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ANNOUNCEMENT OF THE PEOPLE’S BANK OF CHINA AND CHINA BANKING REGULATORY COMMISSION

Announcement of the People’s Bank of China and China Banking Regulatory Commission

[2007] No.5

The People’s Bank of China and China Banking Regulatory Commission have cleared some existing rules, regulations and regulatory documents
on financial affairs as issued by the People’s Bank of China according to the Law of the People’s Republic of China on the People’s
Bank of China, the Banking Supervision Law of the People’s Republic of China and the Law of the People’s Republic of China on Commercial
Banks. We hereby publicize the clearing result of the second batch of rules, regulations and regulatory documents, totally 74 pieces,
as follows:

1.

With regard to the 60 rules, regulations and regulatory documents as issued by the People’s Bank of China (Appendix 1), including
the Circular of the People’s Bank of China Concerning the Further Regulation of the Business Operation of Non-banking Financial Institutions,
the People’s Bank of China and China Banking Regulatory Commission shall take charge of supervising, implementing and interpreting
the related matters involved in these rules, regulations and regulatory documents according to their respective statutory duties
and responsibilities, and any modification or abolishment shall be made jointly by the People’s Bank of China and China Banking Regulatory
Commission.

2.

With regard to the 14 rules, regulations and regulatory documents as issued by the People’s Bank of China (Appendix 2) including the
Measures for Administering Trust and Investment Companies, China Banking Regulatory Commission shall take charge of implementing,
interpreting and amending them.

Appendix: 1. The rules, regulations and regulatory documents supervised and implemented jointly by the People’s Bank of China and
China Banking Regulatory Commission

Appendix 2. The rules, regulations and regulatory documents supervised and implemented by China Banking Regulatory Commission

People’s Bank of China

China Banking Regulatory Commission

January 16, 2007
Appendix 1
The rules, regulations and regulatory documents supervised and implemented jointly by the People’s Bank of China and China Banking
Regulatory Commission (Altogether 60)

1.

Circular of the People’s Bank of China Concerning the Further Regulation of the Business Operation of Non-banking Financial Institutions
(Yin Fa [2001] No.356)

2.

Circular of the People’s Bank of China concerning Issues Concerning the Administration of Market Access of Chinese-funded Commercial
Banks (No.105 [2002] of the People’s Bank of China)

3.

Circular concerning the Printing and Distribution of the Provisions on Administering Urban Cooperative Banks (Yin Fa [1997] No.264)

4.

Measures for Administering Overseas Financial Institutions (Order No.1, 1990 of the People’s Bank of China)

5.

Circular of the People’s Bank of China on Matters Concerning Practically Doing Well in Renaming County (Urban) Credit Cooperative
as Rural Credit Cooperative (Yin Fa [2001] No.105)

6.

Guiding Opinions of the People’s Bank of China concerning Inter-bank Borrowing between Rural Credit Cooperatives (Yin Fa [2002] No.107)

7.

Circular of the General Office of the People’s Bank of China Concerning Matters on Initiating Foreign Exchange Business by Rural Credit
Cooperatives (Yin Fa [2002] No.240)

8.

Letter concerning Matters Concerning the Take-over of Financial Assets (Yin Ban Han [2000] No.65)

9.

Circular Concerning Matters on Stripping Bad Loans (Yin Ban Fa [2000] No.89)

10.

Circular Concerning the Printing and Distribution of the Interim Measures for Avoiding and Disposing the Payment Risks of Financial
Institutions (Yin Fa [1998] No.49)

11.

Some Provisions on Implementing the Regulation concerning the Administration of Savings (Yin Fa [1993] No. 7)

12.

Circular concerning Reinforcing the Administration of Personal Business of Depositing and Withdrawing Savings in Financial Institutions
(Yin Fa [1997] No.363)

13.

Circular Concerning the Printing and Distribution of the Measures for Administering Renminbi Corporate Deposit (Yin Fa [1997] No.485)

14.

Circular Concerning the Printing and Distribution of the Measures for Administering of Deposits at Notice (Yin Fa [1999] No.3)

15.

Circular Concerning the Printing and Distribution of the Measures for Administering Educational Deposits (Yin Fa [2000] No.102)

16.

