LETTER OF THE MINISTRY OF COMMERCE ABOUT REINFORCING THE PROTECTION OF INTELLECTUAL PROPERTY WHEN ATTENDING OR ORGANIZING OVERSEAS EXHIBITIONS

Letter of the Ministry of Commerce about Reinforcing the Protection of Intellectual Property When Attending or Organizing Overseas
Exhibitions

Shang Fa Han [2007] No.16

The people’s governments of all provinces, autonomous regions, municipalities directly under the Central Government, the cities specifically
designated in the state plan and Xinjiang Production and Construction Corporations.:

During these years, the Chinese enterprises have been involved in more and more disputes on intellectual property when attended overseas
exhibitions. On CPHL Worldwide 2006 which was held in France, the Chinese enterprise exhibitors were suspected of infringement on
intellectual property, which leaded to ill consequences, for example, some related personnel were detained and some exhibits were
confiscated. The same thing happened in March 2007 on CeBIT, which was held in Hanoverian, Germany. The repetitive occurrence of
such incidents shows that some Chinese enterprises are short of the awareness of protecting intellectual property and fail to place
enough emphasis on the protection of intellectual property when preparing to go abroad to attend exhibitions. Such incidents have
not only impaired China’s overseas good image in the facet of protection of intellectual property, but also resulted in great damage
to the reputation and interests of those enterprise exhibitors themselves and even endangered the personal safety of some individuals.

To respect and protect intellectual property is not only a requirement for the development of enterprises themselves, a requirement
for the development of national economy and science and technology, but also a requirement for promoting the sound development of
Chinese-foreign trade and economic relations. Therefore we should make continuous efforts to enhance enterprises’ understanding of
protecting intellectual property. For the purpose of guiding enterprises going abroad to attend exhibitions to do well the protection
of intellectual property, we hereby inform the related issues as follows:

Great emphasis shall be laid on the protection of intellectual property in attending overseas exhibitions. More efforts in guiding
and supervising the related local functional management shall be made. And an effective work mechanism to avoid the occurrence of
infringements in overseas exhibitions shall be set up.

The circumstances about the protection of intellectual property in the process of attending overseas exhibitions by local enterprises
shall be sorted out and analyzed. The administration of enterprises attending overseas exhibitions and entities organizing overseas
exhibitions shall be further reinforced. The examination and verification of the protection of intellectual property shall be taken
as an importance task.

A responsibility system for infringements on intellectual property shall be set up. Those domestic enterprises that attend overseas
exhibitions or entities organizing overseas exhibitions which lead to serious consequences because of their infringement upon intellectual
property shall be imposed upon necessary punishment according to the actual circumstances.

Enterprises attending overseas exhibitions or entities organizing overseas exhibitions shall be trained in terms of intellectual property
to improve their awareness of protecting intellectual property. They shall not only protect their own intellectual property but respect
others’ legitimate rights and interests.

All regions shall actively conduct China’s business councils in foreign countries to hear the related suggestions when organizing
overseas exhibitions.

Each region shall contact the Department of Treaty and Law of the Ministry of Commerce in the case of any complaint or suggestion
in conducting the related work.

Contact person: Yang Hanhui, Chen Fuli

Tel: 65198154/8761

Ministry of Commerce

April 30, 2007

Ministry of Commerce
2007-04-30

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING REFUND OF TAXES LEVIED ON PURCHASE OF DOMESTIC EQUIPMENT BY CONSTRUCTION ENTERPRISES ENTRUSTED BY FOREIGN-FUNDED ENTERPRISES THROUGH CONTRACTING FOR LABOR AND MATERIALS

Circular of the State Administration of Taxation concerning Refund of Taxes Levied on Purchase of Domestic Equipment by Construction
Enterprises Entrusted by Foreign-funded Enterprises through Contracting for Labor and Materials

Guo Shui Han [2007] No.637

All the state taxation bureaus of all provinces, autonomous regions, municipalities directly under the Central Government and cities
specifically designated in the state plan:

We have received letters from some areas recently requesting the State Administration of Taxation to clear the examination and approval
procedures for refund of taxes levied on purchase of domestic equipment by construction enterprises entrusted by foreign-funded enterprises
through contracting for labor and materials. Upon study, a circular on relevant issues is hereby rendered as follows:

For the engineering projects which are contracted out by foreign-funded enterprises through contracting for labor and materials, if
such construction enterprises execute with their contractors an agreement for purchase of domestic equipment, entrusted to purchase
domestic equipment, and get VAT invoices (the purchasers on VAT invoices should be the Construction Enterprises) issued therefore,
the invoices shall be delivered to the foreign-funded enterprises for application for tax refund under relevant rules.

Procedures for Application for Tax Refund

(1)

When applying for tax refund, the foreign-funded enterprises should fill out Application Form for Purchase of Domestic Equipment by
Foreign-funded Projects, together submit the credence stipulated in Circular of the State Administration of Taxation and National
Development and Reform Commission on Printing and Issuing the Trial Measures for the Administration of Refund of Taxes Levied on
Purchase of Domestic Equipment by Foreign-funded Projects (Guo Shui Fa [2006] No.111), VAT invoices for the purchase of domestic
equipment by the construction enterprises on behalf of the engineering projects, the General Contract by the foreign-funded enterprises
and the construction enterprises, the list of domestic equipment purchased on entrustment, the list of equipment delivered by the
construction enterprises to the foreign-funded enterprises, the Opinion Letter on Checking and Accepting the Equipment issued by
relevant departments of the foreign-funded enterprises, and payment voucher, etc. to the competent tax authorities for tax refund.

(2)

After accepting the application for tax refund, for those equipments under the General Contract between the foreign-funded enterprises
and the construction enterprises, whose VAT invoices read the construction enterprises as the purchasers, the competent tax authorities
should send letters to the tax competent authorities of the supply enterprises to make an investigation. If the replies affirm the
authenticity of the invoices and that the tax declaration of the equipment in the invoices has been made, the tax competent authorities
shall handle the application. If the replies cannot affirm the authenticity of the invoices, or if the replies cannot affirm whether
the tax declaration of the equipment in the invoices has been made, or if the replies can not be received, the tax competent authorities
shall not transact the application.

Other matters not covered in this Circular shall be governed by the document “Guo Shui Han [2006] No.111”.

State Administration of Taxation

June 12, 2007

State Administration of Taxation
2007-06-12

COMPANIES LAW

Companies Law of the People’s Republic of China

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

No. 42

The Companies Law of the People’s Republic of China has been revised and adopted at the 18th Meeting of the Standing Committee
of the Tenth National People’s Congress of the People’s Republic of China on October 27, 2005, and its revised version is hereby
promulgated and shall go into effect as of January 1, 2006.

Hu Jintao

President of the People’s Republic of China

October 27, 2005

(Adopted at the 5th Meeting of the Standing Committee of the Eighth National People’s Congress on December 29, 1993; amended for
the first time in accordance with the Decision on Revision of the Company Law of the People’s Republic of China made at the 13th
Meeting of the Standing Committee of the Ninth National People’s Congress on December 25, 1999; amended for the second time in
accordance with the Decision on Revision of the Company Law of the People’s Republic of China made at the 11th Meeting of the Standing
Committee of the Tenth National People’s Congress on August 28, 2004; and revised at the 18th Meeting of the Standing Committee
of the Tenth National People’s Congress on October 27, 2005)

Contents

Chapter I　General Provisions

Chapter II　Incorporation and Organizational Structure of a Company with Limited Liability

Section 1　Incorporation

Section 2　Organizational Structure

Section 3　Special Provisions on One-person Companies with Limited Liability

Section 4　Special Provisions on Wholly Stated-owned Companies

Chapter III　Equity Transfer of Companies with Limited Liability

Chapter IV　Incorporation and Organizational Structure of a Company Limited by Shares

Section 1　Incorporation

Section 2　Shareholders General Assembly

Section 3　Board of Directors, and the Manager

Section 4　Board of Supervisors

Section 5　Special Provisions on Organizational Structure of Listed Companies

Chapter V　Issue and Transfer of Shares of Companies Limited by Shares

Section 1　Issue of Shares

Section 2　Transfer of Shares

Chapter VI　Qualifications and Obligations of Directors, Supervisors and Senior Managers of Companies

Chapter VII　Corporate Bonds

Chapter VIII　Financial Affairs and Accounting of Companies

Chapter IX　Merger and Division of Companies, Increase and Reduction of Capital

Chapter X　Dissolution and Liquidation of Companies

Chapter XI　Branches of Foreign Companies

Chapter XII　Legal Responsibility

Chapter XIII　Supplementary Provisions

Chapter I　General Provisions

Article 1　This Law is enacted in order to standardize the organization and behavior of companies, to protect the legitimate rights
and interests of companies, shareholders and creditors, to maintain the socio-economic order and to promote the development of the
socialist market economy.

Article 2　For the purposes of this Law, the term company refers to a company with limited liability or a company limited by shares
incorporated within the territory of the People’s Republic of China in accordance with this Law.

Article 3　A company is an enterprise legal person, which has independent property of a legal person and enjoys the property rights
of a legal person. The company shall be liable for its debts to the extent of its entire property.

Shareholders of a company with limited liability shall assume liability towards the company to the extent of the capital contributions
subscribed respectively by them; and the shareholders of a company limited by shares shall assume liability towards the company to
the extent of the shares subscribed respectively by them.

Article 4　The shareholders of a company shall, in accordance with law, enjoy such rights as benefiting from the assets of the company,
participation in making major decisions and selection of managerial personnel.

Article 5　In its operational activities, a company shall abide by laws and administrative regulations, observe social morals and
commercial ethics, persist in honesty and good faith, accept supervision by the government and the public, and assume social responsibility.

The legitimate rights and interests of companies shall be protected by law, and shall be inviolable.

Article 6　Where an entity intends to incorporate a company, it shall, in accordance with law, apply to a company registration authority
for registration of such incorporation. Where the conditions for incorporation provided for by this Law are met, the company registration
authority shall have the company registered as a company with limited liability or a company limited by shares; and where the said
conditions are not met, the company shall not be registered as one with limited liability or as one limited by shares.

Where laws or administrative regulations provide that approval is required for incorporation of a company, the procedures of approval
shall be completed according to law prior to registration of the company.

The public may apply to the company registration authority for inquiry about the items registered by a company, and the authority
shall provide services for such inquiry.

Article 7　The company registration authority shall issue a business license to a company incorporated according to law. The date
on which the business license is issued shall be the date on which a company is incorporated.

In the business license of a company shall clearly be stated such items as the name, domicile, registered capital, actually received
capital, scope of business and name of the legal representative of the company.

Where the items stated in the business license of a company are altered, the company shall have the alterations registered according
to law, and the company registration authority shall renew its business license.

Article 8　A company with limited liability incorporated according to this Law shall have the words “company with limited liability”
or “limited company” indicated in its name.

A company limited by shares incorporated according to this Law shall have the words “company limited by shares” or “company
by shares” indicated in its name.

Article 9　Where a company with limited liability is to be changed into a company limited by shares, it shall meet the conditions
of a company limited by shares provided for by this Law. Where a company limited by shares is to be changed into a company with limited
liability, it shall meet the conditions of a company with limited liability provided for by this Law.

Where a company with limited liability is changed into a company limited by shares, or a company limited by shares is changed into
a company with limited liability, the rights of credit and the debts of the company prior to the change shall be inherited by the
company after the change.

Article 10　The domicile of a company shall be the place where its main administrative organization is located.

Article 11　Articles of association shall be formulated according to law when a company is incorporated. The articles of association
of a company shall have binding force on the company, its shareholders, directors, supervisors and senior managers.

Article 12　The business scope of a company shall be defined in the company’s articles of association, and shall be registered
according to law. A company may revise its articles of association and alter its scope of business, but shall have such revision
and alteration registered.

The items within the scope of business of a company that are subject to approval as provided for by laws and administrative regulations
shall be submitted for approval according to law.

Article 13　The chairman of the board of directors, the executive director or the manager shall, in accordance with the provisions
of a company’s articles of association, serve as the legal representative of the company, which shall be registered according to
law. Where the legal representative of a company is replaced, the company shall have such replacement registered.

Article 14　A company may establish branches. Where a company intends to establish a branch, it shall apply for registration to
the company registration authority, in order to obtain a business license for the branch. However, such a branch shall not possess
the status of a legal person, and its civil liabilities shall be borne by the company.

A company may establish subsidiaries, which shall possess the status of legal persons, and shall independently bear civil liabilities
according to law.

Article 15　A company may invest in other enterprises; however, it shall not become the investor that assumes joint and several
liability for the debts of the enterprises in which it invests, except where otherwise provided for by law.

Article 16　Where a company intends to invest in another enterprise or provide guarantee for another entity, the matter shall, in
accordance with the provisions of the company’s articles of association, be subject to a resolution adopted by the board of directors
or the shareholders assembly or the shareholders general assembly; and where norms for the gross amount of investments or guarantees
and for the amount of a single investment or guarantee are specified in the company’s articles of association, such norms shall
not be exceeded.

Where a company intends to provide a guarantee for its shareholder or its actual controller, the matter shall be subject to a resolution
adopted by its shareholders assembly or shareholders general assembly.

The shareholder specified in the preceding paragraph or the shareholder dominated by the actual controller specified in the preceding
paragraph shall not participate in the vote on the matter specified in the preceding paragraph. The resolution on such matter shall
be adopted if it is voted for by other shareholders present at the meeting who hold more than half of the voting rights.

Article 17　Companies shall protect the lawful rights and interests of their staff and workers, sign labor contracts with them according
to law, participate in social insurance, and improve occupational protection so as to achieve safety in production.

Companies shall, in various forms, improve vocational education and on-the-job training among their staff and workers so as to enhance
their quality.

Article 18　The staff and workers of a company shall, in accordance with the Trade Union Law of the People’s Republic of China,
organize a trade union to carry out trade union activities and protect the lawful rights and interests of the staff and workers.
The company shall provide the trade union of the company with the conditions necessary for carrying out its activities. The trade
union of a company shall represent the staff and workers to sign with the company collective contracts on such items as the payment
for work done, working hours, welfare and insurance benefits as well as occupational safety and health of the staff and workers according
to law.

Companies shall, through the conference of the representatives of the staff and workers or other forms, carry out democratic management
in accordance with the provisions of the Constitution and relevant laws.

When a company discusses to make decisions on structural reform or on major issues in business operation, or formulate important
rules and regulations, it shall listen to the opinions of the trade union, and shall listen to the opinions and proposals of the
staff and workers through the conference of the representatives of staff and workers or other forms.

Article 19　In companies, Communist Party organizations shall, in accordance with the provisions of the Constitution of the Communist
Party of China, be set up to carry out activities of the Party. Companies shall provide the necessary conditions for the Party organizations
to carry out their activities.

