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CHINESE-FOREIGN JOINT VENTURES

The Law of the PRC on Chinese-Foreign Joint Ventures

    

(Adopted by the Second Session of the Fifth National People’s Congress on July 1, 1979 and Promulgated on and Effective as of July
8, 1979)

   Article 1.

With a view to expanding international economic co-operation and technical exchange, the People’s Republic of China permits foreign
companies, enterprises, other economic organizations or individuals (hereafter referred to as “foreign joint venturers” ) to join
with Chinese companies, enterprises or other economic organizations (hereafter referred to as “Chinese joint venturers”) in establishing
joint ventures in the People’s Republic of China in accordance with the principle of equality and mutual benefit and subject to approval
by the Chinese Government.

   Article 2.

The Chinese Government protects, in accordance with the law, the investment of foreign joint venturers, the profits due them and their
other lawful rights and interests in a joint venture, pursuant to the agreement, contract and articles of association approved by
the Chinese Government.

All the activities of a joint venture shall comply with the provisions of the laws, decrees and pertinent regulations of the People’s
Republic of China.

   Article 3.

The joint venture agreement, contract and articles of association signed by the parties to the venture shall be submitted to the Foreign
Investment Commission of the People’s Republic of China, and the Commission shall, within three months, decide whether to approve
or disapprove them. After approval, the joint venture shall register with the General Administration for Industry and Commerce of
the People’s Republic of China, obtain a license to do business and start operations.

   Article 4.

A joint venture shall take the form of a limited liability company.

The proportion of the investment contributed by the foreign joint venturer(s) shall generally not be less than 25 per cent of the
registered capital of a joint venture.

The parties to the venture shall share the profits, risks and losses in proportion to their respective contributions to the registered
capital.

No assignment of the registered capital of a joint venturer shall be made without the consent of the other parties to the venture.

   Article 5.

Each party to a joint venture may make its investment in cash, in kind or in industrial property rights, etc.

The technology and the equipment that serve as a foreign joint venturer’s investment must be advanced technology and equipment that
actually suit our country’s needs. If the foreign joint venturer causes losses by deception through the intentional use of backward
technology and equipment, it shall pay compensation for the losses.

The investment of a Chinese joint venture may include the right to the use of a site provided for the joint venture during the period
of its operation. If the right to the use of the site does not constitute a part of a Chinese joint venturer’s investment, the joint
venture shall pay the Chinese Government a fee for its use.

The various investments referred to above shall be specified in the joint venture contract and articles of association, and the value
of each (excluding that of the site) shall be jointly assessed by the parties to the venture.

   Article 6.

A joint venture shall have a board of directors, which shall have its size and composition stipulated in the contract and the articles
of association after consultation between the parties to the venture, and the directors shall be appointed and replaced by the parties
to the venture. The board of directors shall have a chairman, whose office shall be assumed by the Chinese joint venture(s), and
one or two vice-chairmen, whose office(s) shall be assumed by the foreign joint venture(s). In handing major problems, the board
of directors shall reach a decision through consultation by the parties to the venture, in accordance with the principle of equality
and mutual benefit.

The board of directors is empowered, pursuant to the provisions of the articles of association of the joint venture, to discuss and
decide all major problems of the venture: expansion programs, proposals for production and operating activities, the budget for revenues
and expenditures, distribution of profits, plans concerning manpower and pay scales, the termination of business and the appointment
or employment of the president, the vice-president(s), the chief engineer, the treasurer and the auditors, as well as their powers
and terms of employment, etc.

The offices of president and vice-president(s) (or factory manager and deputy manager(s)) shall be assumed by the respective parties
to the venture.

The employment and dismissal of the staff and workers of a joint venture shall be provided for in accordance with the law in the agreement
and contract of the parties to the venture.

   Article 7.

After payment out of the gross profit earned by the joint venture of the joint venture income tax, pursuant to the provisions of the
tax laws of the People’s Republic of China, and after deduction from the gross profit of a reserve fund, a bonus and welfare fund
for staff and workers, and a venture expansion fund, as provided in the articles of association of the joint venture, the net profit
shall be distributed to the parties to the joint venture in proportion to their respective contributions to the registered capital.

A joint venture that possesses advanced technology by world standards may apply for a reduction of or exemption from income tax for
the first two to three profit- making years.

A foreign joint venturer that reinvests in China its share of the net profit may apply for refund of a part of the income taxes already
paid.

   Article 8.

A joint venture shall open an account with the Bank of China or a bank approved by the Bank of China.

The pertinent foreign exchange transactions of a joint venture shall be conducted in accordance with the regulations on foreign exchange
control of the People’s Republic of China.

In its operating activities a joint venture may directly raise funds from foreign banks.

The various kinds of a insurance coverage of joint venture shall be furnished by Chinese insurance companies.

   Article 9.

The production and operating plans of a joint venture shall be filed with the departments in charge and shall be implemented through
economic contracts.

In its purchase of required raw and processed materials, fuels, parts and auxiliary equipment, etc., a joint venture should give first
priority to purchases in China. It may also purchase them directly from the international market with foreign exchange raised by
itself.

A joint venture is encouraged to market its products outside China. Export products may be distributed to foreign markets through
the joint venture directly or through associated agencies, and they may also be distributed through China’s foreign trade agencies.
Products of the joint venture may also be distributed in the Chinese market.

Whenever necessary, a joint venture may establish branches outside China.

   Article 10.

The net profit that a foreign joint venturer receives after fulfilling its obligations under the laws and the agreement and the contract,
the funds it receives at the time of the joint venture’s scheduled expiration or early termination, and its other funds may be remitted
abroad through the Bank of China in accordance with the foreign exchange regulations and in the currency specified in the joint venture
contract.

A foreign joint venturer shall be encouraged to deposit in the Bank of China foreign exchange that it is enpost_titled to remit abroad.

   Article 11.

The wages, salaries and other legitimate income earned by the foreign staff and workers of a joint venture, after payment of the individual
income tax under the tax laws of the People’s Republic of China, may be remitted abroad through the Bank of China in accordance with
the foreign exchange regulations.

   Article 12.

