Used Mechanical and Electrical Products.

After receiving the declaration, the port commodity inspection organ shall present the Filing Form for Importation of the Used Mechanical
and Electrical Products (the first couplet) sealed with “registration accepted” and pass on in time the Filing Form for Importation
of the Used Mechanical and Electrical Products (the second couplet) to the commodity inspection organ in the place where the imports
are going to be used.

5.

After the used mechanical and electrical products imported have gone through the customs, the import unit (or the consignee) shall,
within the stipulated time, take along with it the necessary documents including the invoice, the packing list and the bill of lading,
etc. To apply to the commodity inspection organ in the place where the imports are going to be used for inspection. Without application
for the inspection, any such product shall not be sold, installed or used.

6.

The inspection of the used mechanical and electrical products imported shall be conducted in accordance with the Commodity Inspection
Law, the Enforcement Regulations of the Commodity Inspection Law and relevant provisions concerning commodity inspection.

7.

These provisions shall be implemented as of the date of promulgation.

Attachment (omitted)



 
The State Administration for the Quarantine of Import and Export Commodities, the State Import & Export Office for
Mechanical and Electrical Products
1998-02-08

 







CIRCULAR OF STATE ECONOMIC AND TRADE COMMISSION ON PRINTING AND DISTRIBUTING THE INTERIM PROVISIONS ON STATE-OWNED ENTERPRISES’ UTILIZING OF FOREIGN INVESTMENT FOR RESHUFFLING

The State Economic and Trade Commission

Circular of State Economic and Trade Commission on Printing and Distributing the Interim Provisions on State-Owned Enterprises’ Utilizing
of Foreign Investment for Reshuffling

GuoJingMaoWaiJing [1998] No.576

September 14, 1998

Economic and Trade Committees (Economic Committees, Economic Planning Committees) of all provinces, autonomous regions, municipalities
separately listed on the State plan, municipalities directly under the Central Government, Xinjiang Production and Building Corps
and all the branches under the State Council:

Along with the development of our country’s utilizing of foreign direct investment and deepening of the reformation of state-owned
enterprises, besides putting foreign funds into infrastructure and technology improvement projects, state-owned enterprises also
utilize foreign funds to annex other domestic enterprises, to complement enterprise floating assets and to reimburse enterprise debts
as forms of asset reshuffling. In order to totally carry out the policy in utilizing foreign investment of “positiveness, reasonableness
and effectiveness”, to prevent state-owned assets from drainage, to protect state-owned enterprises’ rights and interests, and to
avoid borrowing foreign debts in disguised form, state-owned enterprises’ utilizing of foreign investment for reshuffling must be
regulated in accordance with laws and regulations relevant. Now Moftec (Ministry of Foreign Trade and Economic Cooperation) distributes
Interim Provisions on State-Owned Enterprises’ Utilizing of Foreign Investment for Reshuffling to you all, please implement it accordingly.
Attachment:Interim Provision on State-owned Enterprises’ Utilizing of Foreign Investment for Reshuffling

Article 1

In order to strengthen the control of state-owned enterprises’ utilizing of foreign investment for reshuffling, to totally carry out
the policy of “positiveness, reasonableness and effectiveness” in utilizing foreign investment, protect state-owned enterprises’
rights and interests, to facilitate the reformation of state-owned enterprises, this regulation was formulated in accordance with
Law of Sino-Foreign Joint Venture of the People’s Republic of China, Law of Sino-Foreign Cooperative Venture of the People’s Republic
of China, and Law of Foreign-Owned Venture and other laws and regulations concerned.

Article 2

State-owned enterprises’ utilizing of foreign investment for reshuffling, primarily means that state-owned enterprises’ utilizing
direct foreign investment to annex other domestic enterprises (hereinafter Annexation Projects), to complement self-owned floating
assets (hereinafter Complement Projects) and to reimburse enterprise debts (hereinafter Reimbursement Projects).

Article 3

State-owned enterprises’ utilizing of foreign investment for reshuffling must be operated in accordance with principles as follows:

1.

Strictly observe the Interim Provisions on Foreign Investment Orientation and the Catalog of Industries for Foreign Investment and
other laws and regulations relevant.

2.

Appropriately resettle laid-off workers, not allowed to infringe their lawful rights and interests.

3.

Practically safeguard state-owned assets; prevent it from drainage.

4.

Protect creditors’ interests, not allowed to avoid any bank debts in any way.

Article 4

Moftec, jointly with other government branches concerned, is in charge of directing state-owned enterprises in utilizing foreign investment
for reshuffling.

Article 5

Project Proposals and Feasibility Study Reports of state- owned enterprises’ utilizing foreign investment shall be examined and verified
in accordance with procedures and limits of authority stipulated herein, respectively:

1.

If total investment (in an Annexation Project, total investment stipulated here means total enterprise assets after annexation, hereinafter
the same) is above US$100,000,000 (US$100,000,000 included), such a project shall be submitted for approval to the State Council
by the Economic and Trade Committees concerned (Economic Committees, Economic Planning Committees) of all provinces, autonomous regions,
municipalities directly under the Central Government and municipalities separately listed on the State plan and relevant branches
under the State Council, along with their own reviewing suggestions.

2.

If total investment is below US$100,000,000 and above US$30,000,000 (US$30,000,000 included), such a project shall be initially reviewed
by the Economic and Trade Committees concerned (Economic Committees, Economic Planning Committees) of all provinces, autonomous regions,
municipalities directly under the Central Government and municipalities separately listed on the State plan and relevant branches
under the State Council, who shall then submit it to Moftec for confirmation.

3.

If total investment is below US$30,000,000, such a project shall be examined and verified by the Economic and Trade Committees concerned
(Economic Committees, Economic Planning Committees) of all provinces, autonomous regions, municipalities directly under the Central
Government and municipalities separately listed on the State plan, and relevant branches under the State Council. Meanwhile all the
relevant materials shall be submitted to Moftec for record. Such limits of authority shall not be allowed to be transferred to a
lower level. If the project falls into categories of restriction projects (Second Category), it shall be processed in accordance
with the Interim Provisions on Foreign Investment Orientation.

Article 6

The report for approval shall include items stipulated herein below:

1.

The project name and the location

2.

The state-owned enterprise’s name, its business scope, its technology force, its assets condition and its state of operation

3.

The name(s) of the foreign investor(s), its or their native country or countries, registration certificates, the legal representative
certificates, credit standing certificates, technology force, business scope

4.

Project contents, development targets and directions

5.

The way and scale of utilizing foreign investment, product variety, throughput, market orientation

6.

Total investment, registered capital, ratio between investments for all participants and capital sources

7.

Fixed years of business

8.

Economic effectiveness and social effectiveness analyses

9.

Projects of imbalance of payments in foreign currencies shall be submitted along with the approval from state foreign exchange control
authorities

10.

Suggestions of administrative departments in charge (subjects of investment)

Article 7

Different documents shall be submitted for different item categories, accordingly:

I.

Annexation Projects

1.

General information of the merge enterprise and the merged enterprise (including their business scope, their scale of production,
equipment and technology level, financial standings, etc.).

2.

Balance sheets and statements of assets losses and gains of the merge enterprise and the merged enterprise for the last three consecutive
years, and a detailed list of the merged enterprise’s properties.

3.

Annexation plan (including annexation pattern, way of reshuffling of assets and liabilities, debt condition of the enterprise after
annexation, business scope, scale of production, market share of the product, etc.).

4.

Forms of investment and the time limit of capital subscription of foreign investors.

5.

Resettling program of laid-off workers of the merged enterprise(s).

6.

Opinions of the creditor bank of the merged enterprise.

7.

The opinions of the Coordination Group for the re-employment of laid- off workers from annexation and bankruptcy. The coordination
group should be located in the same province (autonomous region, municipality directly under the Central Government) as the merge
enterprise or the merged enterprise does. Provided that the merge enterprise or the merged enterprise has been transformed into company,
the annexation resolution of the stockholders’ meeting shall be required.

8.

Letter of intent of annexation concluded by the merge and the merged enterprise.

9.

State-Owned Assets Appraisal Report (including the assets of the merged enterprise) confirmed by relevant state-owned assets management
authorities at the same level.

