Facebook
Home German Laws Page 28

German Laws

CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON RELEVANT TAXATION POLICY ISSUES CONCERNING THE SECURITIZATION OF CREDIT ASSETS

Ministry of Finance, State Administration of Taxation

Circular of the Ministry of Finance and the State Administration of Taxation on Relevant Taxation Policy Issues concerning the Securitization
of Credit Assets

Cai Shui [2006] No.5

The departments (bureaus) of public finance, bureaus of state taxes and those of local taxes of all provinces, autonomous regions,
municipalities directly under the Central Government, and cities specifically designated in the state plan, and the Financial Bureau
of Xinjiang Production and Construction Corps:

In order to carry out the “Some Opinions of the State Council on Promoting the Reform, Opening and Stable Development of Capital Markets”
(Guo Fa [2004] No.3), support and increase the proportion of direct financing, improve the structure of assets and liabilities of
banks, promote financial innovation, we hereby, upon approval of the State Council, the notice concerning the relevant issues on
taxation policies for developing the business of securitization of credit assets in the banking sector of China is set forth as follows
:

1.

With regard to the issues of Stamp Duty Policies

(1)

When an initiating institution of securitization of credit assets (i.e., the financial institution that transfers credit assets through
setting up a trust project for a certain purpose [hereinafter referred to as trust project], the same hereafter) trusts a trustee
institution (i.e., the institution that takes charge of managing the trust project properties and sells asset-backed securities on
the basis of its covenant on trust, the same hereafter) with the credit assets for securitization, the stamp duty shall not be levied
on the trust contract signed between both of the parties for the time being.

(2)

When a trustee institution entrusts a loan service institution (i.e., the institution accepts commission of the trustee institution
and takes charge of managing the loans, the same hereafter) to manage credit assets, the stamp duty shall not be levied on the entrusted
management contract signed between both of the parties for the time being.

(3)

Other taxable contracts signed during the course of securitization of credit assets between an initiating institution or trustee institution
and a fund custody institution (i.e., the institution that is entrusted by the trustee institution to take charge of custody of the
funds in the account of trust project properties, the same hereafter) a securities registration and trusteeship institution (i.e.,
China Government Securities Depository Trust & Clearing Co. Ltd.) or any other institution providing services in securitized transactions
shall be exempted from the stamp duty for the said initiating institution or trustee institution for the time being.

(4)

The selling of credit asset-backed securities by the trustee institutions and the trading of credit asset-backed securities by the
investors shall be exempted from stamp duty for the time being.

(5)

The fund accounting books specially set up by initiating institutions or trustee institutions for developing the business of securitization
of credit assets shall be exempted from stamp duty for the time being.

2.

With regard to the issues of Business Tax Policies

(1)

Business tax shall be imposed on the total amount of loan interest income obtained by a trustee institution from the credit asset
trust project that it is entrusted to manage.

(2)

During the course of securitization of credit assets, the loan service institutions that have obtained their service charge income,
the trustee institutions that have obtained their trust rewards, the fund custody institutions that have obtained their entrust rewards,
the securities registration and trusteeship institutions that have obtained their trustee fees, and other institutions that provide
services to securitization transactions and have obtained their service charge incomes, etc., shall all pay business taxes in accordance
with the current business tax policies.

(3)

Business tax shall be imposed on the price differential income obtained by financial institutions (including banks and non-bank financial
institutions) as investors from the trading of credit asset-backed securities; and no business tax shall be imposed on the price
differential income obtained by non-financial institutions as investors from the trading of credit asset-backed securities.

3.

With regard to the issues of Income Tax Policies

(1)

An initiating institution that has got the income from the assignment of credit assets shall calculate and pay enterprise income taxes
in accordance with the policies on enterprise income tax, and the losses incurred as a result of the assignment of credit assets
may be deducted in accordance with the policies on enterprise income tax. The assigned credit assets that are redeemed or replaced
by initiating institutions shall be disposed in accordance with the current policies on enterprise income tax concerning assignment
of assets.

In the process of assignment, redemption and replacement, the initiating institution and the trustee institution shall pay cost and
fees in the light of business transactions between independent enterprises; otherwise the taxation organ shall make adjustment according
to the relevant provisions of the “Law on the Administration of Tax Collection”.

(2)

Enterprise income tax shall not be imposed for the time being, in the course of trust on the part of trust project proceeds allocated
to institutional investors of asset-backed securities (hereinafter referred to as institutional investors) in the same year. For
the part not allocated to the institutional investors in the same year, the trustee institution shall, in the course of trust, declare
and pay enterprise income tax in accordance with the policies on enterprise income tax. When the trust project proceeds on which
the taxes have been paid in the course of trust are allocated to institutional investors again, the institutional investors shall
be disposed in accordance with the relevant current policies concerning enterprise income tax on after-tax proceeds.

(3)

In the process of securitization of credit assets, the loan service institutions that have obtained their service charge, the trustee
institutions that have obtained their trust rewards, the fund custody institutions that have obtained their rewards, the securities
registration and trusteeship institutions that have obtained their trustee fees, and other institutions that provide services to
securitization transactions and have obtained their service charge incomes, shall all calculate and pay enterprise income tax in
accordance with the policies on enterprise income tax.

(4)

During the period when enterprise income tax is exempted from the trust project proceeds for the time being, the institutional investor
to whom proceeds are allocated from the trust project shall, in the course of institutional investment, have its taxable income confirmed
in accordance with the accrual basis, and shall calculate and pay enterprise income tax in accordance with the policies on enterprise
income tax. An institutional investor that has obtained price differential income as a result of its trading in credit asset-backed
securities shall calculate and pay enterprise income tax in accordance with the policies on enterprise income tax, and the losses
of the trading in credit asset-backed securities may be deducted in accordance with the policies on enterprise income tax.

(5)

The trustee institutions and the securities registration and trusteeship institutions shall provide the taxation authority in charge
of the trust project and the taxation authority at the institutional investor’s locality with all the information on finance of trust
project and the detailed information of the proceeds allocated to the institutional investors.

(6)

An institutional investor who obtains income of distribution as a result of liquidation of the trust project shall pay enterprise
income tax in accordance with the policies on enterprise income tax, and the losses as a result of the liquidation may be deducted
in accordance with the policies on enterprise income tax.

4.

When a trustee institution disposes of the credit assets entrusted by an initiating institution for managing, the matters not contained
in the present Notice shall be dealt with in accordance with the present taxation laws, regulations and policies.

5.

The present Notice shall come into force as of the date when the experiment of securitization of credit assets starts.

