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CIRCULAR OF THE GENERAL OFFICE OF THE STATE COUNCIL CONCERNING THE FURTHER STRENGTHENING OF ADMINISTRATION OF TOURIST VESSLES FOR THE RECEPTION OF FOREIGNERS TO TRAVEL THE THREE GORGES ON THE YANGTZE RIVER

Category  TOURISM Organ of Promulgation  The State Council Status of Effect  In force
Date of Promulgation  1995-02-27 Effective Date  1995-02-27  


Circular of the General Office of the State Council Concerning the Further Strengthening of Administration of Tourist Vessles for
the Reception of Foreigners to Travel the Three Gorges on the Yangtze River



(February 27, 1995)

    The Three Gorges on the Yangtze River are important tourist resources in
our country. The tourist industry in the Three Gorges on the Yangtze River has
made great progress in recent years. As a result
of lack of unified
administration and blind competition among some enterprises for building
tourist vessels, such problems as the confusion of operating order, the
imperfection of safety measures and a decline of service quality have surfaced
in the tourist transport carrying foreigners in the Three Gorges on the
Yangtze River. For the purpose of the safe navigation of tourist vessels and
the advancement of service quality, so as to promote the healthy development
of the tourist industry in the Three Gorges on the Yangtze River, and with the
approval of the State Council, the relevant matters are hereby notified as
follows:

    1.In accordance with the relevant provisions of the Regulations of the
People’s Republic of China for the Administration of Water Transport, the
establishment of any enterprise intended to engage in the inter-provincial
tourist transport carrying foreigners in the Three Gorges on the Yangtze River
shall be subject to the approval of the Ministry of Communications; the
establishment of any enterprise intended to engage in the transport within a
province shall be subject to the approval of the communications department of
the province where the said enterprise is to be established.

    With regard to the establishment of a Chinese-foreign equity joint venture
or a Chinese-foreign contractual joint venture intended to engage in the
tourist transport carrying foreigners in the Three Gorges on the Yangtze
River, where the amount of investment exceeds the statutory quota, the project
proposal and the feasibility study report thereof shall be examined and
approved by the State Planning Commission in consultation with the Ministry of
Communications and other competent departments, and the contract and the
articles of association thereof shall be examined and approved by the Ministry
of Foreign Economic Relations and Trade; where the amount of investment is not
more than the statutory quota, the project proposal and the feasibility study
report thereof shall be examined and approved by the Ministry of
Communications, and the contract and articles of association thereof shall be
examined and approved by the Ministry of Foreign Economic Relations and Trade.
The Chinese party to a Chinese-foreign equity or a contractual joint venture
shall invest an amount of not less than 50% of the total amount of investment
and one of the parties to the said venture shall be a professional water
transport enterprise. From now on, any enterprise failing to complete the
formalities in accordance to the above-mentioned provisions shall not engage
in the tourist transport carrying foreigners in the Three Gorges on the
Yangtze River.

    2.Vessels engaged in the tourist transport carrying foreigners in the
Three Gorges on the Yangtze River must conform to the technical standards
provided by the Register of Shipping of the People’s Republic of China and
must possess the valid certificates of vessel survey issued by the Register of
Shipping of the People’s Republic of China or its authorized organizations.
After the date of issuance of this Circular, anyone who builds vessels to be
engaged in the tourist transport carrying foreigners in the Three Gorges on
the Yangtze River shall apply to the Register of Shipping of the People’s
Republic of China or its authorized organizations for a survey under
construction.  For vessels that were surveyed and certificated by the local
survey organizations, new applications for survey shall, within one month from
the issuance of this Circular, be made to the Register of Shipping of the
People’s Republic of China or its authorized organizations and valid
certificates of vessel survey will be issued to those of them which are
surveyed up to standards.

    3.Vessels engaged in the tourist transport carrying foreigners in the
Three Gorges on the Yangtze River must obtain the registration of vessels and
port entry and departure visas from the state harbour superintendencies
authorized by the Bureau of Harbour Superintendency of the People’s Republic
of China. No harbour superintendencies without such authorization shall accept
registration and issue port entry and departure visas to vessels engaged in
the tourist transport carrying foreigners in the Three Gorges on the Yangtze
River.

    4.Crew members in charge of technical work on board tourist vessels
receiving foreigners to travel the Three Gorges on the Yangtze River, must
pass the unified examination organized by the Bureau of Harbour
Superintendency of the People’s Republic of China. The Yangtze Bureau of
Harbour Superintendency of the People’s Republic of China shall be responsible
for the implementation of the specific affairs related to the examination. All
crew members taking up their posts must hold the competency certificates of
crew of the People’s Republic of China.

    5.It is necessary to strengthen conscientiously the administration of
public security. The Bureau of Public Security of Navigation in the Yangtze
River under the Ministry of Communications shall, in accordance with relevant
provisions promulgated by the Ministry of Communications or the Ministry of
Public Security, be responsible for the unified administration of safety
protection, supervision of fire fighting, lodging registration of persons from
abroad, public security of berthing ports and handling of various cases
related to tourist vessels receiving foreigners to travel the Three Gorges on
the Yangtze River. In case where especially serious accidents take place, the
Interim Provisions on Investigation Procedures for Especially Serious
Accidents promulgated by the State Council in 1989 shall apply to deal with
the cases.

    6.It is necessary to strengthen the administration of service quality in
tourist vessels receiving foreigners to travel the Three Gorges on the Yangtze
River. The National Tourism Administration shall formulate the rules on
reception and service, standards and methods for star-rating in conjunction
with the Ministry of Communications and other departments concerned and shall
enforce the inspection and supervision on the service quality.

    7.The Ministry of Communications shall strengthen the planning,
construction and administration of ports and stations as well as tourist
vessels receiving foreigners to travel the Three Gorges on the Yangtze River
so as to alter the situation of the lagging construction and disorderly
administration of ports and stations as early as possible and achieve
coordinated development.

    8.The Ministry of Communications shall, in accordance with the relevant
provisions of the State and the requirements of this Circular, and in
conjunction with the National Tourism Administration, the Ministry of Public
Security and other departments concerned, check up and rectify vessels engaged
in tourist transport business in the Three Gorges on the Yangtze River within
the period of time before the end of June, 1995. The aforesaid departments
shall process new registration and reissue certificates to those which meet
the statutory requirements, set a time limit for those which fail to meet the
requirements to make rectification and correction and revoke the operating
status if requirements have not been met after such rectification and
correction.

    9.A system of holding joint meetings on the coordination in tourism in
the Three Gorges on the Yangtze River shall be instituted. The Ministry of
Communications shall convene the meeting, call together the National Tourism
Administraion, the Ministry of Public Security and other relevant departments
and invite the local departments concerned in Sichuan, Hubei and other
provinces to be present. The meeting shall nonperiodically be held every year
to co-ordinate the relevant work and study and resolve the emerging problems
with a view to advancing service quality and ensuring the normal operating
order of tourist industry carrying foreigners in the Three Gorges on the
Yangtze River.

    10.Enterprises engaging in tourist transport carrying foreigners in the
course of the Yangtze River other than the Three Gorges on the Yangtze River
shall do business with reference to this Circular.

    11.This Circular shall be implemented from the date of its issuance. If
any provisions in the relevant documents issued previously conflict with this
Circular, this Circular shall prevail.






CIRCULAR OF THE STATE ADMINISTRATION FOR INDUSTRY AND COMMERCE AND THE MINISTRY OF FOREIGN TRADE AND ECONOMIC COOPERATION ON ISSUES CONCERNING ESTABLISHMENT OF BRANCHES OF ADVERTISING AGENCIES WITH FOREIGN INVESTMENT

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

Circular of the State Administration for Industry and Commerce and the Ministry of Foreign Trade and Economic Cooperation on Issues
Concerning Establishment of Branches of Advertising Agencies with Foreign Investment

GongShangGuangZi [1995] No.28

May 17, 1995

In accordance with Paragraph 2 of Item 3 of Article 5 of the Provisions of the State Administration for Industry and Commerce and
the Ministry of Foreign Trade and Economic Cooperation on the Establishment of Advertising Agencies with Foreign Investment (GongShangGuangZi
[1994] No.304), specific measures for the establishment of branches of advertising agencies with foreign investment are hereby notified
as follows:

1.

Locally registered advertising agencies with foreign investment, when applying for the establishment of branches, should submit the
application materials and related documents to commissions (departments) of foreign trade and economic cooperation and administrations
for industry and commerce of various provinces, autonomous regions, and municipalities directly under the Central Government and
municipalities separately listed on the State plan. The commissions (departments) of foreign trade and economic cooperation of various
provinces, autonomous regions, and municipalities directly under the Central Government and municipalities separately listed on the
State plan, after seeking opinions from administrations for industry and commerce of the same level, submit all the documents to
the Department of Foreign Investment of the Ministry of Foreign Trade and Economic Cooperation and send a copy to the Department
of Advertising Supervision and Administration of the State Administration for Industry and Commerce.

2.

Advertising agencies with foreign investment registered at the State Administration for Industry and Commerce, when applying for the
establishment of branches, should, upon the approval of competent Chinese authorities, submit the application materials and related
documents to the Department of Foreign Investment of the Ministry of Foreign Trade and Economic Cooperation and send a copy to the
Department of Advertising Supervision and Administration of the State Administration for Industry and Commerce.

3.

The Department of Foreign Investment of the Ministry of Foreign Trade and Economic Cooperation will, after seeking written opinions
from the Department of Advertising Supervision and Administration of the State Administration for Industry and Commerce and commissions
(departments) of foreign trade and economic cooperation of the provinces and cities where the branches will be set up, decide whether
or not to grant the approval.