Project proposals can only cover items 1, 3, 6, and 7.

II.

Complement Projects

1.

General enterprise information (including its business scope, its scale of production, produce and sale conditions, rate of circulating
fund turnover, capacity utilization rate, assets-liability ratio).

2.

Balance sheets and statements of assets losses and gains for the last three consecutive years.

3.

Enterprise self-owned circulating fund condition, the quantity needed of enterprise circulating fund and its calculating basis.

4.

Forms of investment and the time limit of capital subscription of foreign investors.

5.

The opinions of the enterprise’s main bank of deposit.

6.

State-Owned Assets Appraisal Report confirmed by relevant state-owned assets management authorities at the same level.

Project proposals can only cover items 1, 3 and 5.

III.

Reimbursement Projects

1.

General enterprise information (including its business scope, its scale of production, equipment and technology level, return on total
assets, return on net assets, investment recovery period and loan maturity, etc.)

2.

General enterprise debt information (including debt maturity, currency structure, payback mode, major debtees, overdue debts, etc.)

3.

Balance sheets and statements of assets losses and gains for the last three consecutive years

4.

Payback program (including its debt disposition agreement with its debtees)

5.

State-Owned Assets Appraisal Report confirmed by relevant state-owned assets management authorities at the same level

Project proposals may only cover items 1 and 2.

Article 8

If after annexation, the state-owned enterprise still is in the holding position, the enterprise after annexation shall be allowed
to benefit from relevant policies in accordance with the State Council’s Complement Circular on Related Matters from Tryout Annexation
Practice of State-owned Enterprises and Resettlement of Workers in Such State-Owned Enterprises Herein Stipulated [State Circulation
(Guofa) [1997] No. 10], provided that the enterprise after annexation complies with other conditions required.

Article 9

In projects of state-owned enterprises’ utilizing of foreign investment for reshuffling, in the feasibility study report it shall
be proscribed that foreign investors shall inject their contributions into the project within three months after the release of the
business license. If for the reason of force majeure circumstances, after examination and approval, foreign investors shall inject
at least 60% of their contributions to the project within six months after the release of the business license, and within one year,
all the contributions shall have been injected into the project. Before total contribution, foreign investors can only benefit from
the project on the basis of their actual contributive proportion.

Article 10

The feasibility study report after approval is the essential basis on which contracts (constitutions) shall be concluded. If contradicting
the feasibility study report, contracts (constitutions) shall be approved by authorities reviewing and authorizing the feasibility
study report.

Article 11

This regulation shall be applied when state-owned enterprises for reshuffling utilize investment from investors from the Hong Kong
Special Administrative Region, Taiwan and Macao.

Also, this regulation shall be applied to non-state-owned enterprises.

Article 12

This regulation shall be subjected to interpretation by Moftec and shall enter into force as of the date of promulgation.



 
The State Economic and Trade Commission
1998-09-14

 







REPLY OF THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE ON THE RETROACTIVITY AND OBJECTS OF APPLICATION OF THE REVISED IMPLEMENTING RULES OF THE PEOPLE’S REPUBLIC OF CHINA FOR BUSINESS ENTITY REGISTRATION ADMINISTRATION

The State Administration for Industry and Commerce

Reply of the State Administration for Industry and Commerce on the Retroactivity and Objects of Application of the Revised Implementing
Rules of the People’s Republic of China for Business Entity Registration Administration

GongShangQiZi [1998] No.138

July 7, 1998

Hunan Administration for Industry and Commerce:

We have studied your Request for Instructions dated April 20, 1998 on the Retroactivity and Objects of Application of the Revised
Implementing Rules of the People’s Republic of China for Business Entity Registration Administration (XiangGongShangFaZi[1998]No.64)
and now reply as follows:

I.

As for behaviors on the part of enterprises and operating units in violation of enterprise registration administration prior to December
25, 1996, competent registration administration authorities should conduct punishments in accordance with the previous unrevised
version of the Implementing Rules of the People’s Republic of China for Controlling the Registration of Enterprises as Legal Persons.

II.

As for behaviors of fake investment and withdrawal of registered capital on the part of enterprises with foreign investment, competent
registration administration authorities should first conduct punishment in accordance with the Regulations of the People’s Republic
of China for Controlling the Registration of Enterprises as Legal Persons and its Implementing Rules, as provided for in Article
15 of the Implementing Opinions on Related Issues of the Application of Regulations on Company Registration Administration for Registration
Administration of Enterprises with Foreign Investment of the State Administration for Industry and Commerce (GongShangQiZi [1995]
No.177).

III.

Contracting parties of Chinese-foreign equity joint ventures and Chinese-foreign contractual joint ventures should be handled in accordance
with the Provisions on Investment Appropriation of Contracting Parties of Chinese-foreign equity joint ventures approved by the State
Council for failures to appropriate due investment. Enterprises with foreign investment should be handled in accordance with Articles
31 and 32 of the Implementing Rules of the Law of the People’s Republic of China on Foreign-capital Enterprises for failures to appropriate
due investment.



 
The State Administration for Industry and Commerce
1998-07-07

 







CIRCULAR OF THE STATE COUNCIL CONCERNING STRENGTHENING THE ADMINISTRATION OF FINANCIAL CREDITOR’S RIGHTS IN THE STRUCTURAL REFORM OF MEDIUM- AND SMALL-SIZED STATE-OWNED ENTERPRISES AND COLLECTIVE ENTERPRISES

Category  BANKING Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1998-06-05 Effective Date  1998-06-05  


Circular of the State Council Concerning Strengthening the Administration of Financial Creditor’s Rights in the Structural Reform
of Medium- and Small-sized State-owned Enterprises and Collective Enterprises



(June 5, 1998)

    People’s governments of the province, autonomous region and municipality
directly under the Central Government, ministries and commissions of the State
Council, and organizations directly under the State Council:

    Since the conclusion of the 15th National Congress of the Party, all
localities and departments have made some achievements in quickening
enterprise restructuring in accordance with the requirements of establishing
the socialist market economic system. However, in the course of the structural
reform of medium- and small-sized state-owned enterprises and collective
enterprises, quite a few localities present the phenomenon of taking
enterprise restructuring as an opportunity to suspend, evade or reject
financial debts. This activity has seriously undermined the social credit
relations and resulted in a large quantity of suspended creditor’s rights in
financial institutions, as well as a drop in quality of credit assets and
drain on state-owned assets. For the purposes of standardizing the structural
reform work in medium- and small-sized state-owned enterprises and collective
enterprises, preventing and curbing acts of evading or rejecting financial
debts in various forms, conscientiously protecting the legitimate rights and
interests of financial institutions, and taking precautions against financial
risks, this Circular regarding strengthening the administration of financial
creditor’s rights in the structural reform of medium- and small-sized
state-owned enterprises and collective enterprises is hereby issued as follows:

    1. To Strengthen Conscientiously the Guidance and Supervision over
Enterprise Restructuring

    All localities and departments should proceed with the general interests,
conscientiously carry out state policies and measures for enterprise
restructuring, strengthen the guidance and supervision over the structural
reform work in medium- and small-sized state-owned enterprises and collective
enterprises, standardize behaviours in enterprise restructuring, and
resolutely curb acts of evading and rejecting financial debts in various
forms. Local people’s governments should attach great importance to the
preservation of financial creditor’s rights in enterprise restructuring of
their respective regions and lend strong support to financial institutions in
the administration of their financial creditor’s rights; they are strictly
prohibited from shielding and conniving at the acts of evading and rejecting
financial debts committed by enterprises in the restructuring.

    2. To Confirm Financial Debts According to law by Enterprises in the
Restructuring

    The structural reform of medium- and small-sized state-owned enterprises
and collective enterprises shall be carried out in strict accordance with
relevant state laws and policies as well as the provisions of the Circular
Concerning Prevention of Drain on Bank Credit Assets (Yinfa [1994] No. 40)
promulgated by the People’s Bank of China, the State Economic and Trade
Commission and the Administration of State Property. All enterprises must
devote their whole attention to financial institutions’ views on the
preservation of their creditor’s rights in the restructuring and confirm
financial debts according to law, no matter whatever forms of the
restructuring they will adopt. Those enterprises whose financial debts have
not yet been confirmed shall not start the restructuring work and departments
concerned shall not handle formalities for examination and approval of their
restructuring and registration and shall not renew their business licences.
Evasion and rejection of financial debts occurring in the restructuring of
enterprises before the issuance of this Circular must be corrected without
delay and the financial creditor-debtor relationship must be reestablished.