Circular concerning the Opinions on the Disposal of the Related Matters Concerned after the Implementation of the Provisions on the
Real-Name Personal Savings Account System (Yin Fa [2000] No.126)

17.

Circular on Severely Forbidding Soliciting Depositors with High Interest Rates and Attracting Deposits by Unfair Means (Yin Fa [2000]
No.253)

18.

Supplementary Circular of the People’s Bank of China Concerning the Opinions on the Disposal of the Related Matters Concerned in the
Implementation of the Provisions on the Real-Name Personal Savings Account System (Yin Fa [2001] No.102)

19.

Circular of the People’s Bank of China Concerning Matters on the Day Deposit and Withdrawal of Individual Deposits (Yin Fa [2001]
No.340)

20.

Circular of the People’s Bank of China Concerning the Initiation of the Negotiated Deposits of National Social Security Funds by Commercial
Banks (Yin Fa [2002] No.40)

21.

Circular Concerning the Inquiry, Freeze, Deduction and Transfer of the Deposits of Enterprises, Public Institutions, Organs and Consortium
Banks (Yin Fa [1993] No.356)

22.

Circular Concerning the Inquiry, Freeze, Deduction and Transfer of the Deposits of Army Units and the Related Enterprises, Public
Institutions, Organs and Consortium Banks by the Security Departments of the Army (Yin Fa [1996] No.76)

23.

Circular on Checking and Ceasing the Payment of the Deposits of Withholding Taxpayers and Withholding Agents in Financial Institutions
(Yin Fa [1998] No.312)

24.

Circular Concerning the Printing and Distribution of the Measures for Disposing of Small-sum Secured Loans on Individual Fixed Savings
Deposit Certificates (Yin Fa [1994] No.316)

25.

Circular of the People’s Bank of China Concerning the Printing and Distribution of the Interim Provisions on Protecting Safe Computer
Rooms and Counter Equipments of Banks (Yin Fa [2002] No.42)

26.

Circular on Issuing the Interim Measures for Disposing of Syndicated Loans (Yin Fa [1997] No.415)

27.

Circular of the People’s Bank of China, the Ministry of Foreign Trade and Economic Cooperation, and the State Administration of Taxation
on Conducting the Trust Loan Business for Export Tax Refund Accounts (Yin Fa [2001] No.276)

28.

Circular of the People’s Bank of China Concerning Matters on Administering Fixed Assets Loans (Yin Fa [2001] No.331)

29.

Circular of the People’s Bank of China Concerning the Printing and Distribution of the Guiding Opinions on Administering Small-sum
Credit Loans for Rural Households of Rural Credit Cooperatives ( Yin Fa [2001] No.397)

30.

Circular of the People’s Bank of China on Reinforcing the Administration of the Credit Operations of Public Accumulation Fund for
Housing Construction (Yin Fa [2002] No.247)

31.

Circular Concerning the Printing and Distribution of the Measures for Handling the Hypothecated Loans on Proof National Debts (Yin
Fa [1999] No.231)

32.

Circular of the People’s Bank of China on Regulating the Administration of Co-branded Cards (Yin Fa [2002] No.6)

33.

Scope of Foreign Exchange Business of Non-banking Financial Institutions (Hui Guan Han Zi [1997] No. 258)

34.

Provisions on Administering Foreign Exchange Business of Banks (Approved by the People’s Bank of China on September 8, 1997 and promulgated
by the State Administration of Foreign Exchange on September 27, 1997)

35.

Circular on Forwarding the Circular of the Ministry of Finance and the State Archives Bureau Concerning the Printing and Distribution
of the Measures for Accounting Archives Management (Yin Ban Fa [1998] No.135)

36.

Circular Concerning the Printing and Distribution of the Guidelines on the Foreign Exchange Transferred Loans Business of Policy Banks
and Commercial Banks (Yin Fa [2000] No.351)

37.

Circular of the People’s Bank of China Concerning the Printing and Distribution of the Guiding Opinions on the Basic Norms for Bank
Accounting (Yin Fa [2002] No.370)

38.

Circular on Reinforcing Credit Management of Agricultural and Forestry Development Projects and Strictly Prohibiting Illegally Raising
Funds in the Name of Land Development and Land Transfer (Yin Fa [1999] No.254)

39.

Circular of the People’s Bank of China on Putting Down Underground Banks and Cracking Down on Usury Behaviors (Yin Fa [2002] No.30)

40.

