COMPANY LAW OF THE PEOPLE’S REPUBLIC OF CHINA

The Standing Committee of the National People’s Congress

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

No.29

“Decision of the Standing Committee of the National People’s Congress Regarding the Revision of Company Law of the People’s Republic
of China” is adopted on The 13th Session of the Standing Committee of the Ninth National People’s Congress on December 25, 1999,and
is promulgated. This law and decision are effective as of the same date of Promulgation.

President of the People’s Republic of China: Jiang Zemin

December 25, 1999

Company Law of the People’s Republic of China ContentChapter I General Provisions

Chapter II Establishment and Organizational Structure of Limited Liability Companies

Section 1 Establishment

Section 2 Organizational Structure

Section 3 Wholly State-owned Companies

Chapter III Establishment and Organizational Structure of Joint Stock Limited Companies

Section 1 Establishment

Section 2 Shareholders’ General Meetings

Section 3 Board of Directors, and Manager

Section 4 Supervisory Board

Chapter IV Issue and Transfer of Shares of Joint Stock Limited Companies

Section 1 Issue of Shares

Section 2 Transfer of Shares

Section 3 Listed Companies

Chapter V Company Bonds

Chapter VI Financial Affairs and Accounting of Companies

Chapter VII Merger and Division of Companies

Chapter VIII Bankruptcy, Dissolution and Liquidation of Companies

Chapter IX Branches of Foreign Companies

Chapter X Legal Liability

Chapter XI Supplementary Provisions

Chapter I General Provisions

Article 1

This Law is formulated in accordance with the Constitution of the People’s Republic of China in order to meet the needs of establishing
a modern enterprise system, to standardize the organization and activities of companies, to protect the legitimate rights and interests
of companies, shareholders and creditors, to maintain social and economic order and to promote the development of the socialist market
economy.

Article 2

The term “company” mentioned in this Law refers to a limited liability company or a joint stock limited company incorporated within
the territory of the People’s Republic of China in accordance with this Law.

Article 3

A “limited liability company” or “joint stock limited company” is an enterprise legal person.

In the case of a limited liability company, shareholders shall assume liability towards the company to the extent of their respective
capital contributions, and the company shall be liable for its debts to the extent of all its assets.

In the case of a joint stock limited company, its total capital shall be divided into equal shares, shareholders shall assume liability
towards the company to the extent of their respective shareholdings, and the company shall be liable for its debts to the extent
of all its assets.

Article 4

The shareholders of a company shall, in their capacity of contributors of capital, enjoy such rights of owners as benefiting from
assets of the company, making major decisions and selecting managerial personnel in accordance with the amount of their respective
capital investment in the company.

A company shall enjoy the right to the entire property of the legal person formed by the investments of the shareholders and shall
possess civil rights and bear the civil liabilities in accordance with the law.

The ownership of State-owned assets in a company shall vest in the State.

Article 5

A company shall, with all its legal person assets, operate independently and be responsible for its own profits and losses according
to law.

A company shall, under the macro-adjustment and control of the State, organize its production and operation independently in accordance
with market demand for the purpose of raising economic benefits and labour productivity and maintaining and increasing the value
of its assets.

Article 6

An internal management mechanism shall be implemented within companies, which is characterized by clear definition of powers and responsibilities,
scientific management and combination of encouragement and restraint.

Article 7

State-owned enterprises restructured to form companies must transform their operating mechanism, gradually produce an inventory of
their assets and verify their funds, delimit their property rights, clear off their claims and debts, evaluate their assets and establish
a standard internal management mechanism in accordance with the conditions and requirements set by laws, administrative rules and
regulations.

Article 8

Incorporation of limited liability companies or joint stock limited companies must meet the conditions stipulated by the present Law.
Companies meeting the conditions set by this Law shall be registered as limited liability companies or joint stock limited companies;
while companies failing to meet the conditions set by this Law shall not be registered as limited liability companies or joint stock
limited companies.

Where laws or administrative rules and regulations provide that incorporation of companies must be subject to examination and approval,
the procedures of examination and approval shall be completed according to law prior to the registration of such companies.

Article 9

A limited liability company established according to this Law must clearly indicate the words “limited liability company” in its name.

A joint stock limited company established according to this Law must clearly indicate the words “joint stock limited company” in its
name.

Article 10

A company’s domicile shall be the place where its main administrative organization is located.