Article 20　The shareholder of a company shall observe laws, administrative regulations and the company’s articles of association,
exercise the rights of a shareholder according to law, and shall not abuse his rights to damage the interests of the company or other
shareholders; and he shall not abuse the independent status of the company as a legal person or the limited liability of shareholders
to damage the interests of the creditors of the company.

Where the shareholder of a company abuses the rights of shareholders and thus causes losses to the company or other shareholders,
he shall be liable for compensation according to law.

Where the shareholder of a company abuses the independent status of the company as a legal person or the limited liability of shareholders,
evades debts and thus seriously damages the interests of the creditors of the company, he shall assume joint and several liability
for the debts of the company.

Article 21　Proprietary shareholders, the actual controllers, directors, supervisors and senior managers of a company shall not
take advantage of their affiliated relations to damage the interests of the company.

A person who, in violation of the provisions of the preceding paragraph, causes losses to a company shall be liable for compensation.

Article 22　The resolution adopted by the shareholders assembly or the shareholders general assembly or the board of directors of
a company, which in content violates laws or administrative regulations, shall be invalid.

Where the procedures for convening the meeting of the shareholders assembly or the shareholders general assembly, or the board of
directors, or the voting formulas are against laws, administrative regulations or the articles of association of a company, or the
content of the resolution adopted is against the company’s articles of association, the shareholders may, within 60 days from the
date the resolution is adopted, request the people’s court to rescind the resolution.

Where shareholders take legal proceedings in accordance with the provisions of the preceding paragraph, the people’s court may,
upon request of the company, demand the shareholders to provide appropriate guarantee.

Where a company has registered for alteration in accordance with the resolution adopted by the shareholders assembly, the shareholders
general assembly or the board of directors, and the people’s court declares the resolution invalid or rescinds it, the company
shall apply for cancellation of the registration for such alteration.

Chapter II　Incorporation and Organizational Structure of a Company with Limited Liability

Section 1　Incorporation

Article 23　The following conditions shall be met for the incorporation of a company with limited liability:

(1) The number of shareholders conforms to the statutory number;

(2) The capital contributions of the shareholders reach the statutory minimum amount of capital;

(3) The shareholders have jointly formulated the articles of association;

(4) The company has its name and has established an organizational structure in conformity with the requirements for a company with
limited liability; and

(5) The company has its own domicile.

Article 24　A company with limited liability shall be jointly invested in and incorporated by not more than 50 shareholders.

Article 25　The articles of association of a company with limited liability shall specify the following items:

(1) the name and domicile of the company;

(2) the scope of business of the company;

(3) the registered capital of the company;

(4) the names or post_titles of the shareholders;

(5) the forms of capital contributions, the amounts and dates of capital contributions made by shareholders;

(6) the bodies of the company, and the measures for their establishment, their functions and powers, as well as the rules of procedure;

(7) the legal representative of the company; and

(8) other items which the shareholders assembly deems necessary to be specified.

The shareholders shall sign their names on and affix their seals to the company’s articles of association.

Article 26　The registered capital of a company with limited liability shall be the amount of capital contributions subscribed for
by all of its shareholders, as is registered with the company registration authority. The amount of the initial capital contributions
made by all of the shareholders of the company shall be not less than 20 percent of the company’s registered capital, or not less
than the statutory minimum amount of the registered capital either, and the remainder shall be paid for in full by the shareholders
within two years from the date the company is established; and in the case of an investment company, it may pay for the remainder
in full within five years.

The minimum amount of the registered capital of a company with limited liability shall be RMB 30,000 yuan. Where a greater amount
is provided for by laws or administrative regulations, such provision shall prevail.

Article 27　A shareholder may make his capital contributions in currency or do so by contributing such non-curreny property as material
objects, intellectual property rights and land-use rights that can be evaluated in currency and can be transferred according to law,
except for the property that is not allowed to be used as capital contributions, as is provided for by laws or administrative regulations.

Non-curreny property used for capital contributions shall be evaluated and verified, and shall not be overvalued or undervalued.　Where
laws or administrative regulations provide otherwise, those provisions shall prevail.

The amount of capital contributions made by all of the shareholders in currency shall not be less than 30 percent of the registered
capital of a company with limited liability.

Article 28　A shareholder shall pay, on schedule and in full, the amount of the capital contributions subscribed for in accordance
with the provisions of the articles of association of a company. Where a shareholder makes capital contributions in currency, he
shall deposit the full amount of such capital contributions in currency in the bank account opened by the company with limited liability;
and where a shareholder makes capital contributions with non-corrency property, he shall, according to law, go through the formalities
for the transfer of his property rights.

Where a shareholder fails to make capital contributions in accordance with the provisions of the preceding paragraph, in addition
to paying to the company of his portion of the capital contributions in full, he shall be liable for breach of contract towards the
shareholders who have, on schedule and in full, made their capital contributions.

Article 29　After the shareholders have made their capital contributions, such capital contributions shall be subject to capital
verification by a capital verification authority set up according to law, which shall issue capital verification certificates.

Article 30　After the initial capital contributions made by shareholders have been verified by a capital verification authority
set up according to law, a representative designated by all the shareholders or a proxy jointly entrusted by them shall submit to
the company registration authority such documents as a written application for registration of the company, the company’s articles
of association and the capital verification certificates, in order to apply for registration of the incorporation of the company.

Article 31　Where after the incorporation of a company with limited liability, it is discovered that the actual amount of the value
of the non-currency property used as capital contributions for the incorporation of the company is obviously less than the amount
of the value prescribed in the company’s articles of association, the shareholders that made such contributions shall make up the
difference; and the others who are shareholders at the time of the incorporation of the company shall bear joint and several liability
therefor.

Article 32　After a company with limited liability is incorporated, it shall issue investment certificates to its shareholders.

In an investment certificate the following items shall be specified:

(1) the name of the company;

(2) the date on which the company is incorporated;

(3) the registered capital of the company;

(4) the name or post_title of the shareholder, the amount and date of capital contributions; and

(5) the serial number of the investment certificate and the date of its verification and issue.

An investment certificate shall bear the seal of the company.

Article 33　A company with limited liability shall prepare a roster of its shareholders in which the following items shall be recorded:

(1) the names or post_titles and domiciles of the shareholders;

(2) the amounts of the capital contributions made by the shareholders; and

(3) the serial numbers of their investment certificates.

The shareholders recorded in the roster of the shareholders may claim to exercise their rights in such capacity on the basis of the
said roster.

The company shall register with a company registration authority the names or post_titles of its shareholders and the amount of their
capital contributions; and where items of registration are altered, it shall have the registration altered accordingly. Without registration
or without registration for alteration, the company shall not act against the third party.

Article 34　A shareholder shall have the right to consult and duplicate the company’s articles of association, the minutes of
the meeting of the shareholders assembly, the resolutions of the board of directors, the resolutions of the board of supervisors,
and the financial and accounting reports of the company.

A shareholder may request to consult the accounting books of the company. To do that, the shareholder shall submit a written request
to the company and explain his purposes. Where the company deems, on reasonable grounds, that it is for illegitimate purposes that
the shareholder requests to consult its accounting books, which may damage the lawful interests of the company, the company may refuse
to provide its accounting books for the shareholder to consult, and shall, within 15 days from the date the shareholder submits the
written request, give a written reply to the shareholder and state its reasons. Where the company refuses to provide its accounting
books, the shareholder may request the people’s court to demand the company to provide such books.

Article 35　Shareholders shall draw dividends in proportion to the capital contributions they made; and when a company increases
its capital, its shareholders shall have the right of first refusal to make their subscriptions in proportion to the capital contributions
they made, except where all the shareholders have agreed to draw the dividends not in proportion to their capital contributions or
to do without the right of first refusal in proportion to their capital contributions when making subscriptions.

Article 36　Once a company is incorporated, its shareholders shall not secretly withdraw their capital contributions.

Section 2　Organizational Structure

Article 37　The shareholders assembly of a company with limited liability shall be composed of all of its shareholders. The shareholders
assembly is the organ of power of the company and shall exercise its functions and powers in accordance with this Law.

Article 38　The shareholders assembly shall exercise the following functions and powers:

(1) to decide on the operational policy and investment plan of the company;

(2) to elect or replace directors and supervisors who are not representatives of the staff and workers, and to decide on　matters
concerning the remuneration of the directors and supervisors;

(3) to examine and approve reports of the board of directors;

(4) to examine and approve reports of the board of supervisors or the supervisors;

(5) to examine and approve the annual financial budget plan and final accounts plan of the company;

(6) to examine and approve the company’s plans for profit distribution and for making up losses;

(7) to adopt resolutions on the increase or reduction of the registered capital of the company;

(8) to adopt resolutions on the issue of corporate bonds;

(9) to adopt resolutions on the merger, division, dissolution, liquidation or transformation of the company;

(10) to amend the articles of association of the company; and

(11) other functions and powers provided for in the company’s　　　articles of association.

Where the shareholders express, in writing, their unanimous agreement on the matters specified in the preceding paragraph, they may
directly make a decision without convening a meeting of the shareholders assembly, and all the shareholders shall sign their names
on and affix their seals to the documents of the decision.

Article 39　The first meeting of the shareholders assembly of a company shall be convened and presided over by the shareholder who
has made the greatest capital contributions to the company, and he shall exercise the functions and powers in accordance with the
provisions of this Law.

Article 40　The meetings of the shareholders assembly shall be divided into regular meetings and interim meetings.

Regular meetings shall be convened on schedule as specified by the provisions of the company’s articles of association. An interim
meeting shall be convened when it is proposed by shareholders representing one-tenth or more of the voting rights, by one-third or
more of the directors, by the board of supervisors, or by the supervisors of a company without a board of supervisors.

Article 41　Where a board of directors is set up in a company with limited liability, the meeting of the shareholders assembly shall
be convened by the board of directors and presided over by the chairman of the board of directors; where the chairman of the board
cannot perform such function or fails to do so, the meeting shall be presided over by the vice-chairman of the board; and where the
vice-chairman cannot perform the function or fails to do so, the meeting shall be presided over by a director jointly elected by
half and more of the directors.

Where no board of directors is set up in a company with limited liability, the meeting of the shareholders assembly shall be convened
and presided over by the executive director.

Where a board of directors or the executive director cannot perform or fails to perform the duty of convening a meeting the shareholders
assembly, such a meeting shall be convened and presided over by a board of supervisors or the supervisor of a company where no board
of supervisors is set up; and where the board of supervisors or the supervisor fails to convene and preside over the meeting, the
shareholder representing one-tenth or more of the voting rights may convene and preside over such a meeting on his own.

Article 42　All the shareholders shall be notified 15 days prior to the convening of a meeting of the shareholders assembly, except
where otherwise provided for by the company’s articles of association or agreed upon by all of the shareholders.

The shareholders assembly shall keep minutes of the decisions that are made on the matters discussed at the meeting, and the shareholders
present at the meeting shall sign the minutes.

Article 43　Shareholders shall exercise their voting rights at a meeting of the shareholders assembly in proportion to their respective
capital contributions, except where otherwise provided for by the company’s articles of association.

Article 44　The modes of meeting and voting procedures of the shareholders assembly shall, in addition to what is provided for in
this Law, be stipulated by the company’s articles of association.

Resolutions made at a meeting of the shareholders assembly on amendment to the company’s articles of association, the increase
or reduction of the registered capital, or on the merger, division, dissolution or transformation of the company shall be subject
to adoption by the shareholders representing two-thirds or more of the voting rights.

Article 45　A company with limited liability shall set up a board of directors, which shall be composed of 3 to 13 members, except
where otherwise provided for by Article 51 of this Law.

The members of the board of directors of a company with limited liability that is incorporated with the investment of two or more
State-owned enterprises or two or more State-owned investment entities shall include representatives of the staff and workers of
the company; and the members of the board of directors of other companies with limited liability may include representatives of the
staff and workers of the companies. The representatives of the staff and workers on the board of directors shall be democratically
elected by the staff and workers of the company through the conference of the representatives of the staff and workers, the general
meeting of the staff and workers, or through other forms.

A board of directors shall have a chairman and may have a vice-chairman. The measures for the election of the chairman and vice-chairman
of the board shall be stipulated by the company’s articles of association.

Article 46　The term of office of a director shall be stipulated by the company’s articles of association, but each term of office
shall not exceed three years. A director may, if reelected upon expiration of his term of office, serve consecutive terms.

Where no election is conducted in time before the expiration of the term of office of a director, or the number of the directors
is less than the statutory number due to the resignation of a director within his term of office, the existing director shall, before
the director-elect takes office, continue to perform his duty as a director in accordance with the provisions of laws, administrative
regulations or the company’s articles of association.

Article 47　The board of directors shall be accountable to the shareholders assembly and exercise the following functions and powers:

(1) to convene the meeting of the shareholders assembly, and to report on its work to the board;

(2) to implement the resolutions adopted by the shareholders assembly;

(3)

PROTECTION MEASURES FOR INTELLECTUAL PROPERTY RIGHTS DURING EXHIBITIONS

Ministry of Commerce, State Administration for Industry and Commerce, State Bureau of Copyright, State Intellectual Property Office

Order of the Ministry of Commerce, State Administration of Taxation, State Bureau of Copyright and State Intellectual Property Office

No. 1

The Protection Measures for Intellectual Property Rights (IPRs) during Exhibitions adopted by the Ministry of Commerce, the State
Administration for Industry and Commerce, the State Bureau of Copyright and the State Intellectual Property Office upon deliberation,
are hereby promulgated and shall come into force as of March 1, 2006.

Minister of the Ministry of Commerce Bo Xilai

Director of the State Administration for Industry and Commerce Wang Zhongfu

Director of the State Bureau of Copyright Long Xinmin

Director of the State Intellectual Property Office Tian Lipu

January 10, 2006

Protection Measures for Intellectual Property Rights during Exhibitions

Chapter I General Provisions

Article 1

The present Measures are formulated according to the Foreign Trade Law of the People’s Republic of China, the Patent Law of the People’s
Republic of China, the Trademark Law of the People’s Republic of China, and the Copyright Law of the People’s Republic of China as
well as the relevant administrative regulations for the purpose of intensifying the IPRs protection during exhibitions, safeguarding
the order of the exhibition industry and promoting the sound development thereof.

Article 2

The present Measures shall apply to the protection of relevant patents, trademarks and copyrights in all kinds of exhibitions, trade
fairs, expositions, commodity fairs and shows concerning the economic and technical trade as held within the territory of the People’s
Republic of China.

Article 3

The administrative department of exhibitions shall intensify the coordination, supervision, examination regarding the IPRs protection
during exhibitions and safeguard the normal trading order therein.

Article 4

The exhibition sponsor shall safeguard the legitimate rights and interests of IPRs holders legally. The exhibition sponsor shall,
when attracting investment and canvassing exhibitions, intensify the IPRs protection for participants to the exhibition as well as
the examination of the IPRs status of the items on exhibition (including exhibited items, exhibition boards and relevant publicity
materials, etc.). During an exhibition, the sponsor shall actively cooperate with the administrative IPRs department in the IPRs
protection work.