 
The State Administration for Industry and Commerce, the Ministry of Foreign Trade and Economic Cooperation
1995-05-17

 







CIRCULAR OF THE STATE COUNCIL CONCERNING THE PRROVAL AND TRANSMISSION OF THE OPINIONS OF THE PEOPLE’S BANK OF CHINA ON STRENGTHENING SUPERVISION AND ADMINISTRATION OF FINANCIAL INSTITUTIONS

Category  BANKING Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1994-09-29 Effective Date  1994-09-29  


Circular of the State Council Concerning the Prroval and Transmission of the Opinions of the People’s Bank of China on Strengthening
Supervision and Administration of Financial Institutions

    
Appendix: Opinions on Strengthening Supervision and Administration of

(September 29, 1994)

    

    “The Opinions of the People’s Bank of China on Strengthening Supervision
and Administration of Financial Institutions” has been approved by the State
Council, and is hereby transmitted to you for conscientious implementation
thereof.”

    Work related to the supervision and administration of financial
institutions is wide-ranging and has a strong policy character. Therefore,
various regions and departments should actively support and fully cooperate
with the People’s Bank of China in exercising the function of supervision and
administration. Questions arising during the process of rectifying the
financial institutions shall be appropriately dealt with in accordance with
relevant state provisions in order to promote the safe and efficient
operations of the financial system.
Appendix: Opinions on Strengthening Supervision and Administration of
Financial Institutions

    In order to conscientiously carry out the “Decision of the State Council
on Reform of the Financial System”, practically change the functions of the
People’s Bank of China, further strengthen the supervision and administration
of financial institutions and maintain stable financial order, the following
opinions on the supervision and administration of financial institutions are
hereby introduced:

    1. The People’s Bank of China is authorized by the State Council as the
department in charge of finance and shall in accordance with the law perform
the functions of examining and approving the establishment, alteration and
termination of various types of financial institutions. The establishment of
financial institutions and the operations of financial business must be
approved by the People’s Bank of China, and without such approval, the
management of financial business on self-authorization shall, without
exception, be deemed as unlawful management, and shall be dealt with in
accordance with the law. Administration, supervision, investigation for
decision-making activities the People’s Bank of China conducts in accordance
with the law with respect to financial institutions shall not be subject to
the interference of any unit or individual.

    In case of management of financial business approved by various regions or
departments on their own decisions without being examined and approved, and
without the certificate for the management of financial business issued by the
People’s Bank of China, self-examination and self-correction shall be
conducted in accordance with the law. In case of a necessity of the
establishment, a fresh applicatioin shall be submitted to the People’s Bank of
China for approval.    

    2. Branches and sub-branches of the People’s Bank of China are agencies of
the Headquarters of the People’s Bank of China, and shall approve the
establishment of financial institutions in strict accordance with the
authorization of the Headquarters of the People’s Bank of China, and shall
conscientiously ferret out approvals made in violation of regulations and
beyond the authority for the establishment of financial institutions in
accordance with the provisions outlined in the “Circular on Ferreting Out
Approvals for the Establishment of Financial Institution Made Beyond the Scope
of Authority of Branches at Various Levels of the People’s Bank of China”
(YIN CHUAN NO.27[1994]). All financial institutions established with approvals
made beyond the scope of authority referred to in the document under reference
YIN CHUAN No.27 [1994], which explicitly requires dissolution or merger, shall
be resolutely dissolved or merged, and settlements of creditor’s rights and
debts shall be made finalized jointly with relevant departments. In cases when
no express opinions are outlined in document No.27[1994] on the ferreting out
process, the Headquarters of the People’s Bank of China shall, after
clarifying specific circumstances, draft detailed opinions thereon and
disseminate same recently to all branches and sub-branches of the People’s
Bank of China for implementation.

    3. Securities institutions operated by financial departments must, at the
earliest possible date, be separated from financial departments. With regard
to such institutions, financial securities institutions of provinces,
autonomous regions, municipalities directly under the Central Government and
cities listed under separate plans which are well-managed in conformity with
the conditions required, shall, in accordance with unified standards, be
transformed into standardized securities corporations following the
examination and approval first by local branches of and thereafter by the
Headquarters of the People’s Bank of China, with said corporations subject to
the supervision and administration of the People’s Bank of China. Exchange
institutions handling state bond transactions at the prefectural (city) level
shall be combined with and become branches of securities corporations at the
provincial level if in conformity with relevant conditions, and without
exception, shall be dissolved when not in conformity. Financial securities
institutions and service departments handling state bond at and below the
county level may, after ferreting out, become agencies of financial securities
institutions upon receiving the approval by the local branch of the People’s
Bank of China. The People’s Bank of China jointly with the Ministry of Finance
shall be responsible for ferreting out financial securities institutions.

    4. In accordance with provisions outlined in the “Regulations on the
Administration of Savings”, the postal network and stations handling
transactions related to personal savings of the residents must conform with
requirements for establishing savings institutions, and must obtain the
appropriate permits and certificates for managing financial business. Postal
savings network and stations which have failed to obtain appropriate
certificates, but which are nonetheless engaged in private savings
transactions, shall be reported to the local branch of the People’s Bank of
China, after the post and telecommunications administrative departments of
provinces, autonomous regions and municipalities directly under the Central
Government prepared itemized reports thereon. Following the approval of the
People’s Bank of China and the issuance of relevant permits and certificates,
said institutions may handle savings business of the residents.

    5. Rural cooperative funds are in fact organizations providing mutual
financial assistance serving agriculture and farmers within their respective
communities, and hence are not considered to be financial institutions. The
Ministry of Agriculture bears responsibility for formulating relevant policies
and regulations, as well as to issue directives regarding the administration
and development of cooperative funds in rural areas. The local agricultural
administration departments are departments in charge of cooperative funds in
rural areas. The People’s Bank of China shall, in accordance with the law,
exercise supervision of the business activities of cooperative funds in rural
areas, and shall join with agricultural administration departments in
appropriately handling acts in violation of the regulations in respect of
managing deposits and lending transactions.

    6. Serving in its capacity as the department in charge of pawnbroking and
bearing responsibility for the examination and approval of the establishment
of pawnbroking institutions and administration of related business activities,
the People’s Bank of China shall, in accordance with relevant state
provisions, ferret out and standardize existing institutions, and order those
to stop the banking business conducted beyond their scope of business within a
prescribed period of time.

    7. In accordance with the “Regulations on the Administration of the
Securities of Enterprises”, and with requirements stipulated by the General
Office of the CPC Central Committee and the General Office of the State
Council concerning exercising strict administration of markets for lottery
tickets and prohibiting the issuance of unauthorized lottery tickets, the
People’s Bank of China shall join with relevant planning departments at the
same level to strengthen the administration of enterprise securities and
lottery tickets, and shall be responsible for the examination and approval of
the issuance of enterprise securities within the state plan. Unless otherwise
provided for by the State Council, no funds shall be raised from the society
and no lottery tickets shall be issued without the approval of the People’s
Bank of China. Those found in violation of the relevant provisions concerning
the issuance of securities and lottery tickets shall be investigated and dealt
with by the People’s Bank of China jointly with relevant departments.

    8. With regard to making investments by purchasing shares from financial
institutions, the “Circular on Printing and Distributing `the Provisional
Regulations on Investments Related to Purchasing Shares from Financial
Institutions'” of the People’s Bank of China shall be implemented strictly.
Departments of parties and the government, PLA units, organizations as well as
various institutions included in the national budget, and the state financial
institutions administering policy shall not make investments by purchasing
shares in financial institutions without the explicit approval of the
organization authorized by the state. Investments involving the purchase of
shares of financial institutions made by the local financial departments,
industrial and commercial enterprises and financial institutions designated as
legal entities shall conform with the conditions and the investment ratio
stipulated by the People’s Bank of China. All financial institutions must pay
taxes, operate in strict accordance with the law and conscientiously implement
relevant provisions of the People’s Bank of China.






ORGANIC LAW OF THE LOCAL PEOPLE’S CONGRESSES AND LOCAL PEOPLE’S GOVERMENTS






Organic Law of the Local People’s Congresses and Local People’s Goverments of the PRC

    

(Effective Date 1995.02.28)

CHAPTER I GENERAL PROVISIONS

CHAPTER II LOCAL PEOPLE’S CONGRESSES AT VARIOUS LEVELS

CHAPTER III THE STANDING COMMITTEES OF LOCAL PEOPLE’S CONGRESSES AT AND

ABOVE THE COUNTY LEVEL

CHAPTER IV LOCAL PEOPLE’S GOVERNMENTS AT VARIOUS LEVELS

CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 1 People’s congresses and people’s governments shall be established in provinces, autonomous regions, municipalities directly under
the Central Government, autonomous prefectures, counties, autonomous counties, cities, municipal districts, townships, nationality
townships, and towns.

   Article 2 Standing committees shall be established by local people’s congresses at and above the county level.

   Article 3 The organs of self-government of autonomous regions, autonomous prefectures and autonomous counties shall, in addition to exercising
the functions and powers specified in this Law, exercise the power of autonomy within the limits of their authority as prescribed
by the Constitution, the Law on Regional National Autonomy and other laws.

CHAPTER II LOCAL PEOPLE’S CONGRESSES AT VARIOUS LEVELS

   Article 4 Local people’s congresses at various levels shall be local organs of state power.

autonomous regions, municipalities directly under the Central Government, autonomous prefectures and cities divided into districts
shall be elected by the people’s congresses at the next lower level; deputies to the people’s congresses of counties, autonomous
counties, cities not divided into districts, municipal districts, townships, nationality townships, and towns shall be elected directly
by their constituencies.

