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GUARDING STATE SECRETS LAW

Law of the People’s Republic of China on Guarding State Secrets

    

CONTENTS

CHAPTER I GENERAL PROVISIONS

CHAPTER II SCOPES AND CATEGORIES OF STATE SECRETS

CHAPTER III SECURITY RULES

CHAPTER IV LEGAL RESPONSIBILITY

CHAPTER V SUPPLEMENTARY PROVISIONS

CHAPTER I GENERAL PROVISIONS

   Article 1. This Law is formulated for the purpose of guarding state secrets, safeguarding state security and national interests and ensuring
the smooth progress of reform, of opening to the outside world, and of socialist construction.

   Article 2. State secrets shall be matters that have a vital bearing on state security and national interests and, as specified by legal procedure,
are entrusted to a limited number of people for a given period of time.

   Article 3. All state organs, armed forces, political parties, public organizations, enterprises, institutions and citizens shall have the obligation
to guard state secrets.

   Article 4. The work of guarding state secrets shall be carried out in line with the principle of actively preventing their leak and laying
emphasis on priorities so that state secrets are kept while work in all other fields is facilitated.

   Article 5. The state secret-guarding department shall be responsible for the guarding of state secrets throughout the country.

The local secret-guarding departments at or above the county level shall, within the scope of their functions and powers, be responsible
for the guarding of state secrets in the administrative areas under their jurisdiction.

The central state organs shall, within the scope of their functions and powers, be responsible for and guide the work of guarding
state secrets in their own organs and in the departments subordinate to them.

   Article 6. State organs at or above the county level and units involving state secrets shall, in the light of their actual conditions, set
up bodies or designate personnel to administer the day-to-day work of guarding state secrets within their own organs or units.

   Article 7. Units or individuals that have rendered meritorious services in guarding and protecting state secrets and improving techniques and
measures in this field of work shall be awarded.

CHAPTER II SCOPES AND CATEGORIES OF STATE SECRETS

   Article 8. In accordance with the provisions of Article 2 of this Law, state secrets shall include the following:

(1) secrets concerning major policy decisions on state affairs;

(2) secrets in the building of national defence and in the activities of the armed forces;

(3) secrets in diplomatic activities and in activities related to foreign countries as well as secrets to be maintained as commitments
to foreign countries;

(4) secrets in national economic and social development;

(5) secrets concerning science and technology;

(6) secrets concerning activities for safeguarding state security and the investigation of criminal offences; and

(7) other matters that are classified as state secrets by the state secret-guarding department.

Matters that do not conform with the provisions of Article 2 of this Law shall not be state secrets.

Secrets of political parties that conform with the provisions of Article 2 of this Law shall be state secrets.

   Article 9. State secrets shall fall into three categories: most confidential, classified and confidential.

The most confidential information refers to vital state secrets, the divulgence of which will cause extremely serious harm to state
security and national interests; classified information refers to important state secrets, the divulgence of which will cause serious
harm to state security and national interests; and confidential information refers to ordinary state secrets, the divulgence of which
will cause harm to state security and national interests.

   Article 10. The specific scopes and categories of state secrets shall be stipulated by the state secret-guarding department together with the
Ministries of Foreign Affairs, Public Security and State Security and other central organs concerned.

The specific scopes and categories of state secrets related to national defence shall be stipulated by the Central Military Commission.

Stipulations on the specific scopes and categories of state secrets shall be made known within relevant quarters.

   Article 11. State organs and units at various levels shall, in accordance with the stipulations on the specific scopes and categories of state
secrets, classify the state secrets arising in these organs and units.

When people are not sure whether a certain matter is a state secret or which category of state secrets it should be classified into,
the question shall be determined by the state secret-guarding department, the secret-guarding department of a province, an autonomous
region or a municipality directly under the Central Government, the secret-guarding department of a city where the government of
a province or an autonomous region is located, the secret-guarding department of a larger city approved by the State Council, or
an organ examined and approved by the state secret-guarding department. Pending the classification of the secret, the state organ
or unit where the matter has arisen shall initially take security measures in conformity with the category proposed for its classification.

   Article 12. The categories of secrecy shall, in accordance with the provisions of Articles 9, 10 and 11 of this Law, be marked on documents
and other material that are determined as state secrets. Documents and other material that are not determined as state secrets shall
not be marked as such.

   Article 13. When differences arise as to whether a matter is a state secret or which category it should be classified into, the question shall
be determined by the state secret-guarding department or the secret-guarding department of a province, an autonomous region or a
municipality directly under the Central Government.

   Article 14. While classifying state secrets, state organs and units shall, in the light of each case, determine the periods for guarding these
secrets. Specific measures for determining the periods shall be formulated by the state secret-guarding department.

   Article 15. The categories of state secrets and the periods for guarding them shall be altered in the light of changing circumstances. Such
alterations shall be decided on by the state organs or units that determined the categories of the secrets and the periods for guarding
them or by superior departments.

   Article 16. A state secret shall be automatically declassified upon the expiration of the period for guarding it; in cases where it is necessary
to extend the period, the matter shall be decided on by the state organ or unit that determined the category of the secret and the
period for guarding it or by a superior department.

When it is found, before the expiration of the period for guarding a state secret that it is no longer necessary to guard it as such,
it should be declassified without delay by the state organ or unit that determined its category and defined the period for guarding
it or by a superior department.

CHAPTER III SECURITY RULES

   Article 17. The state secret-guarding department shall formulate security measures regarding the making, receiving, dispatching, transmitting,
use, copying, extracting, preservation and destruction of documents and other material and objects that are state secrets.

Measures for storing, drawing, processing and transmitting state secrets by electronic information and other technical means shall
be formulated by the state secret-guarding department together with the central organs concerned.

   Article 18. Documents and other material and objects that are classified as ” most confidential ” state secrets must be guarded by the following
security measures:

(1) They shall not be copied or extracted without approval by the state organ or unit that determined their categories or by superior
departments;

(2) People shall be specially designated and necessary security measures taken for their dispatch, reception, delivery and carrying;
and

(3) They shall be kept in perfectly equipped safes.

Security measures shall be taken in accordance with the provisions of the preceding paragraphs, for approved copies or extracts of
documents and other material and objects classified as ” most confidential ” state secrets.

   Article 19. Security measures shall be formulated by the state secret-guarding department, together with the central organs concerned, for the
trial manufacture, production, transportation, use, preservation, maintenance and destruction of equipment or goods classified as
state secrets.

   Article 20. In the publication and distribution of newspapers, journals, books, maps, material with illustrations and captions, and audio and
video products and in the production and broadcast of radio and television programmes and films, the relevant security regulations
shall be complied with and no state secrets shall be divulged.

   Article 21. When state secrets have to be furnished for the benefits of contacts and co-operation with foreign countries, approval must be obtained
beforehand in line with the prescribed procedures.

   Article 22. With regard to meetings and other activities that involve state secrets, the sponsor units shall take security measures, explain
to the participants the need to guard secrets and set specific requirements for the purpose.

   Article 23. Military forbidden zones and places and locations that are state secrets not open to the public shall be protected by security measures;
no one may decide to open them to the public or enlarge the area that is open to the public without approval obtained in accordance
with the relevant state regulations.

   Article 24. No state secrets shall be divulged in private contacts or correspondence.

When carrying documents and other material and objects classified as state secrets on official tours, no one shall go against the
relevant security regulations.

No state secrets shall be discussed in public places.

   Article 25. Transmission of state secrets through wire or wireless communications shall be protected by security measures.

No state secrets shall be transmitted by plain code or by a secret code that has not been examined and approved by the central organs
concerned.

No documents or other material and objects classified as state secrets shall be transmitted by ordinary mail.

   Article 26. Without approval by competent departments, no documents or any other material or objects classified as state secret shall be carried,
transmitted, posted or transported out of the country’s territory.

   Article 27. State secrets shall, depending on the circumstances, be accessible only to a certain number of people. The most confidential state
secrets shall be accessible only to people who have obtained approval.

   Article 28. Personnel to be placed specially in charge of state secrets shall be examined and approved in accordance with the provisions of the
state secret-guarding department and the competent personnel department.

Exit from the country’s territory by personnel specially in charge of state secrets shall be approved by the organ that approved their
appointment. If the competent department under the State Council holds that the exit of any one of them from the country’s territory
will endanger state security or cause serious damage to national interests, no approval shall be granted for his exit.

   Article 29. State organs and units shall conduct education among their personnel in the need to guard secrets and check up on secret-guarding
work regularly.

   Article 30. State functionaries and other citizens should, upon discovering that state secrets have been divulged or are in danger of being
divulged, take remedial measures immediately and promptly report the matter to the state organs and units concerned, which shall,
upon receiving such reports, deal with the matter without delay.

CHAPTER IV LEGAL RESPONSIBILITY

   Article 31. Persons who, in violation of the provisions of this Law, divulge state secrets intentionally or through negligence, if the consequences
are serious, shall be investigated for criminal responsibility in accordance with the provisions of Article 186 of the Criminal Law.

Persons who, in violation of the provisions of this Law, divulge state secrets, if the consequences are not serious enough for criminal
punishment, may be given disciplinary sanction in the light of the specific circumstances of each case.

   Article 32. Persons who steal, spy on, buy or illegally provide state secrets for institutions, organizations and people outside the country
shall be investigated for criminal responsibility in accordance with law.

CHAPTER V SUPPLEMENTARY PROVISIONS

   Article 33. The state secret-guarding department shall, in accordance with this Law, formulate measures for its implementation, which shall
come into force after being submitted to and approved by the State Council.

   Article 34. The Central Military Commission shall, in accordance with this Law, formulate the Regulations of the Chinese People’s Liberation
Army on the Guarding of Secrets.

   Article 35. This Law shall come into force as of May 1, 1989. The Provisional Regulations on Guarding State Secrets promulgated in June 1951
shall be annulled as of the same date.

    






BASIC LAW OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION OF THE PEOPLE’S REPUBLIC OF CHINA






The National People’s Congress

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

No.26

The Basic Law of the Hong Kong Special Administrative Region of the People’s Republic of China which is composed of the Method for
the Selection of the Chief Executive of the Hong Kong Special Administrative Region(attachment I), the Method for the Formation of
the Legislative Council of the Hong Kong Special Administrative Region(attachment II), the National Laws to Be Applied in the Hong
Kong Special Administrative Region(attachment III) and the regional flag and the form of the regional emblem of the Hong Kong Special
Administrative Region, has been adopted at the 3rd Session of the Seventh National People’s Congress on April 4, 1990, and promulgated
hereby for implementation as of July 1, 1997.

President of the People’s Republic of China Yang ShangKun

April 4, 1990

Basic Law of the Hong Kong Special Administrative Region of the People’s Republic of China ContentsPreamble

Chapter I General Principles

Chapter II Relationship Between the Central Authorities and

the Hong Kong Special Administrative Region

Chapter III Fundamental Rights and Duties of the Residents

Chapter IV Political Structure

Section 1 The Chief Executive

Section 2 The Executive Authorities

Section 3 The Legislature

Section 4 The Judiciary

Section 5 District Organizations

Section 6 Public Servants

Chapter V Economy

Section 1 Public Finance, Monetary Affairs, Trade, Industry and Commerce

Section 2 Land Leases

Section 3 Shipping

Section 4 Civil Aviation

Chapter VI Education, Science, Culture, Sports, Religion, Labour and Social Services

Chapter VII External Affairs

Chapter VIII Interpretation and Amendment of the Basic Law

Chapter IX Supplementary Provisions

Attachment I Method for the Selection of the Chief Executive of the Hong Kong Special Administrative Region

Attachment II Method for the Formation of the Legislative Council of the Hong Kong

Attachment III National Laws to be Applied in the Hong Kong Special Administrative Region

Preamble

Hong Kong has been part of the territory of China since ancient times; it was occupied by Britain after the Opium War in 1840. On
19 December 1984, the Chinese and British Governments signed the Joint Declaration on the Question of Hong Kong, affirming that the
Government of the People’s Republic of China will resume the exercise of sovereignty over Hong Kong with effect from 1 July 1997,
thus fulfilling the long-cherished common aspiration of the Chinese people for the recovery of Hong Kong.

Upholding national unity and territorial integrity, maintaining the prosperity and stability of Hong Kong, and taking account of its
history and realities, the People’s Republic of China has decided that upon China’s resumption of the exercise of sovereignty over
Hong Kong, a Hong Kong Special Administrative Region will be established in accordance with the provisions of Article 31 of the
Constitution of the People’s Republic of China, and that under the principle of “one country, two systems,” the socialist system
and policies will not be practised in Hong Kong. The basic policies of the People’s Republic of China regarding Hong Kong have been
elaborated by the Chinese Government in the Sino-British Joint Declaration.

In accordance with the Constitution of the People’s Republic of China, the National People’s Congress hereby enacts the Basic Law
of the Hong Kong Special Administrative Region of the People’s Republic of China, prescribing the systems to be practised in the
Hong Kong Special Administrative Region, in order to ensure the implementation of the basic policies of the People’s Republic of
China regarding Hong Kong.