The exhibition sponsor may, by the manner of signing the clause or contract on the IPRs protection with the participants of the
exhibition, intensify the IPRs protection during the exhibition.

Article 5

The participant of exhibition shall take part in an exhibition legally, not infract the IPRs of any other person or entity and assist
the administrative IPRs department or judicial department in the relevant investigation.

Chapter II Treatment for Complaints

Article 6

If an exhibition lasts for 3 days or more and if the administrative department of exhibitions believes it is required , the exhibition
sponsor shall establish an office in charge of IPRs complaints during the exhibition. Where an office in charge of IPRs complaints
is established, the IPRs administrative department at the locality of the exhibition shall dispatch its personnel to station therein
and handle the case of infringement in accordance with law.

In case no office in charge of complaints is established for an exhibition, the IPRs administrative department at the locality of
exhibition shall intensify the guidance for and supervision over the IPRs protection during the exhibition as well as the handling
of relevant cases therein. The exhibition sponsor shall publicize the contact persons and ways of the IPRs administrative department
at the locality of the exhibition in an eye-catching place of the exhibition venue.

Article 7

An office in charge of IPRs complaints in an exhibition shall be comprised of the personnel from the sponsor of the exhibition, the
administrative department of exhibitions, the IPRs administrative department in charge of patents, trademarks, and copyrights, and
perform the following functions and duties:

(1)

Receiving the complaints of the IPRs holders, and suspending the item as suspected of infringement on IPRs on display during the
exhibition;

(2)

Transferring the relevant complaint materials to the competent IPRs administrative department;

(3)

Coordinating and supervising and urging the treatment for complaints;

(4)

Carrying out the statistic and analysis on the information regarding the IPRs protection during the exhibition; and

(5)

Any other relevant matters.

Article 8

An IPRs holder may file a complaint to the office in charge of IPRs complaints during an exhibition or to the IPRs administrative
department. The IPRs holder shall, when filing a complaint to the office in charge of IPRs complaints, submit the following materials:

(1)

A legitimate and effective certificate of IPRs ownership: where any patent is involved therein, the patent certificate, the text of
patent announcement, the identity certification of the patent owner, the certification on the legal status of the patent shall be
submitted; where any trademark is involved therein, the certification documents of trademark registration shall be submitted, which
shall be confirmed by means of the signature or seal affixed by the complainant, and the identity certification of the trademark
owner shall be submitted as well; where any copyright is involved therein, the certification of the copyright and the identity certification
of the copyright owner shall be submitted;

(2)

The basic information about the parties as suspected to have committed any infringement;

(3)

The explanations and evidence for any suspected infringement; and

(4)

Where an agent is entrusted to file a complaint, the relevant Power of Attorney shall be submitted.

Article 9

In the case of any failure to meet the provisions of Article 8 of the present Measures, an office in charge of IPRs complaints during
an exhibition shall inform the related complainant or claimant timely to supplement the relevant materials. In case it fails to make
the supplement, the complaint shall not be accepted.

Article 10

Where a complainant brings any damage to the relevant respondent by submitting any false complaint material or by any other fabricated
complaint, he shall be subject to the relevant legal liabilities.

Article 11

After receiving the complaint materials accorded with Article 8 of the present Measures, The office in charge of IPRs complaints
during an exhibition shall transfer it to the relevant IPRs administrative department within 24 hours

Article 12

When the local IPRs administrative department accepts the requirement of complaint or claim, it shall inform the relevant exhibition
sponsor as well as the relevant respondent to the complaint or claim timely.

Article 13

In the procedures for handling any complaint or claim concerning infringement on IPRs, the local IPRs administrative department may,
according to the exhibition period, designate the limit of answer time for the relevant respondent to a complain or claim

Article 14

Where a respondent to a complaint or claim submits his Statement of answer, the local IPRs administrative department shall make a
decision and deliver it to the two parties timely ,unless any further investigation is required.

Where the respondent to a complaint or claim fails to submit his Statement of answer within the time limit, the local IPRs administrative
department shall not be influenced making the decision.

Article 15

Where an exhibition is concluded, the relevant IPRs administrative department shall notify the treatment decision to the exhibition
sponsor timely . The exhibition sponsor shall finish the statistic and analysis work on IPRs protection during the exhibition and
report the relevant circumstance to the IPRs administrative department timely .

Chapter III Patent Protection during Exhibition

Article 16

Where any office in charge of IPRs complaints requires the assistance of any local intellectual property bureau, the local intellectual
property bureau shall provide positive cooperation and participate in the IPRs protection during the exhibition. The local intellectual
property bureau may carry out the following work during the exhibition:

(1)

Accepting a complaint of suspected infringement on IPRs is transferred by the office in charge of IPRs complaints in the exhibition,
and handling it according to the relevant provisions and regulations of the patent law;

(2)

Accepting the claim of treatment for any dispute over suspected infringement on patent relating to any exhibited item and handling
it according to the provisions of Article 57 of the Patent Law; and

(3)

Accepting the tip-offs on any suspected counterfeit of other’s patent or imitated patent relating to any exhibited item, or investigating
and handling any action of counterfeit of other’s patent or imitated patent relating to any exhibited item by authority , and giving
a punishment according to the relevant provisions of Articles 58 and 59 of the Patent Law.

Article 17

Under any of the following circumstances, the local intellectual property bureau may not accept any complaint of patent infringement
or claim for treatment:

(1)

Where a complainant or claimant has filed a lawsuit of patent infringement to the people’s court;

(2)

Where any patent is in the requiring procedures for declaring invalidation of patent right;

(3)

Where any dispute over the ownership of the patent right is in the trial procedures of the people’s court or in the mediation procedures
of the administrative department of patent; or

(4)

Where any patent right has been terminated and its owner is attempting to resume the patent right.

Article 18

The local intellectual property bureau shall, when notifying the respondent to a complaint or claim, conduct instant investigation
for obtaining the evidence, read and copy the relevant documents relating to the case, inquire of the parties concerned, carry
out on-the-spot inspection by such means as camera shooting or video camera shooting, or collect the evidence by sampling.

The local intellectual property bureau shall, when collecting the evidence, make the note that shall have the signatures or seals
of relevant undertaker and parties concerned under investigation for evidence collection. Where any party concerned under investigation
for evidence collection refuses to render his signature or seal on the note, the reason shall be indicated on the note. Where any
other person is on the spot, he may render his signature on the note at the same time.

Chapter IV Trademark Protection during an Exhibition

Article 19

Where an office in charge of IPRs complaints during an exhibition requires the assistance from the local industry and commerce administrative
department, the latter organ shall provide active cooperation and participate in the IPRs protection work during the exhibition.
The following works during the exhibition by the local industry and commerce administrative department may include:

(1)

Accepting complaints of suspected infringement on trademark transferred by the office in charge of IPRs complaints during the exhibition
and handling them according to the relevant provisions of laws and regulations on trademark;

(2)

Accepting complaints of infringement on the right to exclusive use of trademark in accordance with the provisions of Article 52 of
the Trademark Law; and

(3)

Investigating and punishing any case involving trademark irregularity by authority.

Article 20

Under any case of the following circumstances, the local industry and commerce administrative department may refuse to accept any
complaint or claim for treatment concerning infringement on the right to exclusive use of trademark:

(1)

Where a complainant or claimant has filed a lawsuit of trademark infringement to the people’s court; or

(2)

Where any right of trademark has been invalidated or cancelled.

Article 21

The local industry and commerce administrative department may, after deciding to accept any complaint or claim, carry out the investigation
and treatment according to the relevant provisions of laws and regulations on trademark.

Chapter V Copyright Protection during Exhibition

Article 22

Where an office in charge of IPRs complaints during an exhibition requires the assistance from the local administrative department
for copyright, the latter organ shall provide active cooperation and participate in the IPRs protection during the exhibition. The
following works by local administrative department for copyright during the exhibition may include:

(1)

Accepting the complaints of suspected infringement on copyright transferred by the office in charge of IPRs complaints during the
exhibition and handling them according to the relevant provisions of laws and regulations on copyright; and

(2)

Accepting the complaints of infringement on copyright in accordance with the provisions of Article 47 of the Copyright Law and giving
a punishment according to the relevant provisions of the Copyright Law.

Article 23

The local administrative department for copyright may, after accepting a complaint or claim, adopt the following means to collect
evidence:

(1)

Reading and copying the documents and archives, account books or any other written materials relating to the suspected infringement;

(2)

Collecting the evidence by sampling the duplicate of the suspected of infringement; and

(3)

Registering and preserving the duplicate of the suspected of infringement.

Chapter VI Legal Liabilities

Article 24

Where the local IPRs administrative department believes that a complaint of suspected infringement on IPRs is in fact, it may punish
the exhibitor in collaboration with the administrative department of exhibitions according to law.

Article 25

Where the local IPRs administrative department believes that a claim for the treatment of suspected infringement on any invention
right or new utility model right is in fact, relevant treatment decision shall be decided, according to the provisions of paragraph
1 of Article 11 of the Patent Law on prohibiting promised sale as well as the provisions of Article 57 of the Patent Law on ordering
the infringer to stop his infringement immediately, and order the respondent to the claim to withdraw all the exhibited items of
infringement, to destroy the publicity materials of introduction to exhibited items of infringement and to change the exhibition
board of introduction to exhibited items of infringement. .

Where the local IPRs administrative IPRs department believes that a claim for the treatment of suspected infringement on any patent
of exterior design and the respondent to the claim sells his items on exhibition is in fact, the relevant treatment decision shall
be decided, according to the relevant provisions of paragraph 2 of Article 11 of the Patent Law on prohibited sales action and Article
57 of the Patent Law on ordering the infringer to stop his infringement action immediately, and order the respondent to the claim
to withdraw any exhibited item of infringement from the exhibition.

Article 26

Where anyone fabricates any other’s patent or fabricates any patented by unpatented product, or fabricates any patented method by
non-patented method , the local intellectual property bureau shall give a punishment according to the provisions of Articles 58 and
59 of the Patent Law.

Article 27

Where the local industry and commerce administrative department believes that a claim for treatment of any infringement on trademark
is in fact, it shall give a punishment according to the relevant provisions of the Trademark Law and the Regulation on the Implementation
of the Trademark Law, etc..

Article 28

Where the administrative department for copyright believes that a claim for treatment of any infringement on copyright as well as
the related rights is in fact, relevant punishment shall be given according to the provisions of Article 47 of the Copyright Law,
the relevant exhibited items of infringement as well as publicity materials of introduction to exhibited items of infringement shall
be confiscated and destroyed, and the exhibition boards of introduction to exhibited items of infringement shall be changed.

Article 29

Where, upon investigation, any exhibited item under complaint or claim of infringement has been determined or decided in fact by the
people’s court or the IPRs administrative department and has taken legal effect , the local administrative IPRs department may directly
make a decision on treatment as prescribed in Article 26 , 27, 28 or 29.

Article 30

Where a claimant pleads not only to prohibit an infringing exhibition conducted by the infringer, but also pleads to prohibit any
other IPRs infringement committed by the same infringer, the local IPRs administrative department may give treatment to any suspected
infringement that occurs within its jurisdiction area according to the relevant provisions of laws, regulations and rules on IPRs.

Article 31

Where any infringement by a exhibitor is in fact, the administrative department of exhibitions may make an announcement to this exhibitor
in accordance with the law. Where the infringements by the exhibitor were more than twice consecutively, the exhibition sponsor
shall prohibit the said exhibitor to take part in the next exhibition.

Article 32

Where a sponsor fails to fulfill its obligation regarding the IPRs protection during an exhibition, the administrative department
of exhibitions shall give a warning thereto and disapprove any application for holding any relevant exhibition again upon the circumstance
in accordance with the law .

Chapter VII Supplementary Provisions

Article 33

Where any case hasn’t been concluded at the end of an exhibition, the relevant facts and evidence of the case may be confirmed by
the exhibition sponsor. The IPRs administrative department at the locality of the exhibition shall, within 15 workdays, transfer
it to the IPRs administrative department with jurisdiction for treatment according to law.

Article 34

The term “IPRs administrative department” as mentioned in the present Measures refers to the administrative departments for patent,
trademark and copyright. The term ” administrative department of exhibitions” as mentioned in the present Measures refers to the
department in charge of examination and approval or registration of exhibitions.

Article 35

The present Measures shall come into force as of March 1, 2006.

Ministry of Commerce, State Administration for Industry and Commerce, State Bureau of Copyright, State Intellectual
Property Office
2006-01-10

SUPPLEMENTARY CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION TO THE RELEVANT ISSUES CONCERNING THE TAX-EXEMPTION POLICIES FOR THE EXPORT OF PRODUCTS CONTAINING GOLD

State Administration of Taxation

Supplementary Circular of the State Administration of Taxation to the Relevant Issues Concerning the Tax-exemption Policies for the
Export of Products Containing Gold

Guo Shui Fa [2006] No. 10

The state taxation bureaus of all provinces, autonomous regions, municipalities directly under the Central Government, and cities
specifically designated in the state plan:

Considering the problems in the implementation of the Notice of the State Administration of Taxation about the Tax Policies on the
Export of Products Containing Gold (No. 125 [2005] of the State Administration of Taxation), a supplementary notice is given as follows:

From May 1, 2005, for the export goods (See the concrete list in the Annex) of which the customs commodity codes are 3824909090, 7115901090,
7114200090, 71110000 and 28439000 but which don’t contain gold or platinum, the tax refund (exemption) policies for export shall
continue to apply. For the aforesaid goods already exported prior to the issuance of this Notice, if the time limit for export tax
refund declaration has expired, the tax organs of all places shall accept the tax rebate declarations of the export enterprises in
gear. During the course of examining and approving the tax refund for export, none of the tax organs may complete the tax refund
formalities unless it, upon strict examination, is sure that the above-mentioned goods do not contain any gold or platinum. For other
goods which are inside the above-mentioned customs commodity codes but which do not contain gold or platinum, the State Administration
of Taxation of all provinces and cities shall first conduct a strict examination, then put forward handling opinions and finally
submit formal documents to the State Administration of Taxation for approval.

II.

With regard to the export products containing gold (including gold and platinum) other than those inside the commodity codes as listed
in the document No. 125, for instance, “91131000” “valuable metal watchband” the platinum watchband, shall be enforced the value-added
tax exemption policy according to the regulations in the document No. 125. Article 6 of the Notice of the Ministry of Finance and
State Administration of Taxation about the Tax Policies on Platinum and Its Products (No. 86 [2003] of the Ministry of Finance),
which provides that “the tax refund for export does not apply to the input value-added tax on the part of the raw material of platinum
of the export platinum products, the tax refund only applies to the processing fee in the processing link of platinum products on
the basis of the prescribed tax rebate rate”, shall not be implemented as of May 1, 2005.

III.

The products containing gold or platinum, which are exported in the form of processing with imported materials, shall be exempt from
the value-added tax according to the document No. 125.