Ministry of Finance

State Administration of Taxation

February 20, 2006



 
Ministry of Finance, State Administration of Taxation
2006-02-20

 






MEASURES FOR THE ANNUAL INSPECTION OF ENTERPRISES

State Administration for Industry and Commerce

Order of the State Administration for Industry and Commerce

No. 23

The Measures for the Annual Inspection of Enterprises, which were amended at the executive meeting of the State Administration for
Industry and Commerce of the People’s Republic of China, are hereby promulgated and shall enter into effect as of the day of March
1, 2006.

Director of the State Administration for Industry and Commerce, Wang Zhongfu

February 24, 2006

Measures for the Annual Inspection of Enterprises

Article 1

In order to strengthen the supervision and administration of enterprises and maintain the order of market economy, these Measures
are formulated in accordance with the Regulation on the Company Registration Administration, the Regulation on the Registration Administration
of Enterprise Legal Persons, and the Regulation on the Registration Administration of Partnership Enterprises.

Article 2

These Measures apply to the limited companies, joint-stock limited companies, non-corporate enterprise legal persons, partnership
enterprises, sole proprietorship enterprises and their branches, the enterprises from foreign countries (regions) that engage in
business operations in China as well as other business operational entities (hereinafter referred to as the enterprises) that have
obtained business licenses.

Article 3

The annual inspection of enterprises (hereinafter referred to as the annual inspection) refers to a supervision and management system
whereby the enterprise registration organs carry out regular inspections according to law on the relevant conditions of enterprise
registration depending on the annual inspection documents submitted by the enterprises once a year.

Article 4

An enterprise shall hand in the annual inspection documents to the enterprise registration organ from March 1 to June 30 every year.
In the case of any justifiable reason, an enterprise may hand in an application for postponing the participation in annual inspection
to the enterprise registration organ before June 30, and 30 days may be postponed upon approval of the enterprise registration organ.
An enterprise shall be responsible for the authenticity of the annual inspection documents it hands in.

An enterprise registered in the current year shall be subject to the annual inspection as of the next year.

Article 5

The enterprise registration organs at all levels shall take charge of the annual inspection of the enterprises registered thereby.

An enterprise registration organ at a higher level may entrust the enterprise registration organ at a lower level for the annual inspection
of the enterprises registered thereby.

An enterprise registration organ may entrust the administrative offices for industry and commerce at the locality of enterprises registered
thereby for the annual inspection of these enterprises.

Article 6

The procedures for annual inspection shall be as follows:

(1)

An enterprise hands in its documents for annual inspection;

(2)

The enterprise registration organ accepts and examines the annual inspection documents;

(3)

The enterprise pays the fee for annual inspection; and

(4)

The enterprise registration organ affixes a seal of annual inspection on the duplicate of the business license of the enterprise and
gives back the duplicate of the business license to the enterprise.

Article 7

An enterprise shall hand in the documents for the declaration for annual inspection as follows:

(1)

An annual inspection report;

(2)

The certification of the representative or the entrusted agent designated by the enterprise;

(3)

The duplicate of the business license;

(4)

The photocopies of the relevant licensing certificates or approval documents with the seal of the enterprise if there is any business
item pertinent to pre-registration administrative license in the business scope of the enterprise; and

(5)

Other documents are required to hand in prescribed by the State Administration for Industry and Commerce.

An enterprise legal person shall hand in its annual balance sheets and profit and loss statements, and a company or foreign- funded
enterprise shall hand in the audit report issued by an accountant firm.

If an enterprise has any non-legal-person branch, it shall also hand in a photocopy of the duplicate of the branch’s business license.

An enterprise under liquidation shall only hand in the documents mentioned in Paragraph 1.

Article 8

Besides the documents submitted by a non-legal-person branch of an enterprise, the enterprises from foreign countries (regions) that
engage in business operations in China and other business operational entities mentioned in Paragraph 1 of Article 7 of these Measures,
a non-legal-person branch of an enterprise shall also need to hand in the photocopy of the duplicate of the business license of its
parent enterprise that has passed the annual inspection in the previous year, and other business operational entities shall also
need to hand in a photocopy of the qualification certification of its parent institution.

Article 9

A annual inspection report shall include the contents as follows:

(1)

The conditions on the registered items;

(2)

The conditions on the items that are kept on records;

(3)

The conditions on foreign investments;

(4)

The conditions on the establishment and cancellation of branches; and

(5)

The conditions on business operations.

The annual inspection report handed in by a non-legal-person branch of an enterprise, an enterprise from a foreign country (region)
that engages in the business operations in China or other business operational entities shall only include the contents mentioned
in Item (1) of the preceding Paragraph.

Article 10

Where an enterprise hands in comprehensive documents for annual inspection with intact contents, the enterprise registration organ
shall accept them and issue a notice on acceptance, except it affixes a seal of passing the annual inspection on the spot in accordance
with Article 12 of these Measures.

Where the submitted annual inspection documents are not comprehensive or the contents are not intact, the enterprise registration
organ shall not accept them and shall issue a notice on refusal of acceptance that indicates the reasons for the refusal of acceptance.

Article 11

An enterprise registration organ shall, within 5 workdays as of the acceptance of the annual inspection documents, accomplish the
written examination of the contents of the registered items and the recorded items concerned in the annual inspection documents handed
in by an enterprise, unless it shall need to verify the essential contents of the annual inspection documents.

Where the essential contents of the annual inspection documents need to be verified, the enterprise registration organ shall send
two or more functionaries for the verification.

Article 12

Where the annual inspection documents accord with the provisions upon examination, the enterprise registration organ shall affix a
seal of passing the annual inspection on the duplicate of the business license and return the duplicate to the enterprise; otherwise,
the enterprise registration organ shall order the enterprise to make corrections within the time limit, and after the annual inspection
documents are found to accord with the provisions, the enterprise registration organ shall affix a seal of passing the annual inspection
on the duplicate of the business license and return the duplicate to the enterprise. Where the enterprise shall implement the alteration
registration in accordance with law and the items involved in the business license thus shall be altered, the enterprise registration
organ shall affix a seal of passing the annual inspection on the duplicate of the new business license after the alteration registration.