Article 11

Articles of association must be formulated in accordance with this Law when a company is incorporated. A company’s articles of association
shall have binding force on the company, its shareholders, directors, supervisors and managers.

A company’s scope of business shall be defined in its articles of association and registered in accordance with the law. Items within
the company’s “scope of business” that are subject to restrictions under laws, administrative rules and regulations shall be approved
in accordance with the law.

Companies shall engage in business activities within their registered scope of business. A company may change its scope of business
by amending its articles of association in accordance with statutory procedures and making such amendments registered with the Company
Registration Authority.

Article 12

A company may invest in other limited liability companies or joint stock limited companies and shall assume liability towards the
company so invested in to the extent of such capital contributions.

In case a company, other than an investment company or a holding company as specified by the State Council, invests in other limited
liability companies or joint stock limited companies, the aggregated amount of such investments shall not exceed fifty percent of
its net assets; after the initial investment, the increase therein resulting from capitalization of the profit derived from the company
invested in shall not be included.

Article 13

A company may establish branches, which shall not possess the status of enterprise legal persons and whose civil liabilities shall
be borne by the company.

A company may establish subsidiaries, which shall possess the status of enterprise legal perons, and shall independently bear civil
liabilities according to law.

Article 14

A company must, when engaging in business activities, abide by the law, observe professional ethics, strengthen the construction of
socialist culture and ideology and accept supervision of the government and the public.

The legitimate rights and interests of companies shall be protected by the law and shall be inviolable.

Article 15

Companies must protect the lawful rights and interests of their staff and workers, and strengthen labour protection so as to achieve
safety in production.

Companies shall apply various forms to strengthen professional education and on-the-job training of their staff and workers so as
to improve their quality.

Article 16

Company’s staff and workers shall, in accordance with the law, organize a trade union to carry out the trade union activities and
protect the lawful rights and interests of the staff and workers. The company shall provide its trade union with conditions necessary
for carrying out its activities.

Wholly State-owned companies and limited liability companies invested in and established by two or more State-owned enterprises or
by two or more other State-owned investment entities shall, through staff and workers’ congresses or other forms, practice democratic
management in accordance with the provisions of the Constitution and relevant laws.

Article 17

The grass-root organizations of the Communist Party of China in companies shall carry out their activities in accordance with the
Constitution of the Communist Party of China.

Article 18

The present Law shall apply to limited liability companies with foreign investment. Where laws concerning Chinese-foreign equity joint
ventures, Chinese-foreign contractual joint ventures and foreign-capital enterprises provides otherwise, such provision shall prevail.

Chapter II Establishment and Organizational Structure of Limited Liability Companies

Section 1 Establishment

Article 19

The following conditions must be fulfilled for the establishment of a limited liability company:

(1)

the number of shareholders conforms to the statutory number;

(2)

the capital contributions of the shareholders reach the statutory minimum amount of capital;

(3)

the shareholders have jointly formulated the articles of association of the company ;

(4)

the company has name and an organizational structure established in compliance with the requirements for a limited liability company;
and

(5)

there are fixed premises and necessary conditions for production and operation.

Article 20

A limited liability company shall be jointly invested in and incorporated by not less than two and not more than fifty shareholders.

State-authorized investment institutions or departments authorized by the State may independently invest in and establish wholly State-owned
limited liability companies.

Article 21

If State-owned enterprises established prior to the implementation of this Law comply with the conditions stipulated in this Law for
the establishment of limited liability companies, they may, in the case of enterprises with a single investing entity, be restructured
as wholly State-owned limited liability companies in accordance with this Law, or in the case of enterprises with multiple investing
entities, be restructured as limited liability companies as specified in the first paragraph of the preceding Article.

The implementation procedures and specific measures for restructuring State-owned enterprises as companies shall be formulated separately
by the State Council.

Article 22

The articles of association of limited liability companies shall specify the following particulars:

(1)

the name and domicile of the company;

(2)

the scope of business of the company;

(3)

the registered capital of the company;

(4)

the names or post_titles of the shareholders;

(5)

the rights and obligations of the shareholders;

(6)

the method and amount of capital contributions by the shareholders;

(7)

the conditions for transfer of capital contributions by shareholders;

(8)

the organization of the company, its method of creation, functions and powers and the rules of procedure;

(9)

the legal representative of the company;

(10)

the reasons for dissolution of the company and method of liquidation; and

(11)

other items which the shareholders deem necessary to be specified.

The shareholders shall sign and affix their seals to the company’s articles of association.