Chapter I General Principles

Article 1

The Hong Kong Special Administrative Region is an inalienable part of the people’s Republic of China.

Article 2

The National People’s Congress authorizes the Hong Kong Special Administrative Region to exercise a high degree of autonomy and enjoy
executive, legislative and independent judicial power, including that of final adjudication, in accordance with the provisions of
this Law.

Article 3

The executive authorities and legislature of the Hong Kong Special Administrative Region shall be composed of permanent residents
of Hong Kong in accordance with the relevant provisions of this Law.

Article 4

The Hong Kong Special Administrative Region shall safeguard the rights and freedoms of the residents of the Hong Kong Special Administrative
Region and of other persons in the Region in accordance with law.

Article 5

The socialist system and policies shall not be practised in the Hong Kong Special Administrative Region, and the previous capitalist
system and way of life shall remain unchanged for 50 years.

Article 6

The Hong Kong Special Administrative Region shall protect the right of private ownership of property in accordance with law.

Article 7

The land and natural resources within the Hong Kong Special Administrative Region shall be State property. The Government of the Hong
Kong Special Administrative Region shall be responsible for their management, use and development and for their lease or grant to
individuals, legal persons or organizations for use or development. The revenues derived therefrom shall be exclusively at the disposal
of the government of the Region.

Article 8

The laws previously in force in Hong Kong, that is, the common law, rules of equity, ordinances, subordinate legislation and customary
law shall be maintained, except for any that contravene this Law, and subject to any amendment by the legislature of the Hong Kong
Special Administrative Region.

Article 9

In addition to the Chinese language, English may also be used as an official language by the executive authorities, legislature and
judiciary of the Hong Kong Special Administrative Region.

Article 10

Apart from displaying the national flag and national emblem of the People’s Republic of China, the Hong Kong Special Administrative
Region may also use a regional flag and regional emblem.

The regional flag of the Hong Kong Special Administrative Region is a red flag with a bauhinia highlighted by five star-tipped stamens.

The regional emblem of the Hong Kong Special Administrative Region is a bauhinia in the centre highlighted by five star-tipped stamens
and encircled by the words “Hong Kong Special Administrative Region of the People’s Republic of China” in Chinese and “HONG KONG”
in English.

Article 11

In accordance with Article 31 of the Constitution of the People’s Republic of China, the systems and policies practised in the Hong
Kong Special Administrative Region, including the social and economic systems, the system for safeguarding the fundamental rights
and freedoms of its residents, the executive, legislative and judicial systems, and the relevant policies, shall be based on the
provisions of this Law.

No law enacted by the legislature of the Hong Kong Special Administrative Region shall contravene this Law.

Chapter II Relationship Between the Central Authorities and the Hong Kong Special Administrative Region

Article 12

The Hong Kong Special Administrative Region shall be a local administrative region of the People’s Republic of China, which shall
enjoy a high degree of autonomy and come directly under the Central People’s Government.

Article 13

The Central People’s Government shall be responsible for the foreign affairs relating to the Hong Kong Special Administrative Region.

The Ministry of Foreign Affairs of the People’s Republic of China shall establish an office in Hong Kong to deal with foreign affairs.

The Central People’s Government authorizes the Hong Kong Special Administrative Region to conduct relevant external affairs on its
own in accordance with this Law.

Article 14

The Central People’s Government shall be responsible for the defence of the Hong Kong Special Administrative Region.

The Government of the Hong Kong Special Administrative Region shall be responsible for the maintenance of public order in the Region.

Military forces stationed by the Central People’s Government in the Hong Kong Special Administrative Region for defence shall not
interfere in the local affairs of the Region.

The Government of the Hong Kong Special Administrative Region may, when necessary, ask the Central People’s Government for assistance
from the garrison in the maintenance of public order and in disaster relief.

In addition to abiding by national laws, members of the garrison shall abide by the laws of the Hong Kong Special Administrative Region.

Expenditure for the garrison shall be borne by the Central People’s Government.

Article 15

The Central People’s Government shall appoint the Chief Executive and the principal officials of the executive authorities of the
Hong Kong Special Administrative Region in accordance with the provisions of Chapter IV of this Law.

Article 16

The Hong Kong Special Administrative Region shall be vested with executive power. It shall, on its own, conduct the administrative
affairs of the Region in accordance with the relevant provisions of this Law.

Article 17

The Hong Kong Special Administrative Region shall be vested with legislative power.

Laws enacted by the legislature of the Hong Kong Special Administrative Region must be reported to the Standing Committee of the National
People’s Congress for the record. The reporting for record shall not affect the entry into force of such laws.

If the Standing Committee of the National People’s Congress, after consulting the Committee for the Basic Law of the Hong Kong Special
Administrative Region under it, considers that any law enacted by the legislature of the Region is not in conformity with the provisions
of this Law regarding affairs within the responsibility of the Central Authorities or regarding the relationship between the Central
Authorities and the Region, the Standing Committee may return the law in question but shall not amend it. Any law returned by the
Standing Committee of the National People’s Congress shall immediately be invalidated. This invalidation shall not have retroactive
effect, unless otherwise provided for in the laws of the Region.

Article 18

The laws in force in the Hong Kong Special Administrative Region shall be this Law, the laws previously in force in Hong Kong as provided
for in Article 8 of this Law, and the laws enacted by the legislature of the Region.

National laws shall not be applied in the Hong Kong Special Administrative Region except for those listed in Attachment III to this
Law. The laws listed therein shall be applied locally by way of promulgation or legislation by the Region.

The Standing Committee of the National People’s Congress may add to or delete from the list of laws in Attachment III after consulting
its Committee for the Basic Law of the Hong Kong Special Administrative Region and the government of the Region. Laws listed in Attachment
III to this Law shall be confined to those relating to defence and foreign affairs as well as other matters outside the limits of
the autonomy of the Region as specified by this Law.

In the event that the Standing Committee of the National People’s Congress decides to declare a state of war or, by reason of turmoil
within the Hong Kong Special Administrative Region which endangers national unity or security and is beyond the control of the government
of the Region, decides that the Region is in a state of emergency, the Central People’s Government may issue an order applying the
relevant national laws in the Region.

Article 19

The Hong Kong Special Administrative Region shall be vested with independent judicial power, including that of final adjudication.

The courts of the Hong Kong Special Administrative Region shall have jurisdiction over all cases in the Region, except that the restrictions
on their jurisdiction imposed by the legal system and principles previously in force in Hong Kong shall be maintained.

The courts of the Hong Kong Special Administrative Region shall have no jurisdiction over acts of state such as defence and foreign
affairs. The courts of the Region shall obtain a certificate from the Chief Executive on questions of fact concerning acts of state
such as defence and foreign affairs whenever such questions arise in the adjudication of cases. This certificate shall be binding
on the courts. Before issuing such a certificate, the Chief Executive shall obtain a certifying document from the Central People’s
Government.

Article 20

The Hong Kong Special Administrative Region may enjoy other powers granted to it by the National People’s Congress, the Standing Committee
of the National People’s Congress or the Central People’s Government.

Article 21

Chinese citizens who are residents of the Hong Kong Special Administrative Region shall be enpost_titled to participate in the management
of state affairs according to law. In accordance with the assigned number of seats and the selection method specified by the National
People’s Congress, the Chinese citizens among the residents of the Hong Kong Special Administrative Region shall locally elect deputies
of the Region to the National People’s Congress to participate in the work of the highest organ of state power.

Article 22

No department of the Central People’s Government and no province, autonomous region, or municipality directly under the Central Government
may interfere in the affairs which the Hong Kong Special Administrative Region administers on its own in accordance with this Law.

If there is a need for departments of the Central Government, or for provinces, autonomous regions, or municipalities directly under
the Central Government to set up offices in the Hong Kong Special Administrative Region, they must obtain the consent of the government
of the Region and the approval of the Central People’s Government.

All offices set up in the Hong Kong Special Administrative Region by departments of the Central Government, or by provinces, autonomous
regions, or municipalities directly under the Central Government, and the personnel of these offices shall abide by the laws of the
Region.

For entry into the Hong Kong Special Administrative Region, people from other parts of China must apply for approval. Among them,
the number of persons who enter the Region for the purpose of settlement shall be determined by the competent authorities of the
Central People’s Government after consulting the government of the Region.

The Hong Kong Special Administrative Region may establish an office in Beijing.

Article 23

The Hong Kong Special Administrative Region shall enact laws on its own to prohibit any act of treason, secession, sedition, subversion
against the Central People’s Government, or theft of state secrets, to prohibit foreign political organizations or bodies from conducting
political activities in the Region, and to prohibit political organizations or bodies of the Region from establishing ties with foreign
political organizations or bodies.

Chapter III Fundamental Rights and Duties of the Residents

Article 24

Residents of the Hong Kong Special Administrative Region (“Hong Kong residents”) shall include permanent residents and non-permanent
residents.

The permanent residents of the Hong Kong Special Administrative Region shall be:

(1)

Chinese citizens born in Hong Kong before or after the establishment of the Hong Kong Special Administrative Region;

(2)

Chinese citizens who have ordinarily resided in Hong Kong for a continuous period of not less than seven years before or after the
establishment of the Hong Kong Special Administrative Region;

(3)

Persons of Chinese nationality born outside Hong Kong of those residents listed in categories (1) and (2);

(4)

Persons not of Chinese nationality who have entered Hong Kong with valid travel documents, have ordinarily resided in Hong Kong for
a continuous period of not less than seven years and have taken Hong Kong as their place of permanent residence before or after the
establishment of the Hong Kong Special Administrative Region;

(5)

Persons under 21 years of age born in Hong Kong of those residents listed in category (4) before or after the establishment of the
Hong Kong Special Administrative Region; and

(6)

Persons other than those residents listed in categories (1) to (5), who, before the establishment of the Hong Kong Special Administrative
Region, had the right of abode in Hong Kong only.

The above-mentioned residents shall have the right of abode in the Hong Kong Special Administrative Region and shall be qualified
to obtain, in accordance with the laws of the Region, permanent identity cards which state their right of abode.

The non-permanent residents of the Hong Kong Special Administrative Region shall be persons who are qualified to obtain Hong Kong
identity cards in accordance with the laws of the Region but have no right of abode.

Article 25

All Hong Kong residents shall be equal before the law.

Article 26

Permanent residents of the Hong Kong Special Administrative Region shall have the right to vote and the right to stand for election
in accordance with law.

Article 27

Hong Kong residents shall have freedom of speech, of the press and of publication; freedom of association, of assembly, of procession
and of demonstration; and the right and freedom to form and join trade unions, and to strike.

Article 28

The freedom of the person of Hong Kong residents shall be inviolable.

No Hong Kong resident shall be subjected to arbitrary or unlawful arrest, detention or imprisonment. Arbitrary or unlawful search
of the body of any resident or deprivation or restriction of the freedom of the person shall be prohibited. Torture of any resident
or arbitrary or unlawful deprivation of the life of any resident shall be prohibited.

Article 29

The homes and other premises of Hong Kong residents shall be inviolable. Arbitrary or unlawful search of, or intrusion into, a resident’s
home or other premises shall be prohibited.

Article 30

The freedom and privacy of communication of Hong Kong residents shall be protected by law. No department or individual may, on any
grounds, infringe upon the freedom and privacy of communication of residents except that the relevant authorities may inspect communication
in accordance with legal procedures to meet the needs of public security or of investigation into criminal offences.

Article 31

Hong Kong residents shall have freedom of movement within the Hong Kong Special Administrative Region and freedom of emigration to
other countries and regions. They shall have freedom to travel and to enter or leave the Region. Unless restrained by law, holders
of valid travel documents shall be free to leave the Region without special authorization.

Article 32

Hong Kong residents shall have freedom of conscience.

Hong Kong residents shall have freedom of religious belief and freedom to preach and to conduct and participate in religious activities
in public.

Article 33

Hong Kong residents shall have freedom of choice of occupation.

Article 34

Hong Kong residents shall have freedom to engage in academic research, literary and artistic creation, and other cultural activities.

Article 35

Hong Kong residents shall have the right to confidential legal advice, access to the courts, choice of lawyers for timely protection
of their lawful rights and interests or for representation in the courts, and to judicial remedies.

Hong Kong residents shall have the right to institute legal proceedings in the courts against the acts of the executive authorities
and their personnel.

Article 36

Hong Kong residents shall have the right to social welfare in accordance with law. The welfare benefits and retirement security of
the labour force shall be protected by law.

Article 37

The freedom of marriage of Hong Kong residents and their right to raise a family freely shall be protected by law.

Article 38

Hong Kong residents shall enjoy the other rights and freedoms safeguarded by the laws of the Hong Kong Special Administrative Region.

Article 39

The provisions of the International Covenant on Civil and Political Rights, the International Covenant on Economic, Social and Cultural
Rights, and international labour conventions as applied to Hong Kong shall remain in force and shall be implemented through the laws
of the Hong Kong Special Administrative Region.