Article 13

An enterprise registration organ shall mainly examine such contents in the annual inspection documents handed in by a company as follows:

(1)

Whether the company has used its name in accordance with the provisions, or whether the company has gone through the formalities of
alteration registration in accordance with the provisions for renaming;

(2)

Whether the company has gone through the formalities of alteration registration in accordance with the provisions for changing its
domicile;

(3)

Whether the company has gone through the formalities of alteration registration in accordance with the provisions for changing its
legal person;

(4)

Whether the company makes a false report on its registered capital, whether its shareholders or promoters have made their contributions
in accordance with the provisions or have withdrawn their capital contributions;

(5)

Whether the relevant licensing certificates or approval documents have been cancelled, revoked or have expired if there is any business
item subject to pre-registration administrative license within the business scope of the company, and whether the business operations
of the company are within the scope of its registered business operations;

(6)

Whether the company has gone through the formalities of alteration registration in accordance with the provisions for the equity transfer
of its shareholders or promoters;

(7)

Whether the business term of the company has come to the due date;

(8)

Whether the company has gone through the formalities for archival filing in accordance with the provisions for the modification of
its articles of association or alteration of its directors, supervisors or managers;

(9)

Whether the company has gone through the formalities for archival filing in accordance with the provisions for the establishment of
a branch, whether any of its branches has been cancelled or been ordered to be closed or its business license has been revoked;

(10)

Whether the liquidation group has gone through the formalities for archival filing in accordance with the provisions after the company
has come into the procedures of liquidation; and

(11)

Whether one natural person has invested to set up two or more one-person limited companies.

Article 14

An enterprise registration organ shall mainly examine such contents in the annual inspection documents handed in by a non-corporate
enterprise legal person as follows:

(1)

Whether the enterprise has used its name in accordance with the provisions, or whether the enterprise has gone through the formalities
of alteration registration in accordance with the provisions for it’s renaming;

(2)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
its domicile or business place;

(3)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
its legal person;

(4)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
its economic nature;

(5)

Whether the relevant licensing certificates or approval documents have been cancelled, revoked or expired if there is any business
item subject to pre-registration administrative license in the business scope of the enterprise, and whether the business operations
of the enterprise are within the scope of its registered business operations;

(6)

Whether have the act of withdrawn or transferred the registered capital;

(7)

Whether the business term of the enterprise has come to the due date;

(8)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for the setting
up or cancellation of any branch;

(9)

Whether the enterprise has gone through the formalities for archival filing in accordance with the provisions for changing its department
in-charge; and

(10)

Whether the enterprise has modified its articles of association.

Article 15

An enterprise registration organ shall mainly examine such contents in the annual inspection documents handed in by a partnership
enterprise as follows:

(1)

Whether the enterprise has used its name in accordance with the provisions, or whether the enterprise has gone through the formalities
of alteration registration in accordance with the provisions for renaming;

(2)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
its business place;

(3)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
the partner in charge of partnership affairs;

(4)

Whether the relevant licensing certificates or approval documents have been cancelled, revoked or have expired if there is any business
item subject to pre-registration administrative license within the business scope of the enterprise, and whether the business operations
of the enterprise are within the scope of its registered business operations;

(5)

Whether the business operational mode of the enterprise is within the scope of its registered business operational modes;

(6)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
the name or domicile of any of its partners;

(7)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
the amount or mode of contribution of any of its partners; and

(8)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for the setting
up or cancellation of any of its branches.

Article 16

An enterprise registration organ shall mainly examine such contents in the annual inspection documents handed in by a sole-investor
enterprise as follows:

(1)

Whether the enterprise has used its name in accordance with the provisions, or whether the company has gone through the formalities
of alteration registration in accordance with the provisions for renaming;

(2)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
its domicile;

(3)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
the name or domicile of its contributor;

(4)

Whether the relevant licensing certificates or approval documents have been cancelled, revoked or expired if there is any business
item subject to pre-registration administrative license within the business scope of the enterprise, and whether the business operations
of the enterprise are within the scope of its registered business operations;

(5)

Whether the business operational mode of the enterprise is within the scope of the registered business operational modes; and

(6)

Whether the enterprise has gone through the formalities of alteration registration in accordance with the provisions for changing
the amount or mode of contributions of the contributor.

Article 17

An enterprise registration organ shall mainly examine such contents in the annual inspection documents handed in by a non-legal-person
branch of an enterprise, an enterprise from a foreign country (region) that engaged in business operations in China or any other
business operational entity as follows:

(1)

Whether the relevant enterprise has used its name in accordance with the provisions, or whether it has gone through the formalities
of alteration registration in accordance with the provisions for renaming;

(2)

Whether the relevant enterprise has gone through the formalities of alteration registration in accordance with the provisions for
changing its business (operation) place;

(3)

Whether the relevant enterprise has gone through the formalities of alteration registration in accordance with the provisions for
changing its person-in-charge;

(4)

Whether the relevant licensing certificates or approval documents have been cancelled, revoked or expired if there is any business
item subject to pre-registration administrative license within its business scope, and whether its business operations are within
the scope of its registered business operations; and

(5)

Whether any other business entity has gone through the formalities of alteration registration in accordance with the provisions for
changing its parent institution.

Article 18

An enterprise registration organ or administrative office for industry and commerce that is authorized to implement the annual inspection
shall report the annual inspection circumstance to the authorizing enterprise registration organ before July 31.

An enterprise registration organ shall, before July 31, report the annual inspection circumstance to the administrative office for
industry and commerce at the locality of enterprises, and the administrative office for industry and commerce shall bring the annual
inspection information into the economic registration information of the enterprises.

Article 19

If an enterprise fails to accept the annual inspection in accordance with the provisions, the enterprise registration organ shall
order it to accept the annual inspection within the time limit. If it is a company, it shall be imposed a fine from RMB 10, 000 Yuan
to RMB100, 000 Yuan. If it is a subsidiary, a non-corporate enterprise legal person or any of its branches or an enterprise from
a foreign country (region) that engages in business operations in China or any other business operational entity, it shall be imposed
a fine less than RMB 30,000 Yuan. And if it is a partnership enterprise, a sole-investor enterprise or any of its branches, it shall
be imposed a fine less than RMB 3,000 Yuan.

If an enterprise still fails to accept the annual inspection within the time limit after being ordered to do so, the enterprise registration
organ shall announce it. If it still fails to accept the annual inspection within 60 days as of announcement, its business license
shall be revoked in accordance with law.

Article 20

If an enterprise keeps from actual situation or resorts to deceits in the annual inspection, the enterprise registration organ shall
order it to make corrections within the time limit. If it is a company, it shall be imposed a fine from RMB10, 000 Yuan to RMB 50,000
Yuan. Where the circumstance is serious, its business license shall be revoked. If it is a subsidiary, a non-corporate enterprise
legal person or any of its branches or an enterprise from a foreign country (region) that engages in business operations in China
or any other business entity, it shall be imposed a fine less than RMB 30,000 Yuan. If it is a partnership enterprise, a sole-investor
enterprise or any of its branches, it shall be imposed a fine less than RMB 3,000 Yuan.

Article 21

Where an enterprise registration organ finds, in the course of annual inspection, that an enterprise commits any act in violation
of the provisions on enterprise registration administration, it may, except to order the enterprise to make corrections give punishment
on the enterprise in accordance with the provisions on enterprise registration administration.