The contract period of a joint venture may be decided through consultation by the parties to the venture according to its particular
line of business and circumstances. Upon the expiration of the joint venture contract period, if the parties have agreed, the period
may be extended, subject to approval by the Foreign Investment Commission of the People’s Republic of China. An application for extension
of the contract shall be made six months before expiration of the contract.

   Article 13.

Before the expiration of the joint venture contract period, in case of heavy losses, failure of a party to fulfill the obligations
prescribed by the contract and the articles of association, force majeure, etc., the contract may be terminated before the date of
expiration through consultation and agreement by the parties to the venture, subject to approval by the Foreign Investment Commission
of the People’s Republic of China and to registration with the General Administration for Industry and Commerce. In cases of losses
caused by a breach of contract, the financial responsibility shall be borne by the party that has violated the contract.

   Article 14.

Disputes arising between the parties to a joint venture that the board of directors cannot settle through consultation may be settled
through mediation or arbitration by a Chinese arbitration agency or through arbitration by another arbitration agency agreed upon
by the parties to the venture.

   Article 15.

This Law shall come into force on the day of its promulgation. The power to amend this Law is vested in the National People’s Congress.

(The English translations are for reference only)

    





PROVISIONS ON LABOUR MANAGEMENT IN CHINESE-FOREIGN EQUITY JOINT VENTURES

Category  LABOUR ADMINISTRATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1980-07-26 Effective Date  1980-07-26  


Provisions on Labour Management in Chinese-foreign Equity Joint Ventures


Notes:

(Promulgated by the State Council on July 26, 1980)

    Article 1  Labour management problems concerning Chinese-foreign equity
joint ventures (hereinafter referred to as “joint ventures”) shall all be
handled in accordance with these Provisions, in addition to the pertinent
stipulations in Article 6 of the Law of the People’s Republic of China on
Chinese-Foreign Equity Joint Ventures.

    Article 2  Matters pertaining to employment, dismissal and resignation of
the workers and staff members, tasks of production and other work, wages and
awards and punishment, working time and vacation, labour insurance and
welfare, labour protection and labour discipline in joint ventures shall be
stipulated in the labour contracts signed.

    A labour contract is to be signed by a joint venture and the trade union
organization in the joint venture collectively. A relatively small joint
venture may sign contracts with the workers and staff members individually.

    A signed labour contract must be submitted to the labour management
department of the government of the province, autonomous region or
municipality directly under the Central Government for approval.

    Article 3 (Note (1))  The workers and staff members of a joint venture
either recommended by the authorities in the locality in charge of the joint
venture or the labour management department, or recruited by the joint venture
itself with the consent of the labour management department, shall all be
selected by the joint venture through rigorous examinations.

    Joint ventures may run workers’ schools and training courses to train
managerial personnel and skilled workers.

    Article 4  With regard to the workers and staff members who become
redundant as a result of changes in production and technical conditions of the
joint venture, those who fail to meet the requirements after training and are
not suitable for other jobs in the joint venture can be discharged. However,
this must be done in accordance with the stipulations in the labour contract
and the enterprise must give compensation to these workers.

    The dismissed workers and staff members will be assigned to other jobs by
the authorities in charge of the joint venture or the labour management
department.

    Article 5 (Note (2))  The joint venture may, according to the degree of
seriousness of the case, take action against those workers or staff members
whose violation of the rules and regulations of the enterprise has resulted in
certain bad consequences. Punishment by discharge must be reported to the
authorities in charge of the joint venture and the labour management
department for approval.

    Article 6 (Note (3))  With regard to the dismissal and punishment of
workers and staff members by the joint venture, the trade union has the right
to raise objections if it considers them unreasonable, and send
representatives to seek a solution through consultation with the board of
directors. Should the consultation fail to arrive at a solution, the matter
shall be handled in accordance with the procedures set forth in Article 14 of
these Provisions.

    Article 7  When workers and staff members of a joint venture, on account
of special circumstances, submit their resignation to the enterprise through
the trade union in accordance with the labour contract, the enterprise shall
give its consent.

    Article 8  The pay levels of workers and staff members in a joint venture
shall be determined at 120-150% of the real wages of workers and staff members
of state-owned enterprises of the same trade in the locality.

    Article 9  The wage standards, the forms of payment, and bonus and subsidy
systems are to be discussed and decided by the board of directors.

    Article 10  The rewards and welfare funds drawn by the joint venture from
the profits must be used as rewards and collective welfare and shall not be
diverted to other uses.

    Article 11  A joint venture must pay for the Chinese workers’ and staff
members’ labour insurance, cover their medical expenses and various kinds of
government subsidies in the line with the standards obtaining in state-owned
enterprises.

    Article 12  The employment of foreign workers and staff members and their
dismissal, resignation, pay, welfare and social insurance and other relevant
matters shall all be specified in the employment contracts.

    Article 13  Joint ventures must implement the relevant rules and
regulations of the Chinese Government on labour protection and ensure safety
in production and civilized production. The labour management department of
the Chinese Government has the right to supervise and inspect their
implementation.

    Article 14  Labour disputes occurring in a joint venture shall first of
all be solved through consultation by the two parties. If consultation fails
to arrive at a solution, either party or both parties may request arbitration
by the labour management department of the people’s government of the
province, autonomous region or municipality directly under the Central
Government where the joint venture is located. Either party that disagrees to
the arbitration award may file a suit at a people’s court.

    Article 15  The power of interpretation of these Provisions resides in the
State Bureau of Labour of the People’s Republic of China.

    Article 16  These Provisions shall come into force as of the date of
promulgation.