Annex: Statistic Form of Products Not Containing Gold (Platinum)(Omitted)

State Administration of Taxation

January 20, 2006

State Administration of Taxation
2006-01-20

GUIDELINES FOR THE SECURITY EVALUATION OF ELECTRONIC BANKS

Guidelines for the Security Evaluation of Electronic Banks

January 26, 2006
Chapter I General Rules

Article 1

In order to enhance the security and risk management of electronic banks, and ensure the objectivity, timeliness, integrity and effectiveness
of the security evaluation of electronic banks, the present Guidelines are constituted in accordance with related legal provisions
as required by the Measures for the Administration of Electronic Banks.

Article 2

Security evaluation of electronic banks refers to the inspection and evaluation of the security testing as well as the management
and control ability of electronic banks in terms of security strategies, internal control systems, risk management, system security
and protection of clients, etc..

Article 3

A financial institution that develops the business of electronic banking shall perform at least one comprehensive security evaluation
of its electronic banks every two years upon its electronic banking development and management requirements.

Article 4

A financial institution may employ an external professional assessment institution for evaluating the security of its electronic
banks, or may acquire an internal evaluation department that is independent from the electronic banking operation and management
department for security evaluation.

Article 5

A financial institution shall set up a regulatory rules system and work procedures for the security evaluation of its electronic
banks, and make sure the security evaluation of its electronic banks to be performed timely and objectively.

Article 6

The security evaluation of electronic banks of a financial institution shall be subject to the surveillance and guidance of China
Banking Regulatory Commission (hereinafter referred to as CBRC).

Chapter II Security Evaluation Institutions

Article 7

Institutions for taking the security evaluation of electronic banks of financial institutions may be external social professional
organizations or internal independent departments of financial institutions that meet the requirements accordingly.

Article 8

An external organization for the security evaluation of electronic banks shall comply with the requirements as follows:

(1)

having moderately perfect management rules and operational rules for developing the business of the security evaluation of electronic
banks;

(2)

having constituted systematic and complete evaluation handbooks or evaluation guidance documents, and the evaluation procedures, evaluation
methods and foundations and the evaluation criteria, etc. shall be included at least;

(3)

having various types of professionals in line with the security evaluation of electronic banks, and being familiar with related industrial
standards around the world and China; and

(4)

satisfying other requirements prescribed by the CBRC for developing the business in the security evaluation of electronic banks.

Article 9

An internal department of a financial institution shall satisfy the following requirements besides those prescribed in Article 8
when implementing the security evaluation of electronic banks:

(1)

being independent from the development department, operation department or management department of the electronic banking system;
and

(2)

having not participated in the purchase of related equipments for electronic banks directly.

Article 10

The CBRC shall take charge of authorizing the qualifications for security evaluation of electronic banks.

A security evaluation institution of electronic banks may apply to the CBRC for the authorization of its qualification before developing
the business in the security evaluation of electronic banks of financial institutions.

Article 11

A financial institution may choose a security evaluation institution that has or has not been authorized by the CBRC when performing
the security evaluation of its electronic banks.

Where a financial institution chooses a security evaluation institution that has been authorized by the CBRC, related provisions in
the present Guidelines shall apply to the management of the related security evaluation institution. Where a financial institution
chooses a security evaluation institution that has not been authorized by the CBRC, the standards for choosing the security evaluation
institution may not be lower than the requirements prescribed in Articles 8 and 9, and related materials shall be submitted in accordance
with the Measures for the Administration of Electronic Banking.

A security evaluation institution of electronic banks shall observe the related provisions on the implementation and management of
the security evaluation of electronic banks when developing the business in the security evaluation of electronic banks whether it
has been authorized by the CBRC or not.

Article 12

The CBRC shall organize an authorization of security evaluation institutions of electronic banks annually, and it shall be announced
one month prior to the authorization.

Article 13

A security evaluation institution of electronic banks that applies for qualification authorization shall submit the materials (in
septuplicate) as follows within the time limit prescribed in the notice of the CBRC :

(1)

its application report for authorizing the qualification for security evaluation of electronic banks;

(2)

its introduction:

(3)

the management framework, management rules, and operating rules, etc., for the security evaluation business;

(4)

the evaluation handbook or evaluation guidance documents;

(5)

resumes of major assessors; and

(6)

other documents and materials as required by the CBRC.

Article 14

The CBRC shall organize related experts and supervisory personnel for evaluating the application materials after receiving a complete
set of the application materials for security evaluation qualification authorization, and assess whether the security evaluation
institution of electronic banks has met the related qualification requirements by way of ballots.

Article 15

The CBRC shall issue a Letter of Opinions on the Qualification Authorization of the Security Evaluation Institutions of Electronic
Banks, specify the evaluation opinions, and authorize the qualification of the evaluation institution upon the assessment of the
qualification of an evaluation institution.

Article 16

The Letter of Opinions on the Qualification Authorization of the Security Evaluation Institutions of Electronic Banks issued by the
CBRC shall only be used for deliberating the business on security evaluation of electronic banks between the evaluation institution
and financial institutions, and may not affect other business activities of the evaluation institution.

No evaluation institution may use the Letter of Opinions on the Qualification Authorization of the Security Evaluation Institutions
of Electronic Banks for promotion or other activities.

Article 17

As for an evaluation institution, qualification requirements of which are met upon evaluation of the CBRC, the qualification authorization
thereof shall be valid for two years.

Where an evaluation institution fails to satisfy the qualification requirements upon evaluation of the CBRC, the evaluation institution
may apply for a new qualification authorization in the next year.

Article 18

In case any of the following circumstances occurs to a security evaluation institution of electronic banks within the valid term
of qualification authorization, the CBRC shall revoke the evaluation and authorization opinions it has made:

(1)

The evaluation institution is in poor management, and its staff divulges the secrets of any assessed institution;

(2)

The quality of evaluation work is inferior, and there is major omission in its evaluation activities;

(3)

The evaluation institution fails to submit the evaluation reports as required, or there are fake statements in the evaluation reports;

(4)

The evaluation institution uses the Letter of Opinions on the Qualification Authorization of the Security Evaluation Institutions
of Electronic Banks for promotion or other business activities; or

(5)

The evaluation institution commits any other act of severely neglecting its duties.

Article 19

If an evaluation institution commits any of the following acts, the CBRC shall accept its qualification authorization application
no more within a certain time or without day, and no financial institution shall entrust this evaluation institution for the security
evaluation:

(1)

Colluding with the entrusting institution for jointly disguising the security loopholes as found during the course of security evaluation,
and failing to embrace them in the evaluation report as required;

(2)

Practicing falsification during the course of evaluation and producing the security evaluation reports; or

(3)

Divulging the secret information of the evaluated institution, or using the secret materials of the evaluated institution improperly.

In case any of the aforesaid circumstances occurs to an internal evaluation department of a financial institution, the related department
and persons in charge shall be punished by the CBRC in accordance with related laws.

Article 20

The information on any security evaluation institution of electronic banks authorized by the CBRC, as well as the authorization and
cancellation of its qualification, etc. shall be announced to all the financial institutions for developing the business in the electronic
banking only, and may not be publicized.

A financial institution may not divulge the related information announced by the CBRC to any third party to influence other business
activities of the related institution, and may not use the related information for other business activities irrelevant to the security
evaluation of electronic banks.

Article 21

A financial institution may choose a security evaluation institution of electronic banks independently within the scope of evaluation
institutions authorized by the CBRC.

Article 22

As for a foreign-funded financial institution, main electronic banking system of which is established outside of the territory of
China and which performs the security evaluation of electronic banks outside of the territory of China, and for an overseas branch
of a Chinese-funded financial institution that needs to implement the security evaluation of electronic banks outside of the territory
of China as required by the local supervisory organ, choosing the evaluation institution of electronic banks shall comply with the
legal requirements of the local country or region.

The financial institution shall perform the security evaluation with reference to the related provisions in the present Guidelines
if there is no related legal requirement in the local country or region.

Article 23

A financial institution shall sign a service agreement in written form with the security evaluation institution of electronic banks
it employs, and shall comprise explicit confidentiality articles and liabilities in this service agreement.

The electronic banking management department and the evaluation department of a financial institution shall conclude a letter on the
determination of evaluation liabilities when choosing an internal department as the evaluation institution.

Article 24

A security evaluation institution shall earnestly perform its evaluation duties, and authentically assess the security situation
of the electronic banks of any evaluated institution in light of the evaluation agreement.

Chapter III Implementation of Security Evaluation

Article 25

An evaluation institution shall fully communicate with the evaluated institution concerning the scope, focuses, time and requirements
for evaluation, and constitute the evaluation plans that shall be recognized by both parties through signature before implementing
the security evaluation of electronic banks.

Article 26

An evaluation institution shall assess the security of electronic banks of the entrusting institution on the spot subject to the
evaluation plans.

The security evaluation of electronic banks shall assess the security of the electronic banking system faithfully and comprehensively.

Article 27

The security evaluation of electronic banks shall at least contain the matters as follows:

(1)

security strategies;

(2)

construction of internal control system;

(3)

risk management situation;

(4)

system security;

(5)

plans for continuous operation of electronic banking business;

(6)

contingency plans for the operation of electronic banking business;

(7)

risk warning system of electronic banks; and

(8)

administration of other important security links and mechanism;

Article 28

The evaluation of the security strategies of electronic banks shall at least contain the matters as follows:

(1)

procedures for establishing security strategies and their rationality;

(2)

security strategies for system design and development;

(3)

security strategies for testing and accepting the system;

(4)

security strategies for system operation and maintenance;

(5)

security strategies for system backup and contingency; and

(6)

clients information security strategies.

An evaluation institution shall assess the security strategies of a financial institution in terms of whether there are security strategies,
rules, systems and procedures, whether the present rules are implemented and are updated in a timely manner, and whether the electronic
banking system has been covered completely as well.

Article 29

The evaluation of the internal control systems of electronic banks shall at least contain the matters as follows:

(1)

the overall scientific and appropriate construction of internal control systems;

(2)

the duties of the board of directors and the senior management staff in the security and risk management system of electronic banks,
as well as the justification of duties and liabilities of related departments;

(3)

the status of construction and operation of security monitoring mechanism; and

(4)

the status of construction and operation of internal audit systems.

Article 30

The evaluation of the risk management situation of electronic banks shall at least contain the matters as follows:

(1)

the adaptability and justification of the risk management framework of electronic banks;

(2)

how the board of directors and the senior management personnel understands about the security and risk management of electronic banks,
and the circumstances concerning implementing related policies and strategies;

(3)

the justification of the duties of the management bodies of electronic banks, and the capacity to control related risks;

(4)

the situation about employment and training of management personnel;

(5)

the situation about implementing the rules, systems, operational provisions and procedures for the risk management of electronic banks;

(6)

major risks and management situation of electronic banking; and

(7)

the situation about construction and management of business outsourcing management systems.

Article 31

The evaluation of the security of electronic banking system shall at least contains the matters as follows:

(1)

physical security;

(2)

security of the data communications;

(3)

security of the applied systems;

(4)

management of keys;

(5)

authorization and confidentiality of the clients information; and

(6)

intrusion detection mechanism and report response mechanism.

The evaluation institution shall focus on the evaluation of the security of data communications and the security of the applied systems,
impartially evaluate whether the financial institution has adopted encryption techniques appropriately, whether it has reasonably
designed and equipped servers and firewalls, whether the internal operation systems and database of the bank are under control, and
whether the financial institution has constituted the systems and control procedures for controlling and managing the electronic
banking system in order to ensure the testing and examination for the alterations timely.

Article 32

The evaluation of the continuous operation plans of electronic banking shall at least contain the matters as follows:

(1)

equipment and systematic capacity for ensuring the continuous business operation; and

(2)

systematic arrangements and implementation circumstances for ensuring the continuous business operation.

Article 33

The evaluation of the contingency plans for the electronic banking business shall at least contain the matters as follows:

(1)

the construction and implementation of contingency systems of electronic banks;

(2)

the circumstances on contingency facilities of electronic banks;

(3)

the circumstances on regular and continuous testing and drillings; and

(4)

the capability to handle accidents or external attacks.

Article 34

An evaluation institution shall constitute its own standards for the security evaluation of electronic banks. It shall determine
the weights of the impacts of different evaluation contents to the overall risk of electronic banks in light of the actual situation
of an entrusting institution, and grade each content for evaluation, and calculate the risk grade of the electronic banks of the
assessed institution comprehensively when performing the security evaluation.

Article 35

After the evaluation has completed, the evaluation institution shall prepare a report in a timely manner, and submit an evaluation
report accepted by signature of its legal representative or the authorized representative to the entrusting institution within one
month.

Article 36

An evaluation report shall at least contain the matters as follows:

(1)

time and scope for evaluation and other important stipulations in any other agreement;

(2)

the overall framework, procedures, chief methods for evaluation and an introduction of the major assessors;

(3)

the standards for determining the risk weights of different evaluation contents, the calculation methods for risk grades, and the
definitions of risk grades;

(4)

the evaluation contents for and the descriptions of evaluation activities;

(5)

the conclusion of evaluation;

(6)

the suggestions on the security management of electronic banks of the evaluated institution;

(7)

other issues to be explained as required;

(8)

the definitions of main terms and the introduction of international or domestic standards (they may be given in the annex);

(9)

the table of procedures for the evaluation work (it may be given in the annex); and

(10)

the name list of assessors of the evaluation institution that have participated in the evaluation (it may be given in the annex).

The evaluation institution shall adopt quantitative measures to specify the risk grades of electronic banks of an assessed institution
in the evaluation conclusion, to state main issues and hidden dangers in the security management of electronic banks of the evaluated
institution, and offer suggestions for overall reconstruction.

Article 37

If it is possible to modify an evaluation report after it has been completed and submitted to the entrusting institution, the reasons,
basis and opinions for modification shall be attached to the original report as an annex, and no original report shall be modified
directly.

Chapter IV Management of Security Evaluation Activities

Article 38

A financial institution shall implement the security evaluation of the electronic banking system that has been tested in accordance
with the related provisions when applying for developing the business in the electronic banking.

Article 39

In case any of the following circumstances occurs to a financial institution after the operation of the electronic banking business
has started, it shall organize the security evaluation immediately:

(1)

The system is attacked and broken down due to security loopholes, and is being repaired for operation;

(2)

After the electronic banking system has been renewed or upgraded significantly, it has stopped unexpectedly for 12 hours or more;

(3)

After some major accident when the key equipment or facilities of an electronic bank has been changed, and the continuous operation
can not be guaranteed yet after repair; or

(4)

The evaluation needs to be performed immediately due to the security management of electronic banks.

Article 40

The power of employing an external security evaluation institution by a financial institution shall remain with its board of directors
or senior management personnel.

Article 41

As for a banking financial institution that has performed the centralized data management, the security evaluation of electronic
banks by the headquarters (company) shall comprise the evaluation of the security management circumstances of electronic banks of
its branches, so the branches are not required to conduct a separate security evaluation when developing the business in the electronic
banking.