    3. To Take an Active Part in Enterprise Restructuring and Maintain the
Safety of Financial Creditor’s Rights According to Law by Financial
Institutions

    The structural reform of medium- and small-sized state-owned enterprises
and collective enterprises shall require the participation of financial
institutions if their creditor’s rights have been involved. The financial
institutions should exercise strict supervision over the verification and
evaluation of assets in the restructuring of enterprises. All financial
institutions should conscientiously practise a responsibility system for the
preservation of financial creditor’s rights, make a great effort to check up
and confirm creditor’s rights, maintain the safety of financial creditor’s
rights in real earnest, and report at regular intervals the preservation of
financial creditor’s rights to the People’s Bank of China. For those regions
where financial debts are suspended, evaded and rejected seriously, all
financial institutions having claims on these financial debts should lower the
credit grades of their branches in the regions.

    4. To Do a Good Job in the Evaluation of Assets and Registration of
Property Rights of the Enterprises in the Restructuring

    The structural reform of medium- and small-sized state-owned enterprises
and collective enterprises must be subjected to the strict evaluation and
verification of their assets. With regard to medium- and small-sized
state-owned enterprises, results of assets evaluation shall be submitted to
the department in charge of state property administration for confirmation.
In accordance with provisions of the Measures for the Registration of State
Property Rights of Enterprises (Decree No. 192 of the State Council),
formalities for registration of change in property rights should be completed
in case of any change in property rights in the restructuring of medium- and
small-sized state-owned enterprises. In handling formalities for registration
of change in property rights, relevant departments should require the
restructured enterprises to present the document for the preservation of
financial creditor’s rights that is issued by the financial institutions
concerned. The department of the State Council in charge of state property
administration should step up the administration and inspection of assets
evaluation agencies, conscientiously ensure the confirmation and evaluation of
assets for the restructured enterprises, and impose strict prohibitions
against the distribution of state property to individuals by means of
intentional underrating or free apportioning of assets of restructured
enterprises. Assets evaluation agencies must obtain the legal qualification
authentication and the permit for business and should be formed into genuine
social intermediary organizations that run in a fair and just manner,
exercise evaluation according to law, practise self-discipline, and bear
corresponding legal responsibilities.

    5. To Further Strengthen the leadership, organization and coordination
over the Administration of Financial Creditor’s Rights

    The People’s Bank of China should attach great importance to the
administration of financial creditor’s rights in the structural reform of
enterprises and take the initiatives in exchanging views with local people’s
governments and coordinating their actions in order to strengthen the
leadership over the administration of financial creditor’s rights.
Safeguarding financial creditor’s rights shall be treated as an important job
in financial supervision by setting practical measures, promptly resolving
problems emerging in the work, and reporting major issues, if found, to the
State Council as soon as possible. Any branch of the People’s Bank of China
should, upon discovery of actions evading and rejecting financial creditor’s
rights within its jurisdiction, immediately impose a ban and report the case
to the local people’s government and the bank at the next higher level.

    The People’s Bank of China should organize financial institutions
concerned in checking up on accounts opened by enterprises in different names.
Any financial institution should resolutely practise the fundamental deposit
account system in strict accordance with the provisions of the People’s Bank
of China regarding account management and prevent restructured enterprises
from evading and rejecting financial debts by opening accounts in different
names. For those restructured enterprises that the People’s Bank of China
considers have evaded and rejected financial debts, all financial institutions
shall not open accounts for them and nor provide services such as extending
loans and settling accounts.

    6. To Strengthen Publicity on Financial Laws and Promote the Understanding
of Social Credit

    All localities and departments should make great effort at publicity on
financial laws, raise the sense of financial safety in the whole society, and
maintain the proper relationship of social credit. All local people’s
governments should lend support to people’s courts in trying cases of disputes
over financial claims and debts independently and impartially according to
law, strengthen the cultivation of the sense and mentality of legality, and
create a favourable environment for governing by law. Wide publicity should be
given to enterprises that have accomplished the preservation and appreciation
of state-owned and collectively-owned assets through being restructured
according to law. Units and individuals that have caused the loss of credit
assets as a result of illegal restructuring measures and taking advantage of
restructuring to evade and reject financial debts should be dealt with sternly
and made public by circulating a notice.

    Where violation of the provisions of this Circular has resulted in losses
of financial creditor’s rights, the person in charge of the unit concerned and
persons directly responsible shall be investigated for their responsibilities
in all earnestness. If crimes have been constituted, the violators should be
transferred to the judicial organs and investigated for criminal
responsibility according to law. Where a local people’s government supports
and winks at evasion and rejection of financial debts in the restructuring of
enterprises, the leading official concerned shall be investigated for his
responsibility.






CIRCULAR OF THE STATE COUNCIL CONCERNING THE ORGANIZATIONAL STRUCTURE OF STATE BUREAUX (ADMINISTRATIONS) UNDER THE MANAGEMENT OF MINISTRIES AND COMMISSIONS

Category  STATE INSTITUTIONS Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1998-03-29 Effective Date  1998-03-29  


Circular of the State Council Concerning the Organizational Structure of State Bureaux (Administrations) under the Management of
Ministries and Commissions



(March 29, 1998)

    People’s government of the province, autonomous region and municipality
directly under the Central Government, ministries and commissions of the State
Council, organizations directly under the State Council:

    In accordance with the Restructuring Plan for State Bureaux
(Administrations) under the Management of the State Council’s Ministries and
Commissions approved through deliberation at the First Plenary Meeting of the
State Council, the organizational structure of state bureaux (administrations)
under the management of ministries and commissions is hereby circulated as
follows:

    State Grain Reserve Bureau, under the management of State Development
Planning Commission;

    State Internal Trade Bureau, under the management of State Economic and
Trade Commission;

    State Coal Industry Bureau, under the management of State Economic and
Trade Commission;

    State Machine-Building Industry Bureau, under the management of State
Economic and Trade Commission;

    State Metallurgical Industry Bureau, under the management of State
Economic and Trade Commission;

    State Petroleum and Chemical Industry Bureau, under the management of
State Economic and Trade Commission;

    State Light Industry Bureau, under the management of State Economic and
Trade Commission;

    State Textile Industry Bureau, under the management of State Economic and
Trade Commission;

    State Building Materials Industry Bureau, under the management of State
Economic and Trade Commission;

    State Tobacco Monopoly Bureau, under the management of State Economic and
Trade Commission;

    State Bureau of Foreign Experts Affairs, under the management of Ministry
of Personnel;

    State Oceanography Bureau, under the management of Ministry of Land and
Natural Resources;

    State Bureau of Surveying and Mapping, under the management of Ministry of
Land and Natural Resources;

    State Postal Bureau, under the management of Ministry of Information
Industry;

    State Bureau of Cultural Relics, under the management of Ministry of
Culture;

    State Administration of Traditional Chinese Medicine, under the management
of Ministry of Public Health;

    State Administration of Exchange Control, under the management of the
People’s Bank of China;

    State Administration for Entry and Exit Inspection and Quarantine, under
the management of the General Administration of Customs.

    The State Secrets Bureau and the Office of the Central Secrets Commission
will be merged into one with their respective names retained and included into
the subsidiary institutions of departments under the CPC Central Committee.

    The State Aerospace Bureau and the State Atomic Energy Agency will retain
their names as institutions under the Commission of Science, Technology and
Industry for National Defence.

    The State Language Work Committee will be merged into the Ministry of
Education and retain its name in external contacts.