The rights and freedoms enjoyed by Hong Kong residents shall not be restricted unless as prescribed by law. Such restrictions shall
not contravene the provisions of the preceding paragraph of this Article.

Article 40

The lawful traditional rights and interests of the indigenous inhabitants of the “New Territories” shall be protected by the Hong
Kong Special Administrative Region.

Article 41

Persons in the Hong Kong Special Administrative Region other than Hong Kong residents shall, in accordance with law, enjoy the rights
and freedoms of Hong Kong residents prescribed in this Chapter.

Article 42

Hong Kong residents and other persons in Hong Kong shall have the obligation to abide by the laws in force in the Hong Kong Special
Administrative Region.

Chapter IV Political Structure

Section 1 The Chief Executive

Article 43

The Chief Executive of the Hong Kong Special Administrative Region shall be the head of the Hong Kong Special Administrative Region
and shall represent the Region.

The Chief Executive of the Hong Kong Special Administrative Region shall be accountable to the Central People’s Government and the
Hong Kong Special Administrative Region in accordance with the provisions of this Law.

Article 44

The Chief Executive of the Hong Kong Special Administrative Region shall be a Chinese citizen of not less than 40 years of age who
is a permanent resident of the Region with no right of abode in any foreign country and has ordinarily resided in Hong Kong for a
continuous period of not less than 20 years.

Article 45

The Chief Executive of the Hong Kong Special Administrative Region shall be selected by election or through consultations held locally
and be appointed by the Central People’s Government.

The method for selecting the Chief Executive shall be specified in the light of the actual situation in the Hong Kong Special Administrative
Region and in accordance with the principle of gradual and orderly progress. The ultimate aim is the selection of the Chief Executive
by universal suffrage upon nomination by a broadly representative nominating committee in accordance with democratic procedures.

The specific method for selecting the Chief Executive is prescribed in Attachment I “Method for the Selection of the Chief Executive
of the Hong Kong Special Administrative Region”.

Article 46

The term of office of the Chief Executive of the Hong Kong Special Administrative Region shall be five years. He or she may serve
for not more than two consecutive terms.

Article 47

The Chief Executive of the Hong Kong Special Administrative Region must be a person of integrity, dedicated to his or her duties.

The Chief Executive, on assuming office, shall declare his or her assets to the Chief Justice of the Court of Final Appeal of the
Hong Kong Special Administrative Region. This declaration shall be put on record.

Article 48

The Chief Executive of the Hong Kong Special Administrative Region shall exercise the following powers and functions:

(1)

To lead the government of the Region;

(2)

To be responsible for the implementation of this Law and other laws which, in accordance with this Law, apply in the Hong Kong Special
Administrative Region;

(3)

To sign bills passed by the Legislative Council and to promulgate laws;

To sign budgets passed by the Legislative Council and report the budgets and final accounts to the Central People’s Government for
the record;

(4)

To decide on government policies and to issue executive orders;

(5)

To nominate and to report to the Central People’s Government for appointment the following principal officials: Secretaries and Deputy
Secretaries of Departments, Directors of Bureaux, Commissioner Against Corruption, Director of Audit, Commissioner of Police, Director
of Immigration and Commissioner of Customs and Excise; and to recommend to the Central People’s Government the removal of the above-mentioned
officials;

(6)

To appoint or remove judges of the courts at all levels in accordance with legal procedures;

(7)

To appoint or remove holders of public office in accordance with legal procedures;

(8)

To implement the directives issued by the Central People’s Government in respect of the relevant matters provided for in this Law;

(9)

To conduct, on behalf of the Government of the Hong Kong Special Administrative Region, external affairs and other affairs as authorized
by the Central Authorities;

(10)

To approve the introduction of motions regarding revenues or expenditure to the Legislative Council;

(11)

To decide, in the light of security and vital public interests, whether government officials or other personnel in charge of government
affairs should testify or give evidence before the Legislative Council or its committees;

(12)

To pardon persons convicted of criminal offences or commute their penalties; and

(13)

To handle petitions and complaints.

Article 49

If the Chief Executive of the Hong Kong Special Administrative Region considers that a bill passed by the Legislative Council is not
compatible with the overall interests of the Region, he or she may return it to the Legislative Council within three months for reconsideration.
If the Legislative Council passes the original bill again by not less than a two-thirds majority of all the members, the Chief Executive
must sign and promulgate it within one month, or act in accordance with the provisions of Article 50 of this Law.

Article 50

If the Chief Executive of the Hong Kong Special Administrative Region refuses to sign a bill passed the second time by the Legislative
Council, or the Legislative Council refuses to pass a budget or any other important bill introduced by the government, and if consensus
still cannot be reached after consultations, the Chief Executive may dissolve the Legislative Council.

The Chief Executive must consult the Executive Council before dissolving the Legislative Council. The Chief Executive may dissolve
the Legislative Council only once in each term of his or her office.

Article 51

If the Legislative Council of the Hong Kong Special Administrative Region refuses to pass the budget introduced by the government,
the Chief Executive may apply to the Legislative Council for provisional appropriations. If appropriation of public funds cannot
be approved because the Legislative Council has already been dissolved, the Chief Executive may, prior to the election of the new
Legislative Council, approve provisional short-term appropriations according to the level of expenditure of the previous fiscal year.

Article 52

The Chief Executive of the Hong Kong Special Administrative Region must resign under any of the following circumstances:

(1)

When he or she loses the ability to discharge his or her duties as a result of serious illness or other reasons;

(2)

When, after the Legislative Council is dissolved because he or she twice refuses to sign a bill passed by it, the new Legislative
Council again passes by a two-thirds majority of all the members the original bill in dispute, but he or she still refuses to sign
it; and

(3)

When, after the Legislative Council is dissolved because it refuses to pass a budget or any other important bill, the new Legislative
Council still refuses to pass the original bill in dispute.

Article 53

If the Chief Executive of the Hong Kong Special Administrative Region is not able to discharge his or her duties for a short period,
such duties shall temporarily be assumed by the Administrative Secretary, Financial Secretary or Secretary of Justice in this order
of precedence.

In the event that the office of Chief Executive becomes vacant, a new Chief executive shall be selected within six months in accordance
with the provisions of Article 45 of this Law. During the period of vacancy, his or her duties shall be assumed according to the
provisions of the preceding paragraph.

Article 54

The Executive council of the Hong Kong Special Administrative Region shall be an organ for assisting the Chief Executive in policy-making.

Article 55

Members of the Executive Council of the Hong Kong Special Administrative Region shall be appointed by the Chief Executive from among
the principal officials of the executive authorities, members of the Legislative Council and public figures. Their appointment or
removal shall be decided by the Chief Executive. The term of office of members of the Executive Council shall not extend beyond the
expiry of the term of office of the Chief Executive who appoints them.

Members of the Executive Council of the Hong Kong Special Administrative Region shall be Chinese citizens who are permanent residents
of the Region with no right of abode in any foreign country.

The Chief Executive may, as he or she deems necessary, invite other persons concerned to sit in on meetings of the Council.

Article 56

The Executive Council of the Hong Kong Special Administrative Region shall be presided over by the Chief Executive.

Except for the appointment, removal and disciplining of officials and the adoption of measures in emergencies, the Chief Executive
shall consult the Executive Council before making important policy decisions, introducing bills to the Legislative Council, making
subordinate legislation, or dissolving the Legislative Council.

If the Chief Executive does not accept a majority opinion of the Executive Council, he or she shall put the specific reasons on record.

Article 57

A Commission Against Corruption shall be established in the Hong Kong Special Administrative Region. It shall function independently
and be accountable to the Chief Executive.

Article 58

A Commission of Audit shall be established in the Hong Kong Special Administrative Region. It shall function independently and be
accountable to the Chief Executive.

Section 2 The Executive Authorities

Article 59

The Government of the Hong Kong Special Administrative Region shall be the executive authorities of the Region.

Article 60

The head of the Government of the Hong Kong Special Administrative Region shall be the Chief Executive of the Region.

A Department of Administration, a Department of Finance, a Department of Justice, and various bureaux, divisions and commissions shall
be established in the Government of the Hong Kong Special Administrative Region.

Article 61

The principal officials of the Hong Kong Special Administrative Region shall be Chinese citizens who are permanent residents of the
Region with no right of abode in any foreign country and have ordinarily resided in Hong Kong for a continuous period of not less
than 15 years.

Article 62

The Government of the Hong Kong Special Administrative Region shall exercise the following powers and functions:

(1)

To formulate and implement polici

REGULATIONS OF THE STATE COUNCIL FOR ENCOURAGEMENT OF INVESTMENT BY OVERSEAS CHINESE AND COMPATRIOTS FROM HONG KONG AND MACAO

CIVIL PROCEDURE LAW






Law of Civil Procedure of the People’s Republic of China

    

(Adopted by the fourth session of the seventh National People’s Congress on 9th April 1991)

Part One General Principles

Chapter I. Tasks, Scope of Application and Basic Principles

   Article 1. The Law of Civil Procedure of the PRC takes the Constitution as its basis. It is enacted in the light of China’s experience in handling
civil cases and the actual conditions.

   Article 2. The tasks of the Law of Civil Procedure of the PRC are to protect the party from a lawsuit in exercising its litigant rights and
to ensure that the People’s Court establishes the truth based on facts, distinguishes right from wrong, applies laws correctly, handles
civil cases promptly, ascertains the relationship between civil rights and obligations, takes sanctions against civil violations,
safeguards the legitimate rights and interests of the party to a lawsuit, educates the citizens to abide conscientiously by the law,
safeguards social and economic order and ensures the smooth progress of socialist construction.

   Article 3. Provisions of the Law apply to civil lawsuits between citizens, between legal persons and between other organizations, as well as
among them, filed because of property and personal relationship, and are handled by the People’s Court.

   Article 4. Civil proceedings within the territory of the PRC shall abide by this Law.

   Article 5. In filing a lawsuit and responding to a lawsuit in the People’s Court, foreigners, people without nationality, foreign enterprises
and other organizations shall have the same equal litigant rights and obligations as the citizens, legal persons and other organizations
of the PRC.

Should the court of a foreign country restrict the civil litigant rights of the citizens, legal persons and other organizations of
the PRC, the People’s Court of the PRC shall exercise a reciprocal principle on the civil litigant rights of the citizens, enterprises
and other organizations of that country.

   Article 6. The judicial authority over civil cases is exercised by the People’s Court.

In civil proceedings, the People’s Court administers justice independently according to law, subject to no interference by administrative
organs, organizations or individuals.

   Article 7. In civil proceedings, the People’s Court shall base itself on facts and take the law as the criterion.

   Article 8. In civil proceedings, the litigants shall have equal litigant rights. In handling a civil case, the People’s Court shall ensure and
make it convenient for the litigants to exercise their litigant rights; in the application of the law, the litigants are deemed as
equals.

   Article 9. In civil proceedings, the People’s Court shall promote mediation in accordance with the principle of voluntariness and legitimacy;
a court decision shall be made promptly when mediation has failed.

   Article 10. In civil proceedings, the People’s Court practices the system of collegiate bench, withdrawal and public trial, and the system of
two instances, the first and the final.

   Article 11. Citizens of all nationalities have the right to use their own languages, spoken or written, in civil proceedings.

In districts compactly inhabited by a minority nationality or by a number of nationalities, the People’s Court shall hear cases and
issue legal documents in the commonly used language in the locality.

The People’s Court shall provide interpretation for a litigant participant unacquainted with the spoken or written language commonly
used in the locality.

   Article 12. When the People’s Court is hearing a civil case, the litigant has the right of debate.

   Article 13. Litigants have the right of disposing of their own civil rights and litigant rights within the limits prescribed by law.

   Article 14. The People’s Procuratorate has the right of legal supervision over the trials of civil cases.

   Article 15. Organs, social organizations, enterprises and institutions may support the injured units or individuals to file a suit with the People’s
Court against acts that damaged the civil rights or interests of the state, collectives or individuals.

   Article 16. The People’s Mediation Committee is a mass organization that mediates civil disputes under the guidance of the ground-level people’s
government and ground-level people’s court.

The People’s Mediation Committee conducts mediation according to the law and the principle of voluntariness. Litigants shall honor
the agreement reached through mediation; those who do not wish to mediate, or fail to reconcile their difference, or go back on their
word, may file a suit at the People’s Court.

The People’s Court shall correct any violations of law committed by the People’s Mediation Committee during mediation.

   Article 17. The People’s Congress of ethnic autonomous regions may draft flexible or supplementary provisions in accordance with the principles
incorporated in the Constitution and this Law, as well as the specific ethnic conditions in their localities. The provisions of an
autonomous region shall be reported to the NPC Standing Committee for ratification. The provisions of an autonomous prefecture and
county shall be reported to the standing committee of the provincial or autonomous regional people’s congress for ratification, and
to the NPC Standing Committee for the record.