Article 22

Where an enterprise registration organ or any of its functionaries refuses to implement the annual inspection for an enterprise which
accords with the provisions or implements the annual inspection for an enterprise which fails to accord with the provisions, or arbitrarily
charges fees by taking advantage of annual inspection, charges fees by making use of annual inspection, deducts other fees, asks
for or accepts property or money of others or seeks for other interests, the principal and other persons who are directly responsible
shall be subject to the corresponding liabilities n accordance with the laws and disciplines.

Article 23

The formats of the reports on annual inspection and the styles of the seals for annual inspection shall be uniformly regulated by
the State Administration for Industry and Commerce.

Article 24

These Measures shall be implemented as of March 1, 2006. The Measures for the Annual Inspection of Enterprises, which was promulgated
on December 13, 1996(Order of the State Administration for Industry and Commerce, No.61) and was amended on December 3, 1998 (Order
of the State Administration for Industry and Commerce, No.86), shall be abolished simultaneously.



 
State Administration for Industry and Commerce
2006-02-24

 






CIRCULAR OF THE MINISTRY OF FINANCE OF THE PEOPLE’S REPUBLIC OF CHINA, ON ANNULLING THE ADMINISTRATION LICENSING FEES OF FOREIGN ACCOUNTING FIRMS IN IMPLEMENTING INTERIM AUDITING BUSINESS IN CHINA

Ministry of Finance

Circular of the Ministry of Finance of the People’s Republic of China, on Annulling the Administration Licensing Fees of Foreign Accounting
Firms in Implementing Interim Auditing Business in China

Cai Kuai [2006] No. 7

March 2, 2006

The Financial Offices (Bureaus) in all the provinces, autonomous regions, municipalities and Financial Bureaus of Shenzhen City:

In accordance with Law of the PRC on Certified Public Accountants, Foreign Accounting Firms’ relevant business in China shall be approved
by finance department of the People’s Government of related provinces, autonomous regions, municipalities.

In accordance with Law of Administrative Licensing, the administration licensing fees of Foreign Accounting Firms in implementing
interim auditing business in China shall be annulled as of the date of promulgation of this Circular.



 
Ministry of Finance
2006-03-02

 






LETTER OF CHINA BANKING REGULATORY COMMISSION CONCERNING THE APPROVAL TO DALIAN BRANCH OF JAPAN MIZUHO CORPORATE BANK, LTD. TO DEAL IN PROVIDING RMB BUSINESS SERVICE FOR NON-FOREIGN-FUNDED ENTERPRISES

Letter of China Banking Regulatory Commission concerning the Approval to Dalian Branch of Japan Mizuho Corporate Bank, Ltd. to Deal
in Providing RMB Business Service for Non-foreign-funded Enterprises

Japan Mizuho Corporate Bank, Ltd

The letter which was sign by Hiroshi Saito, president of your bank, and was addressed to this Commission has been received.

The following reply is hereby given to you according to the Regulation of the People’s Republic of China on the Administration of
Foreign-funded Financial Institutions (Order No. 340 of the State Council, hereinafter referred to as the Regulation) and the Detailed
Rules for the Implementation of the Regulation of the People’s Republic of China on the Administration of Foreign-funded Financial
Institutions (Order No. 4 of China Banking Regulatory Commission, hereinafter referred to as the Detailed Rules):

Your Dalian Branch is approved to deal in RMB business services for non-foreign-funded enterprises under the scope prescribed in Article
17 of the Regulation.

After going through the statutory formalities in accordance with the Regulation and the Detailed Rules, your Dalian Branch may, under
Article 35 of the Detailed Rules, deal in providing foreign exchange services for various clients under the following scope; providing
RMB business services for foreign-funded enterprises, China-based foreign institutions, mainland-based representative offices of
the enterprises set up by Hong Kong, Macao and Taiwan, aliens, compatriots from Hong Kong, Macao and Taiwan, and the non-foreign-funded
enterprises; pooling public deposits, granting short-term, medium-term and long-term loans, transacting acceptance and discount of
negotiable instruments, buying and selling government bonds and financial bonds, buying and selling non-stock negotiable instruments
denominated in a foreign currency, providing services on letter of credit and guaranties, transacting domestic and overseas settlements,
buying and selling foreign currencies, buying and selling foreign currencies for itself or on a commissioned basis, converting foreign
currencies, inter-bank funding, bank card business, safety-deposit box, providing credit-standing investigation and consultation
services, as well as other business activities upon approval of China Banking Regulatory Commission.

China Banking Regulatory Commission

March 13, 2006



 
China Banking Regulatory Commission
2006-03-13

 






CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON SUSPENDING THE EXPORT TAX REFUNDING ON GASOLINE AND NAPHTHA

the Ministry of Finance, the State Administration of Taxation

Circular of the Ministry of Finance and the State Administration of Taxation on Suspending the Export Tax Refunding on Gasoline and
Naphtha

Cai Shui [2006] No.42

The finance offices or bureaus and the state taxation bureaus of all provinces, autonomous regions, municipalities directly under
the Central Government and cities under separate state planning, and Sinkiang Production and Construction Corp.,

Upon the approval of the State Council, the policy of export value-added tax refunding on vehicle-use gasoline and aviation gasoline
with the tariff number of 2710111O and the naphtha with the tariff number of 27101120 shall be suspended from March 14, 2006. The
specific time for implementation shall be the export date as indicated by the customs in the Declaration on Export Goods (Used specifically
for export tax refunding).

the Ministry of Finance

the State Administration of Taxation

March 21, 2006



 
the Ministry of Finance, the State Administration of Taxation
2006-03-21

 






CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE ON RELEVANT ISSUES ABOUT FOREIGN EXCHANGE ADMINISTRATION ON DUTY-FREE COMMODITIES

Circular of the State Administration of Foreign Exchange on Relevant Issues about Foreign Exchange Administration on Duty-free Commodities

Hui Fa [2006] No. 16

April 3, 2006

The branches and foreign exchange management departments under the State Administration of Foreign Exchange in all provinces, autonomous
regions, and municipalities directly under the Central Government, the branches in Shenzhen, Dalian, Qingdao, Xiamen and Ningbo;
and all designated Chinese-funded foreign exchange banks,

In order to meet the need for the entry/exit personnel who may purchase the duty-free commodities for consumption in the duty-free
shops within the territory, and facilitate the operations of the duty-free commodity industry, and accommodate to the growing demand
of such traveling personnel as businesspeople and tourists, the following circular is hereby made on relevant issues about improving
the foreign exchange control on duty-free commodities:

I.

The “duty-free commodities” as mentioned in this Circular means the import and home-made commodities sold to specific objects as
prescribed by the General Administration of Customs by duty-free commodities operating units and duty-free shops according to the
kinds of management approved by the General Administration of Customs, including duty-free commodities and duty-free foreign exchange
commodities.

