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RAILWAY LAW OF THE PEOPLE’S REPUBLIC OF CHINA

The Standing Committee of the National People’s Congress

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

No.32

The Railway Law of the People’s Republic of China which has been adopted at the 15th Meeting of the Standing Committee of the Seventh
National People’s Congress on September 7, 1990 is now promulgated and shall enter into force as of May 1, 1991.

President of the People’s Republic of China Yang Shangkun

September 7, 1990

Railway Law of the People’s Republic of China ContentsChapter I General Provisions

Chapter II Railway Transport Business

Chapter III Railway Construction

Chapter IV Safety and Protection of Railway

Chapter V Legal Responsibility

Chapter VI Supplementary Provisions

Chapter I General Provisions

Article 1

This Law is formulated for the purpose of ensuring smooth progress of railway transport and railway construction in order to meet
the demands of socialist modernization and people’s livelihood.

Article 2

Railways as referred to in this Law include State railways, local railways, industrial railways and railway private sidings.

State railways refer to the railways administered by the competent department in charge of railways under the State Council.

Local railways refer to the railways administered by local people’s governments.

Industrial railways refer to the railways administered by enterprises or other units to provide in-house transport services.

Railway private sidings refer to the branch railway lines which are administered by enterprises or other units and are connected to
a State railway line or any other railway line.

Article 3

The competent department in charge of railways under the State Council shall be responsible for railway affairs throughout the country,
implement over the State railway network a transport control system which is highly centralized and under unified command, and shall
provide guidance for, coordination among, supervision over and assistance to local railways, industrial railways and railway private
sidings.

A State railway transport enterprise shall perform the administrative functions as authorized by relevant laws and administrative
rules and regulations.

Article 4

The State shall focus its effort on the development of State railways and provide substantial aid and support to the development of
local railways.

Article 5

A railway transport enterprise must adhere to the socialist orientation in operation and management, pursue the aim of serving the
people, improve operation and management, better the work style, and enhance the transport service quality.

Article 6

Citizens shall have the obligation to take good care of railway installations. Damage to railway installations and disruption of normal
railway traffic shall be prohibited.

Article 7

Local people’s governments at various levels along the railway lines shall assist the railway transport enterprises in ensuring safe
and uninterrupted railway traffic, good social order at stations and on trains, intactness of railway installations, and smooth progress
of railway construction.

Article 8

Regulations governing the technical operations of State railways shall be formulated by the competent department in charge of railways
under the State Council, while rules governing the local railways and industrial railways shall be drawn up with reference to the
regulations governing the technical operations of State railways.

Article 9

The State shall encourage scientific and technological research on railways in order to heighten their scientific and technical level.
Any unit or individual that has achieved outstanding results in such research shall be awarded.

Chapter II Railway Transport Business

Article 10

All railway transport enterprises shall guarantee safe transport of passengers and goods and punctual train arrivals.

Article 11

A railway transport contract shall be an agreement in which the mutual rights and obligations between the railway transport enterprise
and the passenger(s) or shipper(s) are defined.

A passenger ticket, a luggage, parcel or goods consignment note shall represent a contract or a constituent part of a contract.

Article 12

A railway transport enterprise shall ensure the passenger of riding on a train of the number and on the date stated on the passenger’s
ticket, and of arriving at the destination stated on the same ticket. In case of the passenger being unable to ride on the train
of the number and on the date stated on the passenger’s ticket owing to the liability of the railway transport enterprise, the said
enterprise shall, as requested by the passenger, refund the total sum of the ticket fare or make arrangements for the passenger to
ride on another train to the same destination.

Article 13

A railway transport enterprise shall take effective measures to serve the passengers well in a courteous, attentive, warm and cultured
manner, keep the station premises and passenger cars clean and sanitary, provide boiled drinking water and good catering services
on the train.

A railway transport enterprise shall take measures to protect the environment along railway lines from pollution.

Article 14

Any passenger boarding a train shall hold a valid passenger ticket. Any passenger riding on a train without a ticket or with an invalid
ticket shall pay the ticket fare on the train plus such additional charges as specified in relevant railway regulations; the railway
transport enterprise may order any passenger who refuses to do so to leave the train.

Article 15

The State railways and local railways shall plan the goods transport on the principle of promoting production and invigorating circulation.

Priority in transport shall be given to materials for emergency rescue or disaster relief and other goods and materials that warrant
such priority according to relevant regulations of the State.

Where goods and materials to be carried by local railways need to be carried by State railways, the transport plan therefore shall
be incorporated in the transport plan of State railways.

Article 16

A railway transport enterprise shall carry the goods, parcels and luggage to their destinations in observance of the time limit stipulated
in the contract or within the time limit prescribed by the competent department in charge of railways under the State Council. For
any overdue goods, parcel, or luggage, the railway transport enterprise shall be liable to indemnity for breach of contract.

In case a railway transport enterprise fails to deliver the goods, parcels or luggage to their consignee or owner passenger after
thirty days in excess of the time limit, the shipper, consignee or passenger concerned shall be enpost_titled to claim compensation for
loss from the railway transport enterprise.

Article 17

A railway transport enterprise shall be liable to pay compensation for loss, short-delivery, deterioration, contamination, or damage
that might have occurred to the shipped goods, parcels or luggage as of the moment the railway transport enterprise undertakes the
conveyance until the moment of their delivery.

(1)

Any shipper or passenger who has voluntarily applied for insured transport of valued articles shall be enpost_titled to an indemnity on
a par with the actual loss but not exceeding the insured value.

(2)

Indemnity for goods conveyed not in the manner of insured transport of valued articles shall be on a par with the actual loss but
not exceeding the liability limit laid down by the competent department in charge of railways under the State Council. If the loss
is caused by deliberate action or grave fault on the part of the railway transport enterprise, the above-stated liability limit shall
not apply but the indemnity shall be made in conformity with the actual loss.

Any shipper or passenger may, on voluntary basis, buy insurance policy for transport of goods at an insurance agency and the insurance
agency shall be liable for indemnity in conformity with the agreement as stated in the insurance contract.

Any shipper or passenger may, on voluntary basis, enter into insured transport of valued goods or buy insurance policy for transport
of goods, or may do without. No shipper or passenger shall be compelled in any manner to enter into insured transport or buy transport
insurance policy.

Article 18

A railway transport enterprise shall not be liable to indemnity for any loss, in relation to goods, parcels or luggage, caused by
the following reasons:

(1)

Force majeure.

(2)

Natural property of the goods or articles contained in the parcel or luggage, or natural wear and tear.

(3)

Fault on the part of the shipper, consignee or passenger concerned.

Article 19

Any shipper shall truthfully fill in the goods consignment note, and the railway transport enterprise shall be authorized to check
the description, weight and quantity of the goods and parcels as written on the note. Upon check-up, if the reported disagrees with
the real contents, the shipper shall pay for the check-up expenses; if the reported agrees with the real contents, the check-up expenses
shall be borne by the railway transport enterprise, and any damage incurred from the check-up with the contents of the goods or parcels
as a result of the check shall be compensated for by the same enterprise.

Any deficiency in payment of transport charges and other fees as a result of untrue declaration of the goods shipped shall be made
up by the shipper concerned, and the railway transport enterprise shall, according to the relevant regulations of the competent department
in charge of railways under the State Council, collect from the shipper extra transport charges and other fees.

Article 20

Goods consigned for shipment that need packing shall be packed by the shipper in conformity with the national standards for packing
or the trade standards for packing; where both these standards are lacking, the shipper shall pack the goods properly so that the
goods would not suffer any damage due to improper packing.

A railway transport enterprise shall, with regard to the perishable goods and living animals the shipment of which it has undertaken,
in accordance with the relevant regulations of the competent department in charge of railways under the State Council and the contracted
agreement.

Article 21

Upon the arrival of shipped goods, parcels or luggage, the relevant consignee or passenger shall claim them in time in observance
of the time limit set by the competent department in charge of railways under the State Council and at the same time pay any transport
charges and other fees that the shipper has not paid or underpaid; if such time limit is exceeded, the consignee or passenger shall
pay due charges for storage in accordance with relevant regulation.

Article 22

Any shipped goods that are not claimed for thirty days as of the date of issuing the notice of claim for the shipped goods, or that
the consignee has informed the railway transport enterprise in writing of refusing to accept shall be sold off by the railway transport
enterprise on condition that the enterprise has served the shipper a notice about such and received no acknowledgement for thirty
days as of the date of receipt of the notice. The amount of money obtained from the selling, if there is any left after deduction
of storage charges and other deductible fees, shall be refunded to the shipper, or turned over to the state treasury provided it
is not refundable nor claimed by the shipper within one hundred and eighty days as of the date of disposal.

Any parcel not claimed for ninety days as of the date of issuing the notice of claim for such goods by the railway transport enterprise
concerned and any luggage not claimed for ninety days as of its arrival at destination may be disposed of by the said enterprise
provided that the latter has issued a public announcement thereupon and received no claim for the said parcel or luggage ninety days
after the issuance. The amount of money obtained from the selling, if there is any left after deduction of storage charges and other
deductible fees, may be recovered by the shipper, consignee or passenger concerned within one hundred and eighty days as of the date
of the selling, or shall be turned over to the state treasury if no claim for recovery is received within the same time limit.

Dangerous goods and articles the transport of which is restricted according to relevant regulations shall be handed over to the public
security authority or department concerned for disposition and shall not be sold off by the railway transport enterprise itself.

For articles which are not suitable for storage over a long period of time, the deadline for their disposal may be shortened in accordance
with relevant provisions set down by the competent department in charge of railways under the State Council.

Article 23

Passengers, shippers or consignees who are held responsible for any loss of property of a railway transport enterprise shall be liable
to compensation for the loss.

Article 24

The State shall encourage industrial railways to take up also public passenger and goods transport services on a commercial basis;
the State shall promote shared use of railway private sidings by related units on the basis of agreed terms.

Any industrial railway which will take up also public passenger or goods (or both) transport services on commercial basis shall report
such to and obtain approval from the people’s government of the relevant province, autonomous region or municipality directly under
the Central Government.

To any industrial railway undertaking commercial public passenger or goods transport, the provisions governing railway transport enterprises
stipulated in this Law shall apply.

Article 25

Passenger fares and tariffs for goods, parcels and luggage shall be worked out by the competent department in charge of railways under
the State Council and submitted by the latter to the State Council for approval. The items and rates of miscellaneous charges for
passenger and goods transport on State railways shall be laid down by the competent department in charge of railways under the State
Council. Tariffs applicable to specified operating lines, specified goods and provisional operating lines of the State railways shall
be worked out by the competent department in charge of railways under the State Council by agreement with the competent department
in charge of prices under the State Council.

Passenger fares, goods tariffs and the items and rates of miscellaneous charges for passenger and goods transport on local railways
shall be laid down by the competent department in charge of prices under the people’s government of the relevant province, autonomous
region or municipality directly under the Central Government in conjunction with the agency authorized by the competent department
in charge of railways under the State Council.

Passenger fares, goods tariffs and the items and rates of miscellaneous charges for passenger and goods transport on industrial railways
which also run public passenger and goods transport on a commercial basis, and the rates of charges for sharing the use of railway
private sidings, shall be laid down by the competent department in charge of prices under the people’s government of the relevant
province, autonomous region or municipality directly under the Central Government.

Article 26

Passenger fares, tariffs for goods, parcels and luggage, and the items and rates of miscellaneous charges for passenger and goods
transport, must be announced by public notice; the same shall not go into effect before being so announced.

Article 27

Counterfeiting or alterations of tickets or other certificates which are printed and used in relation to passenger and goods transport
by State railways, local railways and industrial railways shall be prohibited.

Reselling of passenger tickets or other railway transport certificates for profit shall be prohibited.

Article 28

Relevant regulations of the State concerning articles the transport of which is prohibited or restricted must be observed in consigning
shipment and carrying goods, parcels or luggage.

Article 29

Domestic through transport of passenger and goods between railway transport enterprises and highway, air or waterway transport enterprises
must be handled in accordance with relevant provisions laid down by the State, or in the absence of such provisions, in accordance
with the agreement reached by all parties concerned.

Article 30

Participation of State or local railways in international through transport must obtain approval from the State Council.

Article 31

Military transport on railways shall be handled in accordance with relevant provisions laid down by the State.

Article 32

In the event of dispute over a railway transport contract, the railway transport enterprise and the involved shipper, consignee or
passenger may settle the dispute by way of mediation; or if a party does not wish to settle the dispute by mediation or the mediation
proves unsuccessful, the railway transport enterprise and the involved shipper, consignee or passenger may, in accordance with relevant
provisions on arbitration included in the contract or with the written agreement on arbitration reached afterwards, apply for arbitration
to an arbitration agency designated by the State.

Where a party does not perform the award of the arbitration agency within the prescribed time limit, the other party may apply to
a people’s court for compulsory execution.

Where no provision on arbitration is made in the contract and no written agreement on arbitration has been reached afterwards, either
of the parties may bring a suit in a people’s court.

Chapter III Railway Construction

Article 33

Planning for the expansion of railway network shall be based on the demands of national economy, social development and the building
up of national defence and shall be coordinated with the development plans of other modes of transport.

Article 34

The construction plan of local railways, industrial railways or railway private sidings must conform to the national railway development
plan and must obtain approval from the competent department in charge of railways under the State Council or an agency authorized
by this department.

Article 35

The planning of any railway track, station, junction area an other related facilities within a planned urban area of a city shall
be brought in line with the overall plan of this city.

The land-use plan for railway construction shall be incorporated in the relevant overall land-use plan. Land needed for future expansion
or construction of new railway lines shall be allotted by the people’s government at or above the county level in its overall land-use
plan.

Article 36

The use of land for railway construction shall be handled in accordance with provisions of relevant laws and administrative rules
and regulations.

The relevant local people’s government shall support railway construction and assist the railway transport enterprise to carry out
land requisition for railway construction, to dismantle or move any structures or inhabitants thereon and make due arrangements for
them.