The number of deputies to the local people’s congresses at various levels and the manner of their election shall be prescribed by
the electoral law. There shall be an appropriate number of deputies elected from the minority nationalities in each administrative
area.

   Article 6 The term of office of the people’s congresses of provinces, autonomous regions, municipalities directly under the Central Government,
autonomous prefectures, counties, autonomous counties, cities and municipal districts shall be five years. The term of office of
the people’s congresses of townships, nationality townships and towns shall be three years; The term of office of the people’s congresses
of provinces, autonomous regions, municipalities directly under the Central Government, autonomous prefectures, counties, autonomous
counties, cities and municipal districts shall be five years. The term of office of the people’s congresses of townships, nationality
townships and towns shall be three years.

   Article 7 The people’s congresses of provinces, autonomous regions, and municipalities directly under the Central Government may, in the light
of the specific conditions and actual needs of their respective administrative areas, formulate and promulgate local regulations,
which must not contravene the Constitution, the law and administrative rules and regulations; they shall report such local regulations
to the Standing Committee of the National People’s Congress and the State Council for the record.

The people’s congresses of cities where provincial and autonomous regional people’s governments are located and the people’s congresses
of relatively large cities with the approval of the State Council may, in the light of the specific conditions and actual needs of
their respective cities, formulate local regulations, which must not contravene the Constitution, the law, administrative rules and
regulations, and the local regulations of their respective provinces and autonomous regions; they shall report such local regulations
to the standing committees of the people’s congresses of the respective provinces and autonomous regions for approval before implementation
and for submission to the Standing Committee of the National People’s Congress and the State Council for the record.

   Article 8 Local people’s congresses at and above the county level shall exercise the following functions and powers:

(1) to ensure the observance and execution, in their respective administrative areas, of the Constitution, the law, administrative
rules and regulations and the resolutions of the people’s congresses and their standing committees at higher levels, and to ensure
the implementation of the state plan and the state budget;

(2) to examine and approve the plans for national economic and social development and budgets of their respective administrative areas
and the reports on the implementation of such plans and budgets;

(3) to discuss and decide on major issues in political, economic, educational, scientific, cultural, public health, protection of
the environment and natural resources and civil and nationality affairs in their respective administrative areas;

(4) to elect the members of their respective standing committees;

(5) to elect governors and deputy governors, chairmen and vice-chairmen of autonomous regions, mayors and deputy mayors, prefects
and deputy prefects, and heads and deputy heads of counties and districts;

(6) to elect the presidents of the people’s courts and the chief procurators of the people’s procuratorates at the corresponding levels;
the election of the chief procurator of a people’s procuratorate shall be reported to the chief procurator of the people’s procuratorate
at the next higher level, who shall submit it to the standing committee of the people’s congress at that same level for approval;

(7) to elect deputies to the people’s congresses at the next higher level;

(8) to hear and examine reports on the work of the standing committees of the people’s congresses at the corresponding levels;

(9) to hear and examine reports on the work of the people’s governments, the people’s courts and the people’s procuratorates at the
corresponding levels;

(10) to alter or annul inappropriate resolutions of the standing committees of the people’s congresses at the corresponding levels;

(11) to annul inappropriate decisions and orders of the people’s governments at the corresponding levels;

(12) to protect the socialist property owned by the whole people, property owned collectively by working people and citizens’ legitimate
private property, maintain public order and safeguard citizens rights of the person and their democratic and other rights;

(13) to protect the legitimate rights and interests of various economic organizations;

(14) to safeguard the rights of minority nationalities; and

(15) to safeguard women’s rights as endowed by the Constitution and the law, such as equality with men, equal pay for equal work and
freedom of marriage.

   Article 9 The people’s congresses of townships, nationality townships, and towns shall exercise the following functions and powers:

(1) to ensure the observance and execution, in their respective administrative areas, of the Constitution, the law, administrative
rules and regulations, and the resolutions of the people’s congresses and their standing committees at higher levels;

(2) to adopt and promulgate resolutions within the scope of their functions and powers;

(3) to decide, in accordance with state plans, on plans for the development of the economy, cultural affairs and public services in
their respective administrative areas;

(4) to examine and approve the budgets of their respective administrative areas as well as the reports on the implementation of the
budgets;

(5) to decide on plans for civil affairs in their respective administrative areas;

(6) to elect the chairman and vice-chairmen of the people’s congress at the corresponding level;

(7) to elect heads and deputy heads of townships and towns;

(8) to hear and examine reports on the work of the people’s governments of townships, nationality townships, and towns;

(9) to annul inappropriate decisions and orders of the people’s governments of townships, nationality townships, and towns;

(10) to protect the socialist property owned by the whole people, property owned collectively by working people and citizens’ legitimate
private property, to maintain public order and safeguard citizens’ rights of the person and their democratic and other rights;

(11) to protect the legitimate rights and interests of various economic organizations;

(12) to safeguard the rights of minority nationalities; and

(13) to safeguard women’s rights as endowed by the Constitution and the law, such as equality with men, equal pay for equal work and
freedom of marriage.

In exercising their functions and powers, the people’s congresses of townships, nationality townships, and towns in which minority
nationalities live in concentrated communities shall adopt specific measures appropriate to the characteristics of the nationalities
concerned.

   Article 10 Local people’s congresses at various levels shall have the power to remove from office members of the people’s governments at the
corresponding levels. Local people’s congresses at or above the county level shall have the power to remove from office members of
their standing committees and the presidents of the people’s courts and the chief procurators of the people’s procuratorates elected
by those standing committees. The removal of the chief procurator of a people’s procuratorate shall be reported to the chief procurator
of the people’s procuratorate at the next higher level, who shall submit the matter to the standing committee of the people’s congress
at that same level for approval.

   Article 11 Local people’s congresses at various levels shall meet in session at least once a year.

A session of a local people’s congress may be convened at any time upon the proposal of one-fifth of its deputies.

   Article 12 Sessions of local people’s congresses at or above the county level shall be convened by their standing committees.

   Article 13 A preliminary meeting shall be held for each session of a local people’s congress at or above the county level to elect the presidium
and secretary-general of that session, adopt the agenda for the session and decide on other preparations.

The preliminary meeting shall be presided over by the standing committee of the people’s congress. The preliminary meeting for the
first session of a people’s congress shall be presided over by the standing committee of the preceding people’s congress at the corresponding
level.

When a local people’s congress at or above the county level meets, its session shall be conducted by the presidium.

When a local people’s congress at or above the county level meets, it shall propose a number of deputy secretaries-general; the choice
of deputy secretaries-general shall be decided by the presidium.

   Article 14 The people’s congress of a township, nationality township or town shall have a chairman, and may have one or two vice-chairmen.
The chairman and vice-chairmen shall be elected from among the deputies to the people’s congress at the corresponding level, and
their term of office shall be the same as that of each people’s congress at that level.

The chairman or vice-chairmen of the people’s congress of a township, nationality township or town shall not concurrently hold office
in an administrative organ of the State; if they hold office in an administrative organ of the State, they must resign from the post
of the chairman or vice-chairmen of the people’s congress at that level.

The chairman or vice-chairmen of the people’s congress of a township, nationality township or town shall, during the period when the
people’s congress at the corresponding level is not in session, be responsible for keeping in touch with the deputies to the people’s
congress at that level, organizing the deputies to conduct activities, and conveying the suggestions, criticisms and opinions of
the deputies and the masses regarding the work of the people’s government at the same level.

   Article 15 When the people’s congress of a township, nationality township, or town holds a session, it shall elect a presidium, which shall
preside over the session and be responsible for convening the next session of that people’s congress. The chairman and vice-chairmen
of the people’s congress of a township, nationality township or town shall be the members of the presidium. The chairman and vice-chairmen
of the people’s congress of a township, nationality township or town shall be the members of the presidium.

   Article 16 The first session of each local people’s congress at any level shall be convened, within two months after the election of its deputies,
by the standing committee of the preceding people’s congress at the corresponding level or by the presidium of the preceding session
of the people’s congress of the township, nationality township, or town.

   Article 17 Members of the local people’s governments at or above the county level, the presidents of the People’s Courts, the chief procurators
of the People’s Procuratorates, and the leading persons of the people’s governments at the township level shall attend sessions of
the people’s congresses at the corresponding levels as nonvoting delegates; leading members of the other relevant government departments
and public organizations at or above the county level may, by decision of the standing committees of the people’s congresses at the
corresponding levels, attend sessions of the people’s congresses at the corresponding levels as nonvoting delegates.

   Article 18 When a local people’s congress holds its sessions, its presidium, standing committee and special committees and the people’s government
at the corresponding level may submit bills and proposals to that people’s congress within the scope of its functions and powers.
The presidium shall decide to refer such bills and proposals to a session of the people’s congress for deliberation, or to simultaneously
refer them to relevant special committees for deliberation and reports before the presidium decides, upon examination of such reports,
to submit them to the people’s congress for a vote.

Ten or more deputies to a local people’s congress at or above the county level, or five or more deputies to the people’s congress
of a township, nationality township, or town may jointly submit a bill or proposal to the people’s congress at the corresponding
level within the scope of its functions and powers. The presidium shall decide whether to place the bill or proposal on the agenda
of the people’s congress or to first refer it to a relevant special committee for deliberation and a recommendation on whether to
place it on the agenda before the presidium makes such a decision.

With agreement of the presidium, deliberation shall be terminated on a bill or proposal placed on the agenda of a session, if the
party that submitted the bill or proposal requests its withdrawal before it is referred to the congress for a vote.