Circular of the People’s Bank of China on Further Doing well in Granting Small-sum Credit Loans to Farmer Households and Improving
Supporting Services for Agriculture (Yin Fa [2002] No.113)

41.

Circular on Further Intensifying Bank Settlement Management ( Yin Fa [1997] No.143)

42.

Circular Concerning the Printing and Distribution of the Interim Measures for Administering the Acceptance, Discount and Rediscount
of Commercial Drafts (Yin Fa [1997] No.216)

43.

Circular Concerning the Printing and Distribution of the Measures for the Settlement of Domestic Letters of Credit and the Procedures
for the Accounting of Letters of Credit ( Yin Fa [1997] No.265)

44.

Circular on Reinforcing the Management of Commercial Drafts and Promoting the Development of Commercial Drafts (Yin Fa [1998] No.229)

45.

Circular of the People’s Bank of China Concerning Maters on the Handling of Bank Draft and Bank Acceptance Business (Yin Fa [2002]
No.364)

46.

Circular on Issuing the Measures for Postal Exchange Fund Settlement (Yin Fa [1993] No.20)

47.

Circular of the People’s Bank of China on Improving and Reinforcing the Administration of Postal Exchange Fund Settlement (Yin Fa
[2002] No.25)

48.

Measures for Administering RMB Bank Settlement Accounts (Order No.5, 2003 of the People’s Bank of China)

49.

Circular of the People’s Bank of China Concerning Matters on Handling the Inquiry and Reply Business of Trans-bank Acceptance by Commercial
Banks (Yin Fa [2002] No.63)

50.

Circular of the People’s Bank of China Concerning Matters on Paying Bonds and Reloan Interest of Financial Assets Management Companies
(Yin Fa [2002] No.97)

51.

Reply on the Related Matters Concerning the Fund Settlement of Stripping Non-performing Loans (Yin Ban Han [2000] No.585of the General
Office of the People’s Bank of China)

52.

Circular of the People’s Bank of China, the Ministry of Finance, the Office of the Leading Group for Poverty Alleviation and Development
under the State Council and the Agricultural Bank of China Concerning the Printing and Distribution of the Implementation Measures
for Administering Interest Discount Loans for Poverty Alleviation (Yin Fa [2001] No.185)

53.

Circular of the People’s Bank of China on Establishing Direct Business Contact between Foreign-funded Banks and the Commercial Banks
of Taiwan (Yin Fa [2002] No.361)

54.

Circular of the People’s Bank of China on Regulating the Competition in the Banking Market (Yin Fa [2002] No.354)

55.

Circular Concerning the Printing and Distribution of the Provisions on Administering Hypothecated Loans on Time Deposit Certificates
of Entities (Yin Fa [1999] No.302)

56.

Circular Concerning the Printing and Distribution of the Measures for Administering Valuable Documents and Important Blank Vouchers
(Yin Fa [1997] No.163)

57.

Circular of the General Office of the People’s Bank of China on the Relevant Issues Concerning the Reform of Bank Accounting System
(Yin Ban Fa [2001] No.186)

58.

Provisions on Administering the Foreign Exchange Business of Non-banking Financial Institutions (Approved by the People’s Bank of
China on December 18, 1992 and promulgated by the State Administration of Foreign Exchange on January 1, 1993)

59.

Circular Concerning the Printing and Distribution of the Measures for Administering Loans for the Increase of Registered Capital of
the Chinese Parties of Sino-foreign Equity Joint Ventures and Sino-foreign Cooperative Joint Ventures (Yin Fa [2000] No.68)

60.

Circular on Forwarding the Measures of the Ministry of Public Security for the Administration of Computer Virus Prevention and Control
(Yin Ban Fa [2000] No.156)

Appendix 2
The rules, regulations and regulatory documents supervised and implemented by China Banking Regulatory Commission

1.

Circular of the General Office of the People’s Bank of China Concerning the Related Matters on Reinforcing the Supervision over Non-banking
Financial Institutions (Yin Ban Fa [2002] No.162)

2.

Measures for Administering Trust and Investment Companies (Order No.5, 2002 of the People’s Bank of China)

3.