Article 37

Any railway transport enterprise shall, having acquired the right to use any land for railway construction, use the land for the approved
purpose and shall not use the land for any other purposes without proper authorization; no other unit or individual may occupy or
seize the said land.

The department of land administration under the local people’s government at or above the county level shall order any unit or individual
that has occupied or seized the land appropriated for railway construction to stop doing so and to compensate the railway transport
enterprise concerned for the loss.

Article 38

The standard railway gauge shall be 1435mm. Standard gauge must be adopted in the construction of a new State railway.

For narrow-gauge railways, the gauge shall be 762mm or 1000mm.

Other technical requirements for new railways and reconstructed railways shall conform to relevant national standards or trade standards.

Article 39

A railway line, after its completion of construction, may, in accordance with the procedures laid down by the State for capital construction,
be put into operation only after it has been duly examined and accepted as satisfactory.

Article 40

At the crossing point of a railway and a highway, priority shall be given to the installation of a grade separation structure; at
a crossing where a grade separation structure is not installed, a level crossing or a pedestrian cross-walk may be laid in conformity
with relevant provisions of the State. The setting up of a level crossing or a pedestrian cross-walk within a planned urban area
shall be decided by the railway transport enterprise, or the relevant enterprise owning the relating industrial railways or private
sidings, or any other relevant unit jointly with the department in charge of city planning.

The removal of an established level crossing or pedestrian cross-walk shall be decided by the railway transport enterprise, or the
relevant enterprise owning the relating industrial railway or private siding, or any other relevant unit by agreement with the local
people’s government.

Article 41

Any railway bridge to be built across a water course shall conform to the requirements for flood prevention, navigation and flow of
current as laid down by the State in relevant regulations.

Chapter IV Safety and Protection of Railways

Article 42

A railway transport enterprise must strengthen the control and protection of railways, regularly inspect and repair railway transport
facilities so as to ensure intactness of these facilities and guarantee safe conveyance of passengers and goods.

Article 43

The railway security organ and the local security authority shall jointly keep the public order along railway lines, in stations and
on trains, while dividing up the work in such a way that the public order in stations as well as on trains shall be under the charge
of the railway security organ, and the public order along railway lines shall be under the joint charge of the local security authority
and the railway security organ, with the local security authority in the main.

Article 44

The competent department in charge of electric power shall guarantee the power supply for railway traction and critical loads arising
in railway operation. The scope of power supply for critical loads arising in railway operation shall be defined by the competent
department in charge of railways under the State Council through consultation with the competent department in charge of electric
power under the State Council.

Article 45

Hill slopes beyond the right-of-way of and flanking the railway line shall be conditioned as key territories for water and soil conservation
by the relevant local people’s government. Slopes on top of railway tunnels shall be conditioned by the local people’s government
with due assistance of the relevant railway transport enterprise. Hill slopes within the railway line’s right-of-way shall be conditioned
by the railway transport enterprise.

Article 46

In case there is any such activity as building an uphill pond, a reservoir, or a dyke or dam; excavating a water course, a trunk channel
or other waterway; stone-quarrying; sand-fetching; or digging a well for water, which is carried out within a specific distance from
both sides of a railway line, bridge or culvert, and which might cause adverse effects on the stability of the railway subgrade or
endanger the railway bridge or culvert, the relevant local people’s government at or above the county level shall order such activities
to be ceased, and set a time limit for restoring the site to its original state or to take necessary safety and protection measures.

Unless the approval of the relevant railway transport enterprise is obtained and proper safety and protection measures are provided,
the erecting of power or communications lines over or across a railway line, the laying of buried cables or pipes along a railway
subgrade, and the digging of tunnels through or under a railway embarkment shall not be allowed.

Building of any structures or planting of any trees which might hinder a good watch from the driver’s cabin over the railway line
shall not be allowed at the inner side of a curve or at a place close to a level crossing or a pedestrian cross-walk. In case any
building, such as afore-mentioned, has been erected, the local people’s government at or above the county level shall order the builder
to remove the building, and if any tree, such as afore-mentioned, has been planted, the said government shall order the relevant
unit or individual to remove, trim or cut down the tree within a specified period of time.

Any unit or individual that violates the provisions stated in the preceding three paragraphs shall be liable to compensation for any
loss thereby suffered by the relevant railway transport enterprise.

Article 47

It shall be prohibited to install a level crossing or a pedestrian cross-walk without proper authorization.

Necessary signs and protective installations must be provided at level crossings or pedestrian cross-walks in conformity with relevant
regulations.

Pedestrians and vehicles must, when passing a railway level crossing or a pedestrian cross-walk, observe the relevant regulations
governing passage over crossings.

Article 48

Transport of dangerous goods must be handled in conformity with the regulations formulated by the competent department in charge of
railways under the State Council. It shall be forbidden to consign for shipment any dangerous article under the name of a non-dangerous
article.

Passengers shall be prohibited from carrying any dangerous article into a railway station or a train. Railway security personnel or
any such railway worker designated by the competent department in charge of railways under the State Council shall, for the safety
of transher have the right to inspect the article or articles carried by any passenger. Any railway worker when carrying out transport
safety inspection shall bear an on-duty identification sign.

A list of the descriptions of dangerous articles shall be specified and promulgated by the competent department in charge of railways
under the State Council.

Article 49

Any railway worker shall have the right to stop any person who is about to damage or destroy, or cause to move or shift, any railway
signalling installation or other facilities for traffic operation, and any person who is about to place obstacle(s) on the railway
track. The railway worker may catch such a person and hand him over to the public security authorities.

Article 50

It shall be forbidden for anybody to make a covert ride on a goods train, to climb up or hang on to a train in motion, or to hit or
strike a train. Any railway worker shall have the right to stop such a person.

Article 51

It shall be forbidden to walk, sit or lie on a railway track. Any railway worker shall have the right to stop such conduct.

Article 52

It shall be forbidden to graze livestock within twenty metres of either side of a railway track. Any railway worker shall have the
right to stop such conduct.

Article 53

Any railway worker shall have the right to stop persons who have gathered up to intercept a train, or to assault a railway traffic
control office. The responsible public security personnel on site shall have the right to order those persons who refuse to stop
such action to disperse; and if such a demand is refused, the responsible public security personnel on site shall, according to relevant
regulations established by the State, choose to force them to disperse by necessary means. Those who refuse to obey shall be taken
away from the site by force or detained.

Article 54

Any railway worker shall have the right to stop those persons who try to start a riot and rob goods and materials being transported
on railways and may seize them and hand them over to the public security authorities; the public security personnel on site may detain
them.

Article 55

Any railway worker shall have the right to stop any person who is picking quarrels and stirring up troubles on board a train causing
public disorder or jeopardizing the physical being or property of other passengers; the railway security personnel may detain such
person.

Article 56

If a certain kind of infectious disease which demands quarantine as stated in legal provisions is discovered in a railway station
or on board a passenger train, the railway sanitation and quarantine authority shall carry out the necessary quarantine process;
the local sanitation and quarantine authority shall render assistance to the former upon request.

The quarantine of goods in transport shall be carried out in accordance with relevant regulations of the State.

Article 57

In case of any railway traffic accident, the railway transport enterprise shall act in accordance with relevant provisions about the
investigation and handling of accidents stipulated by the State Council and its relevant competent department, and ensure the timely
restoration of normal traffic; no unit or individual shall hinder the re-opening of the railway track and train operation.

Article 58

A railway transport enterprise shall be liable to compensation for any personal injury or fatality due to traffic accident or other
operational accident. It shall hold no liability for compensation for any personal injury or fatality due to force majeure or due
to the fault of the aggrieved person oneself.

Personal injury or fatality resulting from passing the railway track at a level crossing or via a pedestrian cross-walk in violation
of relevant regulations or from walking, sitting or lying on the railway track shall be deemed injury or fatality caused by the fault
of the aggrieved person one-self.

Article 59

Major bridges and tunnels of State railways shall be guarded by the Chinese People’s Armed Police Forces.

Chapter V Legal Responsibility

Article 60

Any person who, in violation of relevant provisions of this Law, has carried any dangerous article into a railway station or on board
a train or has consigned for shipment any dangerous article under a name of a non-dangerous article thus causing a grave accident,
shall be investigated for criminal responsibility in accordance with Article 115 of the Criminal Law. Any enterprise, institution,
State organ, or public organization which commits the crime as specified in this Article shall be imposed a fine, and the person
in charge of any of the aforesaid unit and the person or persons immediately responsible for the offence shall be investigated for
criminal responsibility.

Any person who carries dynamite or detonator or who illegally carries firearms, bullets or controlled knives into a railway station
or on board a train shall be investigated for criminal responsibility with reference to Article 163 of the Criminal Law.

Article 61

Any person who intentionally damages or destroys or causes to move or shift any railway signalling installation, or places on the
railway track obstacle(s) that might lead to the overturning of a train without having caused serious consequences shall be investigated
for criminal responsibility in accordance with Article 108 of the Criminal Law; any person who acts in the aforesaid manner causing
serious consequences shall be investigated for criminal responsibility in accordance with Article 110 of the Criminal Law.

Article 62

Any person who steals spare

DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS ON THE ESTABLISHMENT OF MARITIME COURTS IN COASTAL PORT CITIES

Decision of the Standing Committee of the National People’s Congress on the Establishment of Maritime Courts in Coastal Port Cities

     Important Notice: This English document is coming from “LAWS AND REGULATIONS OF THEPEOPLE’S REPUBLIC OF CHINA GOVERNING
FOREIGN-RELATED MATTERS” (1991.7)which is compiled by the Brueau of Legislative Affairs of the StateCouncil of the People’s
Republic of China, and is published by the ChinaLegal System Publishing House.In case of discrepancy, the original version in Chinese
shall prevail.

Whole Document DECISION OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’SCONGRESS ON THE ESTABLISHMENT OF MARITIME
COURTS IN COASTAL PORT CITIES(Adopted at the Eighth Meeting of the Standing Committee of theSixth National People’s Congress and
promulgated for implementation byOrder No. 20 of the President of the People’s Republic of China onNovember 14, 1984)To
meet the needs in the development of the country’s maritime transportand in its economic relations and trade with foreign
countries, effectively exercise the country’s judicial jurisdiction and handlemaritime affairs and maritime trade cases
promptly, so as to safeguard thelawful rights and interests of both Chinese and foreign litigants, thefollowing decisions have
been made:1. Maritime courts shall be established in certain coastal port citiesaccording to need. The establishment of such
courts, their alteration andtheir abolition shall be decided by the Supreme People’s Court.The establishment of adjudicatory apparatus
and administrative offices ofthe maritime courts shall be decided by the Supreme People’s Court.2. The maritime courts shall be
responsible to the standing committees ofthe people’s congresses of the municipalities where they are located.The judicial work
of maritime courts shall be subject to supervision bythe higher people’s courts in their respective localities.3. The maritime
courts shall have jurisdiction over maritime cases andmaritime trade cases of first instance; they shall not handle criminalcases
or other civil cases. The designation of the jurisdiction area foreach maritime court shall be decided by the Supreme People’s
Court.The higher people’s court in the locality where a maritime court islocated shall have jurisdiction over appeals against
the judgments andorders of the maritime court.4. The president of a maritime court shall be appointed or removed by thestanding
committee of the people’s congress of the city where the court islocated, upon a proposal submitted by the chairman of the
standingcommittee of the people’s congress. The vice- presidents, chief judgesand associate chief judges of divisions, judges
and members of thejudicial committee of a maritime court shall be appointed or removed bythe standing committee of the people’s
congress of the city where thecourt is located, upon a proposal submitted by the president of themaritime court.

    





CIRCULAR OF THE STATE COUNCIL CONCERNING THE APPROVAL OF THE NATIONAL DEVELOPMENT ZONES FOR NEW AND HIGH TECHNOLOGY INDUSTRIES AND THE RELEVANT POLICIES AND PROVISIONS

Category  SCIENCE AND TECHNOLOGY Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1991-03-06 Effective Date  1991-03-06  


Circular of the State Council Concerning the Approval of the National Development Zones for New and High Technology Industries and
the Relevant Policies and Provisions


ANNEX I  Requirements and Measures for the Acknowledgement and
ANNEX II  Interim Provisions on Policies for the National Development
ANNEX III  Provisions on the Tax Policy for the National Development

(March 6, 1991)

    In pursuance of the Decision of the Central Committee of the Communist
Party of China on the Reform of the Science and Technology Management System,
a number of development zones for new and high technology industries have
been successively established in recent years in some large and mediumsized
technologyintensive cities and coastal areas, which have promoted the
development of new and high technology industries in our country. In order to
act in the spirit of further implementing the Torch Programme and managing
well the development zones for new and high technology, as advocated in the
Proposal of the Central Committee of the Communist Party of China on the
Formulation of the TenYear Programme and the Eighth FiveYear Plan for
National Economic and Social Development so as to expedite the development of
new and high technology industries, the State Council has decided to
designate another group of existing development zones for new and high
technology industries in various places as national development zones for new
and high technology industries, in addition to the Beijing Experimental Zone
for the Development of New Technology Industries approved by the State
Council in 1988, and to bestow them preferential policies accordingly. The
following are hereby notified:

    1. The State Council approves the designation, as examined and determined
by the State Science and Technology Commission, of the following 21
development zones as the national ones for new and high technology industries:

    Donghu New Technology Development Zone, Wuhan;

    Pukou ExportOriented Development Zone for New and High Technologies,
Nanjing;

    Nanhu Science and Technology Development Zone, Shenyang;

    Tianjin New Technology Industries Park;

    Xi’an Development Zone for New Technology Industries;

    Chengdu Development Zone for New and High Technology Industries;

    Weihai Torch Development Zone for High Technology Industries;

    Zhongshan Torch Development Zone for High Technology Industries;

    NanhuNanling New Technology Industries Park, Changchun;

    Harbin High Technology Development Zone;

    Changsha Experimental Zone for the Development of Science and Technology;

    Fuzhou Science and Technology Park;

    Tianhe Development Zone for New and High Technology Industries, Guangzhou;

    Hefei Science and Technology Industry Park;

    Chongqing Development Zone for New and High Technology Industries;

    Hangzhou Development Zone for New and High Technology Industries;

    Guilin Development Zone for New Technology Industries;

    Zhengzhou High Technology Development Zone;

    Ningwozhuang Experimental Zone for the Development of New Technology
Industries, Lanzhou;

    Shijiazhuang Development Zone for New and High Technology Industries; and

    Jinan Development Zone for High Technology Industries.

