IMPLEMENTATION PLAN ON REFORMING THE SUPERVISION AND MANAGEMENT SYSTEM OF SAFETY ON WATER

(Proposed by Ministry of Communications on May 20th 1999, transmitted by the General Office of the State Council, GOSC File No. 54 [1999] on June 5th 1999)

    In accordance with the requirements for furthering administrative system reform and strengthening law enforcement
and supervision authorities proposed by the Party’s fifteenth national congress, in order to harmonize and perfect the supervision
and management system of safety on water, enable the supervisory authorities of safety on water to perform more effectively their
functions of supervising and managing safety on water, preventing vessel pollution, inspecting ship and marine facilities, and guaranteeing
navigation, further meet the needs of developing socialist market economy, pursuant to the spirit in (issued by GOSC File No. 67 [1998], hereinafter referred to as “GOSC file 67”) and (GOSC Letter No. 48 [1998]), the implementation plan on reform in the supervision and management system of safety on water: is proposed
as follows:

    I. Guidelines

    The reform in the supervision and management system of safety on water shall insist on the principle of “simplified,
uniform and effective”.  Under a uniform leadership system, the work division between central and local authorities of
relevant water area shall be clearly defined, and the method of “one water area, one supervisor; one harbor, one supervisor” shall
be adopted.  In the same water area, the same harbor or the same region, repetitive establishment of supervision and management
authorities of safety on water is prohibited.  By reform, among the supervision and management authorities, relationships
shall be further harmonized, functions shall be clarified, policies, layouts and this work shall be unified.  Gradually
a new supervision and management system of safety on water which is suitable to the socialist market economy system, with division
in duties, running well, standardizing in conduct, highly efficient in working and uniform in law enforcement, shall be set up.

    II. Definition of water areas under central management

    The GOSC file 67 provides that the supervisory work of safety on water in coastal sea (including islands)
areas and harbors, opened water areas, and main internal river arteries crossing provinces, autonomous regions or municipalities
directly under central authority (Yangtze river, Pearl river, and Heilongjiang river) and harbors (hereinafter referred to as “Water
areas under central management”) shall be uniformly led by the Ministry of Communications.  To further define the division
of work between central and local authorities in the supervision and management of safety on water, the water areas under central
management are defined as follows:

    (a) The coastal sea (including island) areas and harbors refer to the entire sea areas within state jurisdiction
at the coastal areas (including island) of China, from the estuary of Yalu river of Liaoning province in the north to the estuary
of Beilun river of Guangxi province in the south, and the water areas where all the wharves, loading and unloading areas and operation
sites of coastal harbors being located (including the water area of first harbor at estuary of river joining the sea and the downstream
water area thereof).

    (b) The opened water areas refer to the opened coastal, internal river harbor water areas, and inland navigation
water areas and the opened harbors where international vessel can navigate and reach.  All of these water areas shall be
approved in accordance with relevant state stipulations.

    (c) The main internal river arteries crossing provinces, autonomous regions or municipalities directly under
central authority (Yangtze river, Pearl river, and Heilongjiang river) and harbors refer to the Yangtze artery water area and the
estuary water areas of artery and tributary intersection and harbors from Yibin of Sichuan to Shanghai; Pearl river (West river)
main artery water areas and the estuary water areas of artery and tributary intersection and harbors from Nanning of Guangxi and
thereafter the West river artery, Liuzhou of Guangxi and thereafter the Liu river artery to the main estuaries in Guangdong; the
water areas of Heilongjiang river artery and tributaries and harbors from Heishantou of Inner-Mongolia, Daan of Jilin and thereafter.  The
estuary water areas of artery and tributary intersection refer to the water areas where all the wharves, loading and unloading areas
and operation sites of harbors have been set up at such intersection location; the water areas without harbors refer to the water
areas of such intersection which are closely connected with the navigation order of artery.

    The governments of provinces, autonomous regions and municipalities directly under central authority shall
be responsible for the supervisory work of safety on water of internal rivers, lakes, reservoirs and others which are under central
management (hereinafter referred to “other water areas”).

    III.  Basic principles on authorities transfer and consolidation

    (a) The Ministry of Communications shall set up a specialized authority to exercise the supervisory work of
safety on water within water areas under central management. In order to ensure the continuity and consistency of the supervisory
work of safety on water, and avoid repetitive establishment of authorities, according to the method of “one water area ,one supervisor”
and “one harbor ,one supervisor”, the local supervisory authorities of safety on water defined as performing supervisory duties of
safety on water within water areas under central management shall all be transferred to central supervisory authorities of safety
on water; if central supervisory authorities of safety on water have already existed in the region, the authorities shall be consolidated
and then be led by the Ministry of Communications.

    (b) Due to over dispersion or narrowness of any other water areas, the local people’s government has difficulty
in  setting up  supervision authority to manage, and the relevant people’s government of province, autonomous
region or municipality directly under central authority proposes the supervisory work of safety on water y of such water area be
managed by the Ministry of Communications, both parties may decide this matter through consultation; if the Ministry of Communications
intends to entrust relevant people’s government of province, autonomous region or municipality directly under central authority to
assume the management of the upstream reach or seasonal navigable reach of partial internal river arteries crossing provinces, autonomous
regions or municipalities directly under central authority as well as harbors and other water areas under central management, both
parties may also decide this matter through consultation.