Article 23

The registered capital of a limited liability company shall be the amount of the paid-up capital contributions of all its shareholders
as registered with the Company Registration Authority.

The registered capital of a limited liability company shall be no less than the following minima:

(1)

RMB 500,000 yuan for a company engaged mainly in production and operation;

(2)

RMB 500,000 yuan for a company engaged mainly in commodity wholesale;

(3)

RMB 300,000 yuan for a company engaged mainly in commercial retailing; and

(4)

RMB 100,000 yuan for a company engaged in science and technology development, consultancy or services.

Article 24

A shareholder may make its capital contributions to a company in currency or by contributing material objects, industrial property
rights, non-patented technology and land use rights at their appraised value. The material objects, industrial property rights, non-patented
technology or land use rights to be contributed as capital must undergo an asset valuation and verification, and shall not be overvalued
or undervalued. The appraisal and valuation of land use rights shall be handled in accordance with the laws and administrative rules
and regulations.

The investment in the form of industrial property rights and non-patented technology at their appraised value shall not exceed twenty
percent of the registered capital of a limited liability company, except where special State regulations in respect of the application
of high and new technological achievement provide otherwise.

Article 25

Each shareholder shall make in full the amount of the capital contribution subscribed for under the articles of association of the
company. Where a shareholder makes its capital contribution in currency, it shall deposit the full amount of such capital contribution
in currency in the interim bank account opened by the limited liability company to be established. Where a shareholder makes its
capital contribution in the form of material objects, industrial property rights, non-patented technology or land use rights, the
transfer procedures for the property rights shall be handled in accordance with the law.

Shareholders failing to make the capital contributions they subscribed for in accordance with the preceding paragraph shall be liable
for breach of contract towards the shareholders who have made in full their capital contributions.

Article 26

After all shareholders have made their capital contributions in full, such contributions must be verified by a statutory capital verification
institution which shall issue capital verification certificates.

Article 27

After the total capital contributions of the shareholders have been verified by a statutory capital verification institution, application
shall be made to the Company Registration Authority for registration of the establishment of the company by a representative designated
by all the shareholders or by an agent jointly entrusted by them, who shall submit such documents as an application for registration,
the articles of association and the capital verification certificate.

Where the examination and approval of the relevant authorities is required by the laws or administrative rules and regulations, the
approval documents shall be submitted on application for registration of establishment.

The Company Registration Authority shall grant registration and issue a business licence to a company that meets the requirements
stipulated in this Law; the Company Registration Authority shall not register a company failing to meet the requirements stipulated
in this Law.

The date of the issuance of the company business license shall be the date of the establishment of a limited liability company.

Article 28

Where, after the establishment of a limited liability company, it is discovered that the actual value of the material objects, industrial
property rights, non-patented technology or land use rights contributed as capital is notably less than the value stated in the articles
of association, the shareholders that made such contributions shall make up the discrepancy. Those who are shareholders at the time
of the establishment of the company shall bear joint and several liability therefor.

Article 29

Where branches are established simultaneously with the establishment of a limited liability company, application for registration
of the branches established shall be made to, and business licences obtained from the Company Registration Authority.

Where a limited liability company establishes branches after its establishment, the company’s legal representative shall apply for
the registration to, and obtain business licences from the Company Registration Authority.

Article 30

After a limited liability company has been incorporated, it shall issue capital contribution certificates to its shareholders.

A capital contribution certificate shall specify the following items:

(1)

the name of the company;

(2)

the registration date of the company;

(3)

the registered capital of the company;

(4)

the name or post_title of the shareholder, the amount and date of its capital contribution; and

(5)

the serial number of the capital contribution certificate and the date of its verification and issuance.

A capital contribution certificate shall bear the seal of the company on it.

Article 31

A limited liability company shall prepare a roster of its shareholders with the following items therein:

(1)

the names or post_titles and domiciles of the shareholders;

(2)

the amounts of capital contributions of the shareholders; and

(3)

the serial numbers of the capital contribution certificates.

Article 32

A shareholder shall have the right to look up the minutes of shareholders’ meetings and the financial and accounting reports of the
company.

Article 33

Shareholders shall draw dividends in proportion to their capital contributions. Where a company increases capital, the existing shareholders
shall have priority in subscription for new shares.

Article 34

Once a company is registered, its shareholders may not withdraw their capital contributions.

Article 35

The shareholders of a company may assign among themselves all or part of their capital contributions.