    2. In addition, the Caohejin Development Zone for NewlyEmerged
Technologies in Shanghai, Dalian New and High Technology Industries Park,
Shenzhen Science and Technology Industry Park, Xiamen Torch Development Zone
for High Technology Industries and Hainan International Science and
Technology Industry Park, which have been respectively set up in the economic
and technological development zones and in the special economic zones, are
also designated as the national development zones for new and high technology
industries.

    3. The State Council authorizes the State Science and Technology
Commission to be responsible for the examination and determination of the
bounds and the area of each national development zone for new and high
technology industries, and for the relevant management and specific guidance
of each zone.

    4. The State Council approves the Requirements and Measures for the
Acknowledgement and Determination of New and High Technology Enterprises in
the National Development Zones for New and High Technology Industries
(Annex I) and Interim Provisions on Policies for the National Development
Zones for New and High Technology Industries (Annex II) both formulated by
the State Science and Technology Commission, and Provisions on the Tax Policy
for the National Development Zones for New and High Technology Industries
(Annex III) formulated by the State Administration of Taxation, which should
all be observed and implemented.

    5. In the Beijing Experimental Zone for the Development of New Technology
Industries, all transactions of business should be conducted in accordance
with the Interim Regulations of the Beijing Experimental Zone for the
Development of New Technology Industries, except for the magnitude control of
investment in fixed assets and the reserved percentage of foreign exchange
earned through exportation, which should comply with the existing provisions.

    It is of great significance for the readjustment of industrial structure,
the promotion of the traditional industries transformation, the improvement
of labour productivity and the enhancement of international competitiveness
to accelerate the commercialization and industrialization of the achievements
in high technology by relying on our own scientific and technical strength.
All localities and all relevant departments shall strengthen leadership over
and give effective support to the development zones for new and high
technology industries and, in accordance with the relevant provisions and
policies of the State, promote a sound development of new and high technology
industries of our country.
ANNEX I  Requirements and Measures for the Acknowledgement and
Determination of New and High Technology Enterprises in the National
Development Zones for New and High Technology Industries

    Article 1  These Measures are formulated for the implementation of the
relevant policies and provisions on the national development zones for new
and high technology industries approved by the State Council and the
promotion of the development of new and high technology industries in China.

    Article 2  New and high technology enterprises in the national
development zones for new and high technology industries (hereinafter
referred to as the development zones) shall be acknowledged and determined in
accordance with these Measures.

    Article 3  The science and technology commissions of provinces,
autonomous regions, municipalities directly under the Central Government and
cities separately listed in planning (hereinafter referred to as the
provincial or municipal science and technology commissions) shall be the
competent organs responsible for acknowledging and determining new and high
technology enterprises in the development zones and for supervising the
implementation of these Measures under the people’s governments of provinces,
autonomous regions, municipalities directly under the Central Government and
cities separately listed in planning. The offices of the development zones
shall, under the leadership of the relevant people’s governments and under
the guidance of the relevant provincial or municipal science and technology
commissions, handle the specific matters in examining and approving the
acknowledgement and determination of new and high technology enterprises.

    Article 4  In line with the current state of scientific and technical
development across the world, the scope of new and high technologies is
defined as follows:

    (1) microelectronics and electronic information technology;

    (2) space science and aero/space technology;

    (3) photoelectronics and photo-mechanic-electronic integration technology;

    (4) life science and bioengineering technology;

    (5) materials science and new-material technology;

    (6) energy science and new energy technology and efficient energy-saving
technology;

    (7) ecology science and environmental protection technology;

    (8) earth science and marine engineering technology;

    (9) science of fundamental matters and radiation technology;

    (10) medicine science and biomedical engineering;

    (11) other new processes and technologies applied on the basis of
traditional industries.

    This scope of new and high technologies will be supplemented and revised
in accordance with the continuous development of new and high technologies at
home and abroad, and the State Science and Technology Commission shall
announce the supplemented and revised scope.

    Article 5  A new and high technology enterprise shall be an
intellect-intensive and technology-intensive economic entity. The new and
high technology enterprise in a development zone shall meet the following
requirements:

    (1) being engaged in the research, development, production and business
operations of one or several high technologies and related products as
specified in Article 4 of these Measures, excluding purely commercial
business operations;

    (2) being independent in accounting and management, and responsible for
its own profits and losses;

    (3) being headed by scientific and technical personnel who are familiar
with the research, development, production and business operations of the
enterprise’s products, and are full-time employees of the enterprise;

    (4) having scientific and technical personnel with the educational
qualification at or above the level of higher learning who shall account for
at least 30 percent of the enterprise’s total staffs and workers; among them
at least 10 percent being engaged in research and development of new and high
technology products;

    As for the labour-intensive new and high technology enterprises which are
engaged in the production of new and high technology products or service, the
scientific and technical personnel with educational qualifications at or
above the level of higher learning shall account for at least 20 percent of
their total staffs and workers;

    (5) possessing a capital amounting to or exceeding one hundred thousand
yuan (RMB), as well as premises and facilities commensurate with the scale of
the business operation;

    (6) spending at least 3 percent of the enterprise’s annual gross income
on the research and development of new and high technology and related
products;

    (7) realizing a total of the technological income and output value of new
and high technologies exceeding 50 percent of the annual gross income of the
new and high technology enterprise that generally comprises the technological
income, output value of products from new and high technologies, output value
of products from conventional technologies, and technologically interrelated
trade;

    The technological income refers to earnings from technology consultancy
and transfer, the investment in the form of technologies in businesses,
technological service, training, project and contracting, the export of
technologies, the assimilation of imported technologies, and pilotplant
products that are performed by the new and high technology enterprise;

    (8) having explicit articles of association and strict technical and
financial management system;

    (9) having fixed a business duration of 10 years or longer.

    Article 6  For the setting up of a new and high technology enterprise, an
application shall be submitted to the office of the development zone
concerned for examination and acknowledgement, and then to a provincial or
municipal science and technology commission for approval, and a certificate
of new and high technology enterprise shall be issued by the approving
commission.

    Article 7  The offices of the development zones shall, in accordance with
requirements specified in Article 5 of these Measures, make regular
inspections on new and high technology enterprises. Enterprises which fail to
meet the aforesaid requirements may not enjoy the treatment provided for by
different policies for the national development zones for new and high
technology industries.

    Article 8  The time limit for the products to be listed as new and high
technology ones shall usually be no longer than five years. The time limit
may be extended to seven years after approval for new and high technology
products that need a longer technical cycle.

    Article 9  Any change in the scope of business operation, amalgamation or
breakup, divertion in trade, removal to a new site or close-down of new and
high technology enterprises shall be approved beforehand by the office of the
development zone concerned. The enterprises shall register such changes with
the relevant departments in charge of industry, commerce and taxation.

    Article 10  Any State-owned scientific and technological research unit
located in a development zone which has become a financially independent unit
after the reduction of its Statefunded administration and undertaking
expenses according to the provisions of the State and which meets the
requirements specified in Article 5 of these Measures may be acknowledged as
a new and high technology enterprise upon verification by the office of the
development zone concerned.

    Article 11  These Measures shall replace the Interim Provisions on the
Requirements and Standards for the Acknowledgement and Determination of New
and High  Technology Enterprises promulgated earlier by the State Science and
Technology Commission.

    Article 12  The provincial and municipal science and technology
commissions shall work out detailed rules for the implementation of these
Measures. Any discrepancy found in the original detailed rules for the
implementation shall be revised in accordance with these Measures.

    Article 13  The State Science and Technology Commission shall be
responsible for the interpretation and revision of these Measures.

    Article 14  These Measures shall be put into effect as of the date of
approval by the State Council.
ANNEX II  Interim Provisions on Policies for the National Development
Zones for New and High Technology Industries

    Article 1  These Provisions are formulated to foster the establishment of
new and high technology industries development zones in our country and
promote the development of new and high technology industries.

    Article 2  These Provisions shall apply to new and high technology
enterprises in the national development zones for new and high technology
industries acknowledged and determined in line with the “Requirements and
Measures for the Acknowledgement and Determination of New and High Technology
Enterprises in the National Development Zones for New and High Technology
Industries” formulated by the State Science and Technology Commission.

    Article 3  These Provisions cover all preferential policies except for
tax policy.

    Article 4  Matters concerning preferential tariffs and duties on imports
and exports shall be dealt with in accordance with the following stipulations:

    (1) For importing raw materials and component parts destined for
processing export products by new and high technology enterprises in the new
and high technology industries development zones, import license shall be
exempted. The Customs in charge shall check and release the above-mentioned
raw materials and parts against the export contracts and approval papers
issued by the new and high technology industries development zones.

    (2) Subject to the approval by the Customs, new and high technology
enterprises may set up in the new and high technology industries development
zones bonded warehouses or bonded factories. The Customs shall exempt import
duties, tax for the import products and tax on the added value of products in
accordance with the provisions on processing imported raw materials and parts
and the real export volume of the processed products.

    (3) The export products of new and high technology enterprises, except
for those restricted by the State or those otherwise stipulated, shall be
exempted from export duties.

    (4) Bonded export products shall not be marketed at home unless approved
by the original examination and approval authorities and the Customs, and
duties shall be levied according to the regulations. Of these products, those
that are specifically rationed by the State or require import license shall
go through the procedures for approving the import or for applying for the
import license according to the relevant provisions of the State.

    (5) The import of apparatus and equipment to be used by new and high
technology enterprises for the development of new and high technology and
which cannot be made at home shall be exempted from import duties against the
approval papers issued by the examination and approval authorities and after
the verification by the Customs.

    The Customs may, when deeming it necessary, set up agencies or station
supervisory groups in the new and high technology industries development
zones to supervise and control the imports and exports.

    Article 5  As regards import and export business, it is stipulated as
follows:

    (1) With the approval of the Ministry of Foreign Economic Relations and
Trade, technology import and export corporations may be set up in the new and
high technology industries development zones to promote the access of new and
high technology products to international  markets.

    (2) According to the relevant provisions of the State new and high
technology enterprises with good results in export business may be granted
the right to handle foreign trade transactions. New and high technology
enterprises may, with approval by relevant departments, set up branches
overseas according to business needs.

    Article 6  As regards capital and credits, it is stipulated as follows:

    (1) Banks shall give an active support to new and high technology
enterprises and do their best to provide enterprises with funds needed for
their development, production and construction.

    (2) Banks may arrange the issue of long-term bonds in definite sums for
the new and high technology industries development zones so as to raise funds
from the society to help the development of new and high technology
industries.

    (3) Departments concerned may establish venture investment funds in the
new and high technology industries development zones for the development of
new and high technology products with greater risks. Venture investment
companies may be set up in the new and high technology industries development
zones where conditions are available.

    Article 7  The capital construction projects for production and sales of
new and high technology enterprises shall be carried out according to the
overall plan, and be given priority to be brought into the local fixed
capital investment programmes.

    Article 8  Approved by the local people’s governments, new and high
technology enterprises may be exempted from subscribing for State key
construction bonds.

    Article 9  The new and high technology products developed by new and high
technology enterprises which have met qualifications of the import products
of the same kind in all quality standards and with a certain production scale
shall, after being examined and approved by the State Science and Technology
Commission jointly with other departments concerned, be listed in the
catalogue of the Staterestricted import commodities, and imports of such
products shall be restricted according to the existing regulations on import
control.

    Article 10  Prices of new products developed by new and high technology
enterprises involving Statecontrolled prices (including State-set and
State-guided prices), except for those of specific varieties that shall be
fixed by departments in charge of price control, may be fixed by the
enterprises themselves during a definite period of trial sale of the products
but shall report to departments in charge of the enterprises and price
control for record. Prices of new and high technology products which are not
under the State price control may be fixed by the enterprises themselves.

    Article 11  New and high technology enterprises may apply accelerated
depreciation of their apparatus and equipments used for development of new
and high technologies and production of their products.

    Article 12  All tax payments from new and high technology enterprises in
the new and high technology industries development zones, if not affecting
the portion to be handed over to the central financial department and with
the approval of the local people’s governments, shall be based on the level
of such payments levied in 1990, and the amount of taxes collected in excess
thereof shall be returned, for a period of up to five successive years, to
the new and high technology industries development zones for their further
construction.

    Article 13  Matter related to overseas trips more than once in a year
made by business and technical personnel of new and high technology
enterprises shall be dealt with in accordance with the Circular of the
General Office and the State Council Concerning the Transmission of the
Request for Instructions Submitted by the State Science and Technology
Commission to Simplify the Examining and Approving Procedures for Certain
People of New and High Technology Enterprises with Respect to  Their Multiple
Exit from the Country.

    Article 14  All localities and departments shall, when planning
employment and recruiting staffs and workers, give priority to needs of new
and high technology enterprises for recruiting university graduates and
postgraduates, as well as returned students and experts.

    Article 15  People’s governments of provinces, autonomous regions,
municipalities directly under the Central Government or cities separately
listed in plan where the new and high technology industries development zones
approved by the State are located may work out measures for implementation in
line with these Provisions.

    Article 16  The State Science and Technology Commission shall, jointly
with other departments concerned, inspect at regular intervals the new and
high technology industries development zones. The implementation of
preferential policies shall be suspended in those zones poorly managed or
showing slow progress, even to the degree of cancellation of their
qualifications as the national new and high technology industries development
zones.

    Article 17  The State Science and Technology Commission and other
departments concerned shall be responsible for the interpretation of these
Provisions.