Chapter II. Jurisdiction

Section One: Differentiated Jurisdiction

   Article 18. Unless otherwise stipulated in this Law, the ground-level people’s court is competent to rule on the first instance of civil cases.

   Article 19. The intermediate people’s court is competent to rule on the first instance of the following cases

(1) Major cases involving foreigners;

(2) Cases of great impact within its jurisdiction;

(3) Cases determined by the Supreme People’s Court as coming under its jurisdiction.

   Article 20. The Higher People’s Court is competent to rule on the first instance of civil cases having great impact within its jurisdiction.

   Article 21. The Supreme People’s Court is competent to rule on the first instance of the following civil cases

(1) Cases having great impact nationwide;

(2) Cases it deems necessary to try.

Section Two: Regional Jurisdiction

   Article 22. A civil suit against a citizen comes under the jurisdiction of the people’s court at the place where the defendant is domiciled;
where the defendant’s domicile and regular abode is different, the case comes under the jurisdiction of the people’s court at the
place of his regular abode.

A civil suit against an institution or any other organization comes under the jurisdiction of the people’s court at the place where
the defendant is registered.

When the domiciles and regular abodes of several defendants in the same civil suit come under the jurisdiction of two or more people’s
courts, they all have the right of jurisdiction.

   Article 23. The following civil suits come under the jurisdiction of the people’s court at the place where the plaintiff is domiciled; where
the plaintiff’s domicile and regular abode is different, the case comes under the jurisdiction of the people’s court at the place
of his regular abode

(1) Actions concerning the identity of persons who do not reside within the domain of the PRC;

(2) Actions concerning the identity of persons whose whereabouts are unknown or who have been declared missing;

(3) Actions against persons undergoing re-education through labor;

(4) Actions against persons in prison.

   Article 24. Actions arising from disputes over contracts come under the jurisdiction of the people’s court at the place of their signing or the
place of their implementation.

   Article 25. The two parties to a contract may specify in writing, the jurisdiction of the people’s court of their choice with regard to the defendant’s
registered address, the place for honoring the contract, the place where the contract is signed, the plaintiff’s registered address
and the place of the tendered object, but they must not violate the provisions on differentiated jurisdiction and special jurisdiction
in this Law.

   Article 26. Actions arising from disputes over insurance contracts come under the jurisdiction of the people’s court at the place of the defendant’s
registered address, or at the place of the insured objects.

   Article 27. Actions arising from disputes over negotiable instruments come under the jurisdiction of the people’s court at the place where the
payment is to be made, or at the place where the defendant domiciled.

   Article 28. Actions arising from disputes over contracts concerning rail, road, water, air or through transportation come under the jurisdiction
of people’s court at the place of departure, destination or the place where the defendant is registered.

   Article 29. Actions against acts of encroachment come under the jurisdiction of the people’s court at the place where such acts are committed
or at the place where the defendant is domiciled.

Articles 30. Actions claiming compensation for damage arising from rail, road, water and air accidents come under the jurisdiction
of the people’s court at the place where such accidents occurred, or at the place where the vehicles or ships first arrived, or at
the place where the aircraft first landed, or at the place where the defendant is registered.

   Article 31. Actions claiming compensation for damage from ship collisions or other maritime accidents come under the jurisdiction of the people’s
court at the place where such collisions took place, or at the port where the damaged ship first arrived, or at the port where the
ship responsible for the damage is detained or registered.

   Article 32. Actions claiming salvage money come under the jurisdiction of the people’s court at the place of the salvage or at the port where
the salvaged ship first arrived.

   Article 33. Actions claiming common sea damage come under the jurisdiction of the people’s court at the port where the ship first arrived, or
at the place where common sea damage is settled, or at the port where the journey ends.

   Article 34. The following cases come under the special jurisdiction of the people’s court provided for by this article:

(1) Actions started on account of disputes over immovable property come under the jurisdiction of the people’s court at the place
of the immovable property;

(2) Actions started on account of disputes arising from harbor operations come under the jurisdiction of the people’s court at the
place of the harbor;

(3) Actions started on account of disputes over inheriting property come under the jurisdiction of the people’s court at the place
of the residence of the benefactor at the time of his death or the place of the principal property.

   Article 35. Where an action comes under the jurisdiction of two or more people’s courts, the plaintiff may file a suit at any of them; where
the plaintiff brings an action with two or more people’s courts which are competent, the case shall be handled by the people’s court
that is the first to place the case on file.

Section Three: Transferred Jurisdiction and Designated Jurisdiction

   Article 36. When a people’s court becomes aware that the case it is handling does not come under its jurisdiction, it shall transfer the case
to the competent people’s court which shall handle the case. When a people’s court considers that, according to the rules, it does
not have the right of jurisdiction over a case referred to it, it shall request the superior people’s court level to designate the
jurisdiction and shall make no further transfer by itself.

   Article 37. Where the competent people’s court is unable to perform its right of jurisdiction on special accounts.

Where the right of jurisdiction is in dispute between people’s courts, it shall be resolved through consultation by the two parties
involved; where consultation has failed, they shall request their common superior people’s court to designate the jurisdiction.

   Article 38. Where a party has an objection to the right of jurisdiction after the case is accepted by the people’s court, the party shall raise
its objection at the time of submitting a written reply. The people’s court shall examine the objection raised by the party. Where
the objection is tenable, a ruling shall be made to transfer the case to the competent people’s court; where the objection is untenable,
it shall reject the objection.

   Article 39. A superior people’s court has the right to conduct as the first instance the trial of a civil case which is under the jurisdiction
of an inferior people’s court; it may also refer a civil case under its own jurisdiction of first instance to an inferior people’s
court for trial.

Where an inferior people’s court considers that a civil case of first instance under its jurisdiction should be tried by a superior
people’s court, it may request that the case be referred to the latter.

Chapter III. Trial Group

   Article 40. In civil cases of first instance in the people’s court, justice is administered by a collegiate bench made up of either judges and
assessors, or only of judges. Members of the collegiate bench must total an odd number.

In civil cases where simple procedures are applicable, justice is administered by one judge independently.

Assessors during the exercise of their functions have equal rights and obligations with the judges.

   Article 41. In civil cases of second instance in the people’s court, justice is administered by a collegiate bench made up of judges. Members
of the collegiate bench must total an odd number. The trial de novo of a case returned shall be conducted by a newly organized collegiate
bench in the trial court in accordance with the procedure of first instance.

A case originally of first instance shall be tried de novo by a newly organized collegiate bench in accordance with the procedure
of first instance; a case originally of second instance shall be tried de novo by a newly organized collegiate bench in accordance
with the procedure of second instance.

   Article 42. The presiding judge of the collegiate bench shall be appointed by the president of the court or by a chief judge from among the judges;
where the president of the court or the chief judge takes part in the trial, he shall act as the presiding judge.

   Article 43. The principle of the minority being subordinate to the majority is followed in the deliberation of the collegiate bench. The minutes
of the deliberation shall be made and signed by all members of the collegiate bench. Differing opinions must be recorded accurately.

   Article 44. Judges shall handle cases impartially and in accordance with the law.

Judges may not accept dinner invitations or gifts from the litigants or their legal representatives.

The legal liability of judges, who take bribes, practice favouritism, engage in fraudulent practices and bend the law in administering
justice, shall be pursued. In cases where such acts constitute crimes, the criminal liability involved shall be investigated pursuant
to the law.

Chapter IV. Withdrawal

   Article 45. In any of the following circumstances, a judge must withdraw from the exercise of his functions, and a litigant is enpost_titled to challenge
him in verbal or written form

(1) Where he is a litigant in the case or a close relative of a litigant or his legal representative;

(2) Where he has an interest in the case;

(3) Where he has other relations with a litigant, which may affect fairness in the administration of justice.

The provisions of the preceding paragraph are applicable to recording clerks, interpreters, expert witnesses and inspectors.

   Article 46. In challenging, a litigant shall submit the reasons at the beginning of the hearing; where the cause of the withdrawal is learned
after the hearing commences, the challenge may be raised before the conclusion of arguments in court.

Except for emergency measures required by the case, the person who is thus challenged shall temporarily stop exercising his functions
in the case before a people’s court makes a decision on the challenge.

   Article 47. The withdrawal of a court president who serves as the presiding judge shall be decided by a judicial committee, while that of a judge
shall be decided by the president; the withdrawal of other personnel shall be decided by the presiding judge.

   Article 48. A people’s court shall make a verbal or written decision on a litigant’s application for withdrawal within three days of filing the
application. If the applicant is dissatisfied with the decision, he may apply for reconsideration upon receipt of the decision. During
the period of reconsideration, the person who is challenged shall not stop exercising his functions in the case. The people’s court
shall make a decision on reconsideration and notify the applicant accordingly within three days of receiving the application.

Chapter V. Litigant Participants

Section One: Litigants

   Article 49. Citizens, legal persons and other organizations may act as litigants in civil proceedings.

A legal person shall be represented by his legal representative in the proceedings, while other organizations shall be represented
by their principal leaders.

   Article 50. A litigant has the right to entrust his representative with applying for withdrawal, collecting and presenting evidence, taking part
in arguments, requesting mediation, filing an appeal and requesting execution.

A litigant may inspect materials pertaining to the case, and copy such materials and legal documents. The extent to which materials
pertaining to the case can be inspected and copied, and the methods for doing so, shall be specified by the Supreme People’s Court.

A litigant must exercise his rights in accordance with the law, observe procedural order, and implement any legally binding verdict,
ruling and mediation agreement.

   Article 51. Litigants of the two parties may reconcile of their own accord.

   Article 52. The plaintiff may abandon or alter his request for litigation. The defendant may admit or retort the request, and has the right to
file a counter suit.

   Article 53. A joinder is a case in which the litigants of one or both parties involve two or more people with common litigant objects or objects
of the same type, and which a people’s court deems appropriate to handle together after obtaining the litigants’ consent.

Where the litigants of one party in a joinder have common rights and obligations regarding the litigant objects, the litigant acts
of one of them are binding on the others if the latter recognize the acts; where the litigants have no common rights or obligations
regarding the litigant objects, the litigant acts of any of them are not binding on the others.

   Article 54. The litigants of one party involving many people in a joinder may name a representative to handle the litigation. The representative’s
litigant acts are binding on the litigants he represents. However, the consent of the litigants thus represented must be obtained
when it comes to changing the representative, abandoning the request for litigation, recognizing the other party’s request for litigation
and seeking reconciliation.

   Article 55. Where a case exists in which the litigants are two or more in number with litigant objectives of the same type, but the exact number
is still not determined at the time of litigation, the people’s court may issue a public notice explaining the case and litigant
request and notifying those who have the right to join the litigation to register with the people’s court within a prescribed period.

The registered litigants may elect a representative; if they are unable to elect a representative, the court shall choose a representative
through consultation with the registered litigants.

The litigation acts of the representative are binding on the litigants he represents. When the representative acts to alter or abandon
the litigant request, recognize the litigant request of the other party, or reconcile, he must have the approval of the litigants
he represents.

The judgment or ruling of the people’s court is binding on all the registered individuals who have the right to join; it is also binding
on those with the right to join who did not take part in the registration but apply to start an action within the prescribed litigation
period.

   Article 56. A third party who deems himself enpost_titled to an independent request with regard to the litigant objectives of both parties has the
right to start an action.

Where a third party is not enpost_titled to an independent request as regards the litigant objectives in dispute, but is legally interested
in the results of the civil proceedings, he may apply to take part in the action or the people’s court may notify him to do so. A
third

party who is ordered to accept civil responsibility by the people’s court has the rights and obligations of a litigant.

Section Two: Litigant Representatives

   Article 57. Where the litigant is incapable of litigant action, he may be represented by his legal representative; where he has no legal representatives,
the people’s court shall appoint a representative for him. Where the legal representatives shirk the representation responsibilities
among themselves, the people’s court shall appoint one of them to represent the litigant in the action.

   Article 58. Litigants or legal representatives may entrust one or two persons to represent them in the action.

Lawyers, close relatives of the litigants, persons recommended by social organizations or the units where the litigants work, or other
citizens approved by the people’s court may be entrusted as litigant representatives.

   Article 59. Where a representative is entrusted in the action, a letter of attorney signed or sealed by the party that entrusted the representative
must be presented to the people’s court.

The letter of attorney must list the items of trust and the limit of powers. Where the litigant representative acts to recognize,
abandon or alter the litigant request, lodge a counter-charge or file an appeal, he must have the special authorization of the represented.

The letter of attorney from a Chinese citizen residing abroad must be certified by the Chinese embassy or consulate in the said country.
If there is no Chinese embassy or consulate, it should be certified by the embassy or consulate of a third country that has diplomatic
relations with China and then delivered to the Chinese embassy or consulate in that third country for certification, or it may be
certified by a patriotic overseas Chinese organization.

   Article 60. Where the power of a litigant representative is changed or removed, the litigant shall inform the people’s court in writing, and
the latter shall notify the litigant of the other party.