   Article 19 Suggestions, criticisms and complaints on any aspect of work put forward by deputies to a local people’s congress at or above the
county level to that people’s congress and its standing committee shall be referred by the administrative office of the standing
committee to the departments and organizations concerned for consideration, disposition and reply.

Suggestions, criticisms and complaints on any aspect of work put forward by deputies to the people’s congress of a township, nationality
township, or town to that people’s congress shall be referred by its presidium to the departments and organizations concerned for
consideration, disposition and reply.

   Article 20 When a local people’s congress conducts an election or adopts a resolution, a majority vote of all the deputies shall be required.

   Article 21 Members of the standing committee of local people’s congresses at or above the county level, choices for chairmen and vice- chairmen
of the people’s congresses of townships, nationality townships or towns, governors and deputy governors, chairmen and vice-chairmen
of autonomous regions, mayors and deputy mayors, heads and deputy heads of prefectures, heads and deputy heads of counties, districts,
townships and towns, presidents of the People’s Courts and chief procurators of the People’s Procuratorates shall be nominated by
the presidiums of the people’s congresses at the corresponding levels or jointly nominated by deputies in accordance with the provisions
of this Law.

Thirty or more deputies to the people’s congress of a province, autonomous regions or municipality directly under the Central Government,
or twenty or more deputies to the people’s congress of a city divided into districts or of an autonomous prefecture, or ten or more
deputies to the people’s congress at the county level may nominate, with joint signatures, the candidates for members of the standing
committee of the people’s congress at the corresponding level, leading persons of the people’s government, the president of the People’s
Court and the chief procurator of the People’s Procuratorate at the same level. Ten or more deputies to the people’s congress of
a township, nationality township or town may nominate, with joint signatures, candidates for the chairman and vice-chairmen of the
people’s congress at the corresponding level and leading persons of the people’s government at the same level. Deputies elected from
different electoral districts or electoral units may deliberate on and jointly nominate candidates.

The number of candidates nominated by a presidium or jointly nominated by each deputy together with other deputies shall not exceed
the number of persons to be elected.

Nominators shall make a trustful introduction of their nominees.

   Article 22 In elections for chairmen and secretaries-general of the standing committees of the people’s congresses, chairmen of the people’s
congresses of townships, nationality townships or towns, heads of people’s governments, presidents of the People’s Courts and chief
procurators of the People’s Procuratorates, there shall generally be one more candidate than the number of persons to be elected,
and a competitive election shall be conducted. If only one candidate is nominated, a non-competitive election may be conducted. In
elections for vice-chairmen of the standing committees of the people’s congresses, deputy chairmen of the people’s congresses of
townships, nationality townships or towns, and deputy heads of the people’s governments, there shall be one to three more candidates
than the number of persons to be elected; in elections for members of the standing committees of the people’s congresses, there shall
be one-tenth to one-fifth more candidates than the number of persons to be elected. The specific differential number shall be prescribed
by the people’s congresses at the corresponding levels in the electoral measures on the basis of the number of persons to be elected.
And the competitive election shall be conducted. If the number of candidates nominated is the same as the differential number prescribed
in the electoral measures, the presidium of a people’s congress shall submit the list of candidates to the deputies for deliberation
and discussion, before election is conducted. If the number of candidates nominated exceeds the differential number prescribed in
the electoral measures, a preliminary election shall be conducted after the deputies deliberate and discuss the list of candidates
submitted by the presidium, and an official list of candidates shall, in accordance with the differential number prescribed in the
electoral measures, be determined by order of the votes that the candidates obtain in the preliminary election, and then election
shall be conducted.

When leading persons of State organs at the corresponding levels are to be elected by local people’s congresses at or above the county
level, the time for nomination and consideration of candidates shall be not less than two days.

   Article 23 Elections shall be conducted by secret ballot. The deputies may vote for or against any of the candidates that have been determined,
or may instead elect any other deputies or voters or abstain from voting.

   Article 24 In elections for leading persons of State organs conducted by local people’s congresses at the corresponding levels, when the number
of candidates who obtain more than half of the votes exceeds the number of leading persons to be elected, those who obtain more votes
shall be elected. If the number of votes for some candidates is tied, thus making it impossible to determine the elected, another
balloting shall be conducted for those candidates to resolve the tie, and those who obtain more votes shall be elected.

If the number of the elected persons who obtain more than half of the votes is less than the number of persons needed to be elected,
another election shall be held to make up the difference, the candidates for another election may be determined by order of the votes
they obtain in the first balloting, or may be nominated and determined in accordance with the procedures provided by this Law. Another
election for making up the difference may be held at the current session or the next session of the people’s congress upon decision
by the people’s congress at the corresponding level.

When another election is held to elect the vice-chairmen and members of the standing committee of a people’s congress, the vice-chairmen
of the people’s congress of a township, nationality township or town, and the deputy heads of a people’s government, competitive
election shall be conducted after the differential number is determined in accordance with the provisions in the first paragraph
of Article 22 of this Law.

   Article 25 When by-elections are held by the local people’s congresses at various levels for chairmen, vice-chairmen, secretaries-general and
members of their standing committees, chairmen, and vice-chairmen of the people’s congresses of townships, nationality townships
or towns, governors, deputy governors, chairmen and vice-chairmen of autonomous regions, mayors, deputy mayors, prefects, deputy
prefects, heads and deputy heads of counties, districts, townships and towns, presidents of people’s courts, and chief procurators
of people’s procuratorates, the number of candidates may exceed or equal the number of vacancies, and the election procedures and
methods shall be decided by the people’s congresses at the corresponding levels.

   Article 26 When a local people’s congress at or above the county level is in session, its presidium, its standing committee, or a joint group
of at least one tenth of its deputies may submit a proposal to remove from office members of its standing committee or members of
the people’s government, the president of the people’s court or the chief procurator of the people’s procuratorate at the corresponding
level; the presidium shall refer such proposals to the congress for deliberation.

When the people’s congress of a township, nationality township or town is in session, the presidium or a group of at least one-fifth
of the deputies may submit a proposal to remove from office the chairman or vice-chairmen of the people’s congress, the head or deputy
heads of the township or town; the presidium shall refer the proposal to the congress for deliberation.

In a proposal for removal from office, reasons for the removal shall clearly be stated.

Persons proposed to be removed from office shall have the right to defend themselves at a meeting of the presidium or at the plenary
meeting of a session, or to submit their written defence. The defence made at the meeting of the presidium or the written defence
shall be printed and distributed to participants of the session by the presidium.

The proposal for removal from office submitted to a local people’s congress at or above the county level shall, after being distributed
by the presidium to the participants for deliberation, be submitted to the plenary meeting of the session for voting; or the presidium
shall, subject to decision of the plenary meeting of the session, propose to organize an investigation committee, and the proposal
for removal from office shall be deliberated and decided at the next session of the people’s congress at the corresponding level
on the basis of the report prepared by the investigation committee.

   Article 27 A component member of the standing committee of a local people’s congress at or above the county level, a leading person of a local
people’s government, the president of a People’s Court or the chief procurator of a People’s Procuratorate at or above the county
level may submit the resignation to the people’s congress at the corresponding level, which shall decide whether or not to accept
the resignation; if the people’s congress is not in session, such resignations may be submitted to its standing committee, which
shall decide whether or not to accept the resignations. If the standing committee decides to accept a resignation, it shall report
it to its people’s congress for the record. A resignation of the chief procurator of a people’s procuratorate must be reported to
the chief procurator of the people’s procuratorate at the next higher level, who shall refer it to the standing committee of the
people’s congress at the corresponding level for approval.

The chairman or vice-chairman of the people’s congress of a township, nationality township or town, the head or deputy head of a township
or town may submit his resignation to the people’s congress at the corresponding level, which shall decide whether or not to accept
the resignation.”

   Article 28 When a local people’s congress at any level is in session, a group of at least ten of the deputies may submit a written proposal
for addressing questions to the people’s government or any of its departments, the People’s Court or the People’s Procuratorate at
the corresponding level. In the proposal shall clearly be stated to whom the questions are addressed and the specific questions themselves.

The presidium shall decide whether to refer the proposal to the organ addressed for an oral reply at the meeting of the presidium,
or at the plenary meeting of a session, or at the meeting of a relevant special committee, or for a written reply. Where a reply
is made at a meeting of the presidium or of the special committee, the deputies who submit the proposal shall have the right to attend
the meeting as nonvoting delegates and express their opinions; when the presidium considers it necessary, it may have the report
on the reply printed and distributed to the session.

If the reply is to be made orally, the leading person of the organ addressed shall be present at the meeting to give the reply; if
the reply is to be made in writing, it shall be signed by the leading person of the organ addressed, and the presidium shall have
it printed and distributed to the session or to the deputies who address the questions.

   Article 29 When a local people’s congress at any level examines a bill or proposal, its deputies may address questions to the local state organs
concerned, which shall send their personnel to the congress to give explanations.

   Article 30 The people’s congresses of provinces, autonomous regions, municipalities directly under the Central Government, autonomous prefectures
and cities divided into districts may, where necessary, establish special committees such as legislative (political and law) committees,
finance and economic committees, and education, science, culture and public health committees. The special committees shall work
under the direction of the respective people’s congresses; when the people’s congresses are not in session, they shall work under
the direction of the standing committees of the people’s congresses.

Nominations for the chairman, vice-chairmen and members of a special committee shall be made by the presidium from among the deputies
and approved by the people’s congress. When the people’s congress is not in session, its standing committee may appoint additional
individual vice- chairmen and some members of the special committees through nomination by its council of chairmen and approval by
a meeting of the standing committee.