    Article 18  These Provisions shall be put into effect as of the date of
approval by the State Council.
ANNEX III  Provisions on the Tax Policy for the National Development
Zones for New and High Technology Industries

    Article 1  These Provisions are formulated in order to accelerate the
healthy development of new and high technology industries of our country and
to further promote the establishment of the new and high technology
industries development zones.

    Article 2  These Provisions shall apply only to the acknowledged and
determined new and high technology enterprises (hereinafter referred to as
development zone enterprises) in the new and high technology industries
development zones (hereinafter referred to as development zones) approved by
the State Council.

    Article 3  The acknowledgement requirements and standards for the
development zones and development zone enterprises as well as the scope of
new and high technologies and the products thereof shall be dealt with
according to the unified provisions formulated by the State Science and
Technology Commission.

    Article 4  The income tax of development zone enterprises shall be levied
at a reduced rate of 15 percent from the date of their acknowledgement and
determination.

    Article 5  When the output value of export of a development zone
enterprise exceeds 70 percent of its total annual output value, the income
tax shall be levied at a reduced rate of 10 percent after being verified by
the taxation authorities.

    Article 6  A newly-established development zone enterprise may, upon
approval by the taxation authorities of an application filed by the
enterprise, be exempted from income tax in the first two operation years.

    A Chinese-foreign equity joint venture newly-established as a development
zone enterprise and scheduled to operate jointly for a period of 10 years or
more may, upon approval by the taxation authorities of an application filed
by the enterprise, be exempted from income tax in the first two years after
it has begun to make a profit.

    Development zone enterprises using foreign investments within the special
economic zones and economic and technological development zones shall be
subject to the administration of relevant tax policy of the special zones or
economic and technological development zones, and shall not be restricted by
the provisions of the above two paragraphs of this Article.

    On the expiration of the tax-free period, considerations of appropriate
tax reductions or exemptions for a definite period of time may, upon
approval, be given to the enterprises which still have real difficulties in
tax payment.

    Article 7  Development zone enterprises using domestic investments with
an annual net income not exceeding 300,000 yuan (RMB) from technological
transfer and consultation, services and trainings related to this transfer
shall be temporarily exempted from income tax for the above-mentioned amount;
for the portion exceeding 300,000 yuan (RMB), income tax shall be levied
according to the appropriate tax rate. For all new and high technology
products developed under the “Torch Programme”, and conforming to exemption
and reduction conditions for new products, the amount derived from tax
exemption or reduction on products and on the added value of products shall
be used specially for the technical development and shall be exempted from
income tax.

    Article 8  The amount derived from tax exemption or reduction for
development zone enterprises using domestic investments shall be regarded as
national support funds managed under an independent accounting system, and
shall be specially used for the development of new and high technologies and
their products under the supervision of relevant departments.

    Article 9  For a development zone enterprise jointly run with another
investing party, the party shall, according to its own enterprise financial
system, pay  retroactively the income tax or the portion to be handed over to
its superior department from the profit distributed to it after deducting the
tax levied in the development zone.

    Article 10  For development zone enterpri

PROVISIONAL RULES ON ADMINISTRATION OF ALLOCATED LAND USE RIGHT

Provisional Rules on Administration of Allocated Land Use Right

     (Effective Date:1992.03.08–Ineffective Date:)

   Article 1. With a view to implementing “PRC Regulations on Leasing and Transferring of the Right to Use State-owned Urban and Rural Land” (hereinafter
referred to as “Regulations”) and strengthening the administration of allocated land use right, these rules are formulated.

   Article 2. Allocated land use right denotes the right to use State-owned land procured by land users through means other than land-use right
transference.

   Article 3. These rules are applicable to the transferring, leasing and mortgaging of the right to use allocated land (hereinafter referred to
as land use right).

   Article 4. The land administrations of the people’s governments above the county level shall control and supervise in accordance with law the
transferring, leasing and mortgaging of land use right.

   Article 5. Land users who have not got approval from land administrations of municipal or county people’s governments and fail to go through
procedures for the leasing of land use right and pay lease fees shall not transfer, lease or mortgage land use right.

   Article 6. Land users conforming to the following conditions may transfer, lease and mortgage land use right upon approval by land administrations
of municipal or county people’s governments:

a. They are corporations, enterprises, other economic entities and individuals;

b. Bearer of State-owned land use right certificate;

c. Bearer of legal documents of premises and other attached structures and properties on land; and

d. Those who sign land use right leasing contract in accordance with the “Regulations” and these rules and pay lease fees to municipal
or county people’s governments or turn over benefits from the transfer, leasing or mortgaging of rights in lieu of lease fees.

   Article 7. The transfer of land use right denotes the transfer to others of land use right or the right along with the premises and other attached
structures and properties on the land in question by land users.

The original owner of the land use right is the transferor and the party that receives the land use right is the transferee.

   Article 8. Ways of land use right transfer cover sales, exchange, donations, etc.

Sale means that the transferor trades land use right for given benefits.

Exchange means the exchange of land use rights among land users.

Donation means that the transferor transfers land use right gratis to the transferee.

   Article 9. Leasing of land use right means that land users lease land use right or the right along with the premises and other attached structures
and properties on the land in question to others for rents.

The original owner of land use right is the lessor and the party that rents the right is the lessee.

   Article 10. Mortgaging of land use right means that land users mortgage mortgageable land use rights as a guarantee for clearance of debts.

The original owner of the land use right is the mortgagor and the mortgage holder is the mortgagee.

   Article 11. In transferring and mortgaging land use right, ownership of the premises and attached structures and properties on the land in question
is correspondingly transferred and mortgaged; in transferring and mortgaging ownership of the premises and attached structures and
properties, the land use right covered by their use is correspondingly transferred and mortgaged. The transfer of premises and other
attached structures as movable estate is an exception.

In leasing land use right, the use right of the premises and attached structures on land is correspondingly leased; in leasing the
use right of the premises and attached structures, the land use right covered by their use is correspondingly leased.

   Article 12. Land users who transfer, lease or mortgage land use right must bear State-owned land use certificate and legal documents of the premises
and attached structures and properties and apply in written form to land administrations of local municipal or county people’s governments.

   Article 13. Land administrations of municipal or county people’s governments must give a reply in 15 days as of the date of receipt of written
applications for transferring, leasing or mortgaging land use right.

   Article 14. Land administrations of municipal or county people’s governments, through negotiations, sign land use right transfer contract with
the applicant.

   Article 15. Both parties involved in transfer, leasing or mortgaging of land use right shall, in accordance with relevant laws, decrees and the
land use right leasing contract, sign a contract on transfer, leasing or mortgaging of land use right.

   Article 16. Land users shall, within 60 days after the signing of land use right leasing contracts, pay lease fees to local municipal or county
people’s governments and have the land use right leasing registered at the land administrations of the municipal or county people’s
governments.

   Article 17. Both parties shall, within 15 days after the registration of a land use right lease, go to land administrations of municipal or county
people’s governments to have the transfer, leasing or mortgaging of land use right registered.

To get them registered, it is necessary to present the following documents and materials:

a. Certificate of State-owned land use;

b. Land use right leasing contract;

c. Contract on transfer, leasing and mortgaging of land use right; and

d. Other documents and materials deemed necessary by the land administrations of the municipal or county people’s governments.

   Article 18. When land use right is transferred, the rights and obligations recorded in the land use right leasing contract and the registration
documents are correspondingly transferred.

   Article 19. In leasing and mortgaging land use right, the lessor or mortgagor must continue to implement the land use right leasing contract.

   Article 20. After land use right is transferred, if the lessee has the need to change the contents as defined in the land use right leasing contract,
must get consent from the land administrations of the local municipal or county people’s governments and, in accordance with the
approving authority, the approval of the land administrations and urban planning departments and, in accordance with “Regulations”
and these rules, re-sign land use right leasing contract, re-adjust lease fees and go through land registration formalities.

   Article 21. After land use right is leased, the lessee must not add permanent premises and structures. If it is necessary to build interim premises
and structures, the lessee must get consent from the lessor and go through relevant approval formalities in accordance with relevant
laws and regulations.

After land use right is leased, if the lessee has the need to change the content as defined in the land use right leasing contract,
the lessee must get consent from the lessor and approval from the land administrations and urban planning departments in accordance
with “Regulations” and these rules, re-sign land use right leasing contract, re-adjust lease fees and go through land registration
formalities.

   Article 22. After the termination of the land use right leasing contract, the lessor shall, within 15 days as of the date of termination of the
contract, go to the original registration office to cancel the land use right leasing registration.

   Article 23. After the termination of the land use right mortgaging contract, the mortgagor shall, within 15 days as of the date of termination
of the contract, go to the original registration office to cancel the land use right mortgaging registration.

   Article 24. If the mortgagor fails to honor his debt due, or the mortgagor is disbanded or goes bankrupt during the effective period of the mortgaging
contract, the mortgagee has the right, in accordance with State laws and decrees and the mortgaging contract, to dispose of the mortgaged
properties.

Land users who procure land use right through disposing of mortgaged properties must, within 15 days of the date of procurement of
the right, go through formalities to change land registration at the land administrations of the local municipal or county people’s
governments.

   Article 25. When land users who are transferring, leasing or mortgaging the land use right are going through procedures to lease land use right,
the land use right leasing period must be clearly determined through negotiations between the land administrations of the local municipal
or county people’s governments and land users and recorded in the land use right leasing contract and must not exceed the maximum
length of period as defined in the “Regulations”.

   Article 26. Land use right leasing fees are charged in accordance with different means of transferring, leasing or mortgaging to a given proportion
of the listed land price, with the lowest no less than 40% of the listed land price. The listed land price is determined by the land
administrations of the local municipal or county people’s governments by referring to the basic land price, the term of transferring,
leasing or mortgaging the land use right and land conditions.

   Article 27. Land use right fees are collected and managed in accordance with relevant State regulations by land administrations of local municipal
or county people’s governments on behalf of the government.

   Article 28. When the lease term of the land use right is due, land users must, with 15 days as of the date of maturity of the term, bear the
State land use certificate and land use right leasing contract and go to the original registration office to cancel the leasing registration.

   Article 29. After the lease term of the land use right is due, if land users transfer, lease or mortgage the land use right again, they shall,
in accordance with these rules, re-sign land use right leasing contract, pay lease fees and go through formalities to change land
registration.

   Article 30. During the period of land use right leasing, the State, under special circumstances and in accordance with the public interest, may
recover through legal procedures the land use right and pay corresponding compensations according to the length of use and the degree
of development and utilization by land users.

   Article 31. If land users fail to pay all lease fees within the period as prescribed in the land use right leasing contract, the lessor has the
right to cancel the contract and may ask the violator of the contract to compensate.

   Article 32. If a land user fails to go through formalities for land registration in transferring, leasing and mortgaging land use right, his
deed shall be invalid and unprotected by law.

   Article 33. Units and individuals who transfer, lease or mortgage land use right without approval shall be dealt with by land administrations
of local municipal or county people’s governments according to Article 46 of the “Regulations”.

   Article 34. If an involved party does not agree with administrative punitive decisions by land administrations, it may bring a suit to the local
people’s court in accordance with “PRC Administrative Procedural Law”.

   Article 35. Land administrations of people’s governments above the county level should strengthen supervision over and examination of the transferring,
leasing and mortgaging of land use right and handle in time violations of law.

   Article 36. When land administrations are checking or examining the transferring, leasing or mortgaging of land use right, the units or individuals
under examination shall cooperate, report factually and present relevant documents and materials and must not obstruct the execution
of such examinations.

   Article 37. In supervision and examination, land administrations may take the following measures:

a. To check or copy documents or materials;

b. To ask the units or individuals under supervision or examination to present or send documents and materials and other information
relating to supervision and examination; and

c. To order the units or individuals to stop land-related acts underway that violate the law.

   Article 38. The expenses of land administrations in handling leasing of land use right are covered according to relevant State regulations.

   Article 39. Organizations other than economic entities engaged in transferring leasing or mortgaging land use right are handled in the light
of these rules.

   Article 40. Collaboration with others in building houses and running joint ventures with land use right as the condition is deemed as transfer
of land use right and handled according to these rules.

   Article 41. Land administrations of municipal or county people’s governments should organize task forces to check up on the unauthorized acts
of transferring, leasing or mortgaging land use right executed in the period after the “Regulations” was put into force and before
these rules come into effect and have them go through formalities for leasing as a complementary measure after being punished according
to “Regulations”.

   Article 42. The right to interpret these rules rests with the State Land Administration.

   Article 43. These rules come into force as of the date of promulgation.

    





DECISION OF THE CENTRAL COMMITTEE OF THE COMMUNIST PARTY OF CHINA AND THE STATE COUNCIL ON ACCELERATING DEVELOPMENT OF TERTIARY INDUSTRY

Category  GENERAL Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1992-06-16 Effective Date  1992-06-16  


Decision of the Central Committee of the Communist Party of China and the State Council on Accelerating Development of Tertiary Industry


I. Accelerating Development of the Tertiary Industry is of Great Strategic
II. The Goal and Key Areas of the Tertiary Industry to be Quickly
III. Main Policies and Measures for Development of the Tertiary Industry

(June 16, 1992)

    With a view to taking advantage of the present opportunity, speeding up
steps of reform and opening up, concentrating efforts to facilitate
economic construction and in accordance with the Ten-Year Programme and Eighth
Five-Year Plan on National Economic Development and Social Progress, the
tertiary industry should be developed comprehensively and swiftly.
I. Accelerating Development of the Tertiary Industry is of Great Strategic
Significance

    1. Speedy development of the tertiary industry is the necessary result of
the growth of productivity and social progress. The situation of the tertiary
industry is an important indicator by which economic development is
measured in a modern society. The tertiary industry of our country suffers
slow and backward development which falls short of demands of national
economic development. The law of economic development observed in many
countries indicates that when an economy is developed to certain level,
the tertiary industry normally enjoys more speedy development than the first
and secondary industries and obviously plays a role of impetus to the overall
growth of national economy. Our country has just entered that stage. With a
view to smoothly realizing the gigantic objectives of socialist modernization,
we must catch up with the opportunity and promote development of the tertiary
industry to a new level.