   Article 61. Lawyers acting as litigant representatives or other representatives of the litigant have the rights to investigate, collect evidence
and inspect the files of the case in question. The scope and procedure for inspecting the files of the case in question shall be
formulated by the Supreme People’s Court.

   Article 62. The parties involved in divorce cases shall appear before the court, except those incapable of expressing themselves, even though
there are litigant representatives; where the party is unable to appear before the court in special circumstances, he or she must
present his or her views in written form to the people’s court.

Chapter VI. Evidence

   Article 63. Evidence falls into the following categories

(1) Documentary evidence;

(2) Material evidence;

(3) Video and audio material;

(4) Testimony of witnesses;

(5) Statement by litigants;

(6) Conclusion of expert corroborations;

(7) Records of inspection.

T SIZE=”-1″>None of the aforementioned evidence shall serve as the basis of establishment of facts before it has been ascertained
and verified.

   Article 64. Litigants are obliged to present evidence for their assertions.

The people’s court shall investigate and collect evidence which litigants and their representatives cannot collect because of objective
reasons, or evidence which the people’s court deems necessary for the hearing.

The people’s court shall, in accordance with the legal procedure, examine and verify the evidence fully and objectively.

   Article 65. The people’s court has the right to acquire evidence from the relevant units and individuals, and they shall not refuse it.

The people’s court shall examine the documents provided as evidence by relevant units and individuals, distinguish the true from the
false and determine validity.

   Article 66. The evidence shall be displayed and cross-examined by the litigants at the court. Evidence involving state secrets, commercial secrets
and personal secrets shall be kept confidential. Where it is necessary to display such evidence, it shall not be done in public hearing.

   Article 67. The people’s court shall acknowledge the validity of legal acts, legal facts and documents that have been notarized through legal
procedure, except those that can be overturned by counter-evidence.

   Article 68. Originals shall be presented as documentary or material evidence. Where there is indeed difficulty in presenting the originals, reproductions,
photos, copies or abridged versions may be presented.

Documentary evidence in foreign languages must be accompanied by a Chinese translation.

   Article 69. The people’s court shall distinguish the true from the false video and audio material, and, in conjunction with other evidence, determine
whether they can serve as the basis for the establishment of facts.

   Article 70. Whoever knows something about the case in question has the obligation to testify at the hearing. Leaders of the relevant units shall
support the witnesses to testify. Where the witness has difficulty in appearing at a hearing, he may present written testimony upon
the permission of the people’s court.

Those who are unable to express themselves accurately are unqualified to act as witnesses.

   Article 71. The people’s court shall examine the statement of a litigant in the light of the other evidence in the case and determine whether
it can serve as the basis of establishment of a fact.

Where a litigant refuses to make a statement, it shall not affect the establishment of facts in the case by the people’s court on
the basis of the evidence.

   Article 72. When the people’s court needs to corroborate special problems, it shall refer them to a legal corroboratory department; where there
is no legal corroboratory department, the people’s court shall designate a corroboratory department.

The corroboratory department and its designated expert witness have the right to acquaint themselves with the files of the case requiring
corroboration, and question the litigants and witnesses when necessary.

The corroboratory department and the expert witness shall submit a written conclusion of corroboration and sign or seal the corroboration
bill. Where it is corroborated by an expert witness, the bill shall be sealed by the unit where he works to prove his identity.

   Article 73. In inspecting material evidence or the scene, the inspector must produce the document of the people’s court and invite the local
basic organization or the litigant’s unit to send people to take part. The litigant or an adult member of his family shall be present
on the scene; if he refuses to be present, it shall not affect the inspection.

The relevant units and individuals, in accordance with the notice of the people’s court, have the obligation to protect the scene
and assist the inspection.

The inspector shall prepare a written record of the inspection and its results, which shall be signed or sealed by the inspector,
the litigant and the invited participants.

   Article 74. If the evidence should possibly be destroyed or lost, or if it would be difficult to obtain afterwards, the litigant participant
may request the people’s court for security of evidence; the people’s court may also take security measures on its own initiative.

Chapter VII. Period and Service

Section I: Period

   Article 75. The period includes the legal period and the period designated by the people’s court.

The period is computed in hours, days, months and years. The hour and the day from which the period begins are not included therein.

When the final day of the period falls on a holiday, the first day after the holiday shall be the date of the expiration of the period.

The period does not include the time of travel. Litigant documents which have been collected by the post office prior to the expiration
of the period are not deemed to be overdue.

   Article 76. Where the time limit has been exceeded owing to force majeure or other legitimate grounds, the litigant may, within 10 days after
the obstacle is removed, request an extension of the time limit; the people’s court shall decide on granting such a request.

Section II: Service

   Article 77. The service of litigant documents must be accompanied by a certificate of delivery upon which the addressee shall mark the date of
delivery and sign or seal.

The delivery date marked by the addressee on the certificate of delivery is the date of service.

   Article 78. Litigant documents shall be delivered directly to the addressee in person. When the addressee is a citizen and is absent, the documents
may be delivered to an adult member of his family who lives with him, and he shall sign upon delivery; when the addressee is a legal
person or other organizations, the legal representative of the legal person, the principal persons in charge of the organizations
or persons delegated by them shall accept the delivery and sign on their behalf; when the addressee delegates a litigant representative,
the documents shall be served upon this representative who shall sign upon delivery; and when the addressee already delegates a person
on

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

The State Council

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

GuoFa [1991] No.12

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
System, a number of development zones for new and high technology industries have been successively established in recent years in
some large-and medium-sized technology-intensive 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 Ten-Year Programme and the Eighth Five-Year 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 Export-Oriented 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; Nanhu-Nanling 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 Newly-Emerged 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 Acknowledgment and Determination of High and New Technology Enterprises
in the National Development Zones for High and New Technology Industries (Attachment I) and Interim Provisions on Policies for the
National Development Zones for High and New Technology Industries (Attachment II) both formulated by the State Science and Technology
Commission, and Provisions on the Tax Policy for the National Development Zones for High and New Technology Industries (Attachment
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.

Attachment:

I: Requirements and Measures for the Acknowledgment and Determination of High and New Technology Enterprises in the National Development
Zones for New and High Technology Industries(omitted)

II: Interim Provisions on Policies for the National Development Zones for High and New Technology Industries(omitted)

III: Provisions on the Tax Policy for the National Development Zones for High and New Technology Industries(omitted)

 
The State Council
1991-03-06

 




LAW OF THE PEOPLE’S REPUBLIC OF CHINA ON WATER AND SOIL CONSERVATION

The Standing Committee of the National People’s Congress

Law of the People’s Republic of China on Water and Soil Conservation

Order No. 49 [1991] of President

June 29, 1991

(Adopted at the 20th Meeting of the Standing Committee of the Seventh National People’s Congress on June 29, 1991 , Promulgated by
Order No. 49 of the President of the People’s Republic of China on June 29, 1991)

ContentsChapter I General Provisions

Chapter II Prevention

Chapter III Rehabilitation

Chapter IV Supervision

Chapter V Legal Responsibility

Chapter VI Supplementary Provisions

Chapter I General Provisions

Article 1

This Law is formulated for the purpose of the prevention and control of soil erosion, the protection and rational utilization of water
and soil resources, the mitigation of disasters of flood, drought and sandstorm, the improvement of ecological environment and the
development of production.

Article 2

As used in this Law, the term ” water and soil conservation ” means preventive and rehabilitative measures taken against soil erosion
which is caused by natural factors or human activities.

Article 3

All units and individuals shall have the obligation to protect water and soil resources, prevent and control soil erosion, and also
have the right to report against any unit or individual that damages water and soil resources and causes soil erosion.

Article 4

The state shall, in relation to the work of water and soil conservation, implement the policy of prevention first, overall planning,
comprehensive prevention and control, adoption of measures suited to local conditions, strengthening management and stress on beneficial
results.

Article 5

The State Council and the local people’s governments at various levels shall regard the work of water and soil conservation as an
important duty, and adopt measures to ensure the prevention and control of soil erosion.

Article 6

The department of water administration under the State Council shall be in charge of the work of water and soil conservation throughout
the country. The departments of water administration under the local people’s governments at or above the county level shall be in
charge of the work of water and soil conservation in areas under their respective jurisdiction.

Article 7

The department of water administration under the State Council and those under the local people’s governments at or above the county
level shall, on the basis of investigation and assessment of water and soil resources, draw up water and soil conservation plans
in conjunction with other departments concerned. Such water and soil conservation plans shall be subject to the approval by the people’s
governments at the corresponding levels. Any water and soil conservation plan approved by the local people’s government at or above
the county level shall be submitted to the department of water administration under the people’s government at the next higher level
for the record. Any modification to be made to an approved water and soil conservation plan shall be re-submitted for approval to
the original approving department.

The people’s governments at or above the county level shall incorporate the tasks specified in the water and soil conservation plans
into their respective plans for national economic and social development, allocate special funds therefor and organize the implementation
thereof.

The people’s governments at or above the county level shall, in line with the actual conditions of soil erosion, designate key areas
on which preventive and rehabilitative efforts against soil erosion shall be focused.

Article 8

Units and individuals engaged in production and construction activities which may cause soil erosion must adopt measures to protect
the water and soil resources, and shall be responsible to take rehabilitative measures against the soil erosion resulted from their
production and construction activities.

Article 9

The people’s governments at various levels shall intensify the publicity of and education in water and soil conservation, and popularize
scientific knowledge concerning water and soil conservation.

Article 10

The state shall encourage the research in and raise the level of science and technology of water and soil conservation, popularize
the advanced technology in water and soil conservation, and train in a planned way scientific and technological personnel in the
field of water and soil conservation.

Article 11

Units and individuals that have made outstanding achievements in the prevention and control of soil erosion shall be awarded by the
people’s government.

Chapter II Prevention

Article 12

The people’s governments at various levels shall organize every citizen to engage in afforestation and encourage the planting of grass,
thereby enlarging forest-covered areas and increasing vegetation.

Article 13

The local people’s governments at various levels shall, in light of respective actual conditions, organize agricultural collective
economic organizations as well as state-owned agricultural, forest, and livestock farms to plant firewood forests, forage and green
manure crops, and to conduct in a planned way the closing of hillsides for facilitating afforestation and growing grass and the rotation
of closing and grazing periods, so as to check winds, fix drifting sand and preserve vegetation. Destroying forest or burning vegetation
for land reclamation and stripping vegetation and digging up tree stumps on steep hill slopes or in arid regions shall be prohibited.

Article 14

Reclamation of hillsides with a slope of over 25 degrees for cultivation of crops shall be prohibited.

The people’s governments of provinces, autonomous regions and municipalities directly under the Central Government may, in line with
the actual conditions of the areas under their respective jurisdiction, prescribe the reclamation-forbidden slope of below 25 degrees.

The specific area of the reclamation-forbidden slope shall be determined and announced by the local people’s government at the county
level.

Anyone who has conducted reclamation for cultivation of crops on the reclamation-forbidden slopes before the entry into force of this
Law shall, on the basis of capital farming construction and in the light of the actual conditions, gradually stop the cultivation
and, instead, plant trees, grow grass and restore the vegetation, or build terraced fields thereon.

Article 15

Anyone who reclaims waste hillsides with a slope of above 5 degrees but under the prescribed reclamation-forbidden degrees must obtain
prior approval from the department of water administration under the people’s government at the county level; anyone who intends
to reclaim waste hills lopes owned by the state may apply to the people’s government at or above the county level for going through
the procedures for land reclamation only after obtaining approval from the department of water administration under the people’s
government at the county level.

Article 16

Felling of forest trees must be carried out in a rational manner and in line with the local conditions, and clear felling shall be
strictly controlled. Preventive measures against soil erosion shall be adopted in the felling areas and on skid trails, and reforestation
shall be accomplished in good time after the felling. With respect to protective forests such as those for water supply conservation,
water and soil conservation, windbreak and sand-fixation, felling shall only be permitted for tending and regeneration of forests.

For and felling in a forest area, water and soil conservation measures, for the felling area, worked out in accordance with the provisions
of the preceding paragraph, must be included in the felling plan thereof. After the felling plan is approved by the department of
forestry administration, the water and soil conservation measures for the felling area shall be implemented under the supervision
of the departments of water administration and forestry administration.

Article 17

Water and soil conservation measures must be adopted to prevent soil erosion when preparations for afforestation, tending of young
growth, and cultivation of commodity trees such as oil-tea camellia and tung tree are done on hillsides with a slope of above 5 degrees.

Article 18

In the construction of a railway, highway or water project, the disturbance of vegetation shall be minimized; waste sand, rocks and
earth thus created must be disposed of in an area specially designated for the purpose, and shall not be dumped out into any river,
lake, reservoir or any ditch or canal other than the specially designated area; slope protection must be built or other land management
measures adopted on hillslopes within the frontage of the railway and highway; after the project is completed, trees must be planted
and grass grown on the earth-fetching area, excavated land surface and the exposed land surface for the disposition of waste sand,
rock and earth, in order to prevent soil erosion.