The “duty-free commodities operating entities” as mentioned in this Circular means the enterprises that have the qualification for
carrying out the business of duty-free commodities operations upon the approval of the State Council or the department authorized
thereby.

The “duty-free shops” as mentioned in this Circular means the enterprises established by the duty-free commodities operating entities
at the prescribed places for the purpose of selling duty-free commodities upon the approval of the General Administration of Customs.

II.

Duty-free commodities may be priced and settled in foreign currency or Renminbi when they are sold.

III.

When selling duty-free commodities, which are priced and settled in foreign currency or Renminbi, they shall comply with the relevant
provisions on the management of Renminbi exchange rate.

IV.

The duty-free commodities operating entities and the duty-free shops may, according to the provisions of foreign exchange administrative
departments, open foreign exchange current accounts for the settlement of duty-free commodities.

V.

The quota of the foreign exchange current accounts of duty-free commodities operating entities and duty-free shops shall be 100%
approved in the foreign exchange income under the current items of the enterprises.

The range of income of the foreign exchange current accounts of duty-free commodities operating entities shall include: foreign exchange
income for operating duty-free commodities and the affiliated expenses, and foreign exchange income transferred into by each duty-free
shop and other foreign exchange income under the current items. The range of expenditures shall be the payment made for purchasing
the commodities both home and abroad which are operated upon the approval of the General Administration of Customs and the affiliated
expenses as well as other foreign exchange outlays under the current items, and the approved foreign exchange outlays under the capital
item.

The range of income of the foreign exchange accounts under the current items of duty-free shops shall be the foreign exchange income
for selling duty-free commodities and the affiliated expenses as well as other foreign exchange income under the current item. The
range of expenditures shall be the payment made for import goods to the operating entities and the affiliated expenses as well as
other foreign exchange outlays under the current item, and the approved foreign exchange outlays under the capital item.

VI.

In accordance with the provisions of the State Council that the duty-free commodities operating entities shall be responsible for
importing duty-free commodities, duty-free commodities operating entities shall go through the formalities for the purchase and payment
of foreign exchange for import and go through verification formalities according to the relevant provisions of foreign exchange control.

VII.

The payment may be settled in either foreign currency or Renminbi when a duty-free shop pays for import goods and the affiliated
expenses to duty-free commodities operating entities.

VIII.

The foreign currency cash from the income of selling duty-free commodities by duty-free commodities operating entities and duty-free
shops may be deposited into their foreign exchange current accounts. Unless there is necessity to retain a proper scale of changes
for the stock due to the turnover of capital, the duty-free commodities operating entity or duty-free shop may not hold large sum
of foreign currency cash.

IX.

All of the provisions of this Circular on duty-free commodities operating entities and duty-free shops shall apply to the duty-free
commodities enterprises that have the functions of both duty-free commodities operating entities and duty-free shops concurrently.

X.

Other foreign exchange income and expenses involved in the operation of duty-free commodities shall be subject to the relevant state
provisions of foreign exchange management.

XI.

The State Administration of Foreign Exchange and its branches and subsidiaries and foreign exchange management departments shall
have the right to inspect duty-free commodities enterprises such as duty-free commodities operating entities and duty-free shops
and investigate and punish any enterprise that violates the regulations according to the Regulation on Foreign Exchange Management
of the People’s Republic of China and the relevant provisions on foreign exchange management.

XII.

This Circular shall be carried out 30 days after the day of its promulgation, and the Circular on the Relevant Issues concerning
Foreign Exchange Administration of Duty-free Commodities Business (Hui Guan Han Zi [96] No.273 ) shall be abolished simultaneously.

After receiving this Circular, each branch administration of foreign exchange shall forward it to the branches and foreign-funded
banks under its jurisdiction as soon as possible. Each designated Chinese-funded foreign exchange bank shall circulate this Circular
to its subordinate branches as soon as possible after receiving this Circular. If any problem is encountered in the implementation,
please feed them back to the Current Items Administrative Department of the State Administration of Foreign Exchange in time.

Contact telephone: (010) 68402280

Fax:￿￿010￿￿68402272



 
State Administration of Foreign Exchange
2006-04-03

 






INTERIM ADMINISTRATIVE MEASURES FOR COMMERCIAL BANKS TO PROVIDE OVERSEAS FINANCING MANAGEMENT SERVICES

Circular of the People’s Bank of China, China Banking Regulatory Commission and the State Administration of Foreign Exchange on the
Promulgation of the Interim Administrative Measures for Commercial Banks to Provide Overseas Financing Management Services

Yin Fa [2006] No. 121

Shanghai Head Office of the People’s Bank of China, each branch and business management department of the People’s Bank of China and
its central sub-branch of all provincial (or autonomous regional) capital cities, each central sub-branch of Dalian, Qingdao, Ningbo,
Xiamen and Shenzhen, each banking regulatory bureau of all provinces, autonomous regions, municipalities directly under the Central
Government and cities specifically designated in the state plan, each branch and foreign exchange department of the State Administration
of Foreign Exchange of all provinces, autonomous regions and municipalities directly under the Central Government, each branch of
the State Administration of Foreign Exchange of Shenzhen, Dalian, Qingdao, Xiamen and Ningbo, each wholly state-owned commercial
bank and joint-stock commercial bank:

For the purpose of propelling the convertibility of Renminbi capital accounts in an orderly and controllable way, satisfying the reasonable
demands of domestic institutions and individuals for financing investment and asset management abroad, and promoting the balance
of international payments, the People’s Bank of China, China Banking Regulatory Commission and the State Administration of Foreign
Exchange have formulated the Interim Administrative Measures for Commercial Banks to Provide Overseas Financing Management Services,
which are hereby promulgated. Please abide hereby.

Each branch and business management department of the People’s Bank of China shall immediately, after receiving this Circular, transmit
it to the city commercial banks and foreign capital banks within their respective jurisdictions.

The People’s Bank of China

China Banking Regulatory Commission

The State Administration of Foreign Exchange

April 18, 2006

Interim Administrative Measures for Commercial Banks to Provide Overseas Financing Management Services
Chapter I General Provisions

Article 1

For the purpose of regulating commercial banks to provide overseas financing management services, these Measures are formulated in
accordance with the related laws and administrative regulations.

Article 2

The term “providing overseas financing management services” as mentioned in these Measures shall refer to the business activities
carried out in light of the related requirements of these Measures by commercial banks that are qualified for overseas financing
management services and are entrusted by domestic institutions and individual residents (except domestic non-residents, hereinafter
referred to as “investors”) to make stipulated financing product investments with the investors’ funds.