Circular of the People’s Bank of China Concerning the Related Matters on the Trust and Investment Companies’ Operation of Capital
Trust (Yin Fa [2002] No.314 )

4.

Provisions Concerning the Entrusted Loans Business of Financial Trust and Investment Companies (Yin Fa [1993] No.49)

5.

Circular of the People’s Bank of China Concerning the Related Matters on Strengthening the Supervision over Rural Credit Cooperatives
(Yin Fa [2001] No.396)

6.

Circular Concerning the Printing and Distribution of the Opinions on Reinforcing the Prevention, Investigation and Punishment of Cases
of Rural Credit Cooperatives (Yin Fa [1998] No.139)

7.

Circular Concerning the Printing and Distribution of the Guiding Opinions on Reinforcing the Electronic Construction and Management
of Rural Credit Cooperatives (Yin Ban Fa [2000] No.291)

8.

Circular Concerning the Printing and Distribution of the Opinions on Reinforcing and Regulating the Administration of Agency Business
of Rural Credit Cooperatives (Yin Fa [1999] No.335)

9.

Circular of the People’s Bank of China on Issuing the Provisions on Administering Financial Institutions’ Assistance in the Inquiry,
Freeze or Deduction of Deposits (Yin Fa [2002] No.1)

10.

Circular of the General Office of the People’s Bank of China Concerning the Related Matters on the Settlement and Restructuring Work
of Trust and Investment Companies (Yin Ban Fa [2003] No.24)

11.

Circular Concerning the Issuance of the Measures for the Administration of Assisting the Investigation of Cases of Financial Swindling
(Yin Fa [1997] No.195)

12.

Circular Concerning the Printing and Distribution of the Interim Provisions on Safety Protection of the Business Places and Vaults
of Financial Institutions (Yin Fa [1998] No.588)

13.

Circular Concerning the Earnest Implementation of the Circular of the State Council on Strengthening the Administration of Financial
Claims in the Restructuring Process of Small and Medium-sized State-owned Enterprises and Collective Enterprises (Yin Fa [1998] No.578)

14.

Circular on the Related Matters Concerning the Initiation of Entrusted Loans Business by Commercial Banks (Yin Ban fa [2000] No.100)



 
People’s Bank of China, China Banking Regulatory Commission
2007-01-16

 






PROVISIONS ON UTILIZING THE MARKS OF THE MOST COMPETITIVE BRANDS ON THE MARKET

Announcement of Ministry of Commerce

No. 9

For the purpose of strengthening the administration of and regulating the utilization of the marks of the most competitive brands
on the market, the Provisions on Utilizing the Marks of the Most Competitive Brands on the Market are hereby promulgated in accordance
with the Measures for Evaluating and Protecting Brands in the Commercial Field.
The Ministry of Commerce

January 30, 2007

Provisions on Utilizing the Marks of the Most Competitive Brands on the Market

Article 1

For the purpose of strengthening the administration of the marks of the most competitive brands on the market and regulating the
utilization of the marks of the most competitive brands on the market, the present Provisions are formulated in accordance with the
Measures for Evaluating and Protecting Brands in the Commercial Field.

Article 2

The utilization of the marks of the most competitive brands on the market shall be subject to the present Provisions.

Article 3

The Ministry of Commerce shall take charge of the supervision and administration of the marks of the most competitive brands on the
market. The local commerce authorities and commerce chambers shall take charge of assisting the supervision over and administration
of the utilization of the marks of the most competitive brands on the market.

Article 4

The marks of the most competitive brands on the market are in the ownership of the Ministry of Commerce. Two kinds of marks are available
for the most competitive brands on the market. The mark comprises standard drawing, standard font, standard color and secondary color,
and it is suggested to utilize the preferred mark. Please see Affixes 1, 2, 3 and 4, respectively for the marks as well as their
standard drawings, standard fonts, standard colors and secondary colors for the most competitive brands on the market.

Article 5

Where an enterprise’s brand has been granted with the post_title of the most competitive brand on the market, the uniformly prescribed
mark of the most competitive brands on the market may be utilized on the packages, decorations, instructions, advertisements, internet
and other media of its products or services.

Article 6

The marks of the most competitive brands on the market shall be in the prescribed formats when they are utilized. They may be enlarged
or minified pro rata, but the proportion or hue of marks may not be changed.