CIRCULAR OF THE MINISTRY OF TRADE AND ECONOMIC COOPERATION CONCERNING ISSUING THE RULES FOR THE IMPLEMENTATION OF THE PROVISIONS OF THE PEOPLE’S REPUBLIC OF CHINA ON THE ADMINISTRATION OF AGENCY BUSINESS FOR INTERNATIONAL TRANSPORTATION OF GOODS (TRIAL IMPLEMENTATION)

The Ministry of Foreign Trade and Economic Cooperation

Circular of the Ministry of Trade and Economic Cooperation concerning Issuing the Rules for the Implementation of the Provisions of
the People’s Republic of China on the Administration of Agency Business for International Transportation of Goods (Trial Implementation)

WaiJingMaoYunFa [1998] No.20

January 26,1998

All Ministries and Commissions of the State Council,the Foreign Trade and Economic Cooperation Commissions(Departments,Bureaus) of
the various provinces, autonomous regions, municipalitie directly under the Central Government and municipality separately listed
on the State plan:

According to the Provisions of the People’s Republic of China on the Administration of Agency Business for International Transportation
of Goods ,through asking for the suggestions of the State Administration for Industry and Commerce,the State Administration of Taxation
commission,General Administration of Customs and People’s Bank of China,the Rules for the Implementation of the Provisions of the
People’s Republic of China on the Administration of Agency Business for International Transportation of Goods (trial Implementation)
is now issued to you for implementation.

Attachment:the Rules for the Implementation of the Provisions of the People’s Republic of China on the Administration of Agency Business for
International Transportation of Goods (Trial Implementation)

Chapter I General Provisions

Article 1

These Rules are formulated in accordance with the Provisions of the Peoples Republic of China on the Administration of Agency Business
for International Transportation of Goods (hereinafter referred to as the Provisions) which are approved by the State Council and
promulgated on June 29, 1995 by the Ministry of Foreign Trade and Economic Cooperation (hereinafter referred to as the MOFTEC) and
for the purposes of ensuring the order of agency market for international transportation of goods, strengthening the supervision
and administration over agency business for international transportation of goods and promoting the healthy development of our country’s
agency business for international transportation of goods.

Article 2

Agent enterprises of international transportation of goods may act as agent for the consignees or consignors of import and export
goods and also as independent operator engaging in the agency business for international transportation of goods.

Engagement in the agency business for international transportation of goods as agent by the agent enterprises of international transportation
of goods refers to the acts of agent enterprises of international transportation of goods which accept authorization from the consignees,
consignors or their agents of import and export goods, handles related operations in the name of their clients or in their own name
and collect agency fees or commissions.

Engagement in the agency business for international transportation of goods as independent operator by the agent enterprises of international
transportation of goods refers to the acts of agent enterprises of international transportation of goods which accept authorization
from the consignees, consignors or their agents of import and export goods and issue transportation documents, perform transportation
contracts and collect freights and service fees.

Article 3

The name and logo of an agent enterprise of international transportation of goods shall be compliant with the State’s relevant provisions,
consistent with its business and able to imply its business characteristics, and the name shall contain such relevant words as “agency
for transportation of goods”, “transportation service”, “consolidated transportation” or “logistics”.

Article 4

“The scope of authorization” mentioned in Paragraph 2 of Article 4 of the Provisions means that the competent departments of foreign
trade and economic cooperation of the people’s governments of provinces, autonomous regions, municipalities directly under the Central
Government, special economic zones or municipalities separately listed on the State plan (hereinafter referred to as the local competent
departments of foreign trade) are responsible for, with authorization of the MOFTEC, supervision and administration over the agency
business for international transportation of goods within their respective administrative areas (the MOFTEC and local competent departments
of foreign trade are collectively referred to as the competent departments of business hereinafter). The scope of authorization includes:
preliminary examination of the applications of enterprises for engaging in the agency business for international transportation of
goods, the annual examination and license replacement examination for agent enterprises of international transportation of goods,
business statistics, training of professional persons and guidance for local associations of business to carry out their work as
well as, jointly with the relevant local administrative departments, regulating the operational behaviors of agent enterprises of
international transportation of goods and rectifying the business order of agency market for transportation of goods and other work.

Subsidiaries, branch organizations and non-profit-oriented offices in connection with agency for international transportation of goods
set up in the cities with independent planning status (not including special economic zones) by the enterprises directly subordinated
to the departments of the State Council or by the enterprises from other localities accept the supervision and administration from
the provincial competent departments of foreign trade in accordance with the scope of authorization mentioned in the preceding paragraph.

Without authorization of the MOFTEC, other units may not engage in the work of examination, approval or administration of the agency
business for international transportation of goods.

Article 5

The MOFTEC is responsible for the professional training of persons of agent enterprises of international transportation of goods and
for examination of the qualifications of training organizations. A unit without approval may not engage in the training for qualifications
of persons of agent enterprises of international transportation of goods. The conditions for establishment and contents and textbooks
for training are provided by the MOFTEC separately.

After having accepted the training as mentioned in the preceding paragraph and passed the examination, a person engaging in the agency
business for international transportation of goods acquires a certificate of agent qualification for international transportation
of goods.

Chapter II Conditions for Establishment

Article 6

The applicants for agency business for international transportation of goods shall be the units which involve in import and export
trade or international transportation of goods and have stable sources of goods. The investors meeting the above-mentioned conditions
shall hold majority shares in the application projects.

Article 7

The agent enterprises of international transportation of goods shall obtain the enterprise legal person status of the Peoples Republic
of China according to law. The enterprises’ organizational forms are the limited liability companies or joint stock companies. It
is forbidden for a unit of administrative monopoly functions to apply for investment in the agency business for international transportation
of goods. Carriers and other enterprises likely entailing unfair competition to the agency business for international transportation
of goods may not apply for engagement in the agency business for international transportation of goods.

Article 8

Business conditions stipulated in Article 7 of the Provisions include:

(1)

to have at least five professional persons who have been dealing in agency business for international transportation of goods for
more than three years and whose qualifications have been certified by their previous employers; or who have obtained the certificate
of qualifications issued by the MOFTEC according to Article 5 of these Rules;

(2)

to have a fixed place of business, certification of property rights for self-owned housing and places or lease contracts for leased
housing and places;

(3)

to have necessary facilities of business, including a certain number of telephones, fax machines, computers, short-distance means
of transportation, loading and unloading equipment and packaging equipment; and

(4)

to have a stable market of import and export goods resource indicates that there is much quantity of import and export goods transportation
in the local area and agency business for transportation of goods has the conditions and potentials for further development and the
applicant enterprise may get sufficient sources of goods.

Article 9

If the scope of agency business for international transportation of goods applied for by an enterprise includes the multi-modal international
transportation operations, the applicant enterprise shall, in addition to the conditions stipulated in Article 7 of the Provisions
and in Articles 6, 7 and 8 of these Rules, meet the following conditions:

(1)

to have engaged in relevant operations stipulated in Article 32 of these Rules for more than three years;

(2)

to have necessary domestic and foreign agent networks; and

(3)

to have the bills of lading of agency for international transportation of goods registered and recorded by the MOFTEC.

Article 10

An agent enterprise of international transportation of goods shall, whenever applying for setting up of a branch organization, increase
its registered capital by 500,000 Renminbi yuan accordingly. If the enterprise’s registered capital has exceeded the minimum amount
stipulated in the Provisions (5 million Renminbi yuan for ocean shipping, 3 million Renminbi yuan for air transportation and 2 million
Renminbi yuan for land transportation and express delivery), the amount in excess may be used as capital increase for the branch
organization established.

Article 11

Branch organizations mentioned in the Provisions and these Rules refer to branch companies.

Chapter III Procedures for Examination, Approval and Registration

Article 12

It is imperative to obtain the Certificate of Approval for Agent Enterprise of International Transportation of Goods of the People’s
Republic of China (hereinafter referred to as the Certificate of Approval) issued by the MOFTEC for engagement in the agency business
for international transportation of goods. A unit applying for engagement in the agency business for international transportation
of goods shall submit the following documents:

(1)

a written application, including the name of investors, explanations on the applicant qualifications and the business items applied
for;

(2)

a feasibility study report, including basic information, explanations on the qualifications, existing conditions, market analysis,
business forecast, establishment plan, economic budget and development budget;

(3)

the business license of enterprise legal person of investors (photocopy);

(4)

the resolution of board of directors, shareholders meeting or general assembly of shareholders;

(5)

the articles of association of the enterprise (or draft);

(6)

information about main professional persons (including of education backgrounds, majors of study, work experiences, certificates of
qualifications);

(7)

certification of creditworthiness (capital verification reports of all investors issued by accountant firms);

(8)

agreement on investment contribution by the investors;

(9)

resume of the legal representative;

(10)

form of the bill of lading (transportation document) of agency for international transportation of goods;

(11)

letter of advance approval on the name of the enterprise (photocopy, issued by the administrative department for industry and commerce);

(12)

Application Form 1 of Agent Enterprise of International Transportation of Goods (Form 1 annexed); and

(13)

clauses for transaction.