Notes:

    Note (1)  The provisions of this Article are no longer effective. The
relevant provisions now in force are those contained in Article 1 of the
Circular of the General Office of the State Council on the Approval and
Transmission of the Proposals Submitted by the Ministry of Labour and the
Ministry of Personel Concerning Further Implementation of the Policy of
Granting Decision-making Power to Enterprises with Foreign Investment for the
Employment of Working Personel, issued on May 5, 1988. – The Editor

    Note (2)  The provision “Punishment by discharge must be reported to the
authorities in charge of the joint venture and the labour management
department for approval” as stipulated in this Article is no longer effective.
The relevant provisions now in force are those contained in Article 10 of the
Measures for Implementation of the Regulations on Labour Management in
Chinese-Foreign Equity Joint Ventures, promulgated by the Ministry of Labour
and Personnel with the approval of the State Council on January 19, 1984.
– The Editor

    Note (3)  The provisions of this Article are no longer effective. The
relevant provisions now in force are those contained in Article 5 of the
Circular of General Office of the State Council on the Approval and
Transmission of the Proposals Submitted by the Ministry of Labour and the
Ministry of Personel Concerning Further Implementation of the Policy of
Granting Decision-making Power to Enterprises with Foreign Investment for the
Employment of Working Personel, issued on May 5, 1988. – The Editor





MEASURES FOR PROVIDING SHORT-TERM LOANS IN FOREIGN CURRENCY BY THE BANK OF CHINA

Category  BANKING Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1980-08-30 Effective Date  1980-08-30  


Measures for Providing Short-term Loans in Foreign Currency by the Bank of China


Chapter I  Eligible Borrowers and the Purposes for which Loans are to
Chapter II  Conditions for Borrowing
Chapter III  Applications for and Utilization of Loans, and Examination
Chapter VII  Loan Administration
Chapter VIII  Supplementary Provisions

(Approved and promulgated by the State Council on August 30, 1980)

    These Measures for providing short-term loans in foreign currency are
hereunder formulated with a view to speeding up the socialist modernization
programme and, on the basis of self-reliance and by using the foreign currency
funds absorbed by the Bank of China, developing production of exports and
other economic under-takings and increasing foreign exchange earnings as well.
Chapter I  Eligible Borrowers and the Purposes for which Loans are to
be Used

    Article 1  Loans are to be granted to export-oriented industries and
other enterprises earning foreign exchange income directly or indirectly
who can meet the conditions for borrowing. The loans are primarily for
encouraging export-oriented industries to tap production potential and to
support their renovations and retooling old plants and equipments.

    Article 2  The loans are to be used for:

    a. financing imports of advanced technology, equipment and materials
essential to upgrading the borrower’s productivity and the quality, variety
and packaging of export goods;

    b. financing imports of raw materials and components to be processed for
export;

    c. developing transportation and tourism and carrying out engineering
projects contracted in foreign countries;

    d. supporting the processing of raw materials and assembling of parts
supplied by foreign buyers, and supporting compensatory trade; and

    e. providing short-term working capital to production projects that
generate foreign exchange directly or indirectly.
Chapter II  Conditions for Borrowing

    Article 3  Applicants for loans must meet the following requirements:

    a. Marked economic results: Preference is given to borrowers who are able
to earn more foreign exchange in proportion to the money invested and repay
bank loans sooner. Borrowers should be able to run their enterprises
efficiently, make the most of the imported advanced technology, equipment
and raw materials, tap their production potential, renovate obsolete plants
and equipment, enhance the competitiveness of their export goods in the
international markets, thereby earning more foreign exchange and accumulate
more funds for the country.

    b. Assurance of repayment: Borrowers must give evidence of a reliable
source of foreign exchange income and the ability to repay loans plus
interest for which they are required to submit a schedule of repayment.

    Where loans are granted to the export-goods industry, the increased
output attributed to the loan should be primarily for export and not be
included in the state domestic marketing plan. The income from the increased
output and the export proceeds in foreign exchange should first be set aside
for repayment of the bank loan. In case the goods are to be turned over to
a foreign trade corporation for export, the borrower should sign a sales
contract with this corporation which commits the latter to repay the bank
loan in foreign exchange for the borrower.

    Enterprises not directly related to the export trade must submit a
document of approval signed by the competent department committing the
latter to repay the loan from its own foreign exchange income. When
necessary, the bank may demand that some organization that has a regular
foreign exchange income stands surety for the borrower.

    c. Availability of domestic factors of production to make imported
materials and equipment operational: Domestic factors of production refer
to factory buildings, equipment, steam, water, electricity and fuel, raw
materials, labour force, technological expertise and funds in Renminbi
requisite to making the imported equipment and materials operational. These
items must be duly arranged and approved by the Planning Commission or the
competent authorities who have to list them in their plans or sign contracts
with the borrower.

    d. With respect to the items mentioned above, borrowers should obtain
prior approval of higher authorities for those items that require allotment of
funds for capital construction or technological installations.
Chapter III  Applications for and Utilization of Loans, and Examination
and Approval of Applications

    Article 4  Applications for loans should be submitted to the Bank of
China (or People’s Bank of China where the Bank of China does not operate)
together with the following supporting documents: a document evidencing the
approval of the proposed project by the department in charge; a list of
imports the loan is to finance; a schedule proving the domestic factors of
production are available and a copy of the contract; a document approved by
the department in charge showing that counterpart funds in Renminbi have
been earmarked for repayment of the amount of Renminbi required for the
import of the equipment. In the case of a project where the producer needs
to repay the loan with earnings from the export of its products, the
producer should conclude with a foreign trade department a contract or an
agreement on production and sales, and on the repayment of the foreign
currency borrowed.

    Article 5  Applications for loans by the departments under the State
Council shall be examined item by item against the prerequisites for
borrowing by the head office of the Bank of China. Applications by local
departments and enterprises shall be reviewed by the Bank of China’s  regional
branches in the provinces, municipalities and autonomous regions within the
bounds of their respective loan quotas assigned by the head office. Cases
that need to be reviewed by the head office or ministries concerned should
be submitted to them for approval. In examining the applications, the Bank
should keep in touch with the departments in charge and work in close
cooperation with them.

    Article 6  After the application is approved, the borrower should sign a
loan agreement, open a loan account with the Bank of China and place an order
for imports. If the borrower fails to sign the loan agreement or submit a
list of imports within the specified time, the Bank may revoke its approval
of the loan. The list of imports must be signed by the Bank before the
order is placed. Without the approval of the Bank, neither the purpose
for which the loan is to be used nor the descriptions and quantities of
imports should be changed. The borrower should submit to the Bank a copy of
the contract signed with a foreign trader who provides the goods. The Bank
should help the borrower to make the best use of the loan.

    Article 7  For a substantial loan, the borrower should submit a quarterly
withdrawal plan according to which the Bank will arrange the funds. In case
the plan needs to be adjusted because of poor planning or unexpected changes
of circumstances, the borrower should apply to the Bank for adjustment a
month before the end of the quarter. For failure to carry out the plan, the
borrower shall bear additional bank charges on the amount of the  withdrawal
falling short of, or in excess of, the planned amounts so as to compensate
the Bank for losses in raising funds from abroad.