Article 42

As for a banking financial institution that has not performed the centralized data management, if its branches have developed the
business in the electronic banking and have independent equipment and system for business processing, the electronic banking system
of its branches shall, under the uniform management and guidance of the headquarters (company), conduct the security evaluation in
accordance with the related provisions.

Article 43

As for a foreign-funded financial institution that establishes its main business processing system of electronic banks outside the
territory of China, if its headquarters (company) outside the territory of China have performed security evaluation and conform to
the related provisions in the present Guidelines, its domestic branch is not required to separately implement a security evaluation
when developing the business in the electronic banking, however, a security evaluation report shall be submitted to the supervisory
organ in light of the related requirements as prescribed in the present Guidelines.

Article 44

As for a foreign-funded financial institution that sets up its main business processing system of electronic banks within the territory
of China, or sets up its main business processing system of electronic banks outside the territory of China but the overseas headquarters
(company) fail to perform the security evaluation or the security evaluation does not abide by the related provisions in the present
Guidelines, it shall conduct the security evaluation of electronic banks subject to the related provisions.

Article 45

Where several evaluation institutions are required for joint assumption or implementation of the security evaluation of electronic
banks, one main evaluation institution shall be determined by the financial institution to coordinate the overall evaluation work
and the preparation of an overall evaluation report.

Where a financial institution entrusts its electronic banking system to different evaluation institutions for security evaluation,
the security evaluation scope of each evaluation institution shall be determined and the matters under evaluation are completely
covered and no omission may be found.

Article 46

A financial institution shall submit the introduction of the evaluation institution, the evaluation scheme and procedures to be adopted,
etc. to the CBRC within two weeks after an evaluation agreement is signed.

Article 47

The CBRC may designate staff members to participate in the security evaluation of electronic banks of any financial institution upon
the requirements of the supervisory work, but such staff members may not be taken as formal assessors or may not offer evaluation
opinions.

Article 48

An evaluation institution shall perform the evaluation in accordance with the principles of objectivity, fairness, authenticity and
independence, and rigidly preserve the business secrets it has accessed to during the process of evaluation.

Article 49

The entrusting institution and the evaluation institution shall develop an information confidentiality work mechanism during the
evaluation process:

(1)

If it is necessary to consult the related materials, duplicate the related documents or data during the evaluation process, it shall
establish a registration and signature system;

(2)

The documents and materials requested for consultation shall be read at a designated place, and may not be taken out of this place;

(3)

The duplicated documents or data may not be taken out of the working place generally, and if they really need to be carried, it must
specifically register the names, quantity, reasons for taking away, final processing methods, and persons in charge of the documents
or data that have been carried, and the related persons in charge shall confirm with a signature;

(4)

The documents or materials discarded during the process of evaluation or the data that will not be used any more shall be destroyed
or cancelled immediately; and

(5)

The two parties shall sign the notes for the delivery of related confidential data and materials after the evaluation work finishes.

Article 50

A financial institution shall submit the evaluation report to the CBRC within one month as of the receipt of an evaluation report
issued by the evaluation institution.

The financial institution may make necessary explanations concerning the related issues in the evaluation report when submitting an
evaluation report.

Article 51

No security evaluation report on electronic banks may, without approval of the supervisory organ, be used as the promotion materials
or be provided to any third institution excluding the supervisory organ.

Article 52

Where a security evaluation is not performed as required or in which the evaluation procedures and methods or the evaluation report
is seriously flawed, the CBRC may ask the financial institution to conduct a new evaluation.

Article 53

The CBRC may organize independently or entrust an evaluation institution to implement the security evaluation of electronic banks
of a financial institution upon its need in the supervisory work, and the financial institution shall support its work.

Article 54

The CBRC may directly inquire an evaluation institution about its evaluation methods, scope and procedures, etc. upon it need in
the supervisory work.

Article 55

As for any problem reflected in the evaluation report, a financial institution shall take effective measures to remedy.

Chapter V Supplementary Rules

Article 56

The present Guidelines are subject to the interpretation of the CBRC.

Article 57

The present Guidelines shall enter into force as of March 1, 2006.

China Banking Regulatory Commission
2006-01-26

NOTICE OF SAT ON PRINTING AND ISSUING THE AGREEMENT TEXT BETWEEN THE GOVERNMENT OF THE PEOPLE’S REPUBLIC OF CHINA AND THE GOVERNMENT OF THE KINGDOM OF SAUDI ARABIA ON THE AVOIDANCE OF DOUBLE TAXATION AND GETTING PREPARED FOR ITS IMPLEMENTATION

State Administration of Taxation

Notice of SAT on Printing and Issuing the Agreement Text between the Government of the People’s Republic of China and the Government
of the Kingdom of Saudi Arabia on the Avoidance of Double Taxation and Getting Prepared for Its Implementation

No 138 [2006] of the State Administration of Taxation

The state taxation bureau and the local taxation bureau of all provinces, autonomous regions, municipalities directly under the
Central Government, cities directly under State planning, Yangzhou Taxation Refresher Institute, and all the departments under the
State Administration of Taxation,

The Agreement on the Avoidance of Double Taxation and the Prevention of Tax Evasion on Income and Property between the Governments
of the People’s Republic of China and the Kingdom of Saudi Arabia was formally signed by Xie Xuren, Director of the State Administration
of Taxation of China, and Ibrahim Bin Abdul-Aziz Asaf, Minister of Finance of the Kingdom of Saudi Arabia, in Beijing on January
23, 2006. The Agreement shall be effective after both contracting states have completed their respective legal procedures. The text
of the Agreement is hereby printed and distributed to you, please make good preparations prior to the implementation of the Agreement.

Annex: The Agreement between the Government of the People’s Republic of China and the Government of the Kingdom of Saudi Arabia on
the Avoidance of Double Taxation and the Prevention of Tax Evasion on Income and Property

State Administration of Taxation

February 8, 2006 AnnexThe Agreement between the Government of the People’s Republic of China and the Government of the Kingdom of Saudi Arabia on the Avoidance
of Double Taxation and the Prevention of Tax Evasion on Income and Property

The Government of the People’s Republic of China and the Government of the Kingdom of Saudi Arabia, desiring to conclude an agreement
on the avoidance of double taxation and the prevention of tax evasion on income and property , and having agreed to the following:

Article 1

Persons Covered This

Agreement shall apply to the persons who are residents of one or both of the contracting states.

Article 2

Taxes Covered

The present Agreement shall apply to all the taxes imposed by either of the contracting states, its administrative regions or local
authorities on the incomes and properties, disregarding the way of tax collection.

The taxes on all incomes, all properties, or a certain income or a certain property, including the taxes on the proceeds arising from
the transfer of movable property or immovable property, taxes on the total amount of wages or salaries paid by enterprises as well
as the taxes on capital appreciation shall be deemed as taxes on incomes and properties.

The current tax categories to which this Agreement shall apply are:

(a)

in the case of the peoples republic of China:

(1) the individual income tax; and

(2) the foreign-funded enterprises and foreign enterprise income tax.

(hereinafter referred to as “Chinese taxes”)

(b)

in the case of the Kingdom of Saudi Arabia :

(1) zakat tax; and

(2) income tax, including the natural gas investment tax.

(hereinafter referred to as “Saudi taxes”)

This Agreement shall also apply to the identical or substantially similar taxes that are levied after the date of signature of this
Agreement as an addition or replacement to the current tax categories. The competent authorities of both contracting states shall
notify each other of any substantial changes made in their respective taxation laws within a reasonable time limit after such changes
are made.

Article 3

General Definitions

For the purpose of present Agreement, unless the context otherwise requires:

(a)

The term “China” refers to the People’s Republic of China. When used in a geographical sense, it means all the territory of the People’s
Republic of China, in which the Chinese laws relating to taxation apply, including its territorial seas, and any area beyond its
territorial seas, within which the People’s Republic of China has sovereign rights of exploration for and exploitation of the resources
on the sea-bed and its sub-soil and superjacent water resources in accordance with the international law;

(b)

The term “the Kingdom of Saudi Arabia” refers to the territory of the Kingdom of Saudi Arabia sense, including any area beyond its
territorial seas, within which the Kingdom of Saudi Arabia has sovereign rights of exploration for and exploitation of resources
on the water area, sea-bed and its sub-soil and natural resources in accordance with its domestic law and the international law;

(c)

The terms “a contracting state” and “the other contracting state” refer to either China or the Kingdom of Saudi Arabia, as the context
requires;

(d)

The term “person” refers to an individual, a company or any other body;

(e)

The term “company” refers to any legal person entity or any entity which is treated as a legal person entity for taxation purposes;

(f)

The terms “enterprise of a contracting state” and “enterprise of the other contracting state” refer to, respectively, an enterprise
operated by a resident of a contracting state and an enterprise operated by a resident of the other contracting state;

(g)

The term “national” refers to:

(1) any individual possessing the nationality of a contracting state;

(2) any legal person, partnership or association deriving its status as such from the laws of a contracting state;

(h)

The term “international traffic” refers to any transport by a ship or aircraft operated by an enterprise with an actual management
institution or head office in a contracting state, excluding the transport by a ship or aircraft which is operated solely between
places in the other contracting state;

(i)

the term “competent authority” refers

(1) in the case of China, to the State Administration of Taxation or its authorized representatives;

(2) in the case of the Kingdom of Saudi Arabia, to the Ministry of Finance, represented by the Minister of Finance or by his authorized
representatives.

With regard to the application of the agreement by a contracting state, any term not defined herein shall, unless the context otherwise
requires, have the meaning in which it has under the law of that contracting state concerning the taxes to which the agreement applies.
However, the definitions of the relevant terms in the tax laws that a contracting state applies shall prevail over the definition
of the same terms in other laws.

Article 4

Residents

For the purposes of this Agreement, the term “resident of a contracting state” means any person who, under the law of that state,
is obligatory to pay tax therein by reason of his domicile, residence, place of management institution, or place of head office or
any other criterion of a similar nature, simultaneously including this contracting state, its administrative regions and local authorities.
But this term does not include the persons who are obligatory to pay tax only because of the income sourced from or situated in this
contracting state.

Where, by reason of the provisions of Paragraph 1, an individual is a resident of both contracting states, his status shall be determined
as follows:

(a)

he shall be deemed as a resident of the contracting state in which he has a permanent domicile available to him; if he has a permanent
domicile available to him in each of the contracting states, he shall be deemed as a resident of the contracting state with which
his personal and economic relations are closer (center of gravity);

(b)

if the state in which his center of gravity lies cannot be determined, or if he does not have a permanent home available to him in
either contracting state, he shall be deemed as a resident of the state in which he has a habitual abode;

(c)

if he has a habitual abode in each of the contracting states or in neither of them, he shall be deemed as a resident of the contracting
state of which he is a national;

(d)

if he is a national in each of the contracting states or in neither of them, the competent authorities of the contracting states shall
settle the issue by mutual agreement.

Where, by reason of the provisions of Paragraph 1 of the present Article, a person other than an individual is a resident of both
contracting states, his identity of resident shall be deemed as a resident of the contracting state where its actual management institution
or head office is located.

Article 5

Permanent Establishment

For the purposes of this Agreement, the term “permanent establishment” refers to a fixed place of business through which the business
of an enterprise is wholly or partly carried out.

The term “permanent establishment”, in particular, includes:

(a)

a place of management;

(b)

a branch organization;

(c)

a representative office;

(d)

a factory;

(e)

a workshop, and

(f)

a mine, quarry or any other place of exploitation of natural resources.

The term “permanent establishment”, likewise, encompasses:

(a)

A building site, construction, assembly or installation project, or the supervisory activities in connection therewith, but only where
such site, project or activities continue for a period of not less than 6 months;

(b)

the provision of services, including consultancy services, by an enterprise of a contracting state through employees or other engaged
personnel for the aforementioned purpose, provided that the period for such activities (for the same project or relevant project)
is continually or aggregately more than 6 months within any 12-month period.

Notwithstanding the aforesaid provisions of this article, the term “permanent establishment” shall not include:

(a)

the use of facilities solely for the purpose of storage, display or delivery of goods or merchandise belonging to the enterprise;

(b)

the inventory of goods or merchandise belonging to the enterprise solely for the purpose of storage, display or delivery;

(c)

the inventory of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise;

(d)

the fixed business place established solely for the purpose of purchasing goods or merchandise or of collecting information for the
enterprise;

(e)

the fixed business place established solely for the purpose of carrying out, for the enterprise, any other activity of a preparatory
or auxiliary nature; and

(f)

the fixed business place established solely for the purpose of combining the activities listed in Items (a) through (e) of the present
Paragraph if such combination can be attributed to all the activities of the fixed business place with a preparatory or auxiliary
nature.

Notwithstanding the provisions of Paragraphs 1 and 2, where a person (other than an agent with independent status to whom the provisions
of Paragraph 6 apply) who is acting in a contracting state on behalf of an enterprise of the other contracting state, has and habitually
exercises the authority to conclude contracts in the name of the enterprise, that enterprise shall be deemed to have a permanent
establishment in the first-mentioned contracting state in respect of any activities which that person undertakes for the enterprise,
unless the activities of such person are limited to those mentioned in Paragraph 4 which would not make this fixed place of business
a permanent establishment.

An enterprise of a contracting state shall not be deemed to have a permanent establishment in the other contracting state merely because
it operates its business in that other state through a broker, agent on a commissioned basis, or any other agent with independent
status in the ordinary course of their business. However, if all or nearly all of the activities of the agent are on behalf of the
enterprise, he shall not be deemed as an agent with independent status as mentioned in this Paragraph.

The fact that a company which is a resident of a contracting state controls, or is controlled by, a company which is a resident of
the other contracting state, or which operates business in that other contracting state (whether through a permanent establishment
or not), shall not itself render either company a permanent establishment of the other.

Article 6

Income from Immovable Property

Income derived by a resident of a contracting state from immovable property (including income from agriculture or forestry) situated
in the other contracting state may be taxed in that other contracting state.

The term “immovable property” shall have the meaning it has under the law of the contracting state in which the property in question
is situated. The term shall, in any case, include the property accessory to the immovable property, livestock and equipment used
in agriculture and forestry. The rights to which the provisions of general law respecting real property apply, the usufruct of immovable
property and the rights to variable or fixed payments as consideration for the exploiting of, or the right to exploit, the mineral
resources, water sources and other natural resources, but ships and aircrafts shall not be regarded as immovable property.

The provisions of Paragraph 1 shall apply to the income derived from the direct use, lease, or use in any other form, of immovable
property.

The provisions of Paragraphs 1 and 3 shall apply to the income from immovable property of an enterprise and to the income from immovable
property used for the performance of independent personal services.

Article 7

Business Profits

The profits of an enterprise of a contracting state shall be taxable only in that state unless the enterprise carries on its business
in the other contracting state through a permanent establishment situated therein. If the enterprise carries out its business in
the other contracting state through a permanent establishment situated therein, the profits of the enterprise may be taxed in the
other state, but only limited to those attributable to that permanent establishment.