    2. Acceleration of the development of the tertiary industry can facilitate
the forthcoming of a fully developed market, improve socialization and
standardization of service industry, strengthen social security and be
beneficial to smooth implementation of a series of reforms in respect to
labour, wage, price, operational mechanism in enterprises and the
circulation system, and be beneficial to further opening up, attraction of
larger foreign investment, institutional simplification, efficiency growth
and to gradual change of the undesirable status quo that government
agencies, institutions and enterprises take on what ought to be done by
the society. Consequently the tertiary industrial development can create
better conditions for development of reform and opening up in a broader and
in-depth area.

    3. Our country suffers low industrial economic efficiency, low
commercialization of agricultural products, retarded circulation and
financial difficulties which has severely impeded further development of
the national economy. One of the important reasons for which those problems
arise is the ill structure of the whole economy, which can be indicated by
the fact that the tertiary industry falls short of demands of the first and
secondary industries. Even low investment in the tertiary industry can
create immediate efficiency and good social effect. To quicken development of
the tertiary industry can, on one hand, readjust ratio of three
industries and optimize the overall structure of national economy and, on the
other hand, effectively alleviate in-depth structural contradictions of the
economic life and promote faster economic growth.

    4. The 1990s sees large number of new grown-up labour and those labour
that are removed from the first and secondary industries waiting for
reemployment. The tertiary industry has particular advantages in recruitment
of labour; variety of trades and occupations; co-existence of labour;
technology and knowledge concentrated professions which can recruit large
number of various personnel of different levels, especially large number of
technological and specialized talents. To accelerate development of the
tertiary industry is a major solution to alleviation of employment pressure
which is becoming more and more serious in our country.

    5. Towards the end of this century our people’s lives will become fairly
better off. Compared with the living standard of sufficient food and
clothing, the level of well-to-do livelihood does not only mean certain
standards of income already satisfied, but more importantly it should be
measured in terms of commercialization of services and living quality of
residents. Along with economic development and increase of income, the
people are asking for more and higher demands not only upon material life in
respect to clothing, food, housing, transportation, communication, hygiene and
living environment, but also upon cultural life in respect to cultural
entertainment, broadcasting, movies and TV programmes, publications, physical
training and recuperation, and tourism. Only when the tertiary industry is
quickly developed could the ever increasing material and cultural demands of
the people be satisfied and the construction of the socialist material and
cultural, ethical civilization be advanced.
II. The Goal and Key Areas of the Tertiary Industry to be Quickly
Developed

    6. In the light of national circumstances, we have categorized national
economy into three productive industries with agriculture being the first
productive industry, manufacture and construction the secondary industry
and all trades other than the abovementioned being categorized as the
tertiary industry including circulation departments, departments that
serve production and livelihood and departments that provide services for
improvement of science and culture awareness and quality of citizens.

    7. The goal of accelerating the tertiary industry development is to
gradually establish, in about ten years or longer times, an integrated
socialist market system, a comprehensive socialized service system in both
cities and countryside and a social security system, all of which are adapted
to circumstances of our country. In 1990s, development of the tertiary
industry should enjoy higher speed than before along with development of the
first and secondary industries so that the overall national economy could be
brought to a new stage every couple of years. For this purpose, the tertiary
industry should enjoy development at higher speed than the first and secondary
industries. The proportion of the tertiary industry value to GNP and the
proportion of the employment in the tertiary industry to the total social
labour should be brought up to or nearly to the average level of that
proportion in developing countries.

    8. Key areas of the tertiary industry to be developed at high speed are
specified as the following:

    — Firstly, trades which require small investment but generate immediate
result and high efficiency, have large capacity of labour recruitment and
direct relevance to economic development and people’s livelihood. Such trades
mainly refer to those in commerce, goods and materials, external trade,
banking, insurance, tourism, real estate, storehousing, neighborhood services,
catering, entertainment, hygiene, etc.;

    — Secondly, those newly developed trades related to scientific and
technological progress, which mainly consist of consultancy (including
consultancy in science and technology, law, accounting and auditing, etc.),
information and various technical services, etc.;

    — Thirdly, the tertiary industry in countryside, which mainly refer to
those trades that provide services before, during and after harvest or offer
services for improvement of farmers quality and living standards;

    — Fourthly, those basic trades that have comprehensive influence upon
and guiding significance for development of national economy, including
communication and transportation, posts and telecommunications, scientific
research, education and other public undertakings, etc..
III. Main Policies and Measures for Development of the Tertiary Industry

    9. All positive factors including the state, collectives and individuals
should be fully mobilized. Economic collectives, private-run enterprises
and individuals in both cities and countryside should be given free rein to
develop those trades which are small in investment, quick in result,
concentrated with labour and directly serve production and livelihood. The
trades that have comprehensive influence upon and guiding significance
to national economic development should be mainly run by the state, but
competition should be introduced so that under uniform planning and
management localities, departments and economic collectives could also be
mobilized to establish such trades. The acceleration of the tertiary industry
development should principally depend on social forces subject to the
principle of “whoever invest will hold the ownership and be the beneficiary”.
The state should not be dependent upon too much for investment.

    10. Acceleration of steps for development of the tertiary industry should
depend upon deepening reform and further opening up. Reforms and trials in
different forms should be conducted actively. Overseas funds, technologies
and marketing channels should be utilized boldly. Multiple approaches and
methods such as issue of stocks and bonds should be adopted to collect
funds. The form of business groups should be promoted actively so that
limits of departmental, regional or trade ownership could be broken through
and national and regional enterprise groups in the tertiary industry could
be established to the benefit of accelerated development of the tertiary
industry. All practices that are proved by reality to be effective should
be spread as soon as possible. Those that do not bring forth obvious
result should be tried continuously. Those practices that are proved really
unsuccessful should be changed to other forms.

    11. A vital self-development mechanism oriented to industrialization
should be established for the tertiary industry progress. Most of the tertiary
industry organizations should be transformed to business entities or
operated in business manner and try to be independent in operation and
responsible for both wins and losses. Most of the present tertiary industry
organizations which are charity like or public welfare or public undertaking
like should be gradually transformed into business entities under corporate
management.

    12. Where conditions permit, present information, consultancy
institutions and internal service installments and transport vehicles
attached to state organs or enterprises and public institutions should, to
the direction of socialization, be open, in an active manner, to the society
for paid services subject to confidential and safety requirements. Conditions
should be created to make those institutions to be divorced from their
original units, to be independent in operation and accounting. At the same
time social service organizations should be encouraged to contract rear
services, management of retired personnel and other routine work of state
organs, enterprises and public institutions. The close self-service systems
which are often ” big and complete” or “small but complete” should be broken.
Abovementioned services should be socialized gradually.

    13. Enterprises of the tertiary industry should be encouraged to attempt
transdepartmental, transregional or conglomerate merger of other industrial
enterprises that should be closed, suspended, merged or changed in line of
production, and should be rendered preferential support in terms of assets
transfer, liability settlement, credit and taxation. This should be an
important measure for readjustment of industrial structure.

    14. Part of administrative personnel should be actively encouraged to be
separated from administration and to enter trades of services. Those people
that have been separated should be divorced from the administrations. Those
trades that serve production and people’s lives should be developed
vigorously and should recruit as many personnel separated from
administration as possible so that conditions could be created for smooth
progressing of government organizational reform and staff reduction.

    15. To advance reform in labour and personnel system, the tertiary
industry enterprises should be offered discretion with labour employment. The
practice of discharge and resignation should be institutionalized gradually
so as to realize mutual selection in employment. Those institutions that
are operated in business manner and no longer need financial allocation
should be given freedom in recruitment of personnel and independence in
determination of staff size. Those institutions that only partially
depend upon financial allocation should be given more freedom in expansion
of staff size. Surplus labour with industrial enterprises, especially those
skilled personnel, should be encouraged to move to the tertiary industry.
Graduates from colleges and training schools and armymen to be transferred to
civilian work should be encouraged to work in units of the tertiary industry.

    16. Price system should be reformed according to the law of value so that
the long standing problem of insufficient value compensation for the
tertiary industry could be solved. Except for a few items for which it is
really necessary for the state to set the prices and fee collection
standards, most of the prices and service fee standards in the tertiary
industry should be open, subject to floating prices, negotiated prices and
self-quoted prices so that a reasonable price parity could be established.

    17. International business should be encouraged. Some large and medium
sized state-run commercial and materials enterprises should be authorized
with the power to import and export business. Where condition permits
external business development should be promoted energetically and active
efforts should be made to establish China-run enterprises overseas. Subject
to approval, large and medium-sized state-run external enterprises can be
authorized the right to enter domestic market so that business could be
operated in a uniform manner within both domestic and global markets.
Procedures regarding examination and approval of overseas business
development should be further simplified.

    18. Banking, taxation and other economic measures should be adopted for
development of the tertiary industry. Demand for loans by key trades should be
satisfied through arrangements under credit planning. Banks and both city and
township credit cooperatives can issue small loans, for maintenance of
fixed assets and simple equipment, to those collective and private
enterprises, individual industrial and commercial households who have good
efficiency and repayable capacity. When it is really necessary, taxation
upon newly established tertiary industry enterprises may, according to
industrial policies, be delayed or deducted over certain period of time.

    19. Procedures regarding examination and approval should be simplified
so as to alleviate business opening difficulties with establishments of the
tertiary industry. Business autonomy of the tertiary industry enterprises
should be set free. Such enterprises should be permitted to adopt more
flexible operations and expand business scope while their administration
and supervision should be strengthened effectively.

    20. Legal systems governing the tertiary industry should be strengthened.
Relevant laws and regulations regarding corporate and market behavious should
be formulate more speedily. Enterprises should operate according to law
while administrative authorities and economic superintendent departments
should exercise administration and supervision according to law so that the
tertiary industry could enjoy healthy development in a legal approach.

    21. Planning and administration of the tertiary industry should be
strengthened. Different regions have different economic structure and
development level. Their tertiary industry development should also be
different in development focus and speed. Development focus should be
determined in the light of local circumstances and in accordance with state
industrial policies. Investment, credit, employment and land use in the
interest of the tertiary industry should be placed under the overall
development planning and general arrangements of cities and townships. All
regions and departments should formulate programmes for implementation of
the present Decision and revise at the soonest possible time those policies
or regulations that run counter to the present Decision.

    The Party Central Committee and the State Council call for close
attention of the whole party and governments at different levels to the
development of the tertiary industry. All party and government officials
at different levels should unify ideology, renew conception, broaden
thinking, give play to creativity and mobilize the cadres and the people to
work strenuously for realization of the important strategic tasks of the
tertiary industry development.





CIRCULAR OF THE STATE COUNCIL CONCERNING THE PILOT PROJECT FOR NATIONAL TOURIST VACATION AREAS

Category  TOURISM Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1992-08-17 Effective Date  1992-08-17  


Circular of the State Council Concerning the Pilot Project for National Tourist Vacation Areas



(August 17, 1992)

    For the purpose of further expanding the opening up of our country,
developing and exploiting our country’s rich tourist resources, promoting the
transformation of the sightseeing industry into a sightseeing and vacationing
industry in our country, and expediting the development of tourism, the State
Council has decided to launch a pilot project for national tourist vacation
areas in the places where the conditions are ripe, in which enterprises and/or
individuals from abroad and/or Taiwan, Hong Kong and Macau (hereinafter
referred to as the foreign investors) are encouraged to invest in the
development of tourist facilities and tourist businesses. A circular is hereby
promulgated as follows:

    1. National tourist vacation areas refer to comprehensive tourist areas
established in conformity with international requirements for vacation tours
and mainly open to overseas tourists. The areas shall be bounded clearly and
shall be located in the places which are suitable for concentrating complete
sets of tourist facilities, abundant with tourist vacation resources and
source of tourists, convenient for communications and have relatively firm
foundations of foreign relations.

    2. The State encourages the development of tourism and treats it as a key
industry for earning foreign exchange. National tourist vacation areas shall
be granted the following preferential policies:

    (1) The income tax on the enterprises with foreign investment established
within the areas shall be levied at a reduced rate of twenty-four percent.
Among them, enterprises with foreign investment of a productive nature
scheduled to operate for a period of not less than ten years shall, from the
first year of beginning to make a profit, be exempted from income tax in the
first and second years and allowed a fifty percent reduction in the third to
fifth years.

    (2) Building materials, production and management equipment,
transportation equipment and office supplies imported for enterprise use and
included in the total amount of investment by enterprises with foreign
investment established within the areas, as well as settling-in articles and
transportation equipment imported in reasonable quantities by foreign
investors or technicians or other personnel residing in the areas, shall be
exempted from customs duties and consolidated industrial and commercial taxes.
Raw materials, spare parts, components, fittings, auxiliary materials and
packaging materials imported for the production of tourist export goods shall
be treated as bonded goods by Customs.

    (3) Machinery, equipment and other materials for capital construction
required by the construction of infrastructure within vacation areas shall be
exempted from customs duties and product taxes (or value-added taxes).

    (4) Foreign exchange payment shops may be established within the areas.
The examination and approval of these shops shall be handled according to the
relevant State provisions.

    (5) Tourist automobile companies with Chinese-made automobiles and in
co-operation with foreign investors may be established within the areas.
Chinese-made automobiles purchased by the companies within a verified quantity
shall be exempted from the horizontal supporting fees, surcharges for
purchases of motor vehicles and extra consumption taxes. Tourist automobile
companies established by domestic enterprises within the areas may be treated
in reference with the above-mentioned policies. Such automobiles shall be used
only by tourist automobile companies established within the areas, and shall
not be transferred to others for sale. These policies shall be put into effect
by the State Planning Commission in consultation with other relevant
departments.

    (6) Tourist agencies of Category 1 in co-operation with foreign investors
may be established within the areas for overseas tourist services. The
National Tourism Administration shall be in charge of the examination and
administration of the tourist agencies.