All of the above-mentioned documents must, except for those in Items (3) and (11), be submitted with the original copies and stamped
with official seals.

Article 13

The competent department of business shall examine the application project, and the examination covers:

(1)

necessity for the establishment of the project;

(2)

authenticity and integrity of the application documents;

(3)

qualifications of the applicant;

(4)

creditworthiness of the applicant; and

(5)

qualifications of professional persons.

Article 14

The local competent department of foreign trade shall, after examining the application project, submit the preliminary examination
opinions (including the business scope, business district and investors’ investment ratios recommended for approval) and all application
documents to the MOFTEC for examination and approval in accordance with the time requirements provided in Paragraph 1 of Article
11 of the Provisions.

Article 15

Under any of the following circumstances, the MOFTEC rejects the application and gives the reasons:

(1)

Documents are incomplete;

(2)

The procedures of application and submission are not up to the requirements; or

(3)

Applications for engagement in the agency business for international transportation of goods are suspended by the MOFTEC.

Article 16

Under any of the following circumstances and upon verification through investigation, the MOFFEC gives a reply of disapproval:

(1)

The applicant is not qualified for engaging in the agency business for international transportation of goods;

(2)

The applicant was, due to illegally engaging in the agency business activities, punished by the State’s administrative department
within five years before the date of application;

(3)

The applicant intentionally conceals or gives false report on application information; or

(4)

Any other circumstance is not compliant with relevant principles provided in Article 5 of the Provisions.

Article 17

The applicant shall, within 60 days from the date of receiving the reply of approval of the MOFTEC, acquire the Certificate of Approval
from the MOFTEC by presenting the revised articles of association (original copy) and the letter of introduction of the local competent
department of foreign trade.

Article 18

An enterprise may, after being established and having engaged in the agency business for international transportation of goods for
one year, apply to expand its business scope or business district. The local competent department of foreign trade shall, after making
examination, report it to the MOFTEC for approval in accordance with the procedures provided in Article 11 of the Provisions.

An enterprise may, after being established and having engaged in the agency business for international transportation of goods for
one year and under the conditions of having developed to a certain business scale, apply to establish branch companies or organizations.
The said enterprise shall make such application to the local competent department of foreign trade in the place where the branch
company or organization is located (not including the municipality separately listed on the State plan) by presenting the opinions
of the local competent department of foreign trade in the place where the enterprise is located (the letter of opinion solicitation
of the MOFTEC for the enterprise directly subordinated to the department of the State Council in Beijing), and the latter reports
to the MOFTEC for approval according to the provisions of Article 14 of these Rules. The business scope of the branch company or
organization may not go beyond that of its parent company or general company.

An agent enterprise of international transportation of goods must, if setting up a non-business office, report to the local department
of business in the place where the office is located for the record and accepts the latter’s control.

Article 19

An enterprise which submits an application according to Paragraph 1 or 2 of Article 18 of these Rules shall, in addition to relevant
documents provided in Article 12 of these Rules, also submit the following documents:

(1)

the original reply on the agency business for international transportation of goods (photocopy);

(2)

the Certificate of Approval (photocopy);

(3)

the business license (photocopy);

(4)

Application Form 2 of Agent Enterprise of International Transportation of Goods (Form 2 annexed, and if setting up a branch company,
Form 1 annexed);

(5)

report on its operational situation (including network construction);

(6)

resumes of the legal representative of the branch company or the responsible person of the branch organization; and

(7)

registration form of annual examination for the preceding year.

Article 20

When an enterprise applies to set up a branch organization, the applicant shall, within 90 days from the date of receiving the reply
of approval, acquire the Certificate of Approval from the MOFTEC by presenting the legally valid capital verification report after
capital increase and the revised articles of association (the original copy) of the general company according to the provisions of
Article 10 of these Rules and the letter of introduction issued by the local competent department of foreign trade in the place
where the branch organization is located.

Article 21

If an applicant fails to go through procedures for acquiring the certificate at the expiry of the set time limit or fails to start
business operation without justifiable reasons after 180 days from the date of obtaining the Certificate of Approval, its qualifications
for engaging in the agency business for international transportation of goods shall automatically cease to exist, unless its application
for a postponement is approved.

Article 22

The MOFTEC may, in accordance with the development and layout of the agency business for international transportation of goods, decide
to suspend the acceptance of applications for the agency business for international transportation of goods or to take restrictive
measures within a certain period. Decisions made by the MOFTEC in accordance with the provisions of preceding paragraph shall be
pronounced and made public.

Article 23

An agent enterprise of international transportation of goods must, if having any of the following changes, report it to the MOFTEC
for examination and approval and acquire a replacement of its Certificate of Approval:

(1)

name of the enterprise;

(2)

type of the enterprise;

(3)

equity relation;

(4)

decrease in the registered capital;

(5)

business scope; or

(6)

business district.

In case of any of the following changes, the enterprise may directly apply to acquire a replacement of its Certificate of Approval
after reporting it to the MOFTEC for the record:

(1)

postal address or place of business;

(2)

legal representative;

(3)

increase in the registered capital; or

(4)

the department it is affiliated to.

Article 24

Agent enterprises of international transportation of goods shall present the Certificate of Approval to go through registration procedures
with the administrative departments for industry and commerce and the Customs.

No unit without obtaining the Certificate of Approval may use, in its business license of industry and commerce, “the agency business
for international transportation of goods” or the words with identical or similar meaning.

Chapter IV Annual Examination and Replacement of Certificate

Article 25

The MOFTEC adopts the annual examination and replacement of certificate system for agent enterprises of international transportation
of goods.

Article 26

The MOFTEC is responsible for the work of annual examination over the enterprises directly subordinated to the departments of the
State Council in Beijing and the replacement of certificates of agent enterprises of international transportation of goods throughout
the country. Local competent departments of foreign trade are responsible for the work of annual examination over agent enterprises
of international transportation of goods within their respective administrative areas (including the branch companies and organizations
established by the enterprises directly subordinated to the departments of the State Council and by the enterprises from other localities).

Article 27

An agent enterprise of international transportation of goods shall, before the end of March each year, submit the registration form
for annual examination (Form 3 annexed), the capital verification report and the business license (photocopy) to the local competent
department of foreign trade in the place where it is located to apply for the annual examination (the enterprises directly subordinated
to the departments of the State Council in Beijing apply directly to the MOFTEC therefor).

The key points of the annual examination work are to examine the enterprise s operations and their performance in abiding by and implementing
the Provisions and other laws, regulations and rules. After an enterprise passes the annual examination, the competent department
of business affixes the seal of passing the annual examination on its Certificate of Approval.

Article 28

The term of validity of a Certificate of Approval is three years.

An enterprise must, 60 days prior to the expiry of the term of validity of its Certificate of Approval, apply to the local competent
department of foreign trade for replacement. When applying for replacement of the Certificate of Approval, the enterprise shall submit
the following documents:

(1)

registration form for replacement (Form 4 annexed);

(2)

Certificate of Approval (original copy); and

(3)

business license (photocopy).

Article 29

If an enterprise has passed the annual examination in three consecutive years, the local competent department of foreign trade shall,
within 30 days prior to the expiry of the term of validity of the Certificate of Approval, submit it to the MOFTEC for a replacement
of the Certificate of Approval.

Article 30

When an agent enterprise of international transportation of goods applies for replacement, the competent department of business shall
examine its business qualifications and operation situation, and deny the replacement of the Certificate of Approval under any of
the following circumstances:

(1)

failure to comply with the provisions of Article 27 of these Rules;

(2)

failure to go through procedures for replacement as scheduled;

(3)

transfer of equity rights without approval; or

(4)

change of such major items as the enterprise’s name, place of business or registered capital without approval and failure to report
the change for the record according to the relevant provisions.