In addition to applying the provisions of Paragraph 3, where an enterprise of a contracting state carries out its business in the
other contracting state through a permanent establishment situated therein, the permanent establishment shall be regarded as an independent
affiliated enterprise engaging in the same or similar activities under the same or similar conditions. It shall be treated differently
and separately as an independent establishment from the enterprise. The profits of this permanent establishment that may be obtained
shall belong to the permanent establishment itself in each contracting state.

When determining the profits of a permanent establishment, it is allowed to deduct the expenses incurred in the business of the permanent
establishment, including the executive and general administrative expenses, no matter whether they are incurred in the state in which
the permanent establishment is situated or elsewhere. However, no such deduction shall be allowed in respect of the amounts, if any,
paid (otherwise than the reimbursement of actual expenses) by the permanent establishment to the head office of the enterprise or
any of its other offices, by way of royalties, remunerations or other similar payments in return for the use of patents or other
rights, or by way of commission for specific services performed or for management, or, except in the case of a banking enterprise,
by way of income from credit against the permanent establishment. Likewise, no consideration may be taken, in the determination of
the profits of a permanent establishment, for the amounts charged (otherwise than the reimbursement of actual expenses), by the permanent
establishment to the head office of the enterprise or any of its other offices, by way of royalties, remunerations or other similar
payments in return for the use of patents or other rights, or by way of commission for specific services performed or for management,
or, except in the case of a banking enterprise, by way of income from credit against the head office of the enterprise or any of
its other offices.

Insofar as it has been customary in a contracting state to determine the profits to be attributed to a permanent establishment on
the basis of distribution of the total profits of the enterprise to its various parts, the provisions in Paragraph 2 shall not preclude
that contracting state from determining the profits to be taxed by this method of profit distribution. However, the result of adopting
the method of profit distribution shall be in line with the principles provided for in the present Article.

No profits may be attributed to a permanent establishment by reason of mere purchase by that permanent establishment of goods or merchandise
for the enterprise.

For the purposes of the aforesaid Paragraphs, the profits belonging to the permanent establishment shall be determined by the same
method each year unless there is good and sufficient reason to change.

If the profits include the income items that are dealt with separately in other Articles of this Agreement, the provisions of those
Articles shall not be affected by the provisions of the present article.

Article 8

Shipping and Air Transport

The profits from the operations of ships or aircrafts in international transport by an enterprise of a contracting state shall be
taxable only in that contracting state where the actual management institution or head office of this enterprise is located.

If the actual management institution or head office of an enterprise is established on a ship, the profits from the operations of
ships shall be taxable only in that contracting state where the parent port of the ship is located; if there is no parent port, the
profits from the operations of the ship shall be taxable only in that contracting state of which the operator of the ship is a resident;

The provisions of Paragraph 1 shall also apply to the profits from the operations under partnership, joint operations or participation
in an international operating agency.

Article 9

Associated Enterprises

Where

(a)

an enterprise of a contracting state participates directly or indirectly in the management, control or capital of an enterprise of
the other contracting state, or

(b)

a same person participates directly or indirectly in the management, control or capital of an enterprise of a contracting state and
an enterprise of the other contracting state, and in either of the above cases, the commercial and financial relations between the
two enterprises are different from those between two independent enterprises, so the profits which would, but for those conditions,
have been obtained by either enterprises, may be included in the profits of that enterprise and be taxed accordingly.

Where a contracting state includes in the profits of an enterprise of that contracting state (and taxes accordingly) the profits on
which an enterprise of the other contracting state has paid taxes in that other contracting state and the profits so included are
profits which should have been obtained by an enterprise within the contracting state, then that other contracting state shall make
appropriate adjustment to the amount of the tax charged therein on those profits, where that other contracting state considers such
adjustment justifiable. In determining such adjustment, the other provisions of this Agreement shall be taken into consideration,
and the competent authorities of the contracting states shall consult each other, if necessary.

Article 10

Dividends

Dividends paid by a company that is a resident of a contracting state to a resident of the other contracting state may be taxed in
that other state.

However, such dividends may also be taxed in the contracting state of which the company paying the dividends is a resident and according
to the laws of that state, but if the recipient is the beneficial owner of the dividends, the tax so levied shall not exceed 5 percent
of the total amount of the dividends. The competent authorities of both contracting states shall determine the method to execute
this limited tax rate through negotiation.

Notwithstanding the provisions of Paragraphs 1 and 2, if the beneficial owner of the dividends is the government of the other contracting
state, department under it, or any other entity directly or indirectly owned by it, the dividends paid by a resident company of a
contracting state to a resident of the other contracting state shall only be taxable in the other contracting state.

The term “dividends” as used in the present Article refers to the income from shares, mining shares, promoters’ shares or other rights
of participating in the profits not of credit relationship, as well as the income from other corporate rights that are subject to
the same taxation treatment as the income from the shares by the laws of the state of which the company making the profit distribution
is a resident.

The provisions of Paragraphs 1 through 3 shall not apply if the beneficial owner of the dividends, being a resident of a contracting
state, carries out business in the other contracting state of which the company paying the dividends is a resident, through a permanent
establishment situated therein, or provides in that other state independent personal services through a fixed base situated therein,
and the shares for which the dividends are paid are effectively connected with such permanent establishment or fixed base. In such
cases, the application of the provisions of Article 7 or Article 14 shall depend on the concrete circumstances.

Where a company that is a resident of a contracting state derives profits or income from the other contracting state, that other contracting
state may not impose any tax on the dividends paid by or undistributed profits of the company, except insofar as such dividends are
paid to a resident of that other contracting state or insofar as the holding in respect of which the dividends are paid is effectively
connected with a permanent establishment or a fixed base situated in that other contracting state, even if the dividends paid or
the undistributed profits consist wholly or partly of the profits or income arising in such other state.

Article 11

Credit Income

The credit income arising in a contracting state and paid to a resident of the other contracting state may be taxed in that other
contracting state.

However, such credit income may also be taxed in the contracting state where it arises according to the laws of that contracting state,
but if the recipient is the beneficial owner of the credit income, the tax so collected shall not exceed 10 percent of the total
amount of the income. The competent authorities of both contracting states shall determine the method to execute the limited tax
rate through negotiation.

Notwithstanding the provisions of Paragraph 2 of the present Article, the credit income arising in a contracting state and paid to
the government, local authority or central bank of the other contracting state, or to any financial institution wholly owned by the
government of the other contracting state shall be exempted from taxation in the first-mentioned contracting state; or the debt,
from which a resident of the other contracting state obtains income, is indirectly funded by the government, local authority or central
bank of the other contracting state, or to any financial institution wholly owned by the government of the other contracting state,
such credit income shall be exempted from tax in the contracting state.

The term “credit income” as used in the present Article refers to the income derived from various creditor’s rights, whether or not
secured by mortgage and whether or not carrying a right to share the debtor’s profits, and in particular, the income derived from
public debts, bonds or debentures, including premiums and bonuses. The penalties for late payment shall not be regarded as a credit
income provided in the present Article.

The provisions of Paragraphs 1, 2 and 3 shall not apply, if the beneficial owner of the credit income, being a resident of a contracting
state, carries out business in the other contracting state in which the interest arises through a permanent establishment situated
therein, or provides in that other contracting state independent personal services through a fixed base situated therein, and the
creditor’s right in respect of which the proceeds is paid is effectively connected with such permanent establishment or fixed base.
In such cases, the provisions of Article 7 or Article 14 shall apply according to the actual circumstances.

The credit income shall be deemed as arising in a contracting state when the payer is the government, a local authority or a resident
of that contracting state. Where, however, the person paying the proceeds of debt, whether he is a resident of the contracting state
or not, has, in that contracting state a permanent establishment or a fixed base, and the debts on which the proceeds of debt are
paid is connected with the permanent establishment or a fixed base, and such credit income is borne by such permanent establishment
or fixed base, then such credit income shall be deemed as arising in the state where the permanent establishment or fixed base is
situated.

Where, due to any special relationship between the payer and the beneficial owner or between both of them and any other person, if
the amount of the credit income, regarding the credit for which it is paid, exceeds the amount which have been agreed upon by the
payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the last-mentioned
amount. In such case, the excessive part of the payments shall remain taxable according to the laws of each contracting state, but
the other provisions of this Agreement shall be taken into consideration.

Article 12

Royalties

Royalties arising in a contracting state and paid to a resident of the other contracting state may be taxed in that other contracting
state.

However, such royalties may also be taxed in the contracting state in which they arise according to the laws of that state, but if
the recipient is the beneficial owner of the royalties, the tax so collected shall not exceed 10 percent of the total amount of the
royalties. The competent authorities of both contracting states shall determine the method for the execution of the limited tax rate
by mutual agreement.

The term “royalties” as mentioned in this Article refers to the payments of any kind received as a consideration for the use of, or
the right to use, any copyright of literary, artistic or scientific work, including cinematographic films, or films or tapes for
radio or television broadcasting, any patent, trademark, design or model, plan, secret formula or process, or for the use of or the
right to use any industrial, commercial, or scientific equipment, or for any information concerning industrial, commercial or scientific
experience.

The provisions of Paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties, being a resident of a contracting state,
carries out business in the other contracting state in which the royalties arise through a permanent establishment situated therein,
or provides in that other state independent personal services from a fixed base situated therein, and the right or property in respect
of which the royalties are paid is effectively connected with such permanent establishment or fixed base. In such cases, the provisions
of Article 7 or Article 14 shall, as the case may be, apply.

The royalties shall be deemed as arising in a contracting state when the payer is the government, a local authority or a resident
of that contracting state. Where, however, the person paying the royalties, whether he is a resident of a contracting state or not,
has in that contracting state a permanent establishment or a fixed base in connection with the liability to pay the royalties, and
such royalties are borne by the permanent establishment or fixed base, then such royalties shall be deemed as arising in the contracting
state in which the permanent establishment or fixed base is situated.

Where, due to any special relationship between the payer and the beneficial owner or between both of them and some other person, the
amount of the royalties, regarding the use, right or information for which they are paid, exceeds the amount which would have been
agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this article shall apply
only to the last-mentioned amount. In such case, the excessive part of the payments shall remain taxable according to the law of
each contracting state, but the other provisions of this Agreement shall be taken into consideration.

Article 13

Capital Gains

Gains derived by a resident of a contracting state from the alienation of immovable property referred to in Article 6 and situated
in that other contracting state may be taxed in that other contracting state.

Gains from the alienation of movable property forming the part of the business property of a permanent establishment which an enterprise
of a contracting state has in the other contracting state or of the movable property pertaining to a fixed base available to a resident
of a contracting state in the other contracting state for the purpose of providing independent personal services, including the gains
from the alienation of such a pe

ACCOUNTING STANDARD FOR BUSINESS ENTERPRISES NO. 6 – INTANGIBLE ASSETS

Ministry of Finance

Accounting Standard for Business Enterprises No. 6 – Intangible Assets

Cai Kuai [2006] No. 3

February 15, 2006

Chapter I General Provisions

Article 1

To standardize the confirmation and measurement of intangible assets and disclosure of related information, these Standards are formulated
in accordance with the Accounting Standard for Business Enterprises – Basic Standards.

Article 2

The following items shall be subject to other relevant accounting standards:

(1)

The right to use the land as investment real estates shall be subject to the Accounting Standard for Business Enterprises No. 3 -Investment
properties;

(2)

The business reputation formed during the merger of enterprises shall be subject to the Accounting Standard for Business Enterprises
No. 8 -Impairment of assets and Accounting Standard for Business Enterprises No. 20 -Business Combinations; and

(3)

The rights and interests related to oil and natural gas mining areas shall be subject to the Accounting Standard for Business Enterprises
27 -Extraction of Petroleum and Natural Gas.

Chapter II Confirmation

Article 3

The term “intangible asset” refers to the identifiable non-monetary assets possessed or controlled by enterprises which have no physical
shape.

An asset, which satisfies any of the following conditions, shall meet the identifiable standards as mentioned in the definition of
intangible assets:

(1)

Being able to separate or divide from the enterprise and being able to be sold, transferred, licensed, rented or exchanged independently
or along with the relevant contracts, assets or liabilities; or

(2)

Being derived from any contractual right or other statutory rights, no matter whether or not these rights can be transferred or separated
from the enterprise or other rights and obligations.

Article 4

Intangible assets may be confirmed when it meets the conditions simultaneously as follows:

(1)

The economic benefits related to intangible assets are likely to flow into the enterprise; and

(2)

The cost of intangible assets can be measured reliably.

Article 5

When making a judgment on whether or not the economic benefits generated by intangible assets is likely to flow into it, an enterprise
shall make a reasonable estimation to all potential economic factors within the expected service life of intangible assets and present
clear evidences.

Article 6

The expenditures for an intangible item of an enterprise shall all be recorded into the profit or loss for the current period, unless
it is under any of the following circumstances:

(1)

The part meeting the confirmed conditions as prescribed in these Standards and consisting of the cost of intangible assets; and

(2)

The part obtaining from the merger of enterprises not under the same control or cannot being independently confirmed as intangible
assets, or composing the business reputation confirmed on the day of purchase.

Article 7

The expenditures for its internal research and development projects of an enterprise shall be classified into research expenditures
and development expenditures.

The term “research” refers to the creative and planned investigation to acquire and understand new scientific or technological knowledge.

The term “development” refers to the application of research achievements and other knowledge to a certain plan or design, prior to
the commercial production or use, so as to produce any new material, device or product, or substantially improved material, device
and product.

Article 8

The research expenditures for its internal research and development projects of an enterprise shall be recorded into the profit or
loss for the current period.

Article 9

The development expenditures for its internal research and development projects of an enterprise may be confirmed as intangible assets
when they satisfy the following conditions simultaneously:

(1)

It is feasible technically to finish intangible assets for use or sale;

(2)

It is intended to finish and use or sell the intangible assets;

(3)

The usefulness of methods for intangible assets to generate economic benefits shall be proved, including being able to prove that
there is a potential market for the products manufactured by applying the intangible assets or there is a potential market for the
intangible assets itself or the intangible assets will be used internally;

(4)

It is able to finish the development of the intangible assets, and able to use or sell the intangible assets, with the support of
sufficient technologies, financial resources and other resources; and

(5)

The development expenditures of the intangible assets can be reliably measured.

Article 10

For an on-going research and development project which is obtained by an enterprise and has been confirmed as intangible assets, the
post-obtainment expenditures shall be treated in accordance with Articles 7 to 9 of these Standards.

Article 11

The self-created business reputation of an enterprise, or its internally made brand, newspaper or magazine name shall not be confirmed
as intangible assets.

Chapter III Initial Measurement

Article 12

The intangible assets shall be initially measured according to its cost. The cost of outsourcing intangible assets shall include the
purchase price, relevant taxes and other necessary expenditures directly attributable to intangible assets for the expected purpose.