Article 3

China Banking Regulatory Commission (hereinafter referred to as “CBRC”) shall take charge of the admittance administration and business
administration of commercial banks to provide overseas financing management services.

Article 4

The State Administration of Foreign Exchange (hereinafter referred to as “SAFE”) shall take charge of the foreign exchange quota
administration on overseas financing management services of commercial banks.

Article 5

A commercial bank shall, when making overseas financing management investments for customers, follow the laws and regulations of
the state, the provisions of the state on foreign exchange administration and industry administration, as well as the laws and regulations
at the locality of the investments.

Article 6

Where a commercial bank is entrusted by a domestic individual resident to provide overseas financing management services, it shall
follow the related provisions on the administration of commercial banks’ provision of personal financing management services; where
a commercial bank is entrusted by a domestic institution to provide overseas financing management services, it shall conduct it by
referring to the related requirements on building up internal control rules and risk management systems as well as other prudence
requirements pertaining to the administration of commercial banks’ provision of personal financing management services.

Article 7

A commercial bank shall, when providing overseas financing management services, take practical and effective measures to intensify
the management of related risks.

Chapter II Business Admittance Management

Article 8

A commercial bank shall, when intending to provide overseas financing management services, apply with CBRC for approval.

Article 9

A commercial bank providing overseas financing management services shall be a designated foreign exchange bank, and shall satisfy
the following requirements:

(1)

it has established and improved an effective market risk management system;

(2)

it has sound internal control rules;

(3)

it is of the ability for and experience in overseas investment management;

(4)

it has not been penalized by CBRC within one year before applying for the financing management service activities; and

(5)

other conditions on prudence as required by CBRC.

Article 10

A commercial bank shall, when applying with CBRC for the qualification for providing overseas financing management services, provide
the following materials (in triplicate):

(1)

an application letter;

(2)

the related internal control and risk management systems;

(3)

the draft of the custody agreement; and

(4)

other documents as required by CBRC.

Article 11

CBRC shall abide by the related procedures and provisions on administrative license when examining and approving commercial banks’
qualifications for overseas financing management services.

Article 12

Where a commercial bank sells personal financing management products within the territory of China after obtaining the qualification
for overseas financing management services, the activities shall be subject to the related provisions in the Interim Measures for
the Administration of Commercial Banks’ Personal Financing Management Services.

Where a commercial bank sells financing management products or provides comprehensive financing management services to domestic institutions
after obtaining the qualification for overseas financing management services, the admittance administration shall be subject to the
report system, while the matters concerning report procedures and requirements as well as management of related risks shall be handled
by referring to the related provisions on the administration of personal financing management services.

Chapter III Quotas of Foreign Exchanges Purchased for Investments and Conversion Administration

Article 13

Where a commercial bank is entrusted by an investor to provide overseas financing management services with foreign exchanges purchased
with Renminbi, it shall apply with SAFE for the quota of foreign exchanges purchased for overseas financing management services.

Where a commercial bank is entrusted by an investor to invest in overseas financing management with the investor’s own foreign exchanges,
the amount of funds under entrustment shall not be counted into the quota of foreign exchanges purchased for investments as approved
by SAFE.

Article 14

A commercial bank shall, when applying for the quota of foreign exchanges purchased for overseas financing management, provide the
following documents to SAFE:

(1)

the application letter (including but not limited to the basic information on the applicant, the requested quota of foreign exchanges
purchased for investments, the investment plan and etc.) ;

(2)

the approval document on the business qualification by CBRC;

(3)

the draft of the custody agreement;

(4)

the specimen of the agreement of entrustment (in standard form) to be concluded with the certain investor, which shall include the
rights and obligations of both parties, the assumption of proceeds and risks, and other related contents; and

(5)

other documents as required by SAFE.

SAFE shall make a reply on approval or disapproval, inform the applicant in writing and make a copy to CBRC within 20 working days
as of the receipt of the entire application documents.

Article 15

A commercial bank may, within the approved quota of purchased foreign exchanges, issue to investors the overseas financing management
products whose prices are marked in Renminbi, and shall uniformly go through the formalities for purchase of foreign exchanges for
raising Renminbi funds.

Article 16

A commercial bank shall pay the investment principals and proceeds to the investors after the overseas financing management funds
are remitted to China. Where the investor purchases foreign exchanges with Renminbi for investment, the commercial bank shall pay
in Renminbi to the investors after settlement of foreign exchanges; while if an investor makes investments with foreign exchanges,
the commercial bank shall transfer the foreign exchanges into the investor’s original account, or may, if the original account has
been closed up, transfer the foreign exchanges into the account appointed by the investor.

Article 17

The quota of net foreign exchanges purchased by a commercial bank for providing overseas financing management services shall not
exceed the quota of purchased foreign exchanges, which is approved by SAFE.

Article 18

A commercial bank shall take effective measures to offset and manage the foreign exchange rate risks of overseas financing management
services by making use of forward foreign exchange settlement and other businesses.

Chapter IV Administration on Inward and Outward Funds

Article 19

A commercial bank shall, when making overseas financing management investments, entrust another domestic commercial bank approved
by CBRC as qualified for custody business as the custodian to keep all the assets used for overseas investment.

Article 20

In addition to the duties as prescribed by CBRC, the custodian shall fulfill the following functions and duties:

(1)

opening the domestic custody account, the settlement account on use of overseas foreign exchange funds and the securities custody
account in light of the financing management plan on behalf of the commercial bank;

(2)

supervising the commercial bank’s investment operation, and timely reporting it to SAFE when finding any of the commercial bank’s
investment instructions violates any law or rule;

(3)

preserving the related information like the records on the remittance and conversion of the commercial bank’s funds, collection and
payment of foreign exchanges, flow of funds and etc., with the time of preservation to be not less than 15 years;

(4)

making statistical reports on balance of international payments in accordance with the provisions;

(5)

assisting SAFE in inspecting the use of the commercial bank’s funds abroad; and

(6)

other functions and duties as prescribed by SAFE in light of the principle of prudential supervision.

Article 21

A custodian shall submit the related reports according to the following requirements:

(1)

it shall, within 5 working days as of opening the domestic custody account, the settlement account on use of overseas foreign exchange
funds and the securities custody account on behalf of the commercial bank, report it to CBRC and SAFE;

(2)

it shall, within 5 working days as of the day when the commercial bank remits the principals or proceeds out or back, report the remittance
of funds to SAFE;

(3)

it shall, within 5 working days as of the end of each month, report the incomes and expenditures of the commercial bank’s domestic
custody account to SAFE;

(4)

it shall, within 1 month as of the end of each accounting year, submit to SAFE the commercial bank’s statement on using foreign exchange
funds abroad in the last year;

(5)

it shall timely report it to CBRC and SAFE when finding any of the commercial bank’s investment instructions violates any law or rule;
and

(6)

other for-report matters as prescribed by CBRC and SAFE.