    Chapter IV  Term of Loans and Rates of Interest

    Article 8  The term of the loan is to begin from the day of the
withdrawal to the day of repayment of the principal and interest. The term
of loans for importing raw materials and components to be processed for
export is normally 1 year. The term of loans for importing equipment or
materials to be used in making equipment, and that of loans for other
purposes shall not exceed 3 years. Where loans take the form of buyers’
credits, the maturity shall not exceed 5 years.

    Article 9  The interest rates for loans are to be determined and made
public by the head office of the Bank of China on the basis of the cost of
raising funds on the international money markets plus its handling charges.

    Chapter V  Repayment of Loans

    Article 10  The borrower shall, in keeping with the loan agreement,
repay the principal before the loan runs out, and pay the interest regularly
to the Bank. If the borrower fails to repay, the surety is responsible for
repayment. If necessary, the Bank of China or the People’s Bank of China
may force repayment by debiting the foreign currency deposit account of the
borrower or the surety (or by writing of the foreign exchange quota alloted
to the borrower and seizing his counterpart funds in Renminbi earmarked for
the purchase of the foreign exchange quota).

    Article 11  A borrower who has a regular foreign exchange income should
repay the loan from its foreign exchange earnings. A borrower who is not
directly involved in the export trade should repay the loan from export
proceeds received through a foreign trade corporation.

    This corporation or some other organization which stands surety for the
borrower should issue a certificate to “repay foreign exchange quota”
against which the borrower may purchase foreign exchange with Renminbi from
the Bank of China to repay the loan.

    Foreign exchange earnings from processing raw materials and assembling
parts provided by foreign buyers or earnings from compensatory trade must
first be set aside for repayment of the loan.

    Article 12  Loans made to finance a construction project by a state-owned
enterprise may be repaid out of profits derived from the increased output, out
of depreciation reserves for fixed assets, or out of changes payable to the
government for the use of fixed assets. Enterprises that are authorized to
retain a portion of their profits may make repayment from the retained profits
after deductions for the staff’s welfare fund and bonus fund. However,
deductions for the production development fund and for retention of increased
profits are not allowed. Loans to collectively owned township enterprises may
be repaid out of profits derived from the increased output (profits before tax)
or from depreciation reserves for fixed assets. The department in charge is
not allowed to collect profits or demand payment out of the project financed
by the bank loan before the loan is repaid. If the above-mentioned funds are
sufficient to repay the loan and a surplus remains, income tax shall be paid
on the surplus or a percentage of profits shall be turned over to the
government as required. If not, the deficit may, with the consent of the tax
authorities, be covered by the industrial and commercial tax on the increased
output which would otherwise be collected. When applying for the loan, the
borrower should send a copy of the application to the tax authorities for the
record.

    Chapter VI  Buyers’ Credits

    Article 13  When loans are provided in the form of the buyers’ credits,
the following rules shall apply, apart form other provisions in the Measures:

    a. The borrower must abide by the provisions in the buyer’s credit
agreement that the Bank of China has signed with a foreign bank and must
place orders for imports from the country in which the foreign bank is
located.

    b. The borrower must indicate in the order for imports that the buyer’s
credit is to be used for payment. The commercial contract signed between a
Chinese foreign trade corporation and the foreign seller should indicate
the name of the bank providing the buyer’s credit.

    c. At the time the commercial contract is signed, the Bank of China
shall negotiate with the foreign bank providing the buyer’s credit and sign
an agreement on the drawdown of the credit. The agreement shall be signed
by head office of the Bank of China or by one of its branches with its
authorization.
Chapter VII  Loan Administration

    Article 14  Choosing the best possible loanees. The Borrower must
maximize the effective productivity of the loan by relying on cost
accounting. Preference is given to the borrower who earns more foreign
exchange in proportion to the amount of the loan granted and makes repayment
sooner. The borrower who performs poorly or who is unable to repay his loan
upon maturity, will not receive further loans until he shows improvement in
management.

    Article 15  Clearly specifying the responsibilities. Both the Bank and
the borrower shall abide by the loan agreement: the Bank undertakes to
provide the loanable funds; the borrower undertakes to draw on the loan and
utilize its productive potential effectively. The Bank shall raise the
interest by 10-50% for overdue loans counting from the maturity date, and
by 100% for loans diverted to uses other than those authorized by the bank.

    Article 16  Exercising bank supervision. The Bank shall inquire into each
project before financing it, examine the borrower’s application before
approving it and oversee the performance of the borrower after the loan is
granted. The Bank has the duty to help the borrower achieve its economic
goals. In this way the bank shall fulfil its role of promoting, regulating
and supervising the economic activities of the borrower.

    For large loans, the Bank shall sit in on the negotiations between the
borrower and the foreign supplier and make suggestions as to the preferred
currency for making payment and the method of payment. The borrower must
provide the bank with all necessary information, documents, statistics and
a duplicate of the relevant contract.

    The borrower shall be held accountable for violation of government
decrees and policies; failure to abide by the regulations, the contract or
the agreement; dissipation of foreign exchange; or failure to repay the loan
when due. At the same time the Bank may take such disciplinary actions as
suspending or recalling the loan before maturity, raising the interest rate
or even suing the borrower in a court of law.
Chapter VIII  Supplementary Provisions

    Article 17  On the date these Measures come into force, Regulations for
Providing Short-term Loans in Foreign Currency, issued by the Ministry of
Finance on September 29, 1978, shall no longer be valid except for loans and
loan agreements previously approved and signed. Rules for the implementation
of these Measures shall be formulated separately by the Bank of China.