The special committees shall discuss, examine and draw up relevant bills and draft resolutions under the direction of the people’s
congresses and their standing committees at the corresponding levels; they shall make investigations and studies of, and put forward
proposals on matters related to those committees and within the scope of functions and powers of the respective people’s congresses
and their standing committees.

   Article 31 A local people’s congress at or above the county level may appoint an investigation committee on specific questions.

The presidium or a group of at least one-tenth of the deputies may submit to the session of the people’s congress a proposal for organizing
an investigation committee on specific questions, which shall be submitted by the presidium to the plenary meeting for decision.

An investigation committee shall be composed of a chairman, vice- chairmen and members, who shall be nominated by the presidium from
among the deputies and be submitted to the plenary meeting for approval.

An investigation committee shall present an investigation report to the people’s congress at the corresponding level. And the people’s
congress may make an appropriate resolution on the basis of the report presented by the investigation committee. The people’s congress
may authorize its standing committee to listen to the investigation report of the investigation committee, and the standing committee
may make an appropriate resolution and report to the next session of the people’s congress for the record.

   Article 32 The credentials committee established at the first session of each people’s congress of a township, nationality township, and town
shall exercise its functions and powers until the term of office of that people’s congress expires.

   Article 33 The term of office of the deputies to a local people’s congress at any level shall begin with the first session of that people’s
congress and shall expire at the first session of the succeeding people’s congress at the same level.

   Article 34 Deputies to local people’s congresses at various levels and members of their standing committees may not be legally liable for their
speeches and voting at sessions of the people’s congresses or meetings of their standing committees.

   Article 35 No deputy to a local people’s congress at or above the county level may be arrested or placed on criminal trial without the consent
of the presidium of that people’s congress or, when the people’s congress is not in session, without the consent of its standing
committee. If a deputy is caught in the act of crime and detained, the public security organ executing the detention shall immediately
report the matter to the presidium or the standing committee of that people’s congress.

   Article 36 When deputies to local people’s congresses at various levels attend people’s

CIRCULAR OF THE STATE COUNCIL CONCERNING THE STANDARDIZATION OF EXISTING LIMITED LIABILITY COMPANIES AND COMPANIES LIMITED BY SHARES IN ACCORDANCE WITH THE COMPANY LAW

Category  LEGAL PERSONS AND ECONOMIC ORGANIZATIONS Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1995-07-03 Effective Date  1995-07-03  


Circular of the State Council Concerning the Standardization of Existing Limited Liability Companies and Companies Limited by Shares
in Accordance With the Company Law of the People’s Republic of China



(July 3, 1995)

     Prior to the Company Law of the People’s Republic of China (hereinafter
referred to as the Company Law), limited liability companies and companies
limited by shares which were registered according to the relevant laws,
administrative regulations, local regulations and “Standard Notes on Limited
Liability Companies” and “Standard Notes on Companies Limited by Shares” as
promulgated by the relevant departments of the State Council, are hereinafter
referred to as existing limited liability companies and companies limited by
shares, these companies have played an active part in the economic
construction of our country. However, in certain aspects they do not fully
conform with the conditions set out in the Company Law, thus according to the
provisions of the Company Law the existing limited liability companies and
companies limited by shares must be standardized in accordance with the
Company Law. The following problems with regard to standardization are hereby
notified:

    1. Requirements and Time Limit

    Existing limited liability companies and companies limited by shares
must be standardized in strict accordance with the provisions of the Company
Law and the accompanying laws and regulations. Companies which have undergone
internal checking procedures and which already fully conform to the stipulated
conditions may directly apply to the company registration authority for
re-registration; existing companies limited by shares which have been approved
for trading on a stock exchange by the securities management department of the
State Council may apply directly to the company registration authority for
re-registration and the company registration authority shall re-register them.
Companies which have undergone internal checking procedures and which do not
fully conform to the stipulated conditions shall standardize themselves, all
companies which fully conform to the stipulated conditions within the
stipulated time limit (before December 31, 1996) may apply to the company
registration authority for re-registration; if they have not fully conformed
to the stipulated conditions within the stipulated time limit, they cannot
apply for re-registration and according to law they shall change their
registration to become another type of enterprise, thus they may not use the
words “limited liability company” or “company limited by shares” in their
names.

    Close attention should be paid to standardization, this should not be a
mere formality. During the process of standardization, the production and
management activities of existing limited liability companies and companies
limited by shares shall carry on as usual.

    2. Main Contents

    (1) The number of shareholders and promoters of a company shall comply
with the statutory requirements. The number of promoters of an existing
company limited by shares may maintain the status quo; in cases where the
number of shareholders of a former limited liability company does not comply
with the provisions of the Company Law, it shall be changed to comply with
these requirements within the stipulated time limit.

    (2) The registered capital of the companies shall comply with the minimum
amount required by the law, this being the capital actually contributed. The
company’s balance sheet at the end of last year shall be the criterion whereby
capital is verified. In cases where the minimum amount is not met, shortfalls
shall be supplemented within the stipulated time limit.

    (3) The formulation of the rules and regulations of a company and the
matters clearly set out therein must comply with the provisions of the Company
Law, anything that does not comply shall be amended and corrected within the
stipulated time limit.

    (4) The establishment of the management structure of a company, the
production procedures and the conditions of office of the directors, the
chairmen of the board of directors, the supervisors and the convenors of the
supervisory committees shall comply with the provisions of the Company Law,  
anything that does not comply shall be rectified within the stipulated time
limit.

    (5) A company’s system of financial affairs and accounting shall comply
with the provisions of the Company Law, anything that does not comply with
the provisions shall be changed to comply with these requirements within the
stipulated time limit.

    (6) The valuation and verification of company assets shall comply with the
provisions of the Company Law, anything that does not comply shall be
rectified within the stipulated time limit.

    In addition, after re-registration existing companies limited by shares
which were approved for trading on a stock exchange by the securities
management department of the State Council shall improve their organization
and standardize their behavior.

    3. Re-registration and Organizational Guidance

    (1) Re-registration

    Existing limited liability companies and companies limited by shares
shall apply to the company registration authority with which they originally
registered for re-registration, these existing companies shall provide all the
documentation required for re-registration; after re-registration the
existing companies limited by shares shall report to the original company
examination and inspection authority for the record. The specific requirements
for re-registration shall be stipulated by the State Administration for
Industry and Commerce together with other relevant departments.

    Company registration authorities at every level shall conscientiously
exercise their functions and powers in strict accordance with the provisions
of the Company Law and the accompanying laws and regulations, they shall
earnestly carry out the work of re-registering the existing limited liability
companies and companies limited by shares, as well as providing the
departments responsible for organizational or guidance work with information
concerning re-registration.

    If no items in the registration are altered when re-registering, the
company registration authority shall charge the relevant fees according to the
provisions; if any items in the registration are altered, the company
registration authority shall charge a fee for altering the registration in
accordance with the provisions for altering the registration. No other fees
may be charged.

    (2) Organizational Guidance

    Work at state level on organizational guidance shall be carried out by the
State Economic and Trade Commission, the State Commission for Restructuring
the economy, the Ministry of Foreign Trade and Economic Cooperation, the
People’s Bank of China, the State Administration for Industry and Commerce,
the State Administration of State Property, the Securities Commission of
the State Council and other departments; organizational guidance work in each
province shall be carried out by the people’s government of each province,
autonomous region or municipality directly under the Central Government.

    The people’s government of each province, autonomous region or
municipality directly under the Central Government and the relevant
departments of the State Council shall enforce organizational guidance work,
taking charge of its implementation, guaranteeing its quality, coordinating
and settling any relevant problems, and creating good external conditions for
the standardization of existing limited liability companies and companies
limited by shares in accordance with the Company Law.






OFFICIAL REPLY OF THE STATE ADMINISTRATION OF TAXATION TO THE QUESTION CONCERNING THE DELINEATION OF ENTERPRISES WITH FOREIGN INVESTMENT ENGAGING IN COMMUNICATIONS AND TRANSPORTATION

The State Administration of Taxation

Official Reply of the State Administration of Taxation to the Question Concerning the Delineation of Enterprises with Foreign Investment
Engaging in Communications and Transportation

GuoShuiFa [1994] No.383

July 4, 1994

Beijing Municipal Tax Bureau:

We have recently received your bureau’s inquiry, asking the question as to whether or not enterprises with foreign investment engaged
in the business of moving houses and transportation can enjoy the preferential taxation treatment as granted to productive enterprise
with foreign investment. After study we hereby clarify the question as follows:

The communications and transportation services as stated in Subparagraph (8) of Paragraph 1 in Article 72 of the Rules for the Implementation
of the Income Tax Law of the People’s Republic of China on Enterprises with Foreign Investment and Foreign Enterprises include enterprises
with foreign investment engaging in the business of moving houses and transportation, but exclude enterprises with foreign investment
engaging in (express) delivery business of mail and articles.

 
The State Administration of Taxation
1994-07-04

 




WRITTEN REPLY TO THE QUESTION CONCERNING THE DELINEATION OF ENTERPRISE WITH FOREIGN INVESTMENT ENGAGING IN COMMUNICATIONS AND TRANSPORTATION

Written Reply to the Question Concerning the Delineation of Enterprise With Foreign Investment Engaging in Communications and Transportation

     (Effective Date:1994.07.04–Ineffective Date:)

To the Beijing Municipal Tax Bureau:

We have recently received your bureau’s inquiry, asking the question as to whether or not enterprise with foreign investment engaged
in the business of moving houses and transportation can enjoy the preferential taxation treatment as granted to productive enterprise
with foreign investment. After study we hereby clarify the question as follows:

The communications and transportation services as stated in Section (8), Clause 1, Article 72 of the Detailed Rules for Implementation
of the Income Tax Law of the Peoples Republic of China on enterprise with foreign investment and Foreign Enterprises include enterprise
with foreign investment engaging in the business of moving houses and transportation, but exclude enterprise with foreign investment
engaging in(express) delivery business of mail and articles.