In the establishment of a mining or electrical power enterprise or any other large or medium-sized industrial enterprise, the abandoned
stripped topsoil, waste rock, tailings and residues must be disposed of in a specially designated area, and shall not be dumped out
into any river, lake, reservoir or any ditch or canal other than the specially designated area. If the vegetation is damaged on account
of the mining or construction, measures must be taken to rehabilitate the topsoil and vegetation, thereby preventing soil erosion.

Article 19

When the construction of a railway, highway or a water project is carried out, a mining or electrical power enterprise or any other
large or medium-sized industrial enterprise is established in a mountainous, hilly or sandstorm area, the environmental impact statement
for the project must include a water and soil conservation programme approved by the department of water administration. The water
and soil conservation programme shall be drawn up in accordance with the provisions of Article 18 of this Law.

Where a township collective mining enterprise is to be set up or an individual is to apply for mining, in accordance with the provisions
of the Law on Mineral Resources, in a mountainous, hilly or sandstorm area, a water and soil conservation programme approved by the
department of water administration under the people’s government at or above the county level must be submitted before the application
for going through the approving procedures for mining operation is made.

Water and soil conservation facilities in a construction project must be designed, constructed and put into operation simultaneously
with the principal part of the project. When a construction project is completed and checked for acceptance, the water and soil conservation
facilities shall be checked for acceptance at the same time, with personnel from the department of water administration participating.

Article 20

The local people’s governments at various levels shall take measures to strengthen the control over such production activities as
mining, earth-fetching, sand-digging and quarrying, so as to prevent soil erosion.

Earth-fetching, sand-digging and quarrying shall be prohibited in areas in danger of land-collapsing or land-sliding or where mudrock
flow is liable to occur. The scope of such areas shall be determined and announced by the local people’s governments at or above
the county level.

Chapter III Rehabilitation

Article 21

The people’s governments at or above the county level shall, in accordance with the water and soil conservation plans, organize competent
administrative departments and units concerned to engage in a planned way in the rehabilitation of soil erosion.

Article 22

In a water-eroded region, by taking a small river basin comprising the natural ravines and flanking hillslopes as a unit, a comprehensive
system for the prevention and control of soil erosion shall be set up on the basis of overall planning and comprehensive rehabilitation.

In a wind-eroded region, such measures as exploitation of water resources, water diversion for sand removal, planting of trees and
growing of grass, installation of artificial sandbreak and forest network shall be adopted to build a protective system for windbreak
and sand-fixation, thereby controlling hazards of sand storms.

Article 23

The state shall encourage the agricultural collective economic organizations and farmers in soil-eroded regions to carry out rehabilitation
of soil erosion, and shall also practice a policy of giving support as to fund, energy, grain, taxation, etc.; the specific measures
thereof shall be prescribed by the State Council.

Article 24

The local people’s governments at various levels shall organize agricultural collective economic organizations and farmers to manage
in a planned way the cultivated land with a slope of above 5 degrees but under the reclamation-forbidden degrees, by taking in line
with different conditions such water and soil conservation measures as regulating drainage systems, building terraced fields, and
practicing a method of cultivation conducive to water and soil conservation.

Article 25

In soil-eroded regions, any individual who contracts for the use of land owned by the collective shall include the responsibility
of rehabilitating soil erosion in the contract.

Article 26

The rehabilitation of soil erosion on barren hills, waste valleys, barren hillocks and desolated beaches may be contracted to agricultural
collective economic organizations, individual farmers or leaseholding household groups.

Where the rehabilitation of soil erosion on barren hills, waste valleys, barren hillocks or desolated beaches are contracted out,
contracts for the rehabilitation of soil erosion shall be concluded according to the principle of the benefits derived therefrom
to be enjoyed by the contractors for the rehabilitation.

The trees planted on account of the contracted rehabilitation and the fruits yielded therefrom shall belong to the contractors; and
the land expanded as a result of the contracted rehabilitation shall be used by the contractors.

The state shall protect the lawful rights and interests of the parties to a contract for rehabilitation. Within the term of the contracted
rehabilitation, if a contractor dies, his or her successor (s) may, in accordance with the agreements stipulated in the contract,
continue to undertake the contract.

Article 27

Any enterprise or institution must, in the course of construction or production, adopt water and soil conservation measures, and shall
be responsible for the rehabilitation of the soil eroded. If an enterprise or institution is unable to carry out the rehabilitation,
the department of water administration shall undertake the task, and the cost thus entailed shall be borne by the enterprise or institution
that has caused the soil erosion.

The expenses for the prevention and control of soil erosion arising in the course of construction shall be allocated from the capital
construction investment; the expenses for the prevention and control of soil erosion arising in the course of production shall be
allocated from the production cost.

Article 28

The people’s governments at or above the county level shall organize departments concerned to inspect for acceptance the water and
soil conservation facilities built and the trees and grass planted in soil-eroded regions.

The management and protection of water and soil conservation facilities, experimental sites, trees and grass planted and other rehabilitation
achievements shall be strengthened.

Chapter IV Supervision

Article 29

The department of water administration under the State Council shall establish a monitoring network for water and soil conservation,
so as to conduct monitoring and prediction of the nation- wide soil erosion developments and publicly announce the results thereof.

Article 30

Personnel in charge of supervision over water and soil conservation in the departments of water administration under the people’s
governments at or above the county level shall have the right to carry out on-the-spot inspection on the situations of soil erosion
and the prevention and control thereof in areas under their respective jurisdiction. Units and individuals that are being inspected
must truthfully report the situations and provide necessary working conditions for the inspection.

Article 31

Any dispute arising among regions over the prevention and control of soil erosion shall be solved through consultation; if no settlement
is reached through consultation, the case shall be handled by the people’s government at the next higher level.

Chapter V Legal Responsibility

Article 32

In the case of any violation of the provisions in Article 14 of this Law by cultivation crops on reclamation-forbidden hillslopes,
the department of water administration under the people’s government at the county level shall order the cessation of the reclamation
and the adoption of remedial measures, and may also impose a fine.

Article 33

Where any enterprise, institution, or agricultural collective economic organization, without approval of the department of water administration
under the people’s government at the county level, reclaims waste hillsides with a slope of above 5 degrees but under the reclamation-forbidden
degrees, the department of water administration under the people’s government at the county level shall order the cessation of the
reclamation and the adoption of remedial measures, and may also impose a fine.

Article 34

In the case of earth-fetching, sand-digging or quarrying in areas in danger of land-collapsing or land-sliding or where mud-rock flow
is liable to occur, as designated by the local people’s government at or above the county level, the department of water administration
under the people’s government at or above the county level shall order the cessation of the above law-breaking acts and the adoption
of remedial measures, and shall also impose a fine.

Article 35

In the case of tree-felling in forest areas without adopting water and soil conservation measures, thus causing serious soil erosion,
the department of water administration shall report thereon to the people’s government at or above the county level for a decision
to order a rectification within a fixed period of time and the adoption of remedial measures, and shall also impose a fine

Article 36

Any enterprise or institution that causes soil erosion in the course of construction or production and fails to carry out rehabilitation
may, in light of the harmful consequences thus entailed, be punishable with a fine or be instructed to suspend its business for rehabilitation;
the responsible persons concerned shall be subjected to administrative sanctions by the unit where they work or by the competent
departments at higher levels.

The imposition of a fine shall be subject to a decision by the people’s government at the county level on a report submitted by the
department of water administration under the people’s government at the county level. The decision on ordering the suspension of
business for rehabilitation shall be made by the people’s government at the municipal or county level; the suspension of business
for rehabilitation for an enterprise or institution directly under the Central Government or a people’s government at the provincial
level shall be reported to the State Council or the provision people’s government for approval.

Any individual who engages in mining causes soil erosion and fails to carry out rehabilitation shall be punished in accordance with
the provisions of the preceding two paragraphs.

Article 37

Whoever hinders, by use of violence or threat, the performance of duty according to Law by personnel in charge of supervision over
water and soil conservation shall be investigated for criminal responsibility according to law; those who refuse to accept or hinders
the performance of duty by personnel in charge of supervision over water and soil conservation, but without resorting to violence
or use of threat, shall be punished by the public security organ in accordance with the Regulations on Administrative Penalties for
Public Security.

Article 38

If any party is not satisfied with the decision on administrative sanctions, it may, within 15 days after the receipt of the notice
of sanctions, apply for reconsideration to the organ at the next higher level over the one that has made the decision. The party
may also directly bring a suit in a people’s court within 15 days after the receipt of the said notice.

The reconsideration organ shall, within 60 days after the receipt of the application for reconsideration, make a reconsideration decision.
If the party concerned is not satisfied with the reconsideration decision, it may, within 15 days after the receipt of the reconsideration
decision, bring a suit in a people’s court. If the reconsideration organ fails to make a reconsideration decision within the time
limit, the party may, within 15 days after the expiration of the term for reconsideration, bring a suit in a people’s court.

If a party neither applies for reconsideration, nor brings a suit in a people’s court within the time limit, nor complies with the
decision on sanctions, the organ that has made the decision may apply to a people’s court for compulsory execution.

Article 39

Any individual or unit that causes damage from soil erosion shall bear the responsibility of removing the damage, and shall compensate
the units and individuals that have directly suffered the damage.

Any dispute over the liability or amount of compensation may, upon the request by a party, be dealt with by the department of water
administration; if the party is not satisfied with the decision thus made, it may bring a suit in a people’s court. The party may
also directly bring a suit in a people’s court.

In case of irresistible natural disasters, if damage from soil erosion cannot be avoided despite of taking reasonable measures promptly,
the individual or unit concerned shall be exempted from responsibility.

Article 40

In case a person in charge of supervision over water and soil conservation derelicts his or her duty or abuses his or her power and
thus brings losses to the public property or the interests of the state and the people, administrative sanctions shall be enforced
by the unit to which the offender belongs or by the competent department at a higher level; if the offence constitutes a crime, the
offender shall be investigated for criminal responsibility according to law.

Chapter VI Supplementary Provisions

Article 41

The State Council shall for mutate the implementing regulations in accordance with this Law.

The standing committees of the people’s congresses of the provinces, autonomous regions and municipalities directly under the Central
Government may, in accordance with this Law and in the light of the respective actual conditions, formulate measures of implementation.

Article 42

This Law shall enter into force as of the date of promulgation. The Regulations on the Work of Water and Soil Conservation promulgated
by the State Council on June 30, 1982 shall be annulled on the same date.

 
The Standing Committee of the National People’s Congress
1991-06-29

 




OFFICIAL REPLY OF THE STATE COUNCIL CONCERNING THE ABSORPTION OF FOREIGN INVESTMENT FOR THE DEVELOPMENT OF THE YANGPU AREA IN HAINAN PROVINCE

Category  SPECIAL ECONOMIC ZONES AND COASTAL ECONOMIC DEVELOPMENT ZONES Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1992-03-09 Effective Date  1992-03-09  


Official Reply of the State Council Concerning the Absorption of Foreign Investment for the Development of the Yangpu Area in Hainan
Province



(March 9, 1992)

    People’s Government of Hainan Province:

    The Report on the Project Proposal for the Foreign-Invested Development
and Management of Thirty Square Kilometers of Land in the Yangpu Development
Zone, submitted by your Province, has been received. An official reply is
hereby made as follows:

    1. We have agreed in principle with your Province to absorb foreign
investment for the development and management of about thirty kilometers of
land in the Yangpu area and build the area into the Yangpu Economic
Development Zone. You are allowed to negotiate with foreign investors
according to the provisions of the Interim Measures for the Administration of
the Foreign-Invested Development and Management of Tracts of Land.

    2. We have agreed in principle that your Province may assign to foreign
developers the right to the use of all about thirty square kilometers of land
in the Yangpu area at a time. You are allowed to negotiate with foreign
investors and conclude contracts for the assignment of land use rights under
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. The contracts shall expressly provide detailed conditions and terms of
development and exploitation of land, assignment, lease and mortgage of land
use rights, and land-use fees. The contracts shall take effect with the
approval of the State Council.

    After the right to the use of State-owned land has been assigned, the
ownership of resources and objects buried thereunder shall be reserved by the
State. If it is necessary to exploit and utilize them, the relevant laws and
administrative regulations of the State shall apply. The exploitation of
underground water resources in the Yangpu area shall be planned and controlled
in a rational way.

    3. The development of land may be conducted by a single foreign investor,
or jointly by several foreign investors, or by a Sino-foreign joint venture.
For the purpose of the development and management of land, development
enterprises shall be established according to the laws. Under the jurisdiction
and protection of laws of the State, such enterprises must observe laws and
regulations of the State in engaging in any activity.

    4. The Yangpu Economic Development Zone should be built into an
export-oriented industrial area, with advanced technology industries as its
leading sector and with the third industry developed correspondingly.
Development enterprises shall, according to this principle, draw up their
overall planning for the development and construction in the Yangpu Economic
Development Zone, which shall specify the main targets of the development and
construction, and its respective targets in different stages, the details and
requirements for achieving the development target, as well as the plans for
using the developed land.