Where the payment of purchase price for intangible assets is delayed beyond the normal credit conditions, which is of financing intention,
the cost of intangible assets shall be determined on the basis of the current value of the purchase price. The difference between
the actual payment and the current value of the purchase price shall be recorded into profit or loss for the credit period, unless
it shall be capitalized under the Accounting Standards for Enterprises No. 17 – Borrowing Cost.

Article 13

The cost of self-developed intangible assets shall include the total expenditures incurred during the period from the time when it
meets the provisions of Articles 4 to 9 of these Standards to the time when the expected purposes of use are realized, except that
the expenditures which have already been treated prior to the said period shall not be adjusted.

Article 14

The cost invested into intangible assets by investors shall be determined according to the conventional value in the investment contract
or agreement, except for those of unfair value in the contract or agreement.

Article 15

The costs of intangible assets acquired from non-monetary assets transaction, debt recombination, government subsides, and merger
of enterprises shall be determined respectively according to the Accounting Standard for Business Enterprises No. 7 -Exchange of
non-monetary assets, Accounting Standard for Business Enterprises No. 12 – Debt Restructurings, Accounting Standard for Business
Enterprises No. 16 – Government Grants and Accounting Standard for Business Enterprises No. 20 -Business Combinations.

Chapter IV Subsequent Measurement

Article 16

An enterprise shall analyze and judge the service life of intangible assets, when it obtains intangible assets.

As for the intangible assets with limited service life, the enterprise shall estimate the years of its service life, or the amount
of the output or any other similar measurement unit, which constitutes its service life. If it is unable to forecast the period when
the intangible asset can bring economic benefits to the enterprise, it shall be regarded as an intangible asset with uncertain service
life.

Article 17

With regard to intangible assets with limited service life, its amortization amount shall be amortized within its service life systematically
and reasonably.

An enterprise shall amortize intangible assets from the time when it is available for use to the time when it is not confirmed as
the intangible assets any more.

The method chosen by an enterprise for the amortization of intangible assets shall reflect the expected realization pattern of the
economic benefits which relevant to the intangible assets. If it is unable to determine the expected realization pattern reliably,
intangible assets shall be amortized by the straight-line method.

Generally, the amortized amount of intangible assets shall be recorded into profit or loss for the current period, unless there are
other accounting standards.

Article 18

The reasonable amortization amount of intangible assets shall be its cost minus the expected residual value. For intangible assets
with an impairment provision, the accumulative amount of impairment provision shall be deducted from the cost as well. For intangible
assets with a limited service life, its residual value shall be regarded as zero, unless it is under the circumstances as follows:

(1)

A third party promises to purchase the intangible assets at the end of its service life; and

(2)

The information about the expected residual value is able to obtain from the active market and the market is most likely to remain
when the service life of the intangible asset ends.

Article 19

Intangible assets with uncertain service life may not be amortized.

Article 20

The impairment of intangible assets shall be treated in accordance with the Accounting Standards for Enterprises No. 8 -Impairment
of Assets.

Article 21

An enterprise shall, at least at the end of each year, check the service life and the amortization method of intangible assets with
limited service life. When the service life and the amortization method of intangible assets are different from those before, the
years and method of the amortization shall be changed.

An enterprise shall check the service life of intangible assets with uncertain service life during each accounting period. Where there
are evidences to prove the intangible assets have limited service life, it shall be estimated of its service life, and be treated
according to these Standards.

Chapter V Disposal and Discarding

Article 22

The balances of the price acquired and the carrying value of intangible assets shall be recorded into the profit or loss for the current
period, where an enterprise sells intangible assets.

Article 23

In case no economic benefit is expected to be brought by some intangible assets to the enterprise, the carrying value of the intangible
assets shall be written off.

Chapter VI Disclosure

Article 24

An enterprise shall disclose the following information related to its intangible assets according to their categories in the annotation:

(1)

The beginning and ending book balances, accumulative amount of amortization, and accumulative amount of provision for impairment of
intangible assets;

(2)

The estimation about the service lives of intangible assets with limited service lives; the basis for the judgment about the uncertain
service life of intangible assets with uncertain service lives;

(3)

The methods for the amortization of intangible assets;

(4)

The carrying value of intangible assets used for guaranties, the amortization amount for the current period, and other information;
and

(5)

The amount recorded into profit or loss for the current period and those confirmed as the research and development expenditures for
intangible assets.

Ministry of Finance
2006-02-15

ACCOUNTING STANDARDS FOR ENTERPRISES NO. 21 – LEASES

the Ministry of Finance

Accounting Standards for Enterprises No. 21 – Leases

No. 3 [2006] of the Ministry of Finance

February 15, 2006

Chapter I General Provisions

Article 1

With a view to regulating the recognition and measurement of leases, as well as the presentation of relevant information, the present
Standards are formulated according to the Accounting Standards for Enterprises – Basic Standard.

Article 2

The term “lease” refers to an agreement under which the lessor conveys to the lessee in return for rent the right to use an asset
for an agreed period of time.

Article 3

The following items shall be subject to other accounting standard:

(1)

The land use right and buildings rented out by a lessor by way of operating lease shall be subject to the Accounting Standards for
Enterprises No. 3 – Investment Real Estates;

(2)

The licensing agreements for the use of items such as films, video recordings, plays, manuscripts, patents and copyrights shall be
subject to the Accounting Standards for Enterprises No. 6 – Intangible Assets; and

(3)

The impairment of long-term credits formed by the financing leases of a lessor shall be subject to the Accounting Standards for Enterprises
No. 22 – Recognition and Measurement of Financial Instruments.

Chapter II Classification of Leases

Article 4

A lessee and a lessor shall classify a lease as a financing lease or an operating lease on the lease beginning date.

The lease beginning date shall refer to the earlier one of the date of lease agreement or the date on which the parties to the lease
make commitments on the key terms of lease.

Article 5

The “finance lease” shall refer to a lease that has transferred in substance all the risks and rewards related to the ownership of
an asset. The ownership of it may or may not eventually be transferred.

Article 6

Where a lease satisfies one or more of the following criteria, it shall be recognized as a finance lease:

(1)

The ownership of the leased asset is transferred to the lessee when the term of lease expires;

(2)

The lessee has the option to buy the leased asset at a price which is expected to be far lower than the fair value of the leased asset
at the date when the option becomes exercisable. Thus, on the lease beginning date, it can be reasonably determined that the option
will be exercised;

(3)

Even if the ownership of the asset is not transferred, the lease term covers the major part of the use life of the leased asset;

(4)

In the case of the lessee, the present value of the minimum lease payments on the lease beginning date amounts to substantially all
of the fair value of the leased asset on the lease beginning date; in the case of the lessor, the present value of the minimum lease
receipts on the lease beginning date amounts to substantially all of the fair value of the leased asset on the lease beginning date;
and

(5)

The leased assets are of a specialized nature that only the lessee can use them without making major modifications.

Article 7

The “lease term” shall refer to the period as specified in the lease agreement, during which the lease may not be canceled. Once a
lease contract is signed, generally it may not be canceled except for the following circumstances:

(1)

With the consent of the lessor;

(2)

Where the lessee enters into a new lease for the same asset or asset of the same kind with the same lessor;

(3)

Where the lessee makes an additional payment of a sufficiently large amount;

(4)

Upon the occurrence of some remote contingency.

If the lessee has the option to continue to lease the asset for any further period, and it is reasonably certain on the lease beginning
date that the lessee will exercise the option, the renewed period shall be included in the lease term, no matter whether rents will
be paid again or not.

Article 8

The term “minimum lease payment” shall refer to the payments (excluding contingent rents and execution costs) that the lessee shall,
or may be required to make, for the term of lease, plus the residual values guaranteed by the lessee or a party related to the lessee.

Where the lessee has an option to buy the leased asset at a price which is expected to be far lower than the fair value on the date
when the option becomes exercisable, and thus it is reasonably certain that the lessee will exercise the option on the lease beginning
date, the payment required to exercise this purchase option shall be included in the minimum lease payments.

The term “contingent rent” shall refer to the rent which is not fixed in amount and calculated on the basis of factors other than
the length of time, such as the sale quantity, amount of usage, price indices.

The term “execution cost” shall refer to costs incurred during the lease term for using the leased asset, such as the fees for technical
consultation and services, training, maintenance and insurance.

Article 9

The term “minimum lease receipt” shall refer to the minimum lease payments plus the residual values guaranteed to the lessor by a
third party independent from the lessor or the lessee.

Article 10

The term “operating lease” shall refer to a lease other than a financing lease.

Chapter III Accounting Treatments of Lessees in Finance Leases

Article 11

On the lease beginning date, a lessee shall record the lower one of the fair value of the leased asset and the present value of the
minimum lease payments on the lease beginning date as the entering value in an account, recognize the amount of the minimum lease
payments as the entering value in an account of long-term account payable, and treat the balance between the recorded amount of the
leased asset and the long-term account payable as unrecognized financing charges.

The initial direct costs such as commissions, attorney’s fees and traveling expenses, stamp duties directly attributable to the leased
item incurred during the process of lease negotiating and signing the leasing agreement shall be recorded in the asset value of the
current period.

The lease beginning date shall refer to the date on which the lessee begins to have the right to use the leased asset.

Article 12

When a lessee calculates the present value of the minimum lease payments, if it can obtain the lessor’s interest rate implicit in
the lease, it shall adopt the interest rate implicit in the lease as the discount rate. Otherwise, it shall adopt the interest rate
provided in the lease agreement as the discount rate. In case the lessee cannot obtain the lessor’s interest rate implicit in the
lease and no interest rate is provided in the lease agreement, the lessee shall adopt the borrowing interest rate of the bank for
the same period as the discount rate.

Article 13

The expression ” interest rate implicit in the lease” shall refer to the discount rate that, on the lease beginning date, makes the
aggregate present value of the minimum lease payments and the unguaranteed residual values equal to the sum of the fair value of
the leased asset and the initial direct costs of the lessor.

Article 14

The term “guaranteed residue value” shall refer to, in the case of a lessee, the residual value of the asset which is guaranteed by
the lessee or by a third party related to the lessee; and in the case of a lessor, the guaranteed residual value from the standpoint
of the lessee plus the residual value of the asset which is guaranteed by a third party independent from both the lessor and the
lessee.

The term “residual value of the asset” shall refer to the fair value of the leased asset when the term of lease expires as estimated
on the lease beginning date.

The term “unguaranteed residue value” shall refer to the residual value of the leased asset minus the guaranteed residual value of
the lessor.

Article 15

The unrecognized financing charge shall be amortized to each period during the lease term.

The lessee shall adopt the effective interest rate method to calculate and recognize the financing charge in the current period.

Article 16

In calculating the depreciation of a leased asset, the lessee should adopt a depreciation policy for leased assets consistent with
that for depreciable assets which are owned by the lessee.

If it is reasonable to be certain that the lessee will obtain the ownership of the leased asset when the lease term expires, the leased
asset shall be fully depreciated over its useful life.

If it is not reasonable to be certain that the lessee will obtain the ownership of the leased asset at the expiry of the lease term,
the leased asset shall be fully depreciated over the shorter one of the lease term or its useful life.

Article 17

Contingent rents shall be recognized as an expense in the period in which they are actually incurred.

Chapter IV Accounting Treatments of Lessors in Finance Leases

Article 18

On the beginning date of the lease term, a lessor shall recognize the sum of the minimum lease receipts on the lease beginning date
and the initial direct costs as the entering value in an account of the financing lease values receivable, and record the unguaranteed
residual value at the same time. The balance between the sums of the minimum lease receipts, the initial direct costs and the unguaranteed
residual value, and the sum of their present values shall be recognized as unrealized financing income.

Article 19

The unrealized financing income shall be allocated to each period during the lease term.

The lessor shall calculate the financing income at the current period by adopting the effective interest rate method.

Article 20

The lessor shall, at least at the end of each year, reexamine the unguaranteed residual values.

No adjustment may be made if the unguaranteed residual value increases.

Where there is evidence showing a reduction in the unguaranteed residual value, the interest rate implicit in the lease shall be re-calculated
and the associated reduction of the net investment in the lease shall be recognized as a loss for the current period. The financing
incomes for subsequent periods shall be recognized on the basis of the revised net investment in the lease and the recalculated implicit
interest rate.

The net investment in the lease shall be the difference between the sum of the minimum lease receipts and the unguaranteed residual
value in a finance lease and unrealized financing incomes.

Where the unguaranteed residual value for which a loss has been recognized previously is subsequently recovered, the reversal of the
loss shall be limited to the amount of the loss recognized, and the interest rate implicit in the lease shall be recalculated. The
financing incomes for subsequent periods shall be determined based on the revised net investment in the lease and the re-calculated
implicit interest rate.

Article 21

Contingent rents shall be recorded into the profits and losses of the period in which they actually arise.

Chapter V Accounting Treatments of Lessees in Operating Leases

Article 22

The rents from operating leases shall be recorded by the lessee in the relevant asset costs or the profits and losses of the current
period by using the straight-line method over each period of the lease term, unless there are other more reasonable methods.

Article 23

The initial direct costs incurred by a lessee shall be recognized as the profits and losses of the current period.

Article 24

The contingent rents shall be recorded into the profits and losses of the current period in which they actually arise.

Chapter VI Accounting Treatments of Lessors in Operating Leases

Article 25

A lessor shall include the assets subject to operating leases in relevant items of its balance sheets in light of the nature of the
asset.

Article 26

The rents from operating leases shall be recorded in the profits and losses of the current period by using the straight-line method
over each period of the lease term, unless there are other more reasonable methods.

Article 27

The initial direct costs incurred to a lessor shall be recorded into the profits and losses of the current period.

Article 28

As for the fixed assets subject to operating leases, the lessor shall calculate the depreciation of it by adopting depreciation policy
for similar assets. As for other leased assets, systematic and reasonable methods shall be adopted for its amortization.

Article 29

The contingent rents shall be recorded in the profits and losses of the period in which they actually arise.

Chapter VII Sale and Leaseback Transactions

Article 30

A lessor and a lessee shall recognize a sale and leaseback transaction as a financing lease or an operating lease according to Chapter
II of the present Standard.

Article 31

Where a sale and leaseback transaction is determined as a financing lease, any balance between the sales proceeds and the carrying
amount of the asset shall be deferred and amortized as an adjustment to depreciation in light of the depreciation pattern of the
leased asset.

Article 32

Where a sale and leaseback transaction is determined as an operating lease, any balance between the sales proceeds and the carrying
amount of the asset shall be deferred and amortized as an adjustment to the lease payments in light of the proportion of the lease
payments during the lease term. However, in case any evidence shows that the sale and leaseback transaction is based on the fair
value, the balance between the sales proceeds and the carrying amount of the asset shall be recorded in the profits and losses of
the current period.

Chapter VIII Presentation

Article 33

A lessee shall, in its balance sheet, present the balances between the long-term accounts payable minus the unrecognized financing
charges related to the financing leases, long-term liabilities and long-term liabilities due within 1 year respectively.