Article 7

The standard hue of the marks may not be affected by the base color of adhesive media when the marks of the most competitive brands
on the market are printed and the inside colors or drawings may not be revealed.

Article 8

The marks of the most competitive brands on the market can be utilized only on the products or services to which with the post_title of
the most competitive brand on the market have been granted, and the utilization scope thereof may not be enlarged.

Article 9

In accordance with the Measures for Evaluating and Protecting Brands in the Commercial Field, if the post_title of the most competitive
brand is cancelled, an enterprise or individual shall stop the utilization of the marks of the most competitive brand on the market
as of the date of cancellation, and take charge of cleaning up the marks of the most competitive brand on the market it or he has
utilized.

Article 10

In accordance with the Measures for Evaluating and Protecting Brands in the Commercial Field, after the ownership of a brand, to
a post_title of most competitive brand on the market has been granted alters, the utilization right thereof shall be changed accordingly.

Article 11

If any enterprise or individual has not been empowered to utilize the post_title of the mark of the most competitive brands on the market,
it/he may not utilize as its or his own or forge the marks of the most competitive brands on the market.

Article 12

The marks of the most competitive brands on the market shall be safeguarded in accordance with the Measures for Evaluating and Protecting
Brands in the Commercial Field.

Article 13

The Ministry of Commerce shall be responsible for interpreting the present Provisions.

Article 14

The present Provisions shall go into effect as of the promulgation date.

Affix 1: Marks of the Most Competitive Brands on the Market (omitted)

Affix 2: Standard Drawing (omitted)

Affix 3: Standard Font (omitted)

Affix 4: Standard Color and Auxiliary Color (omitted)

The Ministry of Commerce

January 30, 2007



 
Ministry of Commerce
2007-01-30

 






CIRCULAR OF THE MINISTRY OF COMMERCE ON ENTRUSTING CHANGSHA NATIONAL ECONOMIC & TECHNICAL DEVELOPMENT ZONE TO EXAMINE, APPROVE AND ADMINISTER THE RELEVANT WORK ON FOREIGN-INVESTED ENTERPRISES IN SOME SERVICE TRADE SECTORS

Circular of the Ministry of Commerce on Entrusting Changsha National Economic & Technical Development Zone to Examine, Approve
and Administer the Relevant Work on Foreign-invested Enterprises in Some Service Trade Sectors

Shang Zi Han [2007] No. 25

Hunan People’s Government, Changsha Municipal People’s Government and Changsha National Economic & Technical Development Zone,

Pursuant to Some Opinions on Further Promoting the Development Level of National Economic and Technical Development Zones (Guo Ban
Fa [2005] No. 15) as forwarded by the General Office of the State Council to the Ministry of Commerce, the Ministry of Land and Resources
and the Ministry of Construction as well as the provisions of the Ministry of Commerce on the authorized examination, approval and
administration of foreign-funded enterprises, the Ministry of Commerce has finished the archival filing, examination and approval
of the management systems of all the national economic and technological development zones and the connected network for examination
and approval of foreign capital. The related matters are hereby notified as follows:

1.

Upon research, we hereby authorize the Management Committee of Changsha National Economic & Technical Development Zone to be responsible
for examining, approving and administrating the foreign-funded enterprises in related service trade sectors set up inside its zone
for the purpose of encouraging and supporting the national economic and technological development zones to vigorously develop the
high value-added service industries.

2.

The Management Committee of Changsha National Economic & Technical Development Zone shall, in strict accordance with the laws
and regulations on foreign investments as well as the related provisions on foreign-funded enterprises of non-vessel shipping, construction,
printing, construction engineering design, road transport, commerce and international freight forwarding (see appendix), carefully
examine and approve the related foreign-funded enterprises set up within its zone, and report the related problems found in the work
to the Ministry of Commerce in a timely manner. The Ministry of Commerce shall implement the inspection of the aforesaid examination,
approval and administration, and cancel the authorization to a national economic and technological development zone which commits
illegal examination and approval during the course of authorization.

3.

The Management Committee of Changsha National Economic & Technical Development Zone shall conduct a good job in examination and
approval, archival filing and statistical work in strict accordance with the requirements of the Ministry of Commerce for networking
and online joint annual inspection and by taking advantage of the networking certification system for foreign-funded enterprises.
The related statistical data shall be in line with the requirements so that the Ministry of Commerce can keep informed of the situation
and strengthen supervision.