    5. The projects for the construction in the Yangpu Economic Development
Zone shall reflect the State industrial policies and meet the requirements for
economic development in Hainan, and shall be subject to the approval of the
Chinese Government. With regard to the authorities for examination and
approval of these projects, the relevant provisions of the Circular Concerning
the Summary of a Forum on Further Opening up and Quickening Economic
Development and Construction on Hainan Island, approved and transmitted by the
State Council in 1988, shall apply. Projects with foreign investment within
the Development Zone shall, if they don’t depend on the domestic market in
terms of finance, energy resources, raw materials and the sale of products, be
subject to the examination and approval of your Province. However, for those
of them beyond the approved quota, the project proposals shall obtain the
consent of the State Planning Commission before you examine and approve them.
Projects for infrastructure constructed within the Development Zone according
to planning may be examined and approved by your Province.

    With the approval of the People’s Bank of China, banks or other financial
institutions with foreign investment may be established within the Development
Zone.

    6. We have agreed in principle that the Yangpu Economic Development Zone
shall be administered as a closed or separate area. The detailed separation
and supervision measures shall be formulated by the General Customs
Administration and the Special Economic Zone Office under the State Council in
consultation with other relevant departments, and shall be enforced upon
approval.

    7. Subject to the effective separation and supervision measures, policies
for bonded areas shall apply in the Yangpu Economic Development Zone to the
import and export control, collection and exemption of import and export
duties, product tax and value-added tax levied on behalf of the tax
authorities, but not to the administration of consumer goods imported for
market supplies. Before the enforcement of such measures, policies and
measures described in the Circular Concerning the Summary of a Forum on
Further Opening up and Quickening Economic Development and Construction on
Hainan Island, approved and transmitted by the State Council in 1988, and the
Provisions of the State Council Concerning the Encouragement of Investment in
Developing Hainan Island in 1988, shall continue to apply in the Yangpu area.

    Other tax policies in the Yangpu Economic Development Zone shall refer in
principle to the tax policies of the Hainan Special Economic Zone laid down by
the State. The reduction and exemption of taxes under the central authorities
shall be subject to the approval of the Ministry of Finance and the State
Administration of Taxation. Taxes under the local authorities shall be
adjusted in the light of the actual situations in different industries and
nobody may reduce and exempt all of them at a time.

    8. We have agreed in principle to your Province’s preliminary plan for
infrastructure construction with regard to facilities for water supply,
electricity supply, post and telecommunications, and means of transport in the
Yangpu Economic Development Zone. If the linking up of facilities and the
division of management work involves institutions outside the Development
Zone, you shall invite the institutions concerned to sign an agreement or a
contract with development enterprises so as to specify the detailed
requirements and measures. The issue on the building of a small-scale airstrip
in Yangpu shall be referred to the competent authority for special discussion.

    9. The overall planning for allocating shorelines for ports in Yangpu Bay
shall be drawn up by the traffic departments, in which consideration shall be
given to reserve the land extension in depth from shorelines according to the
actual needs for planned ports or piers. The contracts for the assignment of
land use rights and the overall planning for the development and construction
shall specify such consideration. Subject to the planning, Chinese and foreign
parties may jointly invest in the construction and management of ports and
piers, and foreign investors may build and operate piers for the use of
enterprises. Ports and navigation affairs shall be under the unified
administration of the traffic departments.

    10. We have agreed to your Province’s guideline on environmental
protection and measures for controlling the total quantity of pollutants
charged in the Yangpu Economic Development Zone. You should lose no time in
completing the assessment of regional environmental impact and doing other
preparatory work before the development and construction of the land is
started. Construction projects shall be in strict conformity with the
requirements of environmental protection. Facilities for the prevention and
control of pollution shall be designed, built and put into operation
simultaneously with the main project.

    11. We have agreed in principle to your Province’s conception about the
administrative organ to be set up in the Yangpu Economic Development Zone. You
must make the administrative staff simple and efficient, divide functions
among them clearly, and intensify the effective administration as a government
department.

                  






CIRCULAR OF THE STATE COUNCIL REGARDING THE FURTHER OPENING OF NANNING, KUNMING, PINGXIANG AND OTHER FOUR BORDER CITIES (OR COUNTIES OR TOWNS)

Category  SPECIAL ECONOMIC ZONES AND COASTAL ECONOMIC DEVELOPMENT ZONES Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1992-06-09 Effective Date  1992-06-09  


Circular of the State Council Regarding the Further Opening of Nanning, Kunming, Pingxiang and Other Four Border Cities (or Counties
or Towns)



(June 9, 1992)

    The State Council has resolved to further open such places as
Nanning (city), Kunming (city), Pingxiang (city), Dongxing (town),
Wanting (city), Ruili (county) and Hekou (county).

    1. The policies for costal open cities shall be implemented in the cities
of Nanning and Kunming.

    2. The following policies shall be implemented in some cities (or counties
or towns)–Pingxiang, Dongxing, Wanting, Ruili, and Hekou:

    (1) Border trade and economic cooperation with foreign companies shall
be carried out in accordance with relevant regulations approved by the State
Council. The people’s governments of Guangxi Zhuang Autonomous Region and
Yunnan Province within the limit of their authority, may grant certain
authority to the governments of the five cities (or counties or towns)
concerning the administration of border trade and economic cooperation so
that they may have the right to examine and approve some economic contracts
concerning border trade, product processing, and labor service cooperation
without asking a superior department for instructions. The five cities (or
counties or towns) may, with the approval of the Ministry of Foreign Trade
and Economic Cooperation, increase the number of companies dealing with border
trade by one or two.      

    (2) The development of processing trades and foreign-exchange-earning
agriculture shall be encouraged in these regions. During the Eighth Five-Year
Plan period, the five cities (or counties or towns) shall be exempt from
import duties and product taxes (value-added taxes) for imported seeds, seed
plants, breeding stocks, fodder, related technical equipment for developing
the export of agricultural products, and imported machinery and other
materials for processing and export of agricultural products and for
technological reform of enterprises.

    (3) Both domestic and foreign investment should be actively absorbed to
promote development of the economy. The governments of Guangxi Zhuang
Autonomous Region and Yunnan Province, within the limit of their authority,
may extend the authority of the governments of the five cities (or counties or
towns) to examine and approve foreign-funded projects. Income taxes shall be
levied on foreign-funded enterprises in the five cities (or counties or towns)
at a reduced rate of 24 percent.

    (4) Investors from neighboring countries may include the means of
production or other materials and equipment in the total amount of their
investment. These goods may be sold in accordance with the regulations
concerned, and the import duties and the consolidated industrial and
commercial tax shall be reduced by half.

    (5) Qualified cities (or counties or towns) are allowed to establish
border economic cooperation zones, and set up export-oriented processing
enterprises and relevant tertiaries. The specific scope of border economic
cooperation zones shall be examined and approved by the Special Economic
Zones Office of the State Council in conjunction with relevant departments.
The imported machines, equipment, and other materials, as well as office
articles within a reasonable quantity, so long as they are used for
infrastructure construction of border economic cooperation zones, shall be
exempt from import duties and product taxes (value-added taxes). During the
Eighth Five-Year Plan period, the newly-earned financial income of the
economic cooperation zones should be reserved for the construction of local
infrastructure.

    (6) If the scale of production and export of export-oriented productive
enterprises which have links with the inland areas in the border economic
cooperation zones reaches a certain volume, they shall be granted the right
to import from and export to the neighboring countries with the approval of
the Ministry of Foreign Trade and Economic Cooperation. The income taxes of
the inland-associated enterprises shall be levied at a reduced rate of 24
percent supposing the profits remain in the locality, but an additional amount
of nine percent shall be collected by the region in which the inland investors
are if they transfer the profits to inland areas. Until the end of the Eighth
Five-Year Plan period, the above-mentioned enterprises shall be exempt from
regulation tax on investment orientation.

    (7) The commodities received through barter by inland-associated
enterprises and foreign-funded enterprises in the border economic cooperation
zones may be sold by enterprises themselves, and import duties and
consolidated industrial and commercial tax shall be reduced by half for these
commodities. For importing commodities on which the state has placed
restrictions, the formalities of import examination and approval should be
handled in accordance with the relevant regulations of the state.

    (8) The state shall grant appropriate subsidies to assist construction of
customs and other port facilities in these five cities (or counties or towns).
The specific amount and means of subsidization shall be appraised and decided
by the Ministry of Finance.

    The five cities (or counties or towns) are allowed to collect managerial
fees (0.6 yuan/ton) on goods passing through the ports. These fees shall be
used for maintenance and construction of the port facilities and cities.

    (9) Every year during the Eighth Five-Year Plan period, the People’s Bank
shall allocate to Wanting and Ruili 10 million yuan each, and to Pingxiang,
Dongxing, and Hekou 20 million yuan each as credit for fixed assets. These
allocations shall be used for the construction of the border cities and the
border economic cooperation zones and shall be included in the state’s credit
and investment plan.

    (10) From this year to the end of the Eighth Five-Year Plan period, each
of the five cities (or counties or towns) shall be allowed to import 30 items
of transportation for their own use, which shall be exempt from import duties,
value-added taxes and special consumption taxes. These vehicles are to be used
only within the local region, and resale or conveyance outside is forbidden.
This shall be strictly supervised by the local customs offices. The authority
to check and issue import licences shall be granted to the department of
economy and trade of the Guangxi Zhuang Autonomous Region and Yunnan Province.

    (11) Investment and establishment of overseas enterprises in peripheral
countries shall be permitted. According to Document No.13 issued by the State
Council in 1991, the projects with a total investment volume below US$1
million shall be examined and approved by the Guangxi Zhuang Autonomous Region
and Yunnan Province, and licences shall be issued after authority is granted
by the Ministry of Foreign Trade and Economic Cooperation.

    The governments of the Guangxi Zhuang Autonomous Region and the Yunnan
Province should reinforce their leading role over the further-opened cities
and border towns and help them make overall plans for construction and
development. The scale of construction for land development should be suited
to the practical conditions of the localities. While expanding opening up and
speeding up economic construction, the two regions should strengthen
construction of the legal system and socialist spiritual civilization, tighten
macro-control over the economy, take strong measures against crimes such as
smuggling and narcotics trafficking so as to guarantee the security and
stability of the borders and the sound development of all undertakings.






MEASURES FOR THE ADMINISTRATION OF REGISTRATION OF ENTERPRISES FROM FOREIGN COUNTRIES (REGIONS) ENGAGING IN PRODUCTION AND BUSINESS WITHIN THE TERRITORY OF CHINA

Measures for the Administration of Registration of Enterprises from Foreign Countries (Regions) Engaging in Production and Business
within the Territory of China

Decree No.10, 1992 of State Administration for Industry and Commerce
August 15, 1992

(Promulgated by Decree No. 10 of State Administration for Industry and Commerce on August, 15, 1992)

Article 1

These Measures are formulated in accordance with laws and regulations with a view to promoting economic cooperation with foreign
countries, strengthening administration of enterprises from foreign countries (regions) (hereinafter referred to as foreign enterprises)
that are engaged in production and business within the territory of China, protecting their legitimate rights and interests, and
maintaining economic order.

Article 2

According to relevant laws and regulations, foreign enterprises, approved by the State Council and administrative authorities authorized
by the State Council (hereinafter referred to as examination and approval authorities) and engaged in production and business with
the territory of China, shall register with the State Administration for Industry and Commerce or the local administrations for industry
and commerce authorized by the State Administration for Industry and Commerce (hereinafter referred to as the administrative departments
of registration). Foreign enterprises may start production and business only when their applications for registration have been examined
and approved by administrative departments of registration and they are given Business Licenses of People Republic of China (hereinafter
referred to as Business Licenses. Foreign enterprises, who fail to be approved by the examination and approval authorities and whose
applications for registration fail to be examined and approved by administrative departments of registration, may not be engaged
in production and business within the territory of China.

Article 3

According to the state’s laws and regulations in force, foreign enterprises shall apply for registration if they are engaged in the
following production and business:

(1)

Exploration and exploitation of onshore and offshore oil and other mineral resources,

(2)

Contract projects for the construction and decoration of houses and civil engineering, or the installation of circuit pipelines and
equipment,

(3)

Operation and management of foreign-invested enterprises by contracts or authorization,

(4)

Branches established in China by foreign banks, and

(5)

Other production and business permitted by the State.

Article 4

When the projects for production and business conducted by foreign enterprises are approved by the examination and approval authorities,
the foreign enterprises shall register with the administration departments of registration within 30 days of approval.

Article 5

When the foreign enterprises apply for registration, they shall submit the following documents or certificates:

(1)

Applications signed by the chairperson of the board of directors or general manager, and

(2)

Documents and certificates approved by the examination and approval authorities.