    






CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE ISSUE CONCERNING THE LEVY OF STAMP TAX ON ENTERPRISE WITH FOREIGN INVESTMENT AND FOREIGN ENTERPRISES

The State Administration of Taxation

Circular of the State Administration of Taxation on the Issue Concerning the Levy of Stamp Tax on Enterprise with Foreign Investment
and Foreign Enterprises

GuoShuiFa [1994] No.95

April 7,1994

The tax bureaus of various provinces, autonomous regions and municipalities directly under the Central Government, the tax bureaus
of various municipalities separately listed on the State plan and the various sub-bureaus of the Offshore Oil Tax Administration:

In line with the stipulation of the Circular of the State Council On Issues Related to the Interim Regulations Concerning the Levy
of Applicable Value-Added Tax, Consumption Tax and Business Tax on Enterprise with Foreign Investment and Foreign Enterprises, enterprise
with foreign investment, foreign enterprises and other economic organizations and their offices in China (hereinafter referred to
as “enterprises”) shall, beginning from January 1, 1994, pay stamp tax in accordance with the Interim Regulations of the People’s
Republic of China on Stamp Tax and rules for its implementation. Related issues are hereby clarified as follows:

I.

Enterprises which had contracted to be established before December 31, 1993 and have received various dutiable certificates, including
contracts, property rights transfer certificates, business account books and licenses of rights are exempt from stamp tax.

II.

Enterprises which had signed dutiable contracts before December 31, 1993, revised the contracts after January 1, 1994 to increase
the amount of investment or signed a new contract after the expiration of the original contract shall pay stamp tax according to
regulations.

III.

For capital actually received and capital accumulations increased after January 1, 1994 as recorded in the account book, stamp tax
shall be levied on the increased portion; the capital actually received and capital accumulations which have not increased as recorded
in the new account book are exempt from stamp tax; for other account books started using after January 1, 1994, stamp tax shall be
levied according to regulations.

IV.

For property right transfer certificates and right license obtained by the enterprise before December 31, 1993 which were revised,
replaced or transferred, stamp tax shall be levied according to regulations.

V.

If the amount of lump sum stamp tax to be recorded in the account book of the enterprise is too big, with approval from competent
tax authorities, deficient stamp tax payments are allowed to be made up by instalments within three years. Enterprises with an operational
period less than three years shall make up the deficient stamp tax payment within the operational period.

VI.

The current regulations on stamp tax shall be acted upon in regard to other tax-exemption matters.



 
The State Administration of Taxation
1994-04-07

 







CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING TEMPORARY EXEMPTION FROM URBAN MAINTENANCE AND CONSTRUCTION TAX AND ADDITIONAL EDUCATION FEES FOR ENTERPRISES WITH FOREIGN INVESTMENT AND FOREIGN ENTERPRISES

The State Administration of Taxation

Circular of the State Administration of Taxation Concerning Temporary Exemption from Urban Maintenance and Construction Tax and Additional
Education Fees for Enterprises with Foreign Investment and Foreign Enterprises

GuoShuiFa [1994] No.38

February 25, 1994

The tax bureaus of various provinces, autonomous regions and municipalities directly under the Central Government, the tax bureaus
of various municipalities separately listed on the State plan and various branches of the Offshore Oil Tax Administration:

Recently many regions have asked about the question concerning whether or not urban maintenance and construction tax and additional
education fees shall be levied on enterprises with foreign investment and foreign enterprises after reform of the tax system. In
view of the fact that except for value-added tax, consumption tax and business tax and legally stipulated tax items which are levied
on enterprises with foreign investment and foreign enterprises, as to the question concerning the application of other tax categories
to enterprises with foreign investment and foreign enterprises, the State Council will, in line with the spirit of the Decision of
the Standing Committee of the National People’s Congress Concerning the Application of Interim Regulations on Such Taxes As Value-added
Tax, Consumption Tax and Business Tax to Foreign Investment Enterprises and Foreign Enterprises, work out stipulations in the near
future, Therefore, in the opinion of the Administration: Whether or not urban maintenance and construction tax and additional education
fees shall be initiated on enterprises with foreign investment and foreign enterprises the matter shall be implemented in accordance
with the Circular soon to be issued by the State Council, before explicit stipulations are issued by the State Council, the above-mentioned
tax and fees shall not be levied for the time being.



 
The State Administration of Taxation
1994-02-25

 







PROCEDURES ON THE ADMINISTRATION OF ISSUANCE AND TRANSFER OF ENTERPRISE BONDS

Procedures on the Administration of Issuance and Transfer of Enterprise Bonds

     (Effective Date:1994.04.08–Ineffective Date:)

CHAPTER ONE GENERAL PROVISIONS CHAPTER TWO ISSUANCE CHAPTER THREE UNDERWRITERS AND MODES OF UNDERWRITING CHAPTER FOUR GUARANTIES CHAPTER
FIVE REGISTRATION AND TRUST CHAPTER SIX BONDS TRANSFER AND CHANGE OF NAMES CHAPTER SEVEN REVELATION OF INFORMATION CHAPTER EIGHT
PENALTIES CHAPTER NINE SUPPLEMENTARY PROVISIONS

   Article 1 This set of procedures has been formulated in accordance with laws and administrative decrees such as the Company Law, the Guarantee
Law and Regulations on Administration of Enterprise Bonds with the aim of strengthening the administration and standardizing the
issuance and transfer of enterprise bonds to guard against financial risks and protect the lawful rights and interests of creditors.

   Article 2 Enterprise bonds (hereinafter referred to as the bonds) as cited in this set of procedures shall be negotiable securities issued
by enterprises in accordance with legal procedures and with the approval of PBOC with their principals and interests to be repaid
within an agreed time limit.

   Article 3 In issuing bonds, enterprises should provide guarantees and warranties, except those that have been approved by PBOC to be exempted
from such guarantees and warranties.

   Article 4 Bond subscribers should be responsible for the risks of cashing of the bonds by themselves, and are enpost_titled to the following rights:

(1) The right to acquiring interests, recovering principals in accordance with the agreed time limit, or the exercise of related creditor’s
rights in case the bonds cannot be cashed on time;

(2) Transfer, hypothecation and inheritance of the bonds; and

(3) Requesting information on performance and financial standing of the bond issuers with the bonds’ underwriters and issuers.

   Article 5 In issuing and transferring bonds, laws and administrative decrees and regulations should be abided by and the principles of openness,
voluntarism and honesty should be observed, while related information should be fully disclosed and investment risks for the bonds
revealed.

   Article 6 Enterprise legal persons within the boundaries of the People’s Republic of China should abide by this set of procedures when engaging
in the issuance and transfer of the bonds and related activities inside the People’s Republic of China.

PBOC shall be in charge of issuance and transfer of the bonds, and responsible for the implementation of this set of procedures.

   Article 7 The meanings of the following terms are:

Issuer-An enterprise legal person that has been approved by PBOC to issue bonds.

Underwriter-A securities company, trust and investment company or enterprise legal person of financial company under an enterprise
group recognized by PBOC as qualified to engage in underwriting of the bonds.

Guarantor-An enterprise legal person that provides guarantee and warranties to issuers in accordance with provisions of the Guarantee
Law.

Trustee-A central national debt registration and settlement limited liability company (hereinafter referred to as the central registration
company) that handles the overall registration and trust of bonds and their claims in books; and an underwriter that handles registration
of such bonds and their claims and secondary trust.

Subscriber-A legal person, other organization or natural person with civil capacities that subscribes for the bonds.

   Article 8 For an issuance of bonds, an enterprise should first of all go to PBOC for an examination and approval which shall be made in accordance
with the bond issuance plan approved by the State Council and handed down jointly by the State Planning Commission, PBOC, the Ministry
of Finance and the Securities Committee under the State Council. For a central enterprise the examination and approval for bond issuance
should be sought jointly from PBOC and the State Planning Commission and for a local enterprise in the related province, the corresponding
examination and approval should be sought jointly from the corresponding PBOC branch, autonomous region, or municipality directly
under the State Council and the planning commissions of the same administrative level.

Without approval, issuances of enterprise bond whether in a straight format or any disguised form are not allowed.

   Article 9 The principal underwriter of enterprise bonds should assist the issuer in submission of an issuance required under the Standard Format
for Submission for Application by Enterprises to Issue Bonds including bond issuance charters, legal opinionaires to PBOC.

   Article 10 The bond issuance charter should comprise the following contents:

(1) The name, residence, scope of business, legal representative, telephone number for contact, and postal code of the issuer;

(2) The document number and date of the approval document issued by PBOC for the issuance of bonds;

(3) The name, time limit and interest rate of the bonds;

(4) The face value, issuance price and total volume of issuance of the bonds;

(5) The targeted subscribers, the time limit and ways of issuance;

(6) The starting and ending dates of interest payment, the time limit and ways of repayment of principal and interest;

(7) The objectives, uses and profit forecast of the bonds issued;

(8) Operational risks, cashing risks and preventative measures;

(9) Financial statement of the latest quarter;

(10) Major financial data and indicators of the recent three years;

(11) The enterprise’s production and business operation and other basic information concerning business development in the recent
three years;

(12) Basic information about the guarantors (approved by PBOC to be exempted from guarantee should be clearly indicated); and

(13) Other contents as required by PBOC.