Article 31

If an enterprise, due to its own reasons, fails to apply for the replacement of the Certificate of Approval as scheduled, its qualifications
for engaging in the agency business for international transportation of goods shall automatically cease to exist as of the expiry
of the term of validity of the Certificate of Approval. The MOFTEC shall make an announcement of the above-mentioned situation. The
administrative department for industry and commerce shall cancel the above-mentioned enterprise or order it to go through the procedures
for the change of its business scope.

If an enterprise which has lost its qualifications for engaging in the agency business for international transportation of goods wants
to continue its services in the said business, it shall apply again in accordance with the relevant provisions.

Chapter V Business Administration

Article 32

An agent enterprise of international transportation of goods may engage in the business activities as agent or independent operator.
Its business scope includes:

(1)

soliciting goods, booking space (including ship renting, chartering plane and ship accommodation booking), consigning for shipment,
warehousing and packaging;

(2)

supervision of goods loading and unloading, container stuffing, distribution, transit, and related short-distance transportation services;

(3)

Customs declaration, application for check or inspection and buying insurance;

(4)

making, signing and issuing relevant documents, paying freights, settlement and paying miscellaneous charges;

(5)

agency transportation of international exhibits, personal articles and transit goods;

(6)

international multi-modal transportation, consolidated transportation (including container groupware);

(7)

international express delivery (not including private correspondence); and

(8)

consulting and other agency business for international transportation of goods.

Article 33

An agent enterprise of international transportation of goods shall carry out business activities in accordance with the business scope
and business district as stipulated in its Certificate of Approval and its business license.

Article 34

The MOFTEC may, in accordance with the business development situation, authorize the association of business to formulate standard
transaction clauses on agency for international transportation of goods with reference to international practices, and the agent
enterprise of international transportation of goods may invoke them without consent of the MOFTEC. The agent enterprises of international
transportation of goods may also formulate their own transactions clauses; however, they must report to the MOFTEC for the record
before such clauses are used.

Article 35

Agent enterprises of international transportation of goods shall submit their business statistics to the competent departments of
business, and be responsible for the authenticity of their statistical figures. The measures for compiling and submitting business
statistics are provided by the MOFTEC separately.

Article 36

An agent enterprise of international transportation of goods shall, when accepting authorization for handling relevant operations
as agent, sign a written agreement of authorization with the consignee or consignor of import or export. If the two parties have
a business dispute, the written agreement signed shall serve as the basis for the settlement of the dispute.

When an agent enterprise of international transportation of goods engages in relevant operations stipulated in Article 32 of these
Rules as independent operator, it shall issue transportation documents to the goods owner. If it has a dispute with the goods owner,
the transportation documents issued shall serve as the basis for the settlement of the dispute. If it has a business dispute with
the actual carrier, the transportation contract signed with the actual carrier shall serve as the basis for the settlement of the
dispute.

Article 37

The bills of lading of agency for international transportation of goods used by the agent enterprises of international transportation
of goods are subject to the registration and numbering system. All bills of lading of agency for international transportation of
goods signed and issued within the territory of our country must be reported by the agent enterprises of international transportation
of goods to the MOFFEC for registration, and the numbers of approval shall also be marked on the bills.

Agent enterprises of international transportation of goods shall strengthen their work of management of bills of lading of agency
for international transportation of goods. It is forbidden to lend. In case of such circumstances as loss or version revision, they
shall timely report to the MOFTEC for the record.

The transfer of a bill of lading of agency for international transportation of goods is conducted according to the following provisions:

(1)

No straight bill of lading may be transferred;

(2)

The order bill of lading may be transferred after full endorsement or blank endorsement;

(3)

The blank bill of lading may be transferred without endorsement.

The system of liability insurance is applies to the bills of lading of agency for international transportation of goods. Liability
insurance must be bought from insurance companies approved by the People’s Bank of China.

Article 38

When an agent enterprise of international transportation of goods is responsible for performing or organizing to perform international
multi-modal transportation contracts as an independent operator, its liability starts at the time of receipt of goods and ends at
the time of delivery of goods. The basis for assuming liabilities, the limits of liability, exemption conditions and preconditions
for losing liability restrictions are determined in accordance with the relevant provisions of laws.

Article 39

An agent enterprise of international transportation of goods shall use the name and the enterprise code stipulated in its Certificate
of Approval to engage in the agency business for international transportation of goods, and print the name and the code in major
office stationery and documents and certificates.

Article 40

The agent enterprises of international transportation of goods may not use the registered capital within the specified scope for other
purposes.

Article 41

An agent enterprise of international transportation of goods may not transfer, directly or in a disguised manner, its right to engage
in the agency business for international transportation of goods; may not permit other units or individuals to carry out the agency
operations for international transportation of goods in the name of the enterprise itself or its business departments; and may not
sign any agreement with a unit without the right to engage in the agency business for international transportation of goods so as
to make it, either separately or together, engage in the agency business for international transportation of goods and to collect
agency fees, commissions or obtain other interests.

Article 42

An agent enterprise of international transportation of goods as an agent may collect the agency fee from the owner of goods and may
get

DECISION ON THE REVISION OF THE ADOPTION LAW BY THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS

Category  MARRIAGE AND FAMILY Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  In Force
Date of Promulgation  1998-11-04 Effective Date  1999-04-01  


Decision on the Revision of the Adoption Law of the People’s Republic of China by the Standing Committee of the National People’s
Congress


Appendix:Adoption Law of the People’s Republic of China
Contents
Chapter I  General Provisions
Chapter II  Establishment of Adoptive Relationship
Chapter III  Validity of Adoption
Chapter IV  Termination of the Adoptive Relationship
Chapter V  Legal Responsibility
Chapter VI  Supplementary Provisions

(Adopted at the 5th Meeting of the Standing Committee of the 9th

National People’s Congress on November 4, 1998 and promulgated by Order
No. 10 of the President of the People’s Republic of China on November 4,
1998)

    The 5th Meeting of the Standing Committee of the 9th National People’s
Congress hereby decides to make the following revisions in the Adoption Law
of the People’s Republic of China:

    I.Article 2 shall be revised to read as:”Adoption should in the interest
of the upbringing and growth of the minors adopted, safeguarding of the
legitimate rights and interests of the person adopted and the consignee
following the principle of equality and voluntariness, and should not violate
social ethics.”

    II.A section shall be added in Article 6 to read as the Third Section:
“(3)those who have not contracted disease(s) that is(are) considered medically
not advisable to adopt children;”

    The Third Section shall be revised to read as the Fourth Section:
“(4)at the age of 30 full years.”    

    III.The First Paragraph of Article 7 shall be revised to read as:
“Adoption of a child of collateral relative by blood of the same
generation and up to the third degree of kinship may not be subjected to the
restrictions of Section (3) of Article 4, the Section (3) of Article 5,
Article 9 of this Law and the adopted minor under the age of 14 full years.”

    IV.The Second Paragraph of Article 8 shall be revised to read as:
“Adoption of orphans, disabled children or abandaned infants or children
under the care of social welfare institutions whose own parents cannot be
ascertained and found may not be subjected to restrictions of the consignee
being childless and of adoption of one child.”

    V.Article 14 shall be revised to read as:”A stepfather or stepmother
may, with the consent of his/her own parents of the stepson or stepdaughter,
adopt the stepson or stepdaughter and such adoption may not be subjected to
restrictions of Section (3) of Article 4, Section (3) of Article 5 and
Article 6 of this Law and the restriction that the adopted minor must be
under 14 full years of age as well as adoption of one child.”

    VI.The First Paragraph of Article 15 shall be revised to read as:
“The adoption should be registered with the civil affairs department of
people’s government above the county level. The adoptive relationship
shall be established as of the date of registration.”

    A paragraph shall be added to read as the Second Paragraph:”For
adoption of abandoned infants and children whose own parents cannot
be ascertained and found, the civil affairs departments handling the
registration should make an announcement prior to the processing of registration.”

   The Second Paragraph shall be revised to be two paragraphs as
the Third Paragraph and the Fourth Paragraph which read as:”The parties
concerned to the adoptive relationship willing to conclude an adoption
agreement may conclude the adoption agreement.