INTERIM PROVISIONS OF THE SPECIAL ECONOMIC ZONES IN GUANGDONG PROVINCE FOR THE CONTROL OF PERSONNEL ENTERING AND LEAVING CHINAA

CIRCULAR OF THE STATE COUNCIL CONCERNING THE CUTTING DOWN THE STATE’S FOREIGN EXCHANGE EXPENDITURE IN THE INTERNATIONAL AIR TRANSPORT OF PASSENGERS, CARGOES AND MAIL

Category  CIVIL AVIATION Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1981-07-24 Effective Date  1981-07-24  


Circular of the State Council Concerning the Cutting Down the State’s Foreign Exchange Expenditure in the International Air Transport
of Passengers, Cargoes and Mail

(July 24, 1981)

    The following Circular is hereby issued with reference to the general
practice of various countries in the world for the purpose of safeguarding
the State’s interests, cutting down the State’s foreign exchange expenditure
and developing China’s civil aviation undertakings:

    All Chinese and foreigners who are travelling at the expense of the
relevant units of China (including private individuals who are going abroad
with foreign exchange paid by the Bank of China) on international routes where
the Civil Aviation Administration of China (CAAC) operates its flights
(whether they are going abroad, or returning to China, or travelling between
two localities abroad) shall take CAAC flights; cargoes that are to be
transported by air shall also be carried by the CAAC if the Transport expense
is to be covered by the State; and, when the time limit for delivery is the
same, the CAAC shall have the priority of carrying airmail. The CAAC shall
grant appropriate preferential treatment at its discretion. Under special
circumstances, where emergencies render it impossible to wait until CAAC
flights are available, the carrying may be performed by foreign airlines
through the arrangement by the CAAC; the CAAC shall issue a certificate
to facilitate the reimbursement of the expenses thus incurred. Violators of
the aforesaid provisions may not have their expenses reimbursed by their
respective finance departments.

    Various regions and departments are requested to earnestly implement the
aforesaid provisions and the Civil Aviation Administration of China and the
Ministry of Finance shall supervise the implementation thereof.





INTERIM REGULATIONS ON NOTARIZATION

Interim Regulations of the PRC on Notarization

     (Effective Date 1982.04.13–Ineffective Date )

PART I GENERAL RULES

   Article 1. These Regulations are formulated in order to perfect our state notarization system, protect the socialist legal system, prevent
disputes and reduce lawsuits.

   Article 2. Notarization means that the state notarial organization, upon the application of a party concerned, certifies according to law the
authenticity and legality of a legal act, a document or a fact of legal significance so as to protect public property and a citizen’s
rights and legitimate interests in status and property.

   Article 3. A notary’s office is a state notarial organization. A notary’s office shall teach citizens to abide by the law and protect the
socialist legal system through the notarization activities.

PART II THE BUSINESS OF A NOTARY’S OFFICE

   Article 4. The business of a notary’s office is as follows:

(1) To certify contracts (or agreements), commissions and testaments;

(2) To certify rights of inheritance;

(3) To certify the presentation or separation of property;

(4) To certify adoptive relations;

(5) To certify family relations;

(6) To certify status, record of formal learning or career;

(7) To certify birth, marriage, existence or death;

(8) To prove the signatures and/or seals on documents to be true;

(9) To prove the copies, abbreviated versions, translations or photostat copies of documents to tally with the originals;

(10) To certify the effect of enforcement on the documents used for demanding payment of debts or for claiming compensations if they
are considered to be beyond doubt;

(11) To preserve evidence;

(12) To take custody of testaments or other documents;

(13) To draw up the applications for netarization for the parties concerned;

(14) To handle other notarial affairs upon the applications of the parties concerned in accordance with international practice.

PART III THE ORGANIZATION AND LEADERSHIP OF A NOTARY’S OFFICE

   Article 5. A notary’s office shall be set up in a municipality directly under the Central Government, a county (or an autonomous county, the
same hereinafter) or a city. A notary’s office shall also be set up in a district under the jurisdiction of a city with the approval
of the judicial administration authorities of the province, autonomous region or municipality directly under the Central Government.

   Article 6. A notary’s office shall be under the control of the judicial administration authorities.

There are no subordinate relations between notaries’ offices.

   Article 7. A notary’s office shall be provided with notaries and assistant notaries. It shall be provided with a director or vice-director(s)
as required.

The posts of the director or vice-director(s) shall be held by notaries. The director and/or vice-director(s) shall exercise control
over the business of a notary’s office and carry out the duties of notaries.

The director, vice-director(s),notaries and assistant notaries shall be appointed or dismissed respectively in accordance with the
provisions for the administration of cadres by the people’s government of a municipality directly under the Central Government, a
county or a city.

   Article 8. A citizen who has the right to vote and to stand for election shall be appointed notary if he or she possesses any of the following
qualifications:

(1) Graduation from the law speciality of an institution of higher learning, having passed probation and been engaged in a judicial
job or in law teaching or law studies for more than one year;

(2) Service as a judge or a procurator in a people’s court or in a people’s procuratorate;

(3) Judicial vocational work in judicial administration authorities for more than two years, or work in another state organization,
body, enterprise or institution for more than five years, and a knowledge of law equal to that of a graduate from a secondary law
school;

(4) The post_title of assistant notary for more than two years.

   Article 9. A graduate from a higher law instiution or a secondary law school who has passed probation, or a state worker who has the same educational
qualification shall be appointed assistant notary.

PART IV JURISDICTION

   Article 10. Notarial affairs shall be under the jurisdiction of the notary’s office at the location of the applicant’s household register or
at the place of occurrence of the legal act or fact.

   Article 11. The notarial affairs relating to the transfer of property shall be under the jurisdiction of the notary’s office at the location
of the applicant’s household register or at the location of the principal property.

   Article 12. If the household registers of a number of applicants for the handling of the same notarial affair are not located within the area
under the jurisdiction of a notary’s office, or if the property is scattered in a number of areas under the jurisdiction of several
notaries’ offices, the parties concerned shall consult with each other and make the application to any of the notaries’ offices.
If the parties concerned fail to reach any agreement, the case shall be put under the jurisdiction of the notaries’ offices concerned
by means of consultation for the convenience of the people.

   Article 13. If jurisdiction disputes occur between the notaries’ offices, their common higher judicial administration authorities shall specify
the jurisdiction.

   Article 14. The Ministry of Justice and the judicial administration authorities of each province, autonomous region and municipality directly
under the Central Government shall be enpost_titled to assign a certain notarial affair to a certain notary’s office.

   Article 15. Our embassies and consulates accredited abroad shall handle notarial affairs at the request of our citizens in the countries where
they are accredited.