   Article 11 The bonds should be issued through commissioned underwriters. The issuer is not allowed to make deals of the bonds.

   Article 12 With the approval of PBOC, enterprise bonds can either be issued as real-name book-entry bonds or as bearer bonds.

   Article 13 For those issued as real-name book-entry bonds, the issuance should be put under graduated trust by the trustees and the vouchers
for registration and trust of bonds should be unifiedly printed by the central registration company. Prior to printing, the central
registration company shall send the format for the vouchers for registration and trust of bonds to PBOC for reexamination.

   Article 14 For those issued as bearer bonds in kind, the bonds should carry the following contents:

(1) The name and residence of the issuer;

(2) The name, face value, time limit and interest rate of the bonds;

(3) The bonds’ starting and ending dates of interest payment;

(4) The time limit and method of principal and interest repayment;

(5) The issuance date and serial number of the bond;

(6) The issuer’s seal and the legal representative’s seal and signature;

(7) The name and residence of the guarantor;

(8) The number and date of the approval documents issued by the examination and approval authorities; and

(9) The name of the printers of the bonds.

On the surface cover of the bearer bonds the following statement shall appear: “This bond is the only effective and legal proof attesting
to the ownership of creditor’s rights and no vouchers on commissioned storage of bonds are valid.” Bearer bonds should be printed
at printing units designated by PBOC.

The principal underwriter of the bonds should submit samples of the bonds to the PBOC prior to issuance for examination.

   Article 15 When PBOC approves the issuance of the bonds, the issuer should put the bonds into public within three months since the date of the
approval. Otherwise the original approval documents will automatically be annulled; if the enterprise still needs to issue bonds,
formalities should be started anew for examination and approval.

   Article 16 An issuer is not allowed to issue bonds for a second time under one of the following circumstances:

(1) The bonds for the previous issuance have not been fully subscribed;

(2) There have been and still are violations of contract or delayed payment of principals and interests for bonds previously issued
or other debts.

CHAPTER THREE UNDERWRITERS AND MODES OF UNDERWRITING

   Article 17 Before actual underwriting of bonds issued, a securities institution should first of all be verified by PBOC its qualification for
such underwriting and without such a verification by PBOC, or qualifications for underwriting having become invalid, except acting
as a sub-underwriter or underwriting on a commissioned basis a securities institution is not allowed to engage in the work of underwriting.

   Article 18 An underwriter should be responsible for:

(1) Underwriting the bonds issued;

(2) Counciling upon guarantee of bonds;

(3) Registration, secondary trust and transfer of ownership of book- entry bonds;

(4) Bonds dealing for subscribers;

(5) Counciling upon information release for issuers; and

(6) Claiming payment for subscribers when the issuer or the guarantors fail to fulfill their obligations.

   Article 19 For a securities institution to apply for underwriting of bonds, the following conditions should be met:

(1) The net assets of the institution should be no less than RMB100 million;

(2) The proportion of circulating capital in net assets of the institution should not be lower than 50%;

(3) The ratio of net assets to total liabilities of the institution should not be lower than 10%;

(4) The senior managing staff of the institution should be available with necessary knowledge of securities, finance and legal matters
and have not been involved in any major violations of law or regulations in the past two years. Two-thirds or more of them should
have worked in securities-related business for over three years or in finance business for over five years;

(5) The institution has professional personnel who are familiar with related business codes and operating procedures;

(6) The institution is equipped with sound internal risk control and financial management systems;

(7) The institution has not committed any major violations of law or regulations in the past one year; and

(8) Other conditions as required by PBOC.

   Article 20 The securities institution that takes the lead in organizing an underwriting body, or acts as the sole underwriter of the bonds is
in fact the principal underwriter.

A securities institution to become a principal underwriter for the issuance of enterprise bonds, should also meet the following conditions
besides those listed under Article 19:

(1) Its net assets should not be less than RMB500 million;

(2) The number of full-time staff members engaged in bond business should not be less than five. It should also have professional
personnel well equipped with accounting and legal knowledge;

(3) It should have participated in at least three issuances of bonds, or have been engaged in the underwriting of bonds for over three
years; and

(4) There are no such record in the past one year that less than 30% of total bonds issued were sold when the institutions acted as
the principal underwriter.

   Article 21 For a securities institution that meets the conditions as stated in Article 19 and Article 20 of this set of procedures to be qualified
as a bond underwriter, the following documents should be presented to PBOC:

(1) Application for qualification for engagement in the business of bond underwriting;

(2) Duplicate of Permit for Operation in Financial Business;

(3) Duplicate of Business License of Legal Entities (carbon copy);

(4) Articles of association of the institution;

(5) Exposition on its internal risk and financial management system;

(6) Testimonials on the verified net assets at the end of the last quarter of the current fiscal year as presented by a certified
public accounting firm with qualifications in securities-related business;

(7) Assets and liabilities statement, profit and loss statement, and statement on changes in financial standing at the end of the
previous year as audited by a certified public accounting firm with qualifications in securities-related business;

(8) Statements, reports, and explanations on the volume of underwriting and cashing of bonds as organized in the past one year;

(9) Resumes and duplicates of professional certificates of the legal representative, key persons in charge and main professional personnel;
and

(10) Other documents as required by PBOC.

   Article 22 PBOC shall examine the application document for qualification as bond underwriters. If qualified, the approved bond underwriters
will be publicized by PBOC, and the list of the underwriters will be published through the media.

Qualifications for engagement in bond underwriting for securities institutions will be valid for one year as of the date of the publication
of PBOC’s notice and become invalid automatically after one year.

   Article 23 PBOC shall conduct reexamination of the underwriters’ qualification once every year. Securities institutions already acquired underwriters’
qualifications that need to keep the qualifications for the engagement in the business of enterprise bonds underwriting should, within
one month before the expiration of their bond underwriting qualifications, submit items listed in sections 7, 8 and 9 of Article
21 and other documents required by PBOC to PBOC. Otherwise, their qualifications for bond underwriting shall be automatically annulled.

   Article 24 Underwriters should undertake the examinations and checkings of the authenticity, accuracy and integrity of the charters, notice
and other related documents about the issuance issued by the issuers.

   Article 25 When a public issuance of bonds with the total face value of exceeding RMB50 million, the underwriters concerned should form an underwriting
body, which is to compose of more than two underwriting institutions.

The principal underwriter should sign an underwriting agreement with other underwriters.

   Article 26 The principal underwriter should sign an agreement on underwriting with the issuer.

The agreement on underwriting should include the following contents:

(1) The names, residences and names of their legal representatives of the interested parties;

(2) Modes of underwriting;

(3) Categories of bond issuance (as bearer bonds or as book-entry bonds);

(4) The categories and value of bonds underwritten;

(5) The quotas of bond underwriting for each member of the underwriting body;

(6) The time limit of underwriting and the starting and ending dates;

(7) Dates and ways of money transfer for bond funds;

(8) Computation, methods and dates of payment of underwriting expenses;

(9) The responsibilities for cashing the bonds when due and the ways of cremation of the cashed bonds;

(10) Matters pertaining to guarantee of the bonds;

(11) Liabilities for breach of contract; and

(12) Other items as required by PBOC.

   Article 27 In underwriting issuance of enterprises bonds, can such forms as sales on a commission basis, exclusive sale of balance outstanding
or fully exclusive sale can be taken.

For underwriting through sales on a commission basis, the underwriter has not to shoulder any issuance risks but only to transfer
bond funds at agreed dates within the time limit of issuance to the issuer and return all bonds not sold to the issuer at the end
of issuance.

For bonds underwriting through exclusive sales of balance outstanding, the underwriter has to shoulder part of the issuance risks
and purchase all bonds not sold at the end of the time limit of issuance.

For bonds underwriting through fully exclusive sales, the underwriter has to shoulder all risks for the issuance and no matter the
condition of the bond sales should purchase all bonds within an agreed period following the public issuance of the bonds and at the
same time transfer all bond funds to the issuer.

   Article 28 For underwriting through fully exclusive sales, amount committed by an underwriter for an issuance should be limited in value as:

(1) For underwriters whose net assets was more than RMB100 million (including RMB100 million) and less than (but not including) RMB200
million at the end of the previous year, the sum of exclusive sales should not exceed RMB50 million;

(2) For underwriters whose net assets was more than RMB200 million (including RMB200 million) and less than (but not including) RMB50
billion at the end of the previous year, the sum of exclusive sales should not exceed RMB100 million;

(3) For underwriters whose net assets was more than RMB500 million (including RMB500 million) and less than (but not including) RMB1
billion at the end of the previous year, the sum of exclusive sales should not exceed RMB200 million;

(4) For underwriters whose net assets was more than RMB1 billion (including RMB1 billion) and less than (but not including) RMB1.5
billion at the end of the previous year, the sum of exclusive sales should not exceed RMB500 million; and

(5) For underwriters whose net assets was more than RMB1.5 billion (including RMB1.5 billion) at the end of the previous year, the
sum of exclusive sales should not exceed RMB1 billion.

   Article 29 PBOC, in reference to State’s related laws and regulations and this set of procedures, may indicate objective to the underwriting
of certain issuance of bonds by the underwriters that are involved in infringements of regulations.

   Article 30 A securities institution is not allowed to underwrite more than five (including five) issuances of bonds at the same time.

“At the same time” in the previous paragraph refers to coincidence or overlapping of the underwriting periods as stipulated under
the underwriting agreements signed with different issuers.

   Article 31 Central bonds and local bonds of Grade A or higher creditability can be issued all around the country.