4.

Changsha National Economic & Technical Development Zone, the management system of which needs to be improved, has not set up an
independent finance department yet. Changsha National Economic & Technical Development Zone shall keep a close eye on and further
resolve the problems in the management system, keep a concise and efficient management system, and improve the level for examining,
approving and administrating the foreign-funded enterprises. Where any management system problem that may affect the work on examining,
approving and administrating the foreign-funded enterprises is found, this Ministry will withdraw the authorized power of examination,
approval and administration immediately.

5.

This circular shall enter into force as of the promulgation date.

Ministry of Commerce

February 12, 2007
Appendix:
Related documents on entrusting the competent provincial departments of commerce to examine, approve and Administer foreign-funded
service trade Enterprises

1.

Circular of the Ministry of Commerce on Entrusting the Competent Provincial Departments of Commerce to Examine and Manage Foreign-funded
Non-vessel Shipping Enterprises (Shang Zi Han [2005] No. 89)

2.

Circular of the Ministry of Commerce on Entrusting the Provincial Administrative Departments of Commerce to Examine, Approve and Administer
the foreign-funded Construction Enterprises (Shang Zi Han [2005] No. 90)

3.

Circular of the Ministry of Commerce on Entrusting the Administrative Departments of Commerce at the Provincial Level to Examine and
Administer the Foreign-funded Printing Enterprises (Shang Zi Han [2005] No. 91)

4.

Circular of the Ministry of Commerce on Entrusting the Administrative Departments of Commerce at the Provincial Level to Examine and
Administer the Foreign-funded Designing Enterprises for Engineering Projects (Shang Zi Han [2005] No. 92)

5.

Circular of the Ministry of Commerce on Entrusting the Competent Provincial Departments of Commerce to Examine and Manage Some Foreign-funded
Road Transport Enterprises (Shang Zi Han [2005] No. 93)

6.

Circular of the Ministry of Commerce on Entrusting Local Departments to Check Foreign-funded Commercial Enterprises (Shang Zi Han
[2005] No. 94)

7.

Circular of the Ministry of Commerce about the related Issues on Entrusting National Economic and Technical Development Zones to Examine
and Approve foreign-funded Commercial Enterprises and International Freight Forwarding Enterprises (Shang Zi Han [2005] No. 102)

8.

Measures for the Administration of Foreign-funded International Freight Forwarding Enterprises (Decree No. 19, 2005 of the Ministry
of Commerce)



 
Ministry of Commerce
2007-02-12

 






CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION, THE MINISTRY OF FINANCE AND THE PEOPLE’S BANK OF CHINA CONCERNING MATTERS ON COLLECTING VEHICLE PURCHASE TAX

Circular of the State Administration of Taxation, the Ministry of Finance and the People’s Bank of China Concerning Matters on Collecting
Vehicle Purchase Tax

Guo Shui Fa [2007] No.16

The state tax bureaus and public finance departments (bureaus) of each province, autonomous region, municipality directly under the
Central Government and city specifically designated in the state plan, Shanghai Headquarters of the People’s Bank of China, each
branch, business management department, central sub-branch of the People’s Bank of China in provincial capital cities, central sub-branches
in Dalian, Qingdao, Ningbo, Xiamen and Shenzhen:

The relevant matters on issuing tax receipts and refunding taxes from the state treasury that are involved during the implementation
of the collection and management system for vehicle purchase tax are hereby clarified as follows:

1.

Matters on issuing the receipts of the vehicle purchase tax paid through direct finance payment

As regards an vehicle-purchase entity adopting a direct finance payment method and paying vehicle purchase tax through the financial
zero balance account, where the name of the actual taxpayer recorded in the tax payment certificate is not consistent with the payment
account name, the column of code of the payment-making entity (individual) of the General Payment Letter for Taxation shall be filled
with the taxpayer identification number of the actual taxpayer (the taxpayer’s identification number shall be “area code + organizational
code as created by the national technical supervision department”), the column of full name of the paying entity (individual) shall
be filled with the full name of the financial zero balance account” and “(full name of the taxpayer)”, the column of bank of deposit
and the column of account number shall be respectively filled with the bank of deposit and account number of the financial zero balance
account.