PART V THE PROCEDURE OF NOTARIZATION

   Article 16. In the application for notarization, the party concerned shall personally go to the notary’s office and make a written or verbal
application. If someone else is entrusted to do so, he shall present a power of attorney. However, an applicant for the certification
by a notary of a commission, statement, adoption of child, testament or signature and seal shall not entrust someone else to act
on his behalf; if the party has any real difficulty, the notary shall handle notarization at the party’s location.

The state organizations, bodies, enterprises and institutions shall dispatch their representatives to the notaries’ offices in making
applications for notarization. The representatives shall present powers of attorney.

   Article 17. A notary shall be prohibited from handling the notarial affairs applied for by himself or herself or his or her spouse or his or
her own or spouse’s close relatives, and also be prohibited from handling the notarial affairs in which he or his or her spouse has
interests.

A party concerned shall be enpost_titled to apply for the sidestepping of notaries.

   Article 18. A notary shall examine the status of a party concerned and his or her capacities in the exercise of rights and the fulfilment of
obligations; examine whether the facts, documents and related papers of which the party concerned applies for the notarization are
true and legal.

   Article 19. When a notary’s office considers the evidence supplied by the party concerned to be incomplete or doubtful, it shall be enpost_titled
to notify the party to make necessary supplements or make inquiries of the units or individuals concerned and ask for related papers
and materials. The units or individuals concerned shall be obliged to give assistance.

   Article 20. A notary shall make notarial deeds in the forms as stipulated or approved by the Ministry of Justice.

   Article 21. A copy of a notarial deed shall be kept on file after its completion. A number of copies shall be made and issued to the party
concerned together with the original in accordance with the needs of the party.

   Article 22. A notary’s office shall collect fees for handling notarial affairs. The procedures for the collection of notarial fees shall be
separately formulated by the Ministry of Justice.

   Article 23. All the notarial affairs handled by the notary’s office shall be kept confidential.

   Article 24. Either party concerned shall be enpost_titled to apply to the people’s court which has jurisdiction for the enforcement of the credit
document which has been notarized by a notary’s office to effect enforcement according to Clause (10) of Article 4 when the other
party is in breach of the provisions in the said document.

   Article 25. A notary’s office shall refuse to notarize untrue and illegal facts and documents. When the notary’s office refuses the party’s
application for notarization, it shall give the party the reasons for the refusal orally or in writing and explain the appeals procedure
if he or she disagrees with the reasons of the refusal.

If a party concerned disagrees with the reason of the refusal of a notary’s office or considers a notary to have handled his or her
application improperly, he or she shall make an appeal to the city or county judicial administration authorities at the location
of the office or to higher judicial administration authorities and the authorities concerned shall make a decision.

   Article 26. A notarial deed issued shall be cancelled if it is found to be improper or wrong by the notary’s office or the judicial administration
authorities at its same level or higher judicial administration authorities.

   Article 27. If a notarial deed applied for by a party concerned is intended to be used abroad, it shall also be submitted to the Ministry of
Foreign Affairs or the foreign affairs office of the province, autonomous region or municipality directly under the Central Government
and the embassy or consulate of the country concerned in China for attestation, in addition to being handled in the procedure as
stipulated in these Regulations. However, these procedures do not apply to those which are otherwise stipulated by the country where
the deed(s) is (are) to be sent and used or which are agreed by both parties to be exempt from consular attestations.

PART VI SUPPLEMENTARY PROVISIONS

   Article 28. These Regulations shall be applicable to the foreign citizens who live in China.

   Article 29. The Ministry of Justice shall be responsible for the interpretation of these Regulations.

   Article 30. These Regulations shall come into force on the date of promulgation.

    





PROVISIONS OF THE GENERAL CUSTOMS ADMINISTRATION AND THE MINISTRY OF FINANCE CONCERNING THE COLLECTION OF OR EXEMPTION FROM CUSTOMS DUTIES AND CONSOLIDATED INDUSTRIAL AND COMMERCIAL TAXES ON IMPORTS AND EXPORTS FOR THE CHINESE-FOREIGN COOPERATIVE EXPLOITATION OF OFFSHORE OIL

Category  CUSTOMS Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1982-04-01 Effective Date  1982-04-01  


Provisions of the General Customs Administration and the Ministry of Finance Concerning the Collection of or Exemption From Customs
Duties and Consolidated Industrial and Commercial Taxes on Imports and Exports for the Chinese-foreign Cooperative Exploitation of
Offshore Oil

Provisions
Appendix: Detailed Duty-free List of the Import Materials for the
Note:

(Approved by the State Council in February 28, 1982 and promulgated by the

General Customs Administration and the Ministry of Finance on April 1, 1982)
Provisions

    For the purpose of encouraging the Chinese-foreign cooperative
exploitation of offshore oil, the Customs duties and consolidated industrial
and commercial taxes on the imports and exports for oil operations are
stipulated as follows:

    1. The following imports shall be exempt from duties or taxs:

    (1) the machinery, equipment, spare parts and materials, the direct use of
which in prospecting operations has been verified and approved;

    (2) the machinery, equipment, spare parts and materials, the requirement
for the import of which has been verified and approved for direct use in
exploiting operation in accordance with Articles 19 to 21 of the Regulations
of the People’s Republic of china on the Exploitation of Offshore Petroleum
Resources in Cooperation with Foreign Enterprises;

    (3) the parts, components and materials, the requirement for the import
of which has been verified and approved for use in the manufacture in China
of the machinery and equipment to be used in offshore oil exploitation
operations (includings prospecting, well drilling, well cementation, well
survey, well logging, oil recovery, well repair, etc.);

    (4) machinery and other engineering equipment, which are temporarily
imported by foreign contractors for the exploitation of offshore oil, and of
which the re-export is guaranteed, shall be exempt from duties at the time
of import or re-export.

    2. The crude oil due to foreign contractors as stipulated in the contracts
shall be exempt from export duties when it is shipped abroad.

    3. Customs duties and consolidated industrial and commercial taxes shall,
in accordance with the Import and Export Duty Tariff of the Customs of the
People’s Republic of China and the Draft Regulations of the People’s Republic
of China on Consolidated Industrial and Commercial Taxes, be levied on the
imports or exports beyond the ranges stipulated in Article 1 and Article 2.