Where a shareholder intends to assign its capital contribution to persons who are not shareholders, the consent of over half of all
the shareholders must be secured. Those shareholders disapproving the assignment shall purchase the capital contribution to be assigned.
If such shareholders do not make the purchase, they shall be deemed to have consented to the assignment.

Other shareholders shall, under identical terms, have priority in purchasing the capital contribution to be assigned with the consent
of the shareholders.

Article 36

After a shareholder has assigned its capital contribution according to law, the company shall record the name or post_title and domicile
of the consignee and the amount of the capital contribution assigned in the roster of the shareholders.

Section 2 Organizational Structure

Article 37

The shareholders’ meeting of a limited liability company shall be composed of all the shareholders. The shareholders’ meeting shall
be the organ of power of the company and shall exercise its functions and powers in accordance with this Law.

Article 38

The shareholders’ meeting shall exercise the following functions and powers:

(1)

to decide on the business policy and investment plan of the company;

(2)

to elect and recall members of the board of directors and to decide on matters concerning the remuneration of directors;

(3)

to elect and recall supervisors appointed from among the shareholders’ representatives, and to decide on matters concerning the remuneration
of supervisors;

(4)

to examine and approve reports of the board of directors;

(5)

to examine and approve reports of the supervisory board or supervisors;

(6)

to examine and approve the annual financial budget plan and final accounts plan of the company;

(7)

to examine and approve plans for profit distribution of the company and plans for making up losses;

(8)

to adopt resolutions on the increase or reduction of the registered capital of the company;

(9)

to adopt resolutions on the issuance of company bonds;

(10)

to adopt resolutions on the assignment of capital contribution by a shareholder to a person other than the shareholders;

(11)

to adopt resolutions on matters such as the merger, division, transformation, dissolution and liquidation of the company; and

(12)

to amend the articles of association of the company.

Article 39

The rules of deliberation and voting procedures of the shareholders’ meeting shall, except where provided for by this Law, be stipulated
by the articles of association of the company.

Resolutions of the shareholders’ meeting on the increase or reduction of the registered capital, the division, merger, dissolution,
or transformation of the company must be adopted by shareholders of the company representing two-thirds or more of the voting rights.

Article 40

A company may amend its articles of association. A resolution on the amendment of the articles of association must be adopted by shareholders
of the company representing two-thirds or more of the voting rights.

Article 41

Shareholders shall exercise their voting rights at the shareholders’ meeting in proportion to their capital contributions.

Article 42

The first meeting of the shareholders of a company shall be convened and presided over by the shareholder who has made the biggest
capital contribution to the company and shall exercise its functions and powers in accordance with this Law.

Article 43

Shareholders’ meetings shall be divided into regular meetings and interim meetings.

Regular shareholders’ meetings shall be convened on time as stipulated by the articles of association of the company. Interim shareholders’
meetings may be convened upon proposal made by shareholders representing one-fourth or more of the voting rights, or, by one-third
or more of directors or supervisors.

Where a limited liability company has set up a board of directors, its shareholders’ meetings shall be convened by the board of directors
and presided over by the chairman of the board. Where special circumstances preclude the chairman of the board from performing his
function, the meeting shall be presided over by a vice-chairman or a director of the board designated by the chairman.

Article 44

All shareholders shall be notified fifteen days prior to the convening of a shareholders’ meeting.

The shareholders’ meeting shall keep minutes of their decisions on matters discussed at it; the shareholders present at the meeting
shall sign the minutes.

Article 45

A limited liability company shall have a board of directors, which shall be composed of three to thirteen members.

The members of the board of directors of a limited liability company invested in and established by two or more State-owned enterprises,
or by two or more other State-owned investment entities shall include representatives of the staff and workers of the company. Such
representatives of the staff and workers shall be democratically elected by the staff and workers of the company.

A board of directors shall have a chairman and one or two vice-chairmen. The method for the creation of the chairman and vice-chairmen
shall be stipulated in the articles of association of the company.

The chairman of the board of directors shall be the company’s legal representative.