Article 22

A commercial bank shall, after receiving SAFE’s approval document on the quota of purchased foreign exchanges, conclude a custody
agreement with the domestic custodian upon the strength of the approval document, and open a domestic custody account. The commercial
bank shall, within 5 working days as of opening the domestic custody account, submit the formal custody agreement to SAFE.

Article 23

The scope of incomes of a commercial bank’s domestic custody account shall be the foreign exchange funds transferred by the commercial
bank into the aforesaid account, the investment principals and proceeds remitted from abroad and other income as prescribed by SAFE.

The scope of expenditures of a commercial bank’s domestic custody account shall be the funds transferred into the settlement account
on use of overseas foreign exchange funds, the funds remitted back to the commercial bank, the currency conversion fees, the custody
fees, the asset management fees, various commissions and other expenditures as prescribed by SAFE.

Article 24

A domestic custodian shall, in light of the principle of prudence and according to the risk management requirements and commercial
practices, select an overseas financing institution as its overseas custody agent.

The domestic custodian shall open the settlement account on use of the commercial bank’s foreign exchange funds and the securities
custody account at the overseas custody agent, and use the aforesaid accounts for the funds settlement business and securities custody
business with overseas securities registration and settlement institutions.

Article 25

A domestic custodian and its overseas custody agent must separately set custody accounts for different commercial banks.

Chapter V Information Disclosure and the Supervision and Management Thereon

Article 26

A commercial bank shall, when intending to buy overseas financing products, accord with the related risk management provisions of
CBRC.

CBRC shall, under the related laws and regulations, supervise and manage the risks in commercial banks’ overseas financing management
services.

Article 27

A commercial bank providing overseas financing management services shall, when selling its products, notify the investors in details
and in an all-round way of the investment plan, product features and related risks, so that the investors may make their choices
independently.

Article 28

A commercial bank providing overseas financing management services shall, at regular intervals, disclose the information on investment
conditions, investment behaviors and risk conditions and etc. to investors.

Article 29

A commercial bank providing overseas financing management services shall, in accordance with the provisions, fulfill the obligations
of making statistical reports on settlement and sale of foreign exchanges.

Article 30

SAFE may, when required by the balance of payments, adjust the quotas of commercial banks that provide overseas financing management
services for purchasing foreign exchanges for investment.

Article 31

CBRC and SAFE may require a commercial bank, a domestic custodian or an overseas custody agent to provide related information on
the commercial bank’s overseas investment activities, and may, when necessary, make on-the-spot inspections on the commercial bank
in light of their supervisory duties.

Article 32

Where a commercial bank falls under any of the following circumstances, it shall, within 5 working days after the circumstance occurs,
report it to CBRC and SAFE for archiving:

(1)

the custodian or the custody agent is changed;

(2)

the registered capital or the structure of shareholders of the company is changed greatly;

(3)

it is involved in any lawsuit or is severely penalized; or

(4)

other circumstances as prescribed by CBRC and SAFE.

Article 33

Where a commercial bank’s domestic custodian is under any of the following circumstances, it shall, within 5 working days after the
circumstance occurs, report it to SAFE:

(1)

its registered capital or stock right structure is changed greatly;

(2)

it is involved in any major lawsuit or is severely penalized; or

(3)

other matters as prescribed by SAFE.

Article 34

Where a commercial bank or its domestic custodian violates these Measures, it shall be imposed upon administrative penalties by SAFE.
If the circumstance is serious, CBRC and SAFE shall have the power to demand the commercial bank to change the domestic custodian,
or to revoke the commercial bank’s quota of foreign exchanges purchased for overseas financing management services. In case the overseas
custody agent refuses to provide related information, CBRC and SAFE shall have the power to demand to change the overseas custody
agent.

Chapter VI Supplementary Provisions

Article 35

Where a commercial bank invests in the financing products in Hong Kong Special Administrative Region or Macao Special Administrative
Region, it shall take the related clauses in these Measures as reference.

Article 36

The power to interpret these Measures shall remain with the People’s Bank of China and CBRC.

Article 37

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



 
the People’s Bank of China, China Banking Regulatory Commission, the State Administration of Foreign Exchange
2006-04-18

 






INTERIM REGULATIONS OF THE PEOPLE’S REPUBLIC OF CHINA ON TOBACCO LEAF TAX

the State Council

Order of the State Council of People’s Republic of China

No. 464

The Interim Regulatins of the People’s Republic of China on Tobacco Leaf Tax is hereby promulgated and shall enter into effect as
of the day of promulgation.

Premier of the State Council, Wen Jiabao

April 28, 2006

Interim Regulations of the People’s Republic of China on Tobacco Leaf Tax

Article 1

In the territory of the People’s Republic of China, an entity that engages in the purchase of tobacco leaves shall be a taxpayer of
the tobacco leaf tax, which shall pay the tobacco leaf tax in the light of the Regulations.

Article 2

The term “tobacco leaves” mentioned in the Regulations means aired tobacco leaves and baked tobacco leaves.

Article 3

The tobacco leaf tax payable shall be calculated on the ground of the sum as generated from tobacco leaf purchases conducted by taxpayers
as well as the tax rate prescribed in Article 4 of the Regulations. The formula of calculating the tobacco leaf tax payable is:

The amount of tax payable ￿￿ Sum as generated from tobacco leaf purchase ￿￿Tax rate

The amount of tax payable shall be calculated in Renminbi.

Article 4

Tobacco leaf tax shall be levied at the proportional rate of 20%.

The adjustment of tax rate for tobacco leaves, if any, shall be determined by the State Council.

Article 5

The tobacco leaf tax shall be levied by local tax authorities.

Article 6

If a taxpayer purchases tobacco leaves in one place, he shall submit tax returns to the local administrative tax authority.

Article 7

The time when the obligation arises for a taxpayer to pay the tobacco leaf tax shall be the very day when he conducts the corresponding
tobacco leaf purchase.

Article 8

When the day that the obligation arises for him to pay the tobacco leaf tax, a taxpayer shall, within 30 days, submit a tax return
. The specific time limit for paying the tax shall be determined by the administrative tax authority.

Article 9

The administration for the levy of the tobacco leaf tax shall be implemented in accordance with the relevant provisions of the Law
of the People’s Republic of China on the Administration of Tax Collection as well as the Regulations.