Article 34

A lessee shall, in its notes, disclose the following information related to the financing leases:

(1)

the originally recorded carrying amounts at the beginning and the end of the period of each class of leased fixed assets, and the
accumulated depreciation amount;

(2)

the minimum lease payment for each of the next 3 accounting years subsequent to the balance sheet date and the aggregate minimum lease
payment thereafter; and

(3)

The unamortized balance of unrecognized financing charges and the method used to allocate the unrecognized financing charges.

Article 35

A lessor shall, in its balance sheet, present the balances between the financing lease accounts receivable minus the unrealized finance
incomes as long-term liabilities.

Article 36

A lessor shall, in its notes disclose the following information related to the financing leases:

(1)

the minimum lease receipt for each of the next 3 accounting years subsequent to the balance sheet date and the aggregate minimum lease
receipt thereafter; and

(2)

the unamortized balance of unrealized financing income and the method used to allocate the unrealized financing income.

Article 37

As for an important operating lease, the lessee shall, in its notes, disclose the following information:

(1)

the minimum lease payment for the irrevocable operating lease for each of the next 3 accounting years subsequent to the balance sheet
date; and

(2)

the aggregate minimum lease payment thereafter for the irrevocable operating lease.

Article 38

A lessor shall disclose the carrying amount of each class of leased assets in the operating leases.

Article 39

A lessee and a lessor shall disclose each sale and leaseback transaction as well as the significant items in the contract on the sale
and leaseback transaction.

the Ministry of Finance
2006-02-15

ACCOUNTING STANDARDS FOR ENTERPRISES NO. 5 – BIOLOGICAL ASSETS

the Ministry of Finance

Accounting Standards for Enterprises No. 5 – Biological Assets

Cai Kuai [2006] No.3

February 15, 2006

Chapter I General Provisions

Article 1

In order to regulate the recognition and measurement of biological assets related to the agricultural production, and the disclosure
of relevant information, these Standards are formulated in accordance with the Accounting Standards for Enterprises – Basic Standards.

Article 2

Biological assets refer to living animals and plants.

Article 3

Biological assets have a classification of consumptive biological assets, productive biological assets, and public welfare biological
assets.

The consumptive biological assets refer to the biological assets held for sale, or biological assets to be harvested as agricultural
products in the future, consisting of growing field crops, vegetables, commercial forests, livestock on hand, etc.

The productive biological assets refer to the biological assets held on the purpose of producing agricultural products, rendering
labor services, renting, and etc., consisting of the economic forests, fuel forests, productive livestock, draught animals, etc.

The public welfare biological assets refer to the biological assets for the main purpose of protection or environmental protection,
consisting of wind break and sand fixation forests, water and soil conservation forests, water conservation forests, etc.

Article 4

Other relevant accounting standards shall apply to the items as follows:

(1)

The Accounting Standards for Enterprises No. 1 – Inventories, shall apply to the agricultural production of the harvest; and

(2)

The Accounting Standards for Enterprises No. 16 – Governmental Subsidies, shall apply to the governmental subsidies concerning the
biological assets.

Chapter II Recognition and Initial Measurement

Article 5

No biological asset shall be recognized unless it meets the conditions as follows simultaneously:

(1)

An enterprise possesses or controls the biological asset as a result of past transaction or event;

(2)

The economic benefits or service potential concerning this biological asset are likely to flow into the enterprise; and

(3)

The cost of this biological asset can be measured reliably.

Article 6

The initial measurement shall be made to the biological asset at its cost.

Article 7

The cost of a purchased biological asset consists of the purchase price, the relevant taxes, freight, insurance premium and other
expenses that may be directly attributable to the purchase of this asset.

Article 8

The cost of any consumptive biological asset by way of self-planting, self-cultivating, self-breeding shall be ascertained in accordance
with the provisions as follows:

(1)

The cost of self-planting crops and vegetables consists of the necessary expenses for the materials such as the seeds, fertilizers,
and pesticides, labor, indirect apportionment, etc., prior to the harvest;

(2)

The cost of consumptive biological asset such as self-cultivating forest consists of the necessary expenses for forestation, forest
tending, forest operating facilities, testing of good species, investigation and design, indirect apportionment , etc.;

(3)

The cost of self-breeding livestock raised exclusively for meat production consists of the necessary expenses for feed , labor, indirect
apportionment, etc. prior to the sale; and

(4)

The cost of breeding aquatic animals and plants consists of the necessary expenses for materials such as seedlings, feedstuffs, and
fertilizers, labor, indirect apportionment, etc., prior to the sale or the storage.

Article 9

The cost of self-breeding productive biological asset shall be ascertained in accordance with the provisions as follows:

(1)

The cost of self-planting productive biological assets as forests consists of the necessary expenses for forestation, forest tending,
forest operating facilities, testing of good species, investigation and design, indirect apportionment, etc., before accomplishing
the expected objective of production and operation; and

(2)

The cost of self-breeding productive livestock and draught animals consists of the necessary expenses for feedstuffs and labor, indirect
apportionment, etc., before accomplishing the expected objective of production and operation (being grown up). The phrase “accomplishing
the expected objective of production and operation ” refers that, the productive biological assets may produce agricultural products,
render labor services, be rented out stably for several consecutive years after they enter into the normal production period.

Article 10

The cost of self-cultivating public welfare biological assets shall be ascertained in accordance with the necessary expenses for forestation,
forest tending, forest protection, forest operating facilities, testing of good species, investigation and design, indirect apportionment,
etc., prior to the close canopy.

Article 11

The borrowing costs, which shall be included in the cost of biological assets, shall be disposed in accordance with the Accounting
Standards for Enterprises No. 17 – Borrowing Costs. The borrowing costs of consumptive biological assets such as forests shall be
stopped from being capitalized at the close canopy.

Article 12

An investor shall ascertained the cost of a biological asset in accordance with the value as stipulated in the investment contract
or agreement, unless the unfair value is stipulated in the contract or agreement.

Article 13

The cost of a biological asset sourced from the nature shall be ascertained in accordance with its nominal amount.

Article 14

The cost of biological assets obtained from the exchange of non-monetary assets, recombination liabilities and merger of enterprises
shall be ascertained in accordance with the Accounting Standards for Enterprises No. 7 – Exchange of Non-monetary Assets, Accounting
Standards for Enterprises No. 12 – Debt Restructuring and Accounting Standards for Enterprises No. 20 – Merger of Enterprises, respectively.

Article 15

The subsequent expenses for the biological assets as additional forest planting as a result of selective felling, intermediate felling,
or tending and improvement felling shall be included in the cost of the biological asset as forests.

The subsequent expenses for the management and protection or for the breeding of a biological asset after canopy closure or after
the accomplishment of the expected objective of production and operation shall be included in the current profits and losses.

Chapter III Subsequent Measurement

Article 16

An enterprise shall make subsequent measurements for the biological assets in accordance with the provisions from Article17 to Article
21 of these Standards except for the items as prescribed in Article 22 of these Standards.

Article 17

An enterprise shall, in accordance with the schedule, make the depreciation charges of any productive biological asset whose expected
objective of production and purpose has been accomplished, and shall, based on the use of the biological asset, include it in the
cost or current profits and losses of the relevant asset.

Article 18

An enterprise shall, in accordance with the nature of a productive biological asset, the information about the utilization, and the
form of realization of the relevant expected economic benefits, reasonably ascertain the useful life, expected net salvage value,
and depreciation methods of this productive biological asset. The depreciation methods available consist of the straight-line method,
unit-of-production method, unit-of-output method, etc. Once an enterprise ascertain the useful life, expected net salvage value,
or depreciation method of a productive biological asset, it shall not change it randomly, unless it meets the provisions prescribed
as in Article 20 of these Standards.

Article 19

When an enterprise ascertain the useful life of a productive biological asset, it shall take into consideration the factors as follows:

(1)

The expected output capacity or output of physical objects;

(2)

The expected tangible loss of the asset such as decrepitude of productive livestock and draught animals and the aging of economic
forests; and

(3)

The expected intangible loss of the asset, such as the relative decrease or degrade in the production capacity of the productive biological
asset, or the quality of the agricultural products produced thereby as a result of appearance of new products, the relative outmode
of the agricultural products of the productive biological asset as a result of the change of market demands.

Article 20

An enterprise shall, at least at the end of each year, have a check on the useful life, expected net salvage value, and depreciation
method of the productive biological assets.

If there is any difference between the expected useful life or the amount of expected net salvage value and that of the previously
estimated in a fixed asset, or if any significant change is made on the form of realization of the relevant economic benefits, it
shall be regarded as a change of the accounting estimates, and thus the useful life or the expected net salvage value or depreciation
method of the productive biological asset shall be adjusted or changed in accordance with the Accounting Standards for Enterprises
No. 28 – Changes in Accounting Policies and Estimates? and Correction of Errors.

Article 21

An enterprise shall, at least at the end of each year, examine the consumptive biological assets and productive biological assets.
If any well-established evidence indicates that the realizable net value of any consumptive biological asset or the recoverable amount
of any productive biological asset is lower than its book value as a result of natural disaster, plant diseases and insect pests,
animal disease or change of market demand, the enterprise shall, based on the difference between the realizable net value or the
recoverable amount and the relevant book value, make provision for the loss on decline in value of or for the impairment of the biological
asset and shall include it in the current profits and losses. The aforesaid realizable net value and recoverable amount shall be
ascertained in accordance with the Accounting Standards for Enterprises No. 1 – Inventories and Accounting Standards for Enterprises
No. 8 – Asset Impairment, respectively.

If the factors causing any impairment of a consumptive biological asset have disappeared, the amount of write-down shall be resumed
and shall be reversed from the provision for the loss on decline in value of the consumptive biological asset that has been made.
The reversed amount shall be included in the current profits and losses.

Once the provision for impairment of a productive biological asset is made, it shall not be reversed. No provision shall be made for
public welfare biological assets.

Article 22

Where any well-established evidence indicates that the fair value of a biological asset can be obtained in a reliable and continuous
way, the biological asset shall be measured at the fair value. If a biological asset is made a measurement at the fair value, it
shall meet the conditions as follows simultaneously:

(1)

There is an active biological asset trading market; and

(2)

The identical or similar market prices of biological assets and other relevant information can be obtained from the trading market,
so as to make a reasonable estimate on the fair value of the biological asset.

Chapter IV Harvest and Disposal

Article 23

The cost of a consumptive biological asset shall, at the time of harvest or sale, be carried over in accordance with its book value.
The methods available for the carryover of cost consist of the weighted average method, specific cost identification method, stock
volume proportion method, fixed number of years within rotational felling period method, etc.

Article 24

The cost of agricultural products harvested by a productive biological asset shall be ascertained in accordance with the necessary
expenses for the materials , labor, and indirect apportionment, etc., during the course of output or gathering. The book value of
the productive biological asset shall be carried over as the cost of agricultural products by employing such methods as the weighted
average method, specific cost identification method, stock volume proportion method, fixed number of years within rotational felling
period method, etc.

The agricultural products harvested shall be disposed in the light of the Accounting Standards No. 1 – Inventories.

Article 25

The cost of the biological asset of which the purpose has been changed shall be ascertained at the previous book value when its
purpose has not been changed.

Article 26

For a biological asset, when such conditions as sale, inventory loss, death, damage or destroy appear, its balance after deducting
the book value and the relevant taxes from the disposal income shall be included in the current profits and incomes.

Chapter V Disclosure

Article 27

An enterprise shall, in the notes, disclose the information concerning the biological assets as follows:

(1)

The categories of biological assets, quantities of physical output and book value of various biological assets;

(2)

The accumulative amount of provision for loss on decline in value of various consumptive biological assets, and the useful life, expected
net salvage value, depreciation method, amount of accumulative depreciation and accumulative amount of provision for impairment;

(3)

The categories, obtainment methods and quantities of physical goods of the biological assets sourced from the nature;

(4)

The book value of the biological assets used as guaranties; and

(5)

The information about the risks related to the biological assets and the relevant management measures.

Article 28

An enterprise shall, in the notes, disclose the information concerning the increase and decrease of biological assets as follows:

(1)

The increase of the biological assets as a result of purchase;

(2)

The increase of the biological assets as a result of self-planting, self-cultivating or self-breeding;

(3)

The decrease of the biological assets as a result of sale;

(4)

The decrease of the biological assets as a result of inventory loss, death, damage or destroy;

(5)

The depreciation, or provision for loss on decline in value or impairment which has been made; and

(6)

Other alterations.

the Ministry of Finance
2006-02-15

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German Laws

Act on Proceedings in Family Matters and in Matters of Non-contentious Jurisdiction

Act on Occupational Physicians, Safety Engineers and Other Occupational Safety Specialists

LETTER OF THE MINISTRY OF COMMERCE ABOUT REINFORCING THE PROTECTION OF INTELLECTUAL PROPERTY WHEN ATTENDING OR ORGANIZING OVERSEAS EXHIBITIONS

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION CONCERNING REFUND OF TAXES LEVIED ON PURCHASE OF DOMESTIC EQUIPMENT BY CONSTRUCTION ENTERPRISES ENTRUSTED BY FOREIGN-FUNDED ENTERPRISES THROUGH CONTRACTING FOR LABOR AND MATERIALS

COMPANIES LAW

PROTECTION MEASURES FOR INTELLECTUAL PROPERTY RIGHTS DURING EXHIBITIONS

SUPPLEMENTARY CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION TO THE RELEVANT ISSUES CONCERNING THE TAX-EXEMPTION POLICIES FOR THE EXPORT OF PRODUCTS CONTAINING GOLD

GUIDELINES FOR THE SECURITY EVALUATION OF ELECTRONIC BANKS

NOTICE OF SAT ON PRINTING AND ISSUING THE AGREEMENT TEXT BETWEEN THE GOVERNMENT OF THE PEOPLE’S REPUBLIC OF CHINA AND THE GOVERNMENT OF THE KINGDOM OF SAUDI ARABIA ON THE AVOIDANCE OF DOUBLE TAXATION AND GETTING PREPARED FOR ITS IMPLEMENTATION

ACCOUNTING STANDARD FOR BUSINESS ENTERPRISES NO. 6 – INTANGIBLE ASSETS

ACCOUNTING STANDARDS FOR ENTERPRISES NO. 21 – LEASES

ACCOUNTING STANDARDS FOR ENTERPRISES NO. 5 – BIOLOGICAL ASSETS

CONSTITUTION ACT, 1982 – page 22

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

CONSTITUTION ACT, 1982 – page 17

CONSTITUTION ACT, 1982 – page 16

CONSTITUTION ACT, 1982 – page 12

CONSTITUTION ACT, 1982 – page 11

CONSTITUTION ACT, 1982 – page 10

CONSTITUTION ACT, 1982 – page 9

CONSTITUTION ACT, 1982 – page 8

CONSTITUTION ACT, 1982 – page 7