    4. The goods imported duty-free shall not be diverted to other use
without the vertification and approval by the Customs. Those who violate this
clause shall be dealt with by the Customs in accordance with the Interim
Customs Law of the People’s Republic of China.(Note 1.)
Appendix: Detailed Duty-free List of the Import Materials for the
Chinese-Foreign Cooperative Exploritation of Offshore Oil

    I.  Goods which are required and have been inspected and approved for
import and direct use in prospecting operations:

    1. Those for geophysical prospecting:

    (1) geophysical prospecting vessels and their integral accessories;

    (2) seismographs and their integral accessories and fittings; heavy
magnetometers and their fittings;

    (3) isobuoyant cables and their integral accessories;

    (4) data processing special-purpose electronic computers and their
integral accessories;

    (5) seismograph tapes;

    (6) shore platform positioning equipment and its accessory facilities.

    2. Those for well drilling:

    (1) various offshore drilling units, including self-elevating or semi-
submersible drill ships, floating drilling vessels, drilling platforms,
auxiliary vessels and service craft;

    (2) drilling machines and their components, accessories and fittings;

    (3) well comentation equipment and its accessory equipment, including
soot-blowing equipment;

    (4) well survey equipment and its accessory equipment, including
electrographs, pneumographs, inclinometers and other well loggers;

    (5) oil testing and well repairing equipment and its components,
accessories and fittings;

    (6) well drilling special-purpose tools, including drill bits, drill
collars, drilling rods, deflecting tools, deflection preventing tools,
fishing tools and other tools;

    (7) drilling mud treating equipment and chemical materials;

    (8) oil well special-purpose materials, including oil pipes, casings,
well head assemblies and underwater appliances;

    (9) oil well cement and various additives.

    3. Those for safety and rescue:

    (1) various oil well blowout-preventing devices, spare parts and materials;

    (2) various fire prevention and fighting devices and materials;

    (3) various lifesaving appliances, accessories and tools;

    (4) special labour protection articles for offshore operating personnel;

    (5) equipment and materials for diving operations.

    4. Those for communications and transportation:

    (1) helicopters and parking apron equipment;

    (2) communications, transportation and escort vessels and their
accessory components:

    (3) various wire and wireless communication equipment and its fittings.

    5. Oils:

    Special fuel oils, lubricating oil, coolant fluids, etc. required for
offshore operations.

    II  Goods, the requirement for the import of which has been verified and
approved for use in exploiting operations, i.e. in the construction of oil
fields:

    1. Those for oil recovery:

    (1) production platforms, including recovery platforms, treating
platforms, living platforms and beacon towers;

    (2) offshore oil loading facilities, including, single-point moorings,
hinged rocking posts oil storage ships or underwater oil tanks and piled
piers:

    (3) offshore engineering operation vessels;

    (4) power plants and their fittings, including internal combustion engines,
steam turbines, steam engines, generators and electric motors and their
control equipment and devices;

    (5) injection equipment and fittings, including water injection
equipment, gas injection equipment and water quality or gas treatment
facilities;

    (6) well water packers and underground blowout preventers;

    (7) lifting equipment and tools;

    (8) oil (gas) transportation equipment, pipelines and their gate valves
and pipe fittings, intermediate stations and shore terminal equipment and
their gate valves and pipe fittings including various machines and pumps and
fluid separation, heat exchange, purifying and presurizing devices, various
measuring, monitoring and parameter indicating meters, various gate valves
and pipe fittings; various electrical instruments and meters and cables.

    2. Those for automation remote control, and remote monitoring:

    (1) including various devices and instruments and meters;

    (2) air-conditioning installation.

    III  Parts, components and materials, the requirement for import of which
has been verified and approved for the manufacture in China of machinery and
equipment for offshore oil exploitation operation.

    IV  The Ministry of Petroleum Industry shall be responsible for examining
and approving whether it is necessary for the above materials to be purchased
from abridged.

Note:

    Note 1.  The Interim Customs Law of the People’s Republic of China has
been superseded by the Customs Law of the People’s Republic of China, which
was adopted at the 19th Meeting of the Standing Committee of the Sixth
National People’s Congress of the People’s Republic of China on January
22, 1987. — The Editor





CIRCULAR OF THE GENERAL OFFICE OF THE STATE COUNCIL CONCERNING THE ENTRY-EXIT PROCEDURES FOR DEPUTIES TO THE NATIONAL PEOPLE’S CONGRESS AND MEMBERS TO THE NATIONAL PEOPLE’S POLITICAL CONSULTATIVE CONFERENCE WHO RESIDE IN THE REGIONS OF HONG KONG AND MACAO AND OTHER RELATED MATTERS WHEN THEY

Category  LAWS AND REGULATIONS ON AFFAIRS CONCERNING OVERSEAS CHINESE AND HONG KONG, MACAO AND TAIWAN Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1982-12-09 Effective Date  1982-12-09  


Circular of the General Office of the State Council Concerning the Entry-exit Procedures for Deputies to the National People’s Congress
and Members to the National People’s Political Consultative Conference Who Reside in the Regions of Hong Kong and Macao and Other
Related Matters When They

Return to the Inland

(December 9, 1982)

    With the approval of the State Council, a circular is hereby issued to
you concerning the entry-exit procedures for deputies to the National People’s
Congress and members to the National People’s Political Consultative
Conference who reside in Hong Kong and Macao and some other related matters
when they return to the inland on public business:

    1. When the deputies to the National People’s Congress and members of the
National People’s Political Consultative Conference who reside in Hong kong
and Macao are to enter or leave the inland on public business, the departments
concerned shall contact the Customs in advance. The Customs shall give them
the treatment of exemption from inspection.

    2. When the said deputies to the National People’s Congress and members to
the National People’s Political Consultative Conference come to Beijng to
attend a session of the National People’s Congress or of the National People’s
Political Consultative Conference, the expenses for their round trips shall be
borne by the Congress or the Conference.

    3. When the said deputies to the National People’s Congress and members to
the National People’s Political Consultative Conference travel in the inland
areas, they may, by presenting certifications issued by the departments
concerned, use Renminbi (RMB) to buy their air, train (bus) and ship tickets
at the same prices as are paid by domestic travellers.

    You are requested to notify all the departments concerned of the aforesaid
provisions and to instruct them to act on them conscientiously.