    “When both sides or one side of the parties concerned to the adoptive
relationship request(s) notarization for the adoption, notarization for the
adoption should be completed.”

    VII.An article shall be added to read as Article 16:”The public security
department should, upon establishment of the adoptive relationship,
process household registration for the adopted minor pursuant to relevant
state provisions.”

    VIII.Article 20 shall be turned into Article 21, the Second Paragraph
shall be turned into two paragraphs as the Second Paragraph and the Third
Paragraph which read as:”Adoption of children by an alien in the People’s
Republic of China should be subject to the examaination and approval of the competent organ of the country of domicile purauant to
laws of the
said country. The consignee should provide certification on such particulars
as age, marital status, occupation, property, health and whether or not he/she
has been subjected to criminal penalty issued by an organ with authority of his/her country of domicile. The said certification should
be authenticated
by the organ of foreign affairs or the institution authorized by the organ
of foreign affairs of the country of domicile, and authenticated by the
Embassy or Consulate of the People’s Republic of China in the said country.
The said consignee should conclude an agreement in writing with the consignor,
and enter into registration at the civil affairs department of people’s
government at the provincial level in person.

    “When both sides or one side of the parties concerned to the adoptive
relationship request(s) notarization for adoption, notarization for the
adoption should be completed at a notary organ with qualifications of
handling foreign-related notarization confirmed by the department of justice
administration under the State Council.”

    IX.Article 27 shall be turned into Article 28 which shall be revised
to read as:”The parties concerned who agree to terminate the adoptive
relationship should go through registration for the termination of the
adoptive relationship at the civil affairs department.”  

    X.Article 30 shall be turned into Article 31, the First Paragraph shall
be revised to read as:”Whoverer abducts and sells children under the cloak of adopdtion shall be investigated for criminal liability
according to law.”

    The Second Paragraph shall be revised to read as:”Whoever abandons an
infant shall be imposed a fine by the public security department; where a
crime has been constituted, criminal liability shall be investigated
according to law.”

    The Third Paragraph shall be revised to read as:”Whoever sells his/her/
their own child(children) shall be confisticated of the illegal income and
imposed a fine by the public security department; where a crime has been
constituted, criminal liability shall be investigated according to law.

    XI.This Decision shall enter into force as of April 1, 1999. No
registration shall be processed for the establishment or termination of adoptive relationship in pursuance of the Adoption Law of
the People’s
Republic of China pending the implementation of this Decision.

    Corresponding revisions of the Adoption Law of the People’s Republic of China shall be made in accordance
with this Decision and promulgated again.

Appendix:Adoption Law of the People’s Republic of China
(Adopted at the 23rd Meeting of the Standing Committee of the 7th National
People’s Congress on December 29, 1991 and revised in accordance with the
Decision on the Revision of the Adoption Law of the People’s Republic of China taken by the 5th Meeting of the Standing Committee
of the 9th National
People’s Congress on November 4, 1998)
Contents

    Chapter I    General Provisions

    Chapter II   Establishment of Adoptive Relationship

    Chapter III  Validity of Adoption

    Chapter IV   Termination of Adoptive Relationship

    Chapter V    Legal Responsibility

    Chapter VI   Supplementary Provisions

Chapter I  General Provisions

    Article 1  This Law is enacted to protect the lawful adoptive relationship
and to safeguard the rights of parties involved in the adoptive relationship.

    Article 2  Adoption shall be in the interest of the upbringing and growth
of minors adopted, safeguarding of the legitimate rights and interests of the
person adopted and the consignee, following the principle of equality
and voluntariness, and shall not violate social ethics.

    Article 3  Adoption shall not contravene laws and regulations on family
planning.
Chapter II  Establishment of Adoptive Relationship

    Article 4  Minors under the age of 14 full years, as enumerated below, may
be adopted:

    (1) orphans bereaved of parents;

    (2) abandoned infants or children whose own parents cannot be ascertained
and found; or  

    (3) children whose own parents are unable to rear them due to unusual
difficulties.

    Article  5  The following citizens or institutions shall be enpost_titled to
place out children for adoption:

    (1) guardians of orphans;

    (2) social welfare institutions;

    (3) those who have not contracted disease(s) that is(are) considered
medically not advisable to adopt children; and  

    (4) having reached the age of 30 full years.

    Article 6  Consignees shall meet simultaneously the following
requirements:

    (1) being childless;

    (2) capable of rearing and educating the person adopted;

    (3) haveing contracted no disease considered medically undesirable for
adoption of children; and

    (4) having reached the age of 30 full years.

    Article 7  Adoption of a child of a collateral relatiive by blood of the
same generation and up to the third degree of kinship may not be subjected to
the restrictions specified of Section (3) of Article 4, Section (3) of Article
5, Article 9 of this Law and the adopted minor under the age of 14 full years.

    An overseas Chinese, in adopting a child belonging to a collateral
relative by blood of the same generation and up to the third degree of
kinship, may even be not subjected to the restriction of the consignee being
childless.

    Article 8  The consignee may adopt one boy or girl only.

    Adoption of orphans, disabled children or abandoned infants or children
under the care of social welfare instituions whose own parents cannot
be ascertained and found may not be subjected to the restrictions of the
consignee being childless and of adoption of one child.

    Article 9  Where a male person without spouse adopts a female child, the
age difference between the consignee and the person adopted shall be no less
than over 40 full years.

    Article 10  Where the parents intend to place out their child for
adoption, they must act in concert. If one parent cannot be ascertained or
found, the other parent may place out the child for adoption alone.

    Where a person with spouse adopts a child, the husband and wife must
adopt the child in concert.

    Article 11  Adoption of a child and the placing out of the child for  
adoption shall take place on a voluntary basis on both sides. Where the
adoption involves a minor above the age of 10 full years, the consent of the
person adopted shall be obtained.

    Article 12  If the parents of a minor are both persons without full civil
capacity, the guardian(s) of the minor may not place out him(her) for
adoption, except when the parents may do serious harm to the minor.

    Article 13  Where a guardian intends to place out an orphaned minor for
adoption, the guardian must obtain the consent of the person who has
obligations to support the orphan. Where the person who has obligations to
support the orphan disagrees to place out the orphan for adoption, and the
guardian is unwilling to continue the performance of his/her guardianship,
it is necessary to change the guardian in accordance with the General
Principles of the Civil Law of the People’s Republic of China.

    Article 14  A stepfather or stepmother may, with the consent of his/her
own parents of the stepson or stepdaughter, adopt the stepson or stepdaughter,
and such adoption may not be subjected to the restrictions of Section (3) of Article 4, Section (3) of Article 5 and Article 6 of
this Law, and  
the restriction that the adopted minor must be under the age of 14 full
years as well as adoption of one child.

    Article 15  The adoption should be registered with the civil affairs
department of people’s government above the county level. The adoptive
relationship shall be established as of the date of registration.

    For adoption of abandoned infants and children whose own parents cannot
be ascertained and found, the civil affairs department handling registration
should make an announcement prior to the processing of registration.

    The parties concerned to the adoptive relationship willing to conclude
an adoption agreement may conclude the adoption agreement.

    When both sides or one side of the parties concerned to the adoptive
relationship request(s) notarization for adoption, notarization for the
adoption should be completed.

    Article 16  The public security department should, upon establishment of the adoptive relationship, process household registration
for the adopted
minor pursuant to relevant state provisions.

    Article 17  Orphans or children whose own parents are unable to rear
them may be raised by the relatives or friends of their own parents.

    The adoptive relationship shall not be applicable to the relations
between the supporter and the supported.

    Article 18  When death occurs to one side of the spouses, and the other
side intends to place out the minor for adoption, the parents of the deceased
have priority rights to raise the child.  

    Article 19  Persons having placed out a child for adoption may not bear
any more child, in violation of the regulations on family planning, on the
ground of having placed out their child for adoption.

    Article 20  Buying and selling of children or buying and selling of children under the cloak of adoption shall be strictly prohibited.

    Article 21  An alien may, in accordance with this Law, adopt a child
(male or female) in the People’s Republic of China.