2.

Matters on refunding taxes from the state treasury

The tax authorities shall, when handling the business of refunding vehicle purchase tax from the state treasury, issue a Tax Revenue
Refund Notice and submit it to the state treasury. As regards the tax paid through a financial zero balance account, it shall be
refunded to such account; where the tax is paid by a taxpayer through transferring from the taxpayer’s account at the bank of deposit,
it shall be refunded to such account; if the refund of tax is made in cash to individuals, the related provisions of the Urgent Circular
of the State Administration of Taxation, the People’s Bank of China and the Ministry of Finance on Refunding Tax in Cash (Guo Shui
Fa [2004] No. 47) shall apply.

Each tax authority, public finance department, state treasury of the people’s banks and commercial bank of each locality shall, when
collecting vehicle purchase taxes and turning them over to the state treasury, intensify cooperation, enhance working efficiency
and guarantee that vehicle purchase tax may be turned over to the state treasury timely and safely.

The State Administration of Taxation

The Ministry of Finance

The People’s Bank of China

February 12, 2007



 
The State Administration of Taxation, the Ministry of Finance and People’s Bank of China
2007-02-12

 






GUIDING OPINIONS OF THE GENERAL OFFICE OF THE MINISTRY OF COMMERCE ON THE WORK OF ABSORBING FOREIGN INVESTMENT IN 2007

Guiding Opinions of the General Office of the Ministry of Commerce on the Work of Absorbing Foreign Investment in 2007

Shang Zi Zi [2007] No.25

For the purpose of grasping the precious opportunities brought about by the increase of transnational investment and the international
industrial transfer, implementing a scientific outlook of development, raising the quality and level of the absorbed foreign investment,
giving full play the benefits of foreign-funded enterprises in national economic and social development and providing guidance to
the whole country in foreign investment absorption, it is hereby notified:

I.

The Absorption of Foreign Investment of the Whole Country in 2006

The year 2006, which marked the beginning of the Eleventh Five-Year Programme, witnessed a steady increase of foreign investment in
China. Some all-caliber figures concerning the absorption of foreign direct investment in 2006 are given as follows: 41485 foreign-invested
enterprises were established, down by 5.76% compared with the previous year and the actually utilized foreign capital stood at US$69.468
billions, down by 4.06%. 12 out of the aforementioned 41485 were Chinese-foreign equity joint banks, insurance companies and funds
management companies, decreasing by 33.33% over the previous year and they actually utilized a total of US$6.447 billion, decreasing
by 46.64%.

The industrial structure of foreign investment was further optimized and the high-tech industries have gained ground on absorbing
foreign investment. In 2006, the actually utilized investment of high-tech industries amounted to US$10.14249 billion, up by 3.81%
over the previous year, and the telecommunication equipment manufacturing, optoelectronic device manufacturing and computer manufacturing
were the most prominent in this regard with a rise of 61.40%, 50.97% and 48.63% respectively. The increase of foreign investment
in non-financial service sector also gained momentum, which was shown by an actually utilized foreign investment of US$ 14.692 billion,
increasing by 25.79% over the previous year and the proportion in the national total up by almost 4 percentage points. The manufacturing
sector utilized a total of US$40.077 billion of foreign fund, which was down by 5.6% and whose proportion in the national total decreased
by 6.78 percentage points. The macro-regulation of foreign investment in the key industries was very effective. Since 2005, no foreign-invested
projects or projects with extended production capacity had been approved in iron and steel, cement and electrolytic aluminum industries.
In 2006, the actually utilized investment of the iron and steel and cement industries reached US$141 million and US$109 million respectively,
which marked significant decreases of 66.67% and 55.67%.

The distribution of foreign investment remained unbalanced. The eastern China utilized a total of US$56.922 billion of foreign investment
in 2006, which accounted for 90.32% of the national total, the central region absorbed US$3.922 billion, or 6.22% while the figures
for the western part were US$2.177 billion and 3.45%. The old industrial bases of northeastern China made use of US$2.466 billion
of foreign investment, or 3.91% of the national total.