For local bonds issued across the provinces, autonomous regions and municipalities directly under the central government, the issuer
should timely report the condition of bond underwriting to the branch offices of PBOC where the bonds are issued for the record.

No localities or units are eligible to restrict the issuance of bonds that originate from other places but conform to conditions set
in this set of procedures. No localities or units are eligible to restrict the underwriting of local bonds by securities institutions
of other places that are qualified for bond underwriting.

   Article 32 The underwriting commission for underwriters should be computed on the basis of the total face value of bonds issued and collected
at the excess regressive rates. The specific standards are as follows:

Underwriting value Fee standards

Portions not exceeding 1.5%-3% 1.5%-2% RMB100 million Portions exceeding RMB100 1.5%-2% 1.2%-1.5% million but under RMB500 million
Portions exceeding RMB500 1.2%-1.5% 0.8%-1.2% million but under RMB1 billion Portions exceeding RMB1 0.8%-1.5% 0.5%-1.2% billion

   Article 33 When necessary an issuer may sell bonds in instalments. When filing application for such sales, the issuer should clearly indicate
the time of the instalment and volume of sales during each instalment. When changes in the mode and conditions of bond issuance occur,
the issuer should submit the issuance plan to PBOC for approval before the undertaking of the sales of each instalment.

The time limit of underwriting for each instalment of bonds should be no less than 10 days and no more than 60 days.

   Article 34 The issuer should, within 10 work days of the end of each issuance, provide verification certifying the bond funds are really in
place and final reports on underwriting expenses to the principal underwriter.

The principal underwriter should, within 15 work days of the end of each underwriting, submit to PBOC verification reports certifying
the bond funds are really in place, and reports on the work of underwriting, which should explain in detail the implementation of
the agreements on underwriting and on the underwriting body, as well as the final figures of underwriting expenses.

   Article 35 The branches of the PBOC at various levels should establish and perfect the statistical and reporting systems of enterprise bonds,
do a good job in the statistical analysis of enterprise bonds and, in accordance with regulations, provide various statistical reports
and analytical reports in time to reflect the problems existing in the enterprise bond market and conduct supervision and inspection
on the enterprises’ issuance of bonds and use of funds so raised.

   Article 36 Prior to the issuance of bonds, the issuer should provide guarantee and warranties, except that having been approved by PBOC for
exemption. Only when the work concerning guarantees has been approved by PBOC can the bond issuance be started.

   Article 37 The guarantor concerned should, in accordance with the provisions of the Guarantee Law, provide written letter of guarantee to bond
subscribers.

The guarantor may request the issuer to provide object of pledge or hypothecation for counter guarantee.

   Article 38 The principal underwriter should assist the issuer and the guarantor to handle matters pertaining to the guarantee and counter guarantee
of bonds.

   Article 39 The guarantor should be a legal entity that conforms to the provisions of the Guarantee Law and meets the following conditions:

(1) Its net assets should be no less than the principal and interest of the bonds to be issued by the guaranteed party;

(2) It enjoys profits in the past three consecutive years and commands excellent prospects in business;

(3) It is not involved in such affairs as restructuring and dissolution or in major litigation cases; and

(4) Other conditions as required by PBOC.

Announcement should be made in time when a guarantor should lose its capacity to guarantee as a result of dissolution, bankruptcy
or being canceled according to law.

   Article 40 The guarantor may charge guarantee fee on the guaranteed issuer under an amount agreed upon by both sides of the interested parties.

   Article 41 The letter of guarantee should include the following contents:

(1) The varieties and value of bonds being guaranteed;

(2) The time when the bonds mature;

(3) Way of guarantee;

(4) The scope of guarantee and warranties;

(5) The time limit of guarantee; and

(6) Other contents as required by PBOC.

A guarantor should adopt the mode of joint liability for guarantee with the scope of the guarantee comprising principal and interest
of the bonds, contractual fine, damage awards and expense for recovery of debts and time limit for the guarantee being two years
since the date of the bonds’ maturity.

   Article 42 Whereas a guarantor requests the issuer to provide objects as pledge (hypothecation) for counter guarantee, the guarantor and the
pledger (hypothecation) should sign an agreement on assets pledge (hypothecation) and go through corresponding registration formalities
in accordance with the Guarantee Law and other related regulations.

   Article 43 Change of guarantor(s) by an issuer should first of all acquire approval from PBOC.

After the change, the subscribers should accept the guarantee(s) provided by the new guarantor(s) as approved by PBOC.

CHAPTER FIVE REGISTRATION AND TRUST

   Article 44 A trustee shall be the registrant official of the creditor’s rights of book-entry bonds to be responsible for the management of creditor’s
rights, the custody of legal rights and commissioned cashing of bonds after bond issuance and provision of related information services
to subscribers.

   Article 45 Separated levels management shall be instituted for the registration and trust of book-entry bonds with the central registration
companies to assume the general registration office and trustee to directly handle the registration and trust of bonds subscribed
by financial securities institutions and funds; and the underwriters to assume branch registration offices and secondary trustees
to handle the registration and trust of bonds subscribed by other institutions and individuals.

Trutees at various levels are responsible for the authenticity and accuracy of the creditor’s rights for their own clients.

The central registration companies shall maintain supervision on the business operations of various secondary trustees.

   Article 46 A central registration company shall open self-operated bond accounts and secondary trustee general accounts for underwriters to
respectively record the total bonds held by the underwriters themselves and those held by secondary trustee clients and also be responsible
for the unified printing of the triplicate form of bond registration and trust vouchers (including primary and secondary vouchers)
for use in issuance, registration and trust business.

   Article 47 When issuing bonds, the underwriters shall present bond registration and trust vouchers for the subscribers.

Whereas the subscribers are securities institutions or funds, the primary vouchers shall be presented together with the vouchers’
registration slips and then handed over to the central registration company to register, verify and confirm creditor’s rights for
the subscribers and whereas the subscribers are other institutions or individuals, the underwriters should directly register creditor’s
rights, and present the secondary vouchers to them. Meanwhile, the vouchers’s audit slips shall be gathered and handed over to the
headquarters of the underwriter for an inspection by the latter of the standard of the distributed sales of the bonds. The central
registration company has the right to exercise supervision over the process.

The underwriters should submit to the central registration company reports certifying total sum of the underwriter’s bonds trusted
for the registration of the total sum of the underwriters’ bonds trusted under the various underwriters’ secondary trust general
accounts.

Excess or void vouchers should be handed over to the central registration company or the principal underwriter.

   Article 48 After an issuance of the bonds, only after certification by the central registration company and the issuer of the registered total
sum of bonds, the sum of funds actually received, and their consistency, can the creditor’s rights really come into force and then
the central registration company shall present letter of confirmation of creditor’s rights to the issuer.

   Article 49 The issuer should pay registration and trust fee, at the amount of 0.05% of total sum of bonds issued, to the trustee on a lump-
sum basis; this fee shall be collected on a commission basis by the underwriters, and be distributed reasonably among the various
trustees.

   Article 50 After an issuance of bonds, if the subscribers need to deal with the bonds at the stock exchanges, a transfer of trust should be
made in accordance with the related regulations of the central registration company and the stock exchanges. Meanwhile, the central
registration company should establish secondary trust general account for the securities registration companies of the stock exchanges.

   Article 51 For enterprise bonds issued publicly in the society, before the maturity and cashing of bonds, a notice on the methods of cashing
should be announced by the issuer of commissioned cashing institutions through radio, TV, newspapers and other mass media to investors
15 days before the date of cashing with the following main contents:

(1) The names of the issuer and the bonds to be cashed;

(2) The name and residence of the commissioned cashing institution;

(3) The starting and ending dates of the bond cashing;

(4) Settlement of bonds cashed after the designated time;

(5) The publishing unit and its seal of the notice on methods of cashing; and

(6) Other items that need to be publicized.

   Article 52 Three days before the bond’s due, an issuer of book-entry bonds should transfer funds for bond cashing to the accounts designated
by the central registration company and an issuer of bearer bonds should transfer funds for bond cashing to the accounts of the principal
underwriter. If the issuer fails to fulfil a debtor’s obligations, the principal underwriter should notify the guarantor to fulfil
the obligations as pledged in the letter of guarantee and pay the debts; if the guarantor also fails to fulfil corresponding obligation
of paying the debts, the principal underwriter should act on behalf of the subscribers to seek compensations from the issuer or guarantor
concerned.

Risks of direct or indirect losses of incapable of cashing the bonds due in turn should be bore by the subscribers themselves.

CHAPTER SIX BONDS TRANSFER AND CHANGE OF NAMES

   Article 53 For bonds having been transferred to the trust of stock exchanges, their transfer and change of names should be handled in accordance
with related business regulations of the stock exchanges; for those not yet do so or not be listed in the stock exchanges, their
transfer and change of names should be handled in accordance with Article 54 and Article 55 of this set of procedures.

   Article 54 Bearer bonds are transferred at counters of the securities institutions designated by the local office of PBOC and institutions concerned
should submit reports on a monthly basis on the transfer of bonds to the local office of PBOC, and timely make known the problems
arising in the transfer of bonds.

The securities institutions which are to handle the transfer of bond should have sufficient means to distinguish the counterfeit bonds.
They are not allowed to keep the bonds on a commission basis, nor to make or offer commissioned bond storage vouchers in any form
by themselves.

In handling the business of bond transfers, securities institutions should deal with counterfeit bonds, if any, in the following ways
according to different circumstances:

(1) Whereas securities institutions recognize counterfeit bonds in the process of purchase, the counterfeit bonds concerned should
be confiscated and posted with cancellation marks;

(2) Whereas the securities institutions discover counterfeit bonds among th

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...