REGULATIONS FOR THE USE OF CURRENCY IN CONTRIBUTING TAXES TO THE STATE AND IN SETTLEMENT ON ACCOUNTS WITH ENTERPRISES OR INDIVIDUALS RESIDING IN CHINA BY JOINT VENTURES WITH CHINESE AND FOREIGN INVESTMENT

SUPPLEMENTARY PROVISIONS OF THE STANDING COMMITTEE OF THE NATIONAL PEOPLE’S CONGRESS CONCERNING THE TIME LIMITS FOR HANDLING CRIMINAL CASES

Category  LITIGATION Organ of Promulgation  The Standing Committee of the National People’s Congress Status of Effect  Invalidated
Date of Promulgation  1984-07-07 Effective Date  1984-07-07 Date of Invalidation  1997-01-01


Supplementary Provisions of the Standing Committee of the National People’s Congress Concerning the Time Limits for Handling Criminal
Cases



(Adopted at the Sixth Meeting of the Standing Committee of the Sixth

National People’s Congress, promulgated for implementation by Order No.15 of
the President of the People’s Republic of China on July 7, 1984, and effective
as of July 7, 1984) (Editor’s Note: These Provisions were annulled by the
Decision of the National People’s Congress on Amendments of the Criminal
Procedure Law of the People’s Republic of China promulgated on March 17, 1996
and effective as of January 1, 1997)

    The time limits for handling criminal cases prescribed by the Criminal
Procedure Law in the spirit of shortening the time limits as much as possible
and guaranteeing the citizens’ right of the person are both appropriate and
correct. The public security organs and judicial organs shall continue to
improve their work, raise the quality of case-handling and work efficiency,
conscientiously implement the time limits for case-handling prescribed by the
Criminal Procedure Law and, in a practical manner, strive to shorten the time
limits as much as possible. Meanwhile, the following supplementary provisions
are made in order to solve certain special, concrete problems which have
arisen in the process of implementation.

    1. In the event that major cases involving crimes committed by a group or
major and complex cases involving persons going from place to place committing
crimes cannot be concluded within the time limit for holding a defendant in
custody during investigation as stipulated in Paragraph 1 of Article 92 of the
Criminal Procedure Law, or within the time limit for trial in a case of first
instance as stipulated in Article 125, or within the time limit for trial in a
case of second instance as stipulated in Article 142, the time limit for
holding the defendant in custody during investigation may be extended by two
months upon approval or decision by the people’s procuratorates of provinces,
autonomous regions, or municipalities directly under the Central Government,
and the time limit for trial in cases of first and second instances may be
extended by one month upon approval or decision by the higher people’s courts
of provinces, autonomous regions, or municipalities directly under the Central
Government.

    2. In the event that major and complex criminal cases in remote areas with
extremely poor communications cannot be concluded within the time limit
stipulated in the Criminal Procedure Law for holding the defendant in custody
during investigation or within the time limit for trial in a case of first or
second instance, the time limit for case-handling may be appropriately
extended. The extension of the time limit for case-handling and the measures
for its examination and approval shall be dealt with in pursuance of item (1)
above.

    When the time limit for case-handling may be extended in remote areas with
extremely poor communications, such areas shall be designated by the standing
committees of the people’s congresses of the relevant provinces or autonomous
regions.

    3. If in the course of investigation the defendant is found to have
committed other serious crimes, supplementary investigation may be conducted
upon approval of or decision by the people’s procuratorate, and the time limit
for holding the defendant in custody during investigation may be calculated
anew.

    4. A defendant held in custody who is subject to investigation,
prosecution or trial in a case of first or second instance which cannot be
concluded within the time limit stipulated in the Criminal Procedure Law and
who, if permitted to obtain a guarantor pending trial or to live at home under
surveillance, will pose no threat to society may obtain a guarantor pending
trial or live at home under surveillance. The period during whicb he obtains a
guarantor pending trial or lives at home under surveillance shall not be
counted in the time limit for case-handling as stipulated in the Criminal
Procedure Law, but the hearing of the case shall not be suspended.

    5. In the event of a case of public prosecution reviewed and brought by
the people’s procuratorates and heard by a people’s court where the defendant
is not held in custody, the handling of the case is not subject to the
restriction of the time limits stipulated in Articles 97, 125 and 142 of the
Criminal Procedure Law, but the hearing of the case shall not be suspended.

    6. In the event a case of public prosecution over which a people’s
procuratorate or people’s court has jurisdiction is transferred, the time
limit for case-handling shall be reckoned from the date when the new
case-handling organ receives the case.

    7. In the event a people’s court has returned a case to a people’s
procuratorate for supplementary investigation, the latter sball complete the
supplementary investigation within one month. After supplementary
investigation has been completed and the case has been returned to the
people’s court, the court shall calculate anew the time limit for
case-hearing.

    8. Where a people’s court of second instance returns a case for retrial to
the people’s court which originally handled the case, the latter people’s
court shall calculate anew the time limit for case-hearing from the date it
receives the returned case.

    9. The time period during which a defendant undergoes examination for
determination of mental illness shall not be counted in the time limit for
case-handling.

    10. These Provisions shall go into effect on the day of their
promulgation.

    Appendix:
The Relevant Articles in the Criminal Procedure Law

    Article 92  The time limit for holding a defendant in custody during
investigation shall not exceed two months. If the circumstances of a case are
complex and the case cannot be concluded before the expiration of that period,
an extension of one month may be allowed with the approval of the people’s
procuratorate at the next higher level.

    In tbe event a particularly grave and complicated case still cannot be
concluded within the extension period provided in the preceding paragraph, the
Supreme People’s Procuratorate shall request the Standing Committee of tbe
National People’s Congress to approve a postponement of the hearing of the
case.

    Article 97  A people’s procuratorate shall make a decision within one
month on a case that a public security organ has transferred to it with a
recommendation to initiate a public prosecution or exempt it from prosecution;
an extension of half a month may be allowed for major and complicated cases.

    Article 125  A people’s court shall pronounce judgment on a case of public
prosecution within one month, or one and a half months at the latest, after
accepting it for trial.

    Article 142  A people’s court of second instance shall conclude the trial
of a case of appeal or protest within one month, or one and a half months at
the latest, after accepting it for trial.





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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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