Those engaged in the exploration and exploitation of onshore and offshore oil and other mineral resources shall submit documents approved
by the Ministry of Foreign Trade and Economic Cooperation; those engaged in contract projects for offshore oil shall submit approval
letter issued by China National Offshore Oil Corporation; those engaged in contract projects for onshore oil shall submit approval
letter issued by China National Petroleum Corporation or the entities authorized by it; those foreign banks that establish branches
shall submit approval documents issued by People’s Bank of China; those engaged in contract projects for the construction and decoration
of houses and civil engineering, or the installation of circuit pipelines and equipment shall submit Qualification Certificate for
Foreign-Owned Enterprises to Contract Projects issued by the Ministry of Construction; those engaged in operation and management
of foreign-invested enterprises by contracts or authorization shall submit approval document issued by authorities in charge of the
examination and approval of the contracts and articles of association of the foreign enterprises; those engaged in other production
and business shall submit approval documents issued by administrative authorities concerned in accordance with the industry which
their production and business belong to.

(3)

Contract for the production and business that foreign enterprises are engaged in (branches established in China by foreign banks are
not subject to this item).

(4)

Legitimate certificate of operation for enterprises issued by the governments of the countries (regions) where the foreign enterprises
are from,

(5)

Certificate of capital creditability of foreign enterprises,

(6)

Authorization letter issued by the China project person in-charge designated by the chairperson of the board of directors or the general
manager of the foreign enterprises, his/her resume, and ID card, and

(7)

Other relevant documents

Article 6

Main items about the registration of the foreign enterprises: name of enterprise, catalogue of enterprise, address, director, amount
of the fund, business scope, and period of business.

Name of enterprise refers to the name of the foreign enterprise stated in the legitimate certificate of operation, and it shall be
consistent with the name in the contract signed by the foreign enterprise for production and business. When foreign banks establish
branches in China, they shall name the branches after their own names with the name of the sites where the branches are located and
“branch”.

Catalogue of enterprise refers to divisions determined by the different elements of production and business that foreign enterprises
are engaged, and the types are: exploration and exploitation of mineral resources, contract projects, foreign-funded banks and contract
operation and management.

Address of enterprise refers to the sites where foreign enterprises are engaged in production and operation within the territory of
China. If the residences of the foreign enterprises within the territory of China are inconsistent with the sites of their business,
then they shall register both.

Director of enterprise refers to the project director designated by the chairperson of the board of directors or the general manager
of the foreign enterprise.

Amount of the fund refers to the total expense of the foreign enterprise for production and business, such as the total amount of
the contract, the accumulative expense of management of the foreign enterprise contracted or entrusted to operate and manage foreign-invested
enterprises during its period of management, the expense for exploration, exploitation, production and operation in the cooperation
of oil exploitation, operation funds of the branches of the foreign banks.

Business scope refers to the scope of production and business conducted by foreign enterprises within the territory of China. Period
of business refers to the period of production and business conducted by foreign enterprises within the territory of China.

Article 7

Administrative departments of registration shall decide whether or not they will approve the registration within 30 days upon their
acceptance of the applications submitted by foreign enterprises. Upon the approval, the administrative departments shall issue Business
licenses to them.

Article 8

Based on the different categories of production and operation foreign enterprises are engaged in, the term of validity of “Business
Licenses” shall be checked and ratified respectively in accordance with the following terms:

(1)

For foreign enterprises engaged in the exploration and exploitation of mineral resources, the term of validity of their Business Licenses
will be checked and ratified in line with the terms of exploration, exploitation and production.

(2)

For branches set up by foreign banks, the term of validity of their Business Licenses is 30 years, and the licenses shall be renewed
every 30 years. And

(3)

For foreign enterprises engaged in other production and business, the term of validity of their Business Licenses shall be checked
and ratified based on the term of operation specified in their contracts.

Article 9

Foreign enterprises shall conduct business within the scope of production and business checked and ratified by the administrative
departments of registration. Their legitimate rights and interests and business are protected by Chinese laws. Foreign enterprises
may not conduct production and business beyond the scope of production and business checked and ratified by the administrative departments
of registration.

Article 10

If foreign enterprises change their registration items, they shall apply to the administrative departments of registration for making
changes in their registration within 30 days.

The procedures for handling the changes in registration and the documents and the certificates required to be submitted shall follow
the provision in Article Five of these Measures.

Article 11

If foreign enterprises do not intend to apply for an extension of the registration at the expiration of the term of validity of the
Business Licenses, or if they discontinue their contracts or agreements ahead of time, they shall apply to the original administrative
departments of registration for cancellation of registration.

Article 12

When applying for cancellation of registration, foreign enterprises shall submit the following documents or certificates:

(1)

Applications for cancellation of registration signed by the chairperson of the board of directors or the general manager of the foreign
enterprises;

(2)

Business Licenses, their duplicates and official seals;

(3)

Certificates showing the completion of taxes issued by the customs and taxation departments; and

(4)

Documents of approval on the applications for foreign enterprises’ cancellation of registration issued by the competent departments
in charge of their projects.

When checking and ratifying the foreign enterprises’ cancellation of registration, the administrative departments of registration
shall recall Business Licenses, their duplicates, official seals, cancel the register numbers, and notify relevant banks, such departments
as taxation and customs and so on.

Article 13

Foreign enterprises shall pay registration fees when they register for business or for changes in registration. The fee standard
for registration shall follow the provisions stipulated in Notification of the fee standard for the registration of enterprises as
legal persons issued by the Ministry of Finance, the State Price Bureau and the State Administration for Industry and Commerce.

Article 14

Branches of foreign banks, foreign enterprises engaged in business management and that engaged in the exploration and exploitation
of mineral resources shall receive annual check-up in the original administrative departments of registration before May every year.
When receiving annual check-up, they shall submit Business Licenses, their duplicates, reports on last year’s production and business,
etc.

Article 15

Chinese enterprises that have signed contracts for production and business with foreign enterprises may notify timely the administration
departments of registration of cooperation projects, contents and time, and assist the foreign enterprises in going through business
registration, registration for changes, and cancellation of registration. If the Chinese enterprises fail to perform their duty,
they shall bear commensurate responsibilities.

Article 16

What the administrative departments of registration mainly supervise and administer the foreign enterprises are as follows:

(1)

To supervise the foreign enterprises in going through business registration, registration for changes, and cancellation of registration
according to these Measures;

(2)

To supervise the foreign enterprises in conducting production and business within the scope of business checked and ratified by the
administrative departments of registration;

(3)

To supervise the foreign enterprises to receive annual check-up; and

(4)

To supervise the foreign enterprises to conform with Chinese laws and regulations.

Article 17

If foreign enterprises violate these Measures, the administrative departments of registration shall investigate and punish them in
accordance with the articles concerning punishment of the Regulations of the People’s Republic of China for Controlling the Registration
of Enterprises as Legal Persons and Rules for Implementation thereof.

Article 18

Enterprises from Hong Kong, Macao, and Taiwan engaged in the above-mentioned production and business shall follow these Measures.
Foreign enterprises with contracts for business management over domestic enterprises shall follow these Measures.

Article 19

The State Administration for Industry and Commerce is responsible for the interpretation of these Measures.

Article 20

These Measures shall take effect from October 1, 1992.



 
The State Administration for Industry and Commerce
1992-08-15

 







CIRCULAR OF THE STATE COUNCIL REGARDING FURTHER REFORM OF THE ADMINISTRATION OF INTERNATIONAL OCEAN SHIPPING INDUSTRY

Category  COMMUNICATIONS AND TRANSPORT Organ of Promulgation  The State Council Status of Effect  In Force
Date of Promulgation  1992-11-10 Effective Date  1992-11-10  


Circular of the State Council Regarding Further Reform of the Administration of International Ocean Shipping Industry



(November 10, 1992)

    In order to meet the needs of developing foreign economic
relations and trade, a set of reform measures have been drawn up
which concern the administration of the international ocean shipping
industry in China, and which have played an active role in
enlivening foreign trade shipping and promoting the development
of the international ocean shipping industry. However, non-
separation between enterprises and administrative departments,
too much administrative interference and the inactivity of some
reform measures have restricted the management of goods shipping
agencies (hereinafter referred to as cargo agencies), shipping
agencies and the international ocean shipping enterprises
(hereinafter referred to as shipping companies), have caused a lack
of vigor in enterprises and affected the international ocean
shipping industry in China. Thus, further reform in the
administration of the international ocean shipping industry in
China must be undertaken. The following are to be especially
noted:

    1. Free up cargo agencies and shipping agencies, allow more
managers, and encourage competition in order to improve service
quality. Those enterprises, including branches which have
obtained business licenses, which meet business operational
conditions and legally conduct business activities, may engage in
cargo agency and shipping agency activities after approval; cargo
owners and shipping companies shall have the right to freely
select cargo agencies or shipping agencies, and carriers and
cargo owners may establish direct carriage and consignment
relationships; no department may undertake to interfere with
them.

    2. Every positive factor should be brought into play to
develop international ocean shipping. Those enterprises,
including large scale enterprise groups and specialized import
and export companies, which meet business operational conditions
and legally conduct business activities may establish shipping
companies after being approved for engaging in international
ocean shipping.

    3. Freedom in management of the shipping companies shall be
enlarged in accordance with the provisions of the Regulations on
the Transformation of the Mechanisms of the Industrial
Enterprises Owned by the Whole People. Shipping companies may, in
light of state macro requirements, freely determine route
management, ship allocation, increases or decreases in shipping
and ship renewal.

    4. Those routes which domestic shipping companies are not
able to open or those routes for which shipping densities are
insufficient may, on the principle of reciprocity, absorb
foreign-funded regular shipping vessels or overseas Chinese-
funded regular shipping vessels staying at ports in China, but
shipping may not be carried out along the coast. Foreign shipping
companies are allowed to run foreign-funded or Chinese-foreign
joint shipping ventures in a proper manner, and may canvass cargo
business, sign bills, convert foreign exchange and conclude
contracts for their own ships after approval.

    5. The management functions of government departments shall
be conscientiously transferred. The Ministry of Communications
and the Ministry of Foreign Economic Relations and Trade shall,
on the principle of simpler administration and loosened control,
decrease the approval and administrative interference of the
specific routines of enterprises. The Ministry of Foreign Economic
Relations and Trade shall be in charge of the policy, guidelines,
regulations and statistical surveys concerning the administration
of cargo agencies; the Ministry of Communications shall be in charge
of the policies, guidelines, regulations and statistical surveys
concerning the administration of shipping companies and shipping
agencies. Henceforth the two ministries shall, through macroscopic
regulation and economic and legal measures, carry out macro
management of shipping companies, cargo agencies and shipping
agencies engaged in international shipping. Moreover, they shall,
in line with international invention and on the basis of China’s
national conditions, formulate just and reasonable operational
qualification standards and administrative approval measures for
the shipping companies, shipping and cargo agencies, and provide a
fair competitive market environment for enterprises. The two
ministries shall strengthen industrial administration of those
enterprises which participate in competition, without any
discrimination, and shall not treat them differently because they
are subject to different ministries. Each local government shall
also simplify administration, loosen control, and prevent local
protectionism.

    6. The Ministry of Communications shall study the measures
taken by foreign countries in developing the shipping industry
and, through consultation with the relevant departments, formulate
specific policies for promoting the development of the ocean freight
industry in China, which shall be effective after being submitted to
and approved by the State Council.

    The Ministry of Communications, the Ministry of Foreign Economic
Relations and Trade and other departments shall conduct research on
and formulate specific policies for the following items: fair
competition in taxation and management between state-owned shipping
agency enterprises, cargo agency enterprises, shipping companies
and foreign-funded or joint shipping agency enterprises, cargo
agency enterprises or shipping companies; improved supervisory and
restraint mechanisms; getting rid of barriers between different
levels or departments; preventing monopolies; and implementing
measures for the banning of illegal businesses and other activities
concerning the ocean shipping market. These measures shall be
effective after being submitted to and approved by the State Council.

    7. The enterprises subject to the Ministry of Communications
and the Ministry of Foreign Economic Relations and Trade shall
bring into play their respective superiorities and develop a
horizontal integration by adopting joint operation and stock
purchasing measures.

    8. The Ministry of Foreign Economic Relations and Trade and
the Ministry of Communications shall strengthen unity, cooperate
closely and consult with each other in administering
international ocean shipping. In case of problems involving other
departments concerned, agreement must be reached from such
departments or a joint document must be issued; no document with
which the relevant departments do not agree shall be promulgated.
Major issues which do not have the agreement of the relevant
departments through consultation may be submitted to and decided
by the State Council.

    9. The China Ocean Shipping Company and the China National
Foreign Trade Transportation Corporation are the two largest
foreign trade shipping enterprises in China, and shall share the
same policy treatment by the state. The relevant departments shall
support them, improve their competitive power with foreign
companies, and promote the development of the international ocean
shipping industry in China.

    10. Every relevant department shall, in the spirit of this
Circular, check up on the documents promulgated earlier by this
department; in case of any discrepancy with this Circular, former
documents shall be amended in accordance with the provisions of
this Circular and submitted for implementation.

    This Circular shall be implemented as of the date of
promulgation.






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...