    (7) The development of land for the construction within the areas shall be
handled according to the Interim Regulations of the People’s Republic of China
Concerning the Assignment and Transfer of the Right to Use of State-Owned Land
in the Urban Areas. Fees for the assignment of land use rights shall, within
five years from the approval date of the establishment of the areas, be
reserved within the areas for the construction of infrastructure.

    (8) Tourist foreign exchange earnings derived from the areas shall, within
five years from the approval date of the establishment of the areas, be
reserved in full as foreign exchange quotas for the sustained development of
the areas.

    3. Projects for tourist facilities built with foreign investment within
national tourist vacation areas shall, if the amount of investment falls
within the limit of powers for approval laid down by the State Council, be
examined and decided by the provinces, autonomous regions and municipalities
directly under the Central Government, and cities separately listed under the
national plan; those of projects for tourist lodging facilities shall be
submitted to the National Tourism Administration, the State Planning
Commission and the Ministry of Economic Relations and Foreign Trade for the
record. If the amount of investment exceeds the limit of powers for approval
laid down by the State Council, the projects shall be decided according to the
relevant State provisions. For enterprises established for projects of tourist
lodging facilities built with foreign investment, their term of operation
shall not exceed thirty years in principle.

    4. The pilot project for national tourist vacation areas shall be
submitted by local people’s governments to the State Council for examination
and approval.

    5. The pilot project for national tourist vacation areas is an important
arrangement in order to deepen the reform, expand the opening of the tourist
industry, change the structure of tourist products in our country, upgrade the
tourist products and improve their competitive power in the international
market. Departments concerned under the State Council and local governments
concerned shall make proper planning in real earnest and do a good job for
this pilot project. It’s inadvisable to establish too large-scale national
tourist vacation areas in the opening stages. They should gradually develop
from small to large.





CIRCULAR OF THE STATE SCIENCE AND TECHNOLOGY COMMISSION, THE STATE ECONOMIC RESTRUCTURING COMMISSION ON PRINTING AND ISSUING THE INTERIM PROVISIONS ON SEVERAL ISSUES CONCERNING THE ESTABLISHMENT OF HIGH AND NEW TECHNOLOGY INCORPORATED COMPANIES WITHIN NATIONAL HIGH AND NEW TECHNOLOGY INDUSTRY DEVELOPMENT ZONES

The State Science and Technology Commission, the State Economic Restructuring Commission

Circular of the State Science and Technology Commission, the State Economic Restructuring Commission on Printing and Issuing the Interim
Provisions on Several Issues Concerning the Establishment of High and New Technology Incorporated Companies within National High
and New Technology Industry Development Zones

GuoKeFaGaiZi [1992] No.796

November 19,1992

All the people’s governments of provinces, autonomous regions, municipalitie directly under the Central Government, ministries, commissions
and directly subordinate institutions of the State Council:

“Interim Provisions on Several Issues Concerning the Establishment of High and New Technology Incorporated Companies within National
High and New Technology Industry Development Zones” drafted by the Commission of Science Technology and the commission for economic
restructuring is hereby issued to you for the earnest implementation. Attachment:Interim Provisions on Several Issues Concerning the Establishment of High and New Technology Incorporated Companies within National
High and New Technology Industry Development Zones

Article 1

These Provisions are formulated in accordance with the Opinions on the Standardization of Incorporated Companies issued by the State
Economic Restructuring Commission and in consideration of the actual conditions of high and new technology industry development zones
and for the purposes of promoting the optimal combination of high and new technologies with other production factors and advancing
the development of high and new technology industry.

Article 2

These Provisions apply to the establishment of incorporated companies with a high and new technology nature within high and new technology
industry development zones which are approved by the State Council.

Article 3

High and new technology incorporated companies (hereinafter referred to as the company) mean the enterprise legal persons which are
established according to the Opinions on the Standardization of Incorporated Companies of the State Economic Restructuring Commission
(hereinafter referred to as the Opinions on the Standardization) and these Provisions and meet the requirements issued by the State
Science and for acknowledging high and new technology enterprises Technology Commission.

Article 4

The place of registration of a company is its residence. Both the company’s place of registration and its main working offices must
be located within the prescribed high and new technology industry development zone.

Article 5

When a former high and new technology enterprise is restructured into a company, its initiator may be one person if it is acknowledged
by the State Science and Technology Commission as a large or medium-sized high and new enterprise and is approved by the examination
and approval organ.

Article 6

If an enterprise legal person outside the territory or a foreign-capital enterprise legal person within the territory transferring
a high and new technology published by the State Science and Technology Commission or using the said technology as the share in the
company is to be an initiator of the company, it must be reported to the State Economic Restructuring Commission and the State Science
and Technology Commission for special examination and approval, however, the total number thereof may not exceed one-third of the
initiators.

Article 7

When a former high and new technology enterprise is transformed into a company, the property rights of the enterprise’s original net
assets must be defined. Assets of which property rights are difficult to be defined may be invested into the company and managed
in the form of legal person shares.

Article 8

The administrative departments of high and new technology industry development zones are the competent business departments for the
companies, and are responsible for examining the establishment of the companies within high and new technology development zones.

Article 9

The commissions (offices) for restructuring economic system of provinces, autonomous regions and municipalities directly under the
Central Government in the places where the companies are located or the organs authorized by the government are the examination and
approval organs for the companies.

Article 10

When intangible assets are priced as shares, the total amount of intangible assets priced may not, with special approval of the examination
and approval department for the company, exceed 30% of the company’s registered capital if the intangible assets include high and
new technologies. However, such a high and new technology included must meet the following requirements:

(1)

to be the core technology for the company’s main products;

(2)

to meet the requirements issued by the State Science and Technology Commission for acknowledging the high and new technology ;

(3)

to produce by the share subscriber the documentary evidence of post_title to the technology invested as shares, and to guarantee that the
company’s right over the said technology, within the scope or terms agreed upon, may challenge any third party; and

(4)

to have evaluation certificates issued by the technology evaluation organization approved by the State Science and Technology Commission
or its authorized department and a qualified certified public accountant firm.

Article 11

When a former high and new technology enterprise is transformed into a company, the enterprise may, after examination and approval
by the enterprise’s competent department and unanimous resolution of the active employees’ meeting of the former enterprise, give
reward in the form of personal shares to the scientific and technological personnel of the company who have made outstanding contributions
in creating the former enterprise in order to continue to ensure and promote the company’s consolidation and development and to bring
the advantage of intellectual resources into play.

Article 12

The Opinions on the Standardization apply to any matters not included in these Provisions.

Article 13

The science and technology commissions and the commissions for restructuring economic system of provinces, autonomous regions and
municipalities directly under the Central Government may formulate the rules for implementation in accordance with these Provisions.

Article 14

The State Science and Technology Commission is responsible for the interpretation of these Provisions.

Article 15

These Provisions shall enter into force as of the date of promulgation.



 
The State Science and Technology Commission, the State Economic Restructuring Commission
1992-11-19

 






STATEMENT OF THE CHINESE GOVERNMENT ON THE BASELINE OF THE TERRITOTIAL SEA

Category  TERRITORY AND DIPLOMATIC RELATIONS Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1996-05-15 Effective Date  1996-05-15  


Statement of the Chinese Government on the Baseline of the Territotial Sea of the People’s Republic of China



(May 15, 1996)

    According to the Law of the People’s Republic of China on the Territorial
Sea and the Continuous Zone promulgated on February 25, 1992, the government
of the People’s Republic of China hereby states part of the baseline of the
territorial sea adjacent to the mainland of the People’s Republic of China
and the baseline of the territorial sea adjacent to the Xisha Islands.

    1. The straight lines joining the following adjacent base points shall be
a part of the baseline of the territorial sea adjacent to the mainland:

    (1) Shandong Gaojiao (1)    37 degrees 24.0 minutes N

                                122
degrees 42.3 minutes E

    (2) Shandong Gaojiao (2)    37 degrees 23.7 minutes N

                                122
degrees 42.4 minutes E

    (3) The Moye Island (1)    36 degrees 57.8 minutes N

                              
122 degrees 34.2 minutes E

    (4) The Moye Island (2)    36 degrees 55.1 minutes N

                              
122 degrees 32.7 minutes E

    (5) The Moye Island (3)    36 degrees 53.7 minutes N

                              
122 degrees 31.1 minutes E

    (6) The Sushan Island    36 degrees 44.8 minutes N

                            
122 degrees 15.8 minutes E

    (7) The Chaolian Island    35 degrees 53.6 minutes N

                              
120 degrees 53.1 minutes E

    (8) The Dashan Island    35 degrees 00.2 minutes N

                            
119 degrees 54.2 minutes E

    (9) Macaihang    33 degrees 21.8 minutes N

                     121 degrees
20.8 minutes E

    (10) Waikejiao    33 degrees 00.9 minutes N

                      121
degrees 38.4 minutes E

    (11) The Sheshan Island    31 degrees 25.3 minutes N

                              
122 degrees 14.6 minutes E

    (12) Haijiao    30 degrees 44.1 minutes N

                    123 degrees
09.4 minutes E

    (13) Dongnanjiao    30 degrees 43.5 minutes N

                        123
degrees 09.7 minutes E

    (14) The Brother-Two Island    30 degrees 10.1 minutes N

                                  
122 degrees 56.7 minutes E

    (15) The Yushan Islands    28 degrees 53.3 minutes N

                              
122 degrees 16.5 minutes E

    (16) The Taizhou Islands (1)    28 degrees 23.9 minutes N

                                    121
degrees 55.0 minutes E

    (17) The Taizhou Islands (2)    28 degrees 23.5 minutes N

                                    121
degrees 54.7 minutes E

    (18) Daotiaoshan    27 degrees 27.9 minutes N

                        121
degrees 07.8 minutes E

    (19) The Dongyin Island    26 degrees 22.6 minutes N

                              
120 degrees 30.4 minutes E

    (20) The Dongsha Island    26 degrees 09.4 minutes N

                              
120 degrees 24.3 minutes E

    (21) The Niushan Island    25 degrees 25.8 minutes N

                              
119 degrees 56.3 minutes E

    (22) The Wuqiu Island    24 degrees 58.6 minutes N

                            
119 degrees 28.7 minutes E

    (23) The Dongding Island    24 degrees 09.7 minutes N

                                118
degrees 14.2 minutes E

    (24) Daganshan    23 degrees 31.9 minutes N

                      117
degrees 41.3 minutes E

    (25) The Nanpeng Islands (1)    23 degrees 12.9 minutes N

                                    117
degrees 14.9 minutes E

    (26) The Nanpeng Islands (2)    23 degrees 12.3 minutes N

                                    117
degrees 13.9 minutes E

    (27) Shibeishanjiao    22 degrees 56.1 minutes N

                          
116 degrees 29.7 minutes E

    (28) Zhenshiyan    22 degrees 18.9 minutes N

                      
115 degrees 07.5 minutes E

    (29) The Jiapeng Islands    21 degrees 48.5 minutes N

                                113
degrees 58.0 minutes E

    (30) The Weijia Island    21 degrees 34.1 minutes N

                              112
degrees 47.9 minutes E

    (31) Dafanshi    21 degrees 27.7 minutes N

                     112 degrees
21.5 minutes E

    (32) The Qizhou Islands    19 degrees 58.5 minutes N

                              
111 degrees 16.4 minutes E

    (33) Shuangfan    19 degrees 53.0 minutes N

                      111
degrees 12.8 minutes E

    (34) The Dazhou Island (1)    18 degrees 39.7 minutes N

                                  110
degrees 29.6 minutes E

    (35) The Dazhou Island (2)    18 degrees 39.4 minutes N

                                  110
degrees 29.1 minutes E

    (36) Shuangfanshi    18 degrees 26.1 minutes N

                        
110 degrees 08.4 minutes E

    (37) Lingshuijiao    18 degrees 23.0 minutes N

                        
110 degrees 03.3 minutes E

    (38) Dongzhou (1)    18 degrees 11.0 minutes N

                        
109 degrees 42.1 minutes E

    (39) Dongzhou (2)    18 degrees 11.0 minutes N

                        
109 degrees 41.8 minutes E

    (40) Jinmujiao    18 degrees 09.5 minutes N

                      109
degrees 34.4 minutes E

    (41) Shenshijiao    18 degrees 14.6 minutes N

                        109
degrees 07.6 minutes E

    (42) The Xigu Island    18 degrees 19.3 minutes N

                            108
degrees 57.1 minutes E

    (43) Yinggezui (1)    18 degrees 30.2 minutes N

                          108
degrees 41.3 minutes E

    (44) Yinggezui (2)    18 degrees 30.4 minutes N

                          108
degrees 41.1 minutes E

    (45) Yinggezui (3)    18 degrees 31.0 minutes N

                          108
degrees 40.6 minutes E

    (46) Yinggezui (4)    18 degrees 31.1 minutes N

                          108
degrees 40.5 minutes E

    (7) Ganenjiao    18 degrees 50.5 minutes N

                     108 degrees
37.3 minutes E

    (48) Sigengshajiao    19 degrees 11.6 minutes N

                          108
degrees 36.0 minutes E

    (49) Junbijiao    19 degrees 21.1 minutes N

                      108
degrees 38.6 minutes E

    2. The staight lines joining the following adjacent base points shall be
the baseline of the territorial sea adjacent to the Xisha Islands:

    (1) The Dongdao Island (1)    16 degrees 40.5 minutes N

                                  112
degrees 44.2 minutes E

    (2) The Dongdao Island (2)    16 degrees 40.1 minutes N

                                  112
degrees 44.5 minutes E

    (3) The Dongdao Island (3)    16 degrees 39.8 minutes N

                                  112
degrees 44.7 minutes E

    (4) Langhuajiao (1)    16 degrees 04.4 minutes N

                          
112 degrees 35.8 minutes E

    (5) Langhuajiao (2)    16 degrees 01.9 minutes N

                          
112 degrees 32.7 minutes E

    (6) Langhuajiao (3)    16 degrees 01.5 minutes N

                          
112 degrees 31.8 minutes E

    (7) Langhuajiao (4)     16 degrees 01.0 minutes N

                            112
degrees 29.8 minutes E

    (8) The Zhongjian Island (1)    15 degrees 46.5 minutes N

                                    111
degrees 12.6 minutes E

    (9) The Zhongjian Island (2)    15 degrees 46.4 minutes N

                                    111
degrees 12.1 minutes E

    (10) The Zhongjian Island (3)    15 degrees 46.4 minutes N

                                    
111 degrees 11.8 minutes E

    (11) The Zhongjian Island (4)    15 degrees 46.5 minutes N

                                    
111 degrees 11.6 minutes E

    (12) The Zhongjian Island (5)    15 degrees 46.7 minutes N

                                    
111 degrees 11.4 minutes E

    (13) The Zhongjian Island (6)    15 degrees 46.9 minutes N

                                    
111 degrees 11.3 minutes E

    (14) The Zhongjian Island (7)    15 degrees 42.7 minutes N

                                    
111 degrees 11.4 minutes E

    (15) Beijiao (1)    17 degrees 04.9 minutes N

                        111
degrees 26.9 minutes E

    (16) Beijiao (2)    17 degrees 05.4 minutes N

                        111
degrees 26.9 minutes E

    (17) Beijiao (3)    17 degrees 05.7 minutes N

                        111
degrees 27.2 minutes E

    (18) Beijiao (4)    17 degrees 06.0 minutes N

                        111
degrees 27.8 minutes E

    (19) Beijiao (5)    17 degrees 06.5 minutes N

                        111
degrees 29.2 minutes E

    (20) Beijiao (6)    17 degrees 07.0 minutes N

                        111
degrees 31.0 minutes E

    (21) Beijiao (7)    17 degrees 07.1 minutes N

                        111
degrees 31.6 minutes E

    (22) Beijiao (8)    17 degrees 06.9 minutes N

                        111
degrees 32.0 minutes E

    (23) The Zhaoshu Island (1)    16 degrees 59.9 minutes N

                                  
112 degrees 14.7 minutes E

    (24) The Zhaoshu Island (2)    16 degrees 59.7 minutes N

                                  
112 degrees 15.6 minutes E

    (25) The Zhaoshu Island (3)    16 degrees 59.4 minutes N

                                  
112 degrees 16.6 minutes E

    (26) The Beidao Island    16 degrees 58.4 minutes N

                              112
degrees 18.3 minutes E

    (27) The Zhongdao Island    16 degrees 57.6 minutes N

                                112
degrees 19.6 minutes E

    (28) The Nandao Island    16 degrees 56.9 minutes N

                              112
degrees 20.5 minutes E

    (1) The Dongdao Island (1)    16 degrees 40.5 minutes N

                                  112
degrees 44.2 minutes E

    The other part of the baseline of the territorial sea of the People’s
Republic of China shall be announced separately by the government of the
People’s Republic of China.





MEASURES ON THE ADMINISTRATION OF INTERNATIONAL BIDDING FOR MECHANICAL AND ELECTRICAL PRODUCTS

The Ministry of Foreign Trade and Economic Cooperation

Decree of the Ministry of Foreign Trade and Economic Cooperation of the People’s Republic of China

No.1

Measures on the Administration of International Bidding for Mechanical and Electrical Products are hereby promulgated and shall come
into force as of the day of May 11,1999.

Minister of the Ministry of Foreign Trade and Economic Cooperation, Shi Guangsheng

March 14,1999

Measures on the Administration of International Bidding for Mechanical and Electrical Products

Chapter I General Provisions

Article 1

With a view to standardizing the behavior of international bidding of mechanical and electrical products and establishing an open
and fair competition mechanism for international bidding and equitable tender evaluation criteria, these Measures are hereby formulated
pursuant to the Provisional Measures on Managing the Import of Mechanical and Electrical Products, the Circular of the State Council
on Strengthening the Management of Importing Mechanical and Electrical Equipment by Utilizing International Lending Projects (GuoFa
[1990] No.64) and the Circular of the General Office of the State Council on Printing and Distributing the Provisions of the Ministry
of Foreign Trade and Economic Cooperation Concerning the Institution Setting up Under the Function and Staffing (GuoBanFa [1998]
No.122).

Article 2

“International Bidding” specified in these Measures means international open competitive bidding.

Article 3

The Ministry of Foreign Trade and Economic Cooperation (hereinafter referred to as MOFTEC) shall be responsible for coordinating,
managing and supervising international bidding for national mechanical and electrical products, formulating the rules and the management
methods for the international bidding and organizing to conduct the international bidding thereupon, examining and approving the
qualification for international bidding agencies of mechanical and electrical products, and undertaking the routine work of the National
Tender Evaluation Committee.

Article 4

Administrative apparatuses of import and export of mechanical and electrical products of various localities and departments (hereinafter
referred to as import and export apparatuses) shall take the responsibilities for supervising, coordinating and managing the process
of international bidding of their mechanical and electrical products respectively and undertaking the routine work of their own tender
evaluation committee.

Article 5

Agencies of international bidding for mechanical and electrical products (hereinafter referred to as “bidding agencies”) shall undertake
the business of international bidding for mechanical and electrical products.

Article 6

“The purchaser” specified in these Measures means state organs, enterprises, public institutions and other social organizations, which
purchase mechanical and electrical products through international bidding.

“Bidding agencies” specified in these Measures mean legal persons or social intermediaries, which obtain the qualification for bidding
and carry out the international bidding business of mechanical and electrical products in compliance with the Methods on Examining
and Approving the Qualification for International Bidding of Mechanical and Electrical Products (promulgated in another decree).

“The tender” specified in these Measures means legal persons, who participate in tendering competition in accordance with bid documents.

Chapter II Scope of Bidding

Article 7

The following mechanical and electrical products shall be subject to international bidding:

(1)

The mechanical and electrical products specified by the Government to be purchased through international bidding. The concrete catalogue
shall be formulated, adjusted and promulgated by MOFTEC;

(2)

The mechanical and electrical products purchased by utilizing the loans of the World Bank, Japan Overseas Economic Cooperation Fund
(OECF) and Japan Import and Export Bank (hereinafter referred to as “overseas loans”);

(3)

The mechanical and electrical products that shall be purchased through international bidding under the item of government procurement;

(4)

The mechanical and electrical products required by other lending institutions to be purchased through international bidding.

Article 8

The following mechanical and electrical products may be submitted to bidding agencies for bidding by the purchaser:

(1)

The imported mechanical and electrical products controlled by the Government (such as quotas, specified products, etc.). After requesting
the relevant import and export agency to apply to MOFTEC and obtaining the approval of MOFTEC (the application letter is set out
in Attachment 1), the purchaser may authorize bidding agencies to organize international bidding.

(2)

The mechanical and electrical products subject to automatic import registration; and

(3)

The mechanical and electrical products imported by enterprises with foreign investment for self-use.

Article 9

Except in overseas loan projects, international bidding is not necessary to be conducted in the event that one of the following conditions
occurs:

(1)

Utilizing foreign government loan or export credit;

(2)

Not necessary to hand over foreign exchange to foreign parties;

(3)

Purchasing parts and auxiliary equipment needed for manufacturing;

(4)

Purchasing used mechanical and electrical products;

(5)

One-shot import volume less than US $ 10,000; or

(6)

Other mechanical and electrical products to which international bidding is not applicable.

Chapter III Bid Documents

Article 10

Bid documents shall be compiled in accordance with purchasing needs by the purchaser and bidding agencies, or consulting service agencies
entrusted by the purchaser. Bid documents mainly include as follows:

(1)

Invitation for bidding;

(2)

General instructions to tenders;

(3)

Names, quantities and technical specifications of bidding products;

(4)

Contract clauses;

(5)

Contract form; and

(6)

Attachments:

(i)

Tender document;

(ii)

Tender opening table;

(iii)

Tender quotation;

(iv)

Product description table;

(v)

Specification deviation chart;

(vi)

Tender bond format;

(vii)

Format of letter of guarantee of advance payment;

(viii)

Format of power of attorney of legal persons; and

(ix)

Format of letter of authority of manufacturers.

Chapter IV Bidding Procedures

Article 11

The purchaser shall enter authorization agreement for bidding with bidding agencies, which have the qualification for bidding of mechanical
and electrical products, and provide bidding bond (except purchasing mechanical and electrical products by utilizing overseas loan
projects). If the amount of the authorized bidding is up to or below US $ 2 million, the bidding bond shall not exceed 20 percent
of the amount. If the amount of the authorized bidding is above US $ 2 million, the bidding bond of the overage above US $ 2 million
shall not exceed 1 percent of the amount.

Article 12

Compiling bid documents. Bid documents shall include two parts of technique and commerce (including the requirements for the manufacture’s
performance and the evidences for tender evaluation), and the material clauses shall be marked with “*”. If one of the above requirements
does not be satisfied, the case shall result in the rescission of the tender.

Article 13

In addition to clauses of constituting the rescission of commercial tender, the evidences for tender evaluation shall include major
parameters of rescinding technical bid and scope of deviation, and permissible scope of price deviation and discount calculation
methods.

Article 14

The purchaser shall submit bid documents; facilities purchase order, and written and official replies to relevant projects to the
relevant import and export apparatus for examining and verifying the bid documents in compliance with the Provisional Measures on
Managing the Import of Mechanical and Electrical Products. The import and export apparatus shall deliver the reply to the application
for the examination and verification of the bid documents (see Format 1) to the purchaser and the relevant units within 20 working
days (10 working days for miniature unit set of equipment). If the reply does not be delivered during the stipulated period for certain
special reasons, the import and export apparatus shall describe the reasons and the period needed to be extended.

Article 15

The bid documents, which have been examined and approved, may not be amended without the permission of the relevant import and export
apparatus.

Article 16

After the purchaser and the bidding agency receive the reply to the application for the examination and verification of the bid documents,
the bidding announcement shall be published in the newspapers and periodicals or other media specified by the government (see Format
2).

Article 17

The validity period of tender, commencing from the date of the bidding announcement, may not be less than 30 days, and may not be
less than 60 days for main complete set of equipment.

Article 18

Opening the tenders at the time and place stipulated in the bidding announcement. The tender scheme, alternative courses, price reduction
statement or discount from the price shall be advanced at the moment of opening of tenders, otherwise it may not be treated as evidences
for tender evaluation. The purchaser, tenders and relevant parties shall participate in carrying out the opening of tenders.

Article 19

The bidding agency shall deliver or mail the tender opening record (see Format 3) to the relevant import and export apparatus for
reference within 3 days after opening the tenders (the effective starting time shall rest upon the date in the postmark).

Chapter V Rules for Tender Evaluation

Article 20

Initial evaluation shall be conducted by the initial evaluation committee, which has an odd number of members, composed of the purchaser,
the bidding agency and the relevant experts. Half of the members shall be experts.

Article 21

Initial evaluation shall be strictly carried out in accordance with bid documents and tender document and contain three categories
of commerce, technique and price. The tender who has the lowest bid shall be the bid-winner in the event that the two categories
of commerce and technique meet the requirements of the bid documents.

Article 22

Requirements for commerce evaluation. Upon occurrence of one of the following conditions, the bidding shall be rescinded:

(1)

The tender’s failure in providing the tender bond, the insufficiency of the tender bond or the validity period of the letter of guarantee,
or the inconsistency between the tender bond form or the issuing bank and the requirements of the bid documents;

(2)

Exceeding the business scope of the tender;

(3)

The attorney of the tender failure in submitting the valid power of attorney issued by the manufacture;

(4)

The tender document without the signature of the legal representative, or the signing party without the valid power of attorney of
the legal representative;

(5)

The inconsistency between the performance of the tender with the requirements of the bid documents; or

(6)

The insufficiency of the validity period of tender.

Article 23

Requirements for technique evaluation

(1)

The tender document shall be rescinded, if it does not satisfy the major parameters in technical specification and exceeds the scope
of deviation.

(2)

The technical comparison table shall be filled in accordance with the requirements of the bid documents and the major parameters,
and may not be filled in with marks. After clarification of the technical problems, which are needed and permitted to be clarified,
the tender document meeting the requirements shall be regarded as valid, which shall be described in the comparison table.

Article 24

Requirements for the evaluation of price

(1)

The evaluation shall be conducted on the basis of assessing factors stipulated in the tender documents. Any necessary markup or markdown
shall be described according to the stipulation of the bid documents and the tender document during the process of evaluation.

(2)

The tender shall make a list of spare parts necessary for the quality assurance period and the prices in accordance with the requirements
of the bid documents and the technical situations of the products, and credit the price of the spare parts into the tender sum. The
case that the spare parts are not necessary shall be described in the tender document; otherwise the average rate of the spare parts
of other effective tenders shall be credited into the tender sum (or the highest bid of the effective tenders upon the requirement
of lending institutions).

(3)

As for calculating the tender sum in overseas loan projects, the price of foreign products shall be based on CIF, and that of domestic
products shall be based on ex works (excluding value-added tax).

(4)

Except in overseas loan projects, the tender sum shall be calculated on the basis of the installation site specified by the purchaser
after arrival of the products, of which the price of the foreign products shall be CIF add import add duty add internal transport
cost add premium, etc. And the price of the domestic products shall be ex-works (excluding value-added tax) add internal transport
cost add premium, etc.

(5)

If tender prices are denominated in various currencies, those prices shall be converted into US $ based on the current selling rates
of the Bank of China during the process of price evaluation.

Article 25

Rules for dealing with other matters arising from tender evaluation

(1)

The original of banker’s references shall be produced. The duplicated documentation of banker’s references issued within 3 months
before the bid opening has the same effectiveness as the original.

(2)

Clarifying the ambiguity in the tender document shall be permitted, but the material statement concerning technique, commerce, and
price, etc may not be amended. The clarification shall be carried out in writing.