Article 10

The present Regulation shall enter into effect as of the day of promulgation.



 
the State Council
2006-04-28

 






CIRCULAR OF THE PEOPLE’S BANK OF CHINA ON FURTHER INTENSIFYING THE MANAGEMENT OF DEPOSIT AND PAYMENT OF RENMINBI

Circular of the People’s Bank of China on Further Intensifying the Management of Deposit and Payment of Renminbi

Yin Fa [2006] No. 154

Shanghai Headquarters, all branches and business departments of the People’s Bank of China, the central sub-branches of the People’s
Bank of China in all provincial cities, Shenzhen Central Sub-branch of the People’s Bank of China, China Agriculture Development
Bank, all state-owned commercial banks, equity joint commercial banks, and China Postal Savings and Remittance Bureau,

Recently, it was complained that some financial institutions operating the Renminbi deposit and withdrawal business (hereinafter referred
to as the financial institutions) do not fulfill their legal duties owing to merely seeking their own economic benefits. They refuse
to adjust the types of Renminbi or change the deformed or defiled Renminbi notes for people and they do not sort out the deformed
and defiled Renminbi notes in accordance with the relevant provisions of the People’s Bank of China so that some of the Renminbi
notes which were not suitable to circulate re-flow into the market. Their violations not only damaged the interests of the general
public and the image of the financial industry, but also influenced the normal circulation of Renminbi. , You are hereby notified
of the following requirements in order to further intensify the management of circulation of Renminbi and regulate the deposit and
payment of Renminbi:

I.

All financial institutions shall advance their awareness of serving the general public, and shall execute carefully the Regulation
of the People’s Republic of China on the Administration of Renminbi, the Measures of the People’s Bank of China for the Change of
Deformed and Defiled Renminbi Notes and other regulations, and adjust the types of Renminbi notes for the public and freely change
the deformed or defiled Renminbi notes for the general public in accordance with the principle of reasonable needs. The financial
institutions shall consciously accept the supervision of the general public, carefully accept the complaints of the clients and carefully
improve and regulate the deposit and payment of Renminbi.

II.

All financial institutions shall focus on checking and counting the Renminbi notes withdrawn from circulation. They shall establish
an effective internal control mechanism and deliver the Renminbi notes (including paper notes and coins) which meet the provisions
of the Criterions on Sorting out the Renminbi Notes Not Suitable to Circulate to the People’s Bank of China in order to hinder any
external payment of Renminbi notes not suitable to circulate according to the Criterions on Sorting out the Renminbi Notes Not Suitable
to Circulate,.

III.

All branches of the People’s Bank of China shall strengthen the supervision over the management of circulation of Renminbi and regularly
and irregularly direct on-the-spot inspections on the over-the-counter deposit and payment of Renminbi notes of the financial institutions
under their respective jurisdiction, shall timely correct the irregular acts, shall punish the violators according to the relevant
provisions, shall strictly hold the pass of the Renminbi note bundles delivered by the financial institutions, shall not accept any
Renminbi note bundle which falls short of the “Five standards on good Renminbi note bundles” (namely counting correctly, seeking
out all problematic notes, putting the notes in order, binding the notes tightly and affixing a seal clearly) and shall circulate
a notice of criticism on the financial institutions that have a high error rate by circulating a notice,

The present Notification shall be transmitted by Shanghai Headquarters, all branches and business departments of the People’s Bank
of China, central sub-branches of the People’s Bank of China in provincial (capital) cities, and Shenzhen Central Sub-branch of the
People’s Bank of China to the urban commercial banks, rural commercial banks, rural cooperative banks, and urban and rural credit
cooperatives within their respective jurisdictions.

The People’s Bank of China

May 11, 2006



 
The People’s Bank of China
2006-05-11

 






CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON THE RELEVANT TAX ISSUES OF THE ECONOMIC AND TRADE OFFICE OF THE GOVERNMENT OF HONG KONG SAR IN THE MAINLAND

Circular of the State Administration of Taxation on the Relevant Tax Issues of the Economic and Trade Office of the Government of
Hong Kong SAR in the Mainland

Guo Shui Han [2006] No. 494

The state taxation bureaus and local taxation bureaus of Shanghai Municipality, Sichuan and Guangdong provinces,

In order to settle the tax issues of the Economic and Trade Office of the Government of Hong Kong SAR in Guangdong as well as the
economic and trade offices to be set up in Shanghai and Chengdu, Hong Kong and Macao Affairs Office of the State Council has, upon
the approval of the State Council, approved and transmitted to our Administration Facilitating the Work of the Economic and Trade
Office of the Government of Hong Kong SAR in Guangdong (Gang Ban Lian Zi [2006] No. 203) and the Affairs Relating to the Economic
and Trade Office to Be Set Up by the Government of Hong Kong SAR in Chengdu and Shanghai(Gang Ban Lian Zi [2006] No. 201). The Notification
on relevant contents is hereby transmitted as follows. Please abide hereby.

1.

The Economic and Trade Office of the Government of Hong Kong SAR in Guangdong may not pursue commercial and any other activities concerning
making money. It may charge service fees on the base of cost for the relevant services it provides and the revenues from such services
are exempted from business tax and enterprise income tax.

2.

The wages, salaries and other similar remunerations paid by the government of Hong Kong SAR to the functionaries dispatched by it
to its Economic and Trade Office in Guangdong (except other functionaries thereof) are exempted from individual income tax. The specific
tax-exemption matters shall be handled in accordance with the relevant provisions of the Arrangement between the Mainland of China
and Hong Kong SAR on the Avoidance of Double Taxation on Incomes.

3.

The office supplies, motor vehicles transported into the Mainland by the Economic and Trade Office in Guangdong, and the self-use
resettlement articles transported into the Mainland by the Chief of the Office are exempted from the import link value added tax
and consumption tax within the scope of rational amount upon the auditing of the customs . The self-use resettlement articles transported
into the Mainland by other functionaries within a half year since they assume their posts may also enjoy the aforesaid tax-exemption
treatments.

4.

The number of vehicles for the official business of the Economic and Trade Office of Government of Hong Kong SAR in Guangdong is limited
to 2. The number of individuals’ self-use cars and that of motorcycles for each family are limited to 1respectively. The aforesaid
vehicles and motorcycles are exempted from the vehicle and vessel license and plate tax.

5.

The tax treatments for the economic and trade offices to be set up in Shanghai and Chengdu by the Government of Hong Kong SAR shall
be transacted according to the Economic and Trade Office of Hong Kong SAR in Guangdong.

State Administration of Taxation

May 24, 2006



 
State Administration of Taxation
2006-05-24

 






1...272829...83Page 28 of 83

CONSTITUTION ACT, 1982 – page 22

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

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

Disclaimer: There is no confidential attorney-client relationship formed by using Laws.com website and information provided on this site is not legal advice. For legal advice, please contact your attorney. Attorneys listed on this website are not referred or endorsed by this website. By using Laws.com you agree to Laws.com Terms Of Use.
Facebook
© LAWS.COM NETWORK 2023-2024