Article 46

The board of directors shall be responsible to the shareholders’ meeting, and exercise the following functions and powers:

(1)

to be responsible for convening shareholders’ meetings and to report on its work to the shareholders’ meetings;

(2)

to implement the resolutions of the shareholders’ meetings;

(3)

to decide on the business’s plans and investment plans of the company;

(4)

to formulate the annual financial budget plan and final accounts plan of the company;

(5)

to formulate plans for profit distribution and plans for making up losses of the company;

(6)

to formulate plans for the increase or reduction of the registered capital of the company;

(7)

to formulate plans for the merger, division, transformation and dissolution of the company;

(8)

to decide on the establishment of the company’s internal management organs;

(9)

to appoint or dismiss the company’s manager (general manager) (hereinafter referred to as “manager”), and, upon recommendation of
the manager, to appoint and dismiss the company’s deputy manager(s) and persons in charge of the financial affairs of the company,
and to decide on matters concerning their remuneration; and

(10)

to formulate the basic management system of the company.

Article 47

The term of office of directors shall be stipulated by the articles of association of the company but may not exceed three years.
A director may, if reelected upon expiration of his term of office, serve consecutive terms.

The shareholders’ meeting of a company may not unwarrantedly dismiss a director of the board prior to the expiration of his term of
office.

Article 48

Meetings of the board of directors shall be convened and presided over by the chairman of the board. Where special circumstances preclude
the chairman from performing his function, the meeting shall be convened and presided over by a vice-chairman or a director of the
board designated by the chairman. One-third or more of the members of the board of directors may propose the convening of a meeting
of the board of directors.

Article 49

The rules of deliberation and voting procedures of the board of directors shall, except where provided for by this Law, be stipulated
by the articles of association of the company.

All directors shall be notified ten days prior to the convening of a board meeting.

The board meeting shall keep minutes of decisions on matters discussed at it; directors present at the meeting shall sign the minutes.

Article 50

A limited liability company shall have a manager, who shall be appointed or dismissed by the board of directors. The manager shall
be responsible to the board of directors and shall exercise the following functions and powers:

(1)

to be in charge of the production, operation and management of the company, and to organize the implementation of the resolutions
of the board of directors;

(2)

to organize the implementation of the annual business plans and investment plans of the company;

(3)

to draw up plans on the establishment of the internal management organs of the company;

(4)

to draw up the basic management system of the company;

(5)

to formulate specific rules and regulations of the company;

(6)

to recommend the appointment or dismissal of the deputy manager(s) and of persons in charge of the financial affairs of the company;

(7)

to appoint or dismiss management personnel other than those to be appointed or dismissed by the board of directors; and

(8)

other functions and powers granted by the articles of association of the company and the board of directors.

The manager shall attend meetings of the board of directors as a non-voting attendant.

Article 51

Where a limited liability company has a small number of shareholders and is comparatively small in scale, it may have an executive
director instead of a board of directors. The executive director may concurrently serve as the manager of the company.

The powers and functions of the executive director shall be stipulated by the articles of association of the company with reference
to Article 46 of this Law.

Where a limited liability company does not have a board of directors, the executive director shall be the legal representative of
the company.

Article 52

A limited liability company with a relatively large-scale business shall have a supervisory board composed of no less than three members.
The supervisory board shall elect a convener from among its members.

The supervisory board shall be composed of representatives of the shareholders and an appropriate proportion of the staff and workers
of the company. The exact proportion shall be stipulated in the articles of association. The representatives of the staff and workers
in the supervisory board shall be democratically elected by the staff and workers of the company.

Where a limited liability company has a small number of shareholders and is comparatively small in scale, it may have one or two supervisors.

Directors, the manager or personnel in charge of financial affairs of the company may not concurrently serve as supervisors.

Article 53

The term of office of a supervisor shall be three years. A supervisor may, if reelected upon expiration of his term of office, serve
consecutive terms.

Article 54

The supervisory board or the supervisors shall exercise the following functions and powers:

(1)

to examine the financial affairs of the company;

(2)

to supervise the acts of the directors and the manager violating the laws, administrative rules and regulations or the articles of
association of the company during the performance of their functions;

(3)

to demand directors and the manager to make corrections if any of their acts is found to have damaged the interests of the company;

(4)

to propose the convening of interim shareholders’ meetings; and

(5)

other functions and powers as stipulated in the articles of association of the company.

The supervisors shall attend meetings of the board of directors as non-voting participants.

Article 55

A company shall, in studying and deciding on issues involving the personal interests of its staff and workers such as their salaries,
welfare, safety in production, labour protection and labour insurance, solicit in advance the opinions of the trade union and the
staff and workers of the company. And representatives of the trade union or of the staff and workers shall be invited to attend relevant
meetings as non-voting participants.

Article 56

A company shall solicit the opinions and suggestions of the trade union and the staff and workers of the compa

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