(3)

The tender document shall be rescinded in the event that the tender copies the technical specification stipulated in the bid documents
as one part of the tender document.

(4)

The products manufactured by equity joint venture enterprises duly registered in China shall be regarded as meeting with the requirements
for the tenders’ performance, if the performance of the technical person in overall meets the requirements of the bid documents.

Chapter VI Transaction of the Import Procedure

Article 26

The purchaser and the bidding agency shall submit the tender evaluation report with official seals of both parties and signatures
of members of the Initial Evaluation Commission (see Attachment 2) to the relevant import and export apparatus according to the supervisor
privilege level with 15 working days after the initial evaluation.

Article 27

The import and export apparatus shall organize the tender evaluation commission to examine and verify the tender evaluation report
within 10 working days. If no party challenges, import formalities may be handled for the products of foreign bid winner pursuant
to the Provisional Measures on Managing the Import of Mechanical and Electrical Products. The bidding agency shall issue the award
notice on the basis of import formalities. In event of purchasing the products by utilizing overseas loans, the bidding agency shall
submit the tender evaluation report to the lending institution in accordance with the notice of the tender evaluation outcome issued
by the national tender evaluation commission after the examination and verification of the tender evaluation, and obtain its approval
before issuing the award notice and handling import formalities.

Article 28

The purchaser may not enter into supply contracts with foreign sellers who win the bid, unless import formalities have been handled.
The tender bond shall be returned to the purchaser within 5 days after the constitution of supply contracts.

Chapter VII Violation of Rules and Punishment

Article 29

Any of the following acts shall be regarded as violation of rules:

(1)

Colluding with others to invite tenders falsely;

(2)

Disclosing information on tender evaluation during the period of tender evaluation;

(3)

Disrupting the process of bidding and tender evaluation through unfair means;

(4)

Not evaluating tenders in accordance with the rules for tender evaluation stipulated in these Measures;

(5)

Writing the tender evaluation report in contravention of the bid documents and the tender document;

(6)

Constituting supply contracts before examining and approving the tender evaluation report or handling import formalities; or

(7)

Other acts which violate these Measures.

Article 30

Punishment

(1)

If the bidding agency is responsible for the violation of rules, the bidding shall be invalid and a notice of criticism shall be given
to the present violator. In addition, the qualification for bidding of the bidding agency shall be suspended or abolished according
to circumstances of the violation.

(2)

If the tender is responsible for the violation of rules, its tender document shall be invalid. In addition, its qualification for
tender shall be suspended or abolished according to circumstances of the violation.

(3)

If the purchaser is responsible for the violation of rules, the bidding shall be invalid and a notice of criticism shall be given
to the purchaser. In addition, the relevant import and export apparatus may not handle import formalities.

(4)

If the initial evaluation committee is responsible for the violation of rules, the tender evaluation report shall be invalid. In addition,
the member who shall take the material responsibilities for the violation of rules shall be prohibited to conduct the tender evaluation.

(5)

If the purchaser does not enter supply contracts with the bid-winner in accordance with effective stipulations, the bidding bond may
not be returned. The 50% of the bidding bond shall be paid to the bid-winner, and the other 50% shall be paid to the bidding agency.

If the bid-winner does not enter supply contracts with the purchaser in accordance with effective stipulations, the bid bond may not
be returned. The 50% of the bid bond shall be paid to the purchaser, and the other 50% shall be paid to the bidding agency.

(6)

If the acts constitute breach of discipline, the supervisory body shall give administrative sanctions to the violator. If the case
constitutes a crime, the offender shall be investigated for criminal responsibility according to law.

Chapter VIII Supplementary Provisions

Article 31

If the loan agreement between governments of between financing institutions contains special provisions, the special provisions, shall
prevail.

Article 32

Local bidding or invitation for tender may not be adopted in overseas loan projects without the permission of the lending institutions.
If it is permitted, its procedures may follow the procedures of these Measures.

Article 33

Service charges for bidding shall be collected in accordance with the relevant laws and regulations.

Article 34

MOFTEC shall be responsible for the interpretation of these Measures. If the former relevant laws or regulations are in contravention
of these Measures, these Measures shall prevail.



 
The Ministry of Foreign Trade and Economic Cooperation
1999-03-14

 






CIRCULAR OF THE GENERAL OFFICE OF THE STATE COUNCIL ON STRENGTHENING MANAGEMENT OF TRANSFER OF LAND AND STRICTLY BANNING SPECULATIVE LAND DEALING

Category  LAND ADMINISTRATION Organ of Promulgation  The General Office of the State Council Status of Effect  In Force
Date of Promulgation  1999-05-06 Effective Date  1999-05-06  


Circular of the General Office of the State Council on Strengthening Management of Transfer of Land and Strictly Banning Speculative
Land Dealing



(Promulgated by the Document No. [1999] 39 of the General Office of the State Council on May 6,1999)

    Since the issuance of the Circular of the Central Committee of Communist Party of China and the State Council
on Further Strengthening Land Management and Earnestly Protecting Farmland, the land management, especially the work in relation
to the protection of farmland, has been strengthened, certain success has been achieved. However, there still exist some problems
such as disorder in land use, illegal transfer of land use right, and especially the illegal transaction of land collectively owned
by farmers is relatively serious, resulting in speculative land dealing and illegal fund raising in the name of developing “orchard”
or “manor”. In order to further strengthen the management of land transfer, to prevent the fashion of speculative land dealing, to
keep the stability in rural areas, to protect the interests of farmers, and to ensure the healthy and sustainable development of
economy and society, upon the examination and approval of the Premiers’ working conference of the State Council, the issues concerning
strengthening management of land transfer and strictly banning speculative land dealing are announced as follows:

    1.Strictly control the total amount of land used for urban and rural construction, decisively curb illegal
occupying of land for non-agricultural construction

    The construction of cities, villages and towns should not exceed the land use scale set in the overall plan
for land use, in cities the newly increased land for construction and the original land for construction should be uniformly controlled
in a way of aggregate supply and demand,   and the land cannot be supplied exceeding the plan; where the idle land may
be used in a variety of construction, such idle land must be used, the occupying of land for agriculture should not be approved,
for localities where idle land are not fully used, their index for transfer use of agricultural land should be deducted for the next
year.

    The residential sites in rural areas should be strictly controlled in scale and scope, land for building new
houses should be approved in strict accordance with the plan, the newly built houses should be gradually centralized towards core
villages and small towns town. The construction of core villages and small towns should be rationally laid out and planned in a unified
way, the agricultural land should not be arbitrarily occupied or requisitioned. The form of land supply and the relationship of property
right of land should be clearly identified in the construction of small towns, so as to prevent the occurrence of disputes arising
from land property ownership.

    The land used by township enterprises must be strictly controlled in the scope of land for construction of
cities, villages and towns set in the overall plan for land use, the buildings and structures not conforming to the overall plan
for land use should not be re-built or enlarged and should be adjusted and centralized step by step along with the reform of township
enterprises and the cleaning up of land.

    The scope of land for service areas along express ways should be strictly controlled, farmland along the both
sides of highways, if comforting to requirements, must be included into protection areas for capital farmland.

    2.Strengthen the management of transfer of land collectively owned by farmers, strictly ban illegal occupancy
of land collectively owned by farmers for developing real estate.

    The use right of land collectively owned by farmers cannot be transferred, conveyed, or rented for non-agricultural
construction; as for the township enterprises that conform to the plan and have legally obtained the use right of construction land,
if their land use rights have to be conveyed owing to bankruptcy or merger, they should undergo examination and approval procedures
in strict accordance with law.

    Farmers’ residences cannot be sold to urban residents, and urban residents should not be approved to occupy
land collectively owned by farmers to build residences, the relevant departments should not issue land use license and real estate
certificate for illegally-built or bought residence.

    The circumstances that unapproved and arbitrary transference of land collectively owned by farmers into construction
land should be cleaned up earnestly. Those that do not conform to the overall plan for land use should be resumed back to agricultural
purposes within a specified time limit, and returned to the original contractor of land collectively owned by farmers; for those
that conform to the overall plan, procedures for using land must be undertaken according to law.

    3.Strengthen land management of agricultural and forestry development projects, ban the requisition of land
collectively owned by farmers to carry out agricultural and forestry development such as “orchard” or “manor”

    The agricultural and forestry development projects must conform to the overall plan for land use and the annual
plan for land use, the ownership of land right and types of land must be strictly examined, no unit or individual may carry out land
development activities within reclamation-forbidden areas defined by the overall plan for land use.

    The procedures for using land must be go through in strict accordance with the relevant provisions of the
Land Administration Law of the People’s Republic of China, in carrying out agricultural and forestry development projects, no unit
or individual may privately sign an agreement of land use rural collective economic organization, it is prohibited to obtain the
land collectively owned by farmers in the way of requisition to carry out agricultural and forestry development such as “orchard”
or “manor”

    Where the agricultural and forestry development is carried out by using State-owned land in a form of contractual
management, a contractual agreement for State-owned land must be signed, in which the rights and obligations of both parties must
be agreed upon.

    The agricultural and forestry development projects must use the land in strict accordance with the approved
planned purposes, it is strictly prohibited to change the purpose for agriculture and forestry to carry out real estate development
such as villas, holiday-spending houses or entertainment facilities, where not-agricultural construction is really necessary, the
examination and approval procedures for construction use land must be gone through according to law. For those belonging to basic
construction projects, the examination and approval procedures must be through in strict accordance with the procedures for capital
construction. Only after the construction projects have been approved, may the procedures for using land for construction be gone
through, it is strictly prohibited to use land before approval.

    4.Strengthen supervision of land used for development, forbid developing land for illegal financing.

    The land for developing projects for agriculture and forest must be registered. The conditions for conveyance
or renting must be obviously stipulated. Conveyance or renting with no approval is forbidden. If the acquisition of the land use
right is through auction or conveyance and the land is collectively owned and not in use, only after payment is fulfilled and pre-development
is finished, can conveyance, renting, mortgage, contracting and other forms be used to obtain the land use right. With no permission
of renter or original owner, no sub-contract, rent, conveyance, mortgage may be carried out.

    The People’s Bank of China should strengthen management of credit and loan for developing projects for agriculture
and forest, contribute more efforts to the supervision and investigation and punishment to the illegal fund raising acts in the name
of land development or land transfer. As to land for development the payment of which is not completed and the use right of which
is not acquired, the banks concerned should permit the mortgage of it.

    Administrative departments for industry and commerce must strengthen management of enterprises engaged in
developing land, strictly examine their operation scope. These enterprises cannot use “attracting trade” and other informal diction,
should not engage in illegal financial activities; for attracting shareholders to develop land, no matter in the form of selling
or conveyance or any other form, the enterprises should proceed the procedure of enterprise registration according to the Company
Law of the People’s Republic of China. Operation of those enterprises must be strictly supervised. The enterprises, which exceed
their operation scope, must be investigated and punished. As to the enterprises engaged in illegal financial activities, once being
identified, their license should be revoked and the parties concerned should be investigated for liability.

    5.Standardise the transaction of state-owned land, ban speculative land dealing

    Land used for trade, tourism, entertainment, and luxurious houses, in principal, should be supplied in the
way of bidding or auction. Conveyance, rent, or mortgage of transferred land for the first time must conform to the provisions of
law and the requirements agreed upon in the transference contract, those not conforming to the requirements should not be conveyed,
rented or mortgaged. The use right of conveyance and rent of allocated land should be approved by the people’s governments with approving
authorities.

    It is prohibited to speculatively trade land in disguised forms by using construction projects, planning license
or land use sketch with red line. For a construction project of which the project has been approved, if its construction use land
conforms to the land use plan, the procedures for using land must be gone through within a specified time limit.

    Where transaction of the land use right is involved in the reformation and restructuring of a state-owned
enterprise, the land should not be sold at low price, and a schedule for settling land assets should be worked out, the enterprises
subordinated to the Center Government should choose the schedules which may abate the burden of the central finance and submit them
to the competent department of land administration under the State Council for approval.

    As to transaction of land use right is involved in the marketing of purchased public residents or economical
and applicable residents, the returns from land must be turned over to the State.

    6.Comprehensively clean up land conveyance and speculative land trading, decisively investigate and punish
illegal conveyance of land use right and illegal transaction of land collectively owned by farmers

    The people’s governments of provinces, autonomous regions and municipalities directly under the Central Government
should organize a comprehensive cleaning up of the illegal land conveyance and speculative land trading within their respective administrative
areas. The emphasis should be put on the areas connecting cities and villages, especially the illegal used land along highways on
which structures, buildings are privately, or disorderly built. For those that conforming to the overall plan for land use but not
undergoing the relevant procedures according to the provisions, it must be gone through within a specified time limit, where no declaration
is made by the expiration of the time limit, the matter should be investigated and punished as illegal occupancy of land.

    Examine those land-using projects for attracting trade and selling land with the post_titles of “orchard” or “manor”;
in accordance with the principle of “Who ratified will be responsible”, properly deal with the problems. As to those violating regulations,
the party concerned will be examined and punished. If their conduct is serious enough to be regarded as crime, the judiciary will
investigate and punish them. Before the examination completes, approval of the projects for “orchard”, “manor” or “agriculture for
visiting” should be stopped. Perfect the report system, strengthen the supervision by the people and the media, timely punish the
conduct of speculative land dealing  

    The relevant departments of the State Council and the people’s governments of provinces, autonomous regions
and municipalities directly under the Central Government should seriously implement the spirit of this Circular, formulate corresponding
implementing measures and related implementing rules, ensure the implantation of the provisions on strengthening the management of
land conveyance and strictly banning speculative land dealing.

    The people’s governments of provinces, autonomous regions and municipalities directly under the Central Government
should report the circumstances of the cleaning up of land conveyance and speculative land dealing to the State Council by the end
of December 1999. The State Council is to instruct the Ministry of Land and Resources, together with the other departments, to take
the responsibility in supervising and checking the implementation and fulfillment of this Circular, and regularly report to the State
Council.





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CONSTITUTION ACT, 1982 – page 22

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

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

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