    Adoption of children by an alien in the People’s Republic of China
should be subject to the examination and approval of the competent organ
of the country of domicile pursuant to laws of the said country. The
consignee should provide certification on such particulars as age, marital
status, occupation, property, health and whether or not he/she has been
subjected to criminal penalty issued by an organ with authority of his/her
country of domicile. The said certification should be authenticated by the
organ of foreign affairs or the institution authorized by the organ of foreign affairs of the country of domicile and authenticated
by the Embassy
or Consulate of the People’s Republic of China in the said country. The said
consignee should conclude an agreement in writing with the consignor,
and enter into registation at the civil affairs department of people’s
government at the provincial level in person.

    When both sides or one side of the parties concerned to the adoptive
relationship request(s) notarization for adoption, notarization for the
adoption should be completed at a notary organ with qualifications of handling
foreign-related notarization confirmed by the department of justice
administration under the State Council.

    Article 22  When the consignee and the consignor request secrecy of the
adoption be kept, others shall respect their wishes and shall not make a
disclosure thereof.
Chapter III  Validity of Adoption

    Article 23  As of the date of establishment of the adoptive relationship,
the legal provisions governing the relationship between parents and children
shall apply to the rights and obligations in the relationship between adoptive
parents and adopted children; the legal provisions governing the relationship
between children and close relatives of their parents shall apply to the
rights and obligations in the relationship between adopted children and close
relatives of the adoptive parents.

    The rights and obligations in the relationship between an adopted child
and his or her own parents and other close relatives shall terminate with the
establishment of the adoptive relationship.

    Article 24  An adopted child may adopt his or her adoptive father’s or
adoptive mother’s surname, and may also retain his or her original surname,
if so agreed through consultation between the parties concerned.

    Article 25  Any act of adoption contravening the provisions of Article 55
of the General Principles of the Civil Law of the People’s Republic of China
and those of this Law shall be of no legal validity.

    Any act of adoption ruled to be invalid by a people’s court shall be of
no legal validity from the very start of the act.
Chapter IV  Termination of the Adoptive Relationship

    Article 26  No consignee may terminate the adoptive relationship before
the adopted person comes of age, except when the consignee and the consignor
for the adoption agree to terminate such relationship. If the adopted child
involved reaches the age of 10 full years or more, his or her consent shall
be obtained.

    Where a consignee fails to perform the obligation of rearing and
commits maltreatment, abandonment, or other acts of encroachment upon the
lawful rights and interests of the minor adopted child, the consignor  
for adoption shall have the right to demand termination of the adoptive
relationship. Where the comsignee and the consignor for adoption fail to
reach an agreement thereon, a suit may be filed in a people’s court.

    Article 27  Where the relationship between the adoptive parents and an
adult adopted child deteriorates to such a degree that their living together
in a same household becomes impossible, they may terminate their adoptive
relationship by agreement. In the event of failure to reach an agreement,
a suit may be filed in a people’s court.

    Article 28  The parties concerned shall, upon reaching an agreement on
the termination of the adoptive relationship, go through the registration for
the termination of the adoptive relationship at a civil affairs department.

    Article 29  Upon termination of the adoptive relationship, the rights and
obligations in the relationship between an adopted child and his or her
adoptive parents and other close relatives shall also terminate, and the
rights and obligations in the relationship between the child and his or her
own parents and other close relatives shall be restored automatically.
However, with respect to the rights and obligations in the relationship
between an adult adopted child and his or her own parents and other close
relatives, it may be decided through consultation as to whether to restore
them.

    Article 30  Upon termination of the adoptive relationship, an adult
adopted child who has been reared by the adoptive parents shall provide
alimony for the adoptive parents who have lost ability to work and are short
of any source of income. If the adoptive relationship is terminated on account of the
maltreatment or desertion of the adoptive parents by the adopted child on
reaching adulthood, the adoptive parents may demand a compensation from
the adopted child for the living and education expenses paid during the
period of adoption.

    If his or her own parents of an adopted child request the termination of
the adoptive relationship, the adoptive parents may demand an appropriate
compensation from his or her own parents for the living and education expenses
paid during the period of adoption, except if the adoptive relationship is
terminated on account of the maltreatment or abandonment of the adopted child
by the adoptive parents.
Chapter V  Legal Responsibility

    Article 31  Whoever kidnaps and traffics children under the cloak of
adoption shall be investigated for criminal responsibility in accordance with
law.

    Whoever abandons an infant shall be imposed a fine by a public security
organ; where a crime has been constituted, criminal responsibility shall be
investigated according to law.

    Whoever sells his or her own child(children) shall be confisticated of the illegal income and imposed a fine
by a public security organ; where a
crime has been constituted, criminal responsibility shall be investigated
according to law.
Chapter VI  Supplementary Provisions

    Article 32  People’s congresses and their standing committees of  
autonomous areas of nationalities may, on the basis of the principles of
this Law and in the light of the local conditions, formulate adaptive or
supplementary provisions. Provisions of autonomous regions shall be
submitted to the Standing Committee of the National People’s Congress for the
record. Provisions of autonomous prefectures or autonomous counties shall be
submitted to the standing committees of the provincial or autonomous regions’
people’s congresses for approval before coming into force, and shall also be
submitted to the Standing Committee of the National People’s Congress for the
record.

    Article 33  The State Council may, in accordance with this Law, formulate
measures for its implementation.

    Article 34  This Law shall enter into force as of April 1, 1992.






INTERPRETATIONS OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS CONCERNING QUESTIONS ON THE IMPELMENTATION OF THE NATIONALITY LAW IN THE MACAO SPECIAL ADMINISTRATIVE

Category  SPECIAL ADMINISTRATIVE REGION Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  In Force
Date of Promulgation  1998-12-29 Effective Date  1999-12-20  


Interpretations of the Standing Committee of the National People’s Congress Concerning Questions on the Impelmentation of the Nationality
Law of the People’s Republic of China in the Macao Special Administrative



Region

(Adopted at the 6th Meeting of the Standing Committee of the 9th

National People’s Congress on December 29, 1998)

    The Nationality Law of the People’s Republic of China shall become
effective in the Macao Special Administrative Region as of December 20,
1999 in accordance with the provisions of Article 18 of the Basic Law
of the Macao Special Administrative Region of the People’s Republic of China and its Appendix III. Taking into consideration the
historical
background and reality of Macao, the following interpretations are
hereby made with respect to the implementation of the Nationality Law
of the People’s Republic of China in the Macao Special Administrative Region:

    I.Residents of Macao having Chinese blood relationship born on the
territories of China(including Macao) as well as other persons of Chinese
nationality that accord with the provisions of the Nationality Law of the
People’s Republic of China, whether or not they hold Portugese travel
certificates or identity cards, are all Chinese citizens.

    Residents of the Macao Special Administrative Region having both Chinese
blood relationship and Portugese blood relationship may, in accordance with
their personal wishes, choose either the nationality of the People’s Republic
of China or the nationality of the Republic of Portugal. Determination of one
of the nationalities shall mean the forgoing of the other nationality. The
aforesaid residents of the Macao Special Administrative Region shall, pending
the selection of nationality, have the rights provided for in the Basic Law
of the Macao Special Administrative Region, however the rights subject to
restrictions of nationality are excluded.

    II.Chinese citizens of Macao holding Portugese travel certificates may,
after the establishment of the Macao Special Administrative Region, continue
to use the said certificates for travel to other countries or regions, however
they shall not have the rights of consular protection of Portugal for holding
the above-mentioned Portugese travel certificates in the Macao Special
Administrative Regions and other regions of the People’s Republic of China.

    III.Chinese citizens of the Macao Special Administrative Region with
rights of residence in foreign countries may use the relevant certificates
issued by foreign governments for travel to other countries or regions,
however they shall not have rights of foreign consular protection for
holding the above-mentioned certificates in the Macao Special Administrative
Region and othr regions of the People’s Republic of China.

    IV.Chinese citizens among original Macao residents who return to Macao
from overseas prior to or after the establishment of the Macao Special
Administrative Region may, in the event of change in nationality, file
an application with the organ of the Macao Special Administrative Region
that accepts nationality applications on the strength of effective
certificates.

    V.The relevant institution designated by the Government of the Macao
Special Administrative Region is authorized to handle all matters relating
to nationality applications pursuant to the Nationality Law of the People’s
Republic of China and the above provisions.






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...