    (c) During the authorities transfer and consolidation, the personnel transfer must be carried out according
to the registration record on June 18th 1998.  In case of joint office with transportation management, waterway management
and other authorities, the personnel engaging in supervisory activities of safety on water shall be transferred entirely in principle,
and the general management personnel and the retiree shall be transferred according to the ratio of the personnel engaging in supervisory
activities of safety on water to the total operating personnel.

    (d) After the local supervisory authority of safety on water within water areas under central management has
been transferred to the management of the Ministry of Communications, its revenue from stipulated fees shall be transferred simultaneously
to the management of the Ministry of Communications, and the detailed management measures shall be studied and formulated separately
by the Ministry of Finance and the Ministry of Communications.  After the reform, if the funds for operational expenses
of the supervisory authority of safety on water under local management are affected, a part of the stipulated fees transferred may
be refunded. The refund ratio and amount shall be determined by the Marine Bureau of the People’s Republic of China (the Marine Bureau
of the Ministry of Communications) in consultation with the Ministry of Finance, pursuant to the ratio of the amount of stipulated
fees actually paid in 1998 by all transferred units of the province, autonomous region or municipality directly under central authority
to the supervisory authority of safety on water under local management after the reform as opposed to the total revenue from stipulated
fees of all transferred units. The method of such refund shall be studied and determined separately by the Ministry of Finance and
the Ministry of Communications.

    (e) The state-owned assets (including land, office building, employee dormitory and facility, equipment and
vehicle for supervision and management) of the local supervisory authority of safety on water transferred to the management of Ministry
of Communications shall be transferred on the basis of the audited final account in year 1998 without compensation.  All
debts and claims shall be transferred jointly.  For authority by entire organizational transfer, the assets shall be transferred
in entirety; for authority by partial transfer, the assets shall be determined pursuant to the ratio of the number of actually transferred
employees to the number of employees of the original authority and be transferred without compensation  The procedures
shall follow relevant regulations on assets transfer and others .

    (f) The problems of the relevant investment channels on the basic construction projects in construction or
having been filed of the transferred or consolidated supervisory authority of safety on water shall be resolved by the Ministry of
Communications with relevant local people’s government through consultation.

    IV. Operation management and authority establishment

    (a) The Marine Bureau of the People’s Republic of China (the Marine Bureau of the Ministry of Communications)
leads the supervisory work of safety on water throughout the country.  The central supervisory authorities of safety on
water set within water areas under central management and the local supervisory authorities of safety on water set within other water
areas shall respectively conduct supervisory work of safety on water within water areas subject to their jurisdictions.

    (b) The establishment of central supervisory authority of safety on water and cadre management

    According to the natural pattern of shipping economy and the characteristics of shipping, with overall consideration
of the harbor layout and administrative division, pursuant to the principle of “uniform, highly efficient, responsible separately
at different levels “, the authorities directly under the Ministry of Communications shall be established in main harbor cities or
center cities within the developed shipping regions.  The authorities shall be responsible for the supervisory work of
safety on water within water areas subject to their jurisdictions. The establishment of specific authority shall be reported and
approved separately in accordance with stipulated procedures.  The cadre management of leaders of the authorities directly
under the Ministry of Communications shall be conducted mainly by the Ministry of Communications.  When the Ministry of
Communications appoints or removes the main leaders of such authority, the local opinions shall be asked.

    Two-line management in income and expenditure shall be applied to the administrative charges and revenues
from fines and confiscations of the central supervisory authority of safety on water.

    (c) The establishment of local supervisory authorities of safety on water

    The people’s governments of provinces, autonomous regions and municipalities directly under central authority
shall set up authorities to manage the supervisory work of safety on water  within other water areas.  The local
supervisory authorities of safety on water shall be led by the competent administrative authorities in communications of provinces,
autonomous regions and municipalities directly under central authority, and shall execute their duties within water areas subject
to their jurisdictions pursuant to authorized operation scope, in accordance with relevant provisions of regulations and rules on
water safety supervision stipulated by the state and the Ministry of Communications.  The names of the local supervisory
authorities of safety on water  shall be standardized uniformly by the Ministry of Communications.

    V. The organization and implementation of the reform

    The reform in the supervision and management system of safety on water, under the direction of Office of Central
Authority Establishment Commission, shall be organized and implemented by the Ministry of Communications and the relevant people’s
governments of provinces, autonomous regions and municipalities directly under central authority.  The Ministry of Communications
and the relevant people’s governments of provinces, autonomous regions and municipalities directly under central authority shall
organize a specialized group responsible for this work.  They shall insist on guideline of “active and safe”, deploy carefully,
organize elaborately, deal well with problems in various aspects, maintain normal work order, guarantee the entirety of state-owned
assets and ensure the reform running smoothly.

    To be propitious to the transfer and consolidation work of supervisory authorities of water security, the
Ministry of Communications shall sign agreement respectively with relevant people’s governments of provinces, autonomous regions
and municipalities directly under central authority in accordance with the reform plan, and form joint workgroups responsible for
conducting concrete matters in authority transfer and consolidation.

    The transfer and consolidation of supervisory authorities of safety on water shall be implemented in steps
pursuant to the order of “sea first, river second”. The transfer and consolidation work of supervisory authorities of safety on water
in coastal provinces, autonomous regions and municipalities shall be completed before October 1st 1999; the transfer and consolidation
work of supervisory authorities of safety on water in provinces, autonomous regions and municipalities along Yangtze river or Heilongjiang
river shall be completed before the end of year 1999; the people’s governments of provinces, autonomous regions and municipalities
directly under central authority shall, according to the condition of local organization reform, make overall arrangements for the
setup of local supervisory authorities of safety on water and other work.