The foreign-invested enterprises operated well and their role in the development of national economy was further strengthened. In
the first half of 2006, the investment in the fixed assets made by foreign-invested enterprises stood at US$304.31 billion, which
was up by 19.6% over the same period of the previous year and comprised 11.96% of the national total; foreign-invested enterprises
realized an industrial added value of US$906.07 billion, which was an increase of 18.9% and took up 28.54% of the national total.
From January to November, 2006, the import and export volume of foreign-invested enterprises reached US$937.548 billion, which was
an increase of 25.49% and constituted 58.24% of the national total; the export volume of foreign-invested enterprises stood at US$509.617
billion, or 58.24% of the national total, up by 27.90%. The export volumes of new and high-tech products and mechanical and electrical
products were US$223.378 billion (or 87.99% of the national total) and US$367.542 billion (or 74.05% of the national total) respectively,
registering respective increases of 30.53% and 29.59% over the same period of the previous year. From January to September, the taxes
paid by foreign-invested enterprises amounted to US$606.212 billion, or 21.4% of the national total, up by 27.5%, and the added value
of taxes by foreign-invested enterprises constituted 25.59% of the national total.

There are currently about 280 million people directly employed by foreign-invested enterprises, which comprised more than 10% of non-agricultural
labour force in the urban areas.

II.

The Situation of Foreign Investment to Be Faced in 2007

In terms of the international situation, the world economy will maintain good momentum of development in 2007. Modern service industry,
with service outsourcing as its main content, and a new round of industrial transfer characterized by advanced manufacturing, research
and development will continue their development. Merger and acquisition will remain the major form of transnational direct investment
and its total volume will keep growing. Meanwhile, developing countries and neighboring countries will release their new policies
of foreign investment absorption in succession and try to enhance it; the investment made among developed countries are becoming
more liberalized, which will slow down the growth of the international investment in developing countries. After the transition period
of entering WTO, developed countries will pose on China even greater pressure of further opening up which may exceed China’s capacity.

In terms of domestic situation, the effects of the macro-regulation are becoming increasingly noticeable and the national economy
will keep growing healthily and rapidly; foreign-related laws and regulations are becoming better and more complete; the trends of
horizontal and vertical investment transfer of transnational corporations are obvious; an all-directional, multi-layer and wide-range
pattern of opening up, the service sector included, is taking shape, which has created favorable conditions for keeping appropriate
growth of foreign investment. Meanwhile, the advantages in such traditional production factors as land, labour force and energy have
been weakened; some policies concerning the absorption of foreign investment are and will be undergoing revision one after another,
which will add to the uncertainty in the short term, while in the long run will promote the upgrading and adjustment of foreign investment
structure.

All in all, both opportunities and challenges exist in the work of absorbing foreign investment in 2007, which, on the whole, is beneficial
to the active and reasonable absorption and the further improvement of the work on foreign investment in terms of the quality and
level.

III.

The Guidelines of the Work on Absorbing Foreign Investment in 2007

The guidelines are as follows: to fully implement the scientific outlook on development and raise the quality and level of absorbing
foreign investment, with the strategic objective of building a harmonious society as the centre; to adhere to opening up to the outside
world, serve for the overall interests of national economy and maintain the relative continuity and consistency of the foreign investment
policies; to continue the active and reasonable absorption of foreign investment, import advanced technologies, managerial expertise,
high-level talents and optimize the industrial structure; to provide guidance for the gradient industrial transfer of foreign investment
and promote the coordinated development of regional economy; to develop service outsourcing business and raise the development level
of China’s service industry; to build a more open innovation system and strengthen the capability of independent innovation; to keep
a sustainable development in national economic and technological development zones.

IV.

The Objectives of the Work on Absorbing Foreign Investment in 2007

The objectives are as follows: to strictly follow the basic state policy of opening to the outside world and change the mindset on
absorbing foreign investment; to build a government oriented towards providing quality service to the public and improve the overall
environment for absorbing foreign investment, with raising the quality and level of the utilization of foreign investment as the
core; to lead foreign business to invest in the high-tech manufacturing, modern service industry and the high-level research and
development process, as well as in the resource-saving and environment-friendly industries and maintain an appropriate growth of
foreign investment; to carry out the relevant policies concerning the rise of central China, development of the western region and
rejuvenating the old industrial bases in northeast China and to encourage the gradient industrial transfer; to simplify and standardize
the approving procedures of foreign investment and strengthen the supervision over and administration of foreign investment; to build
a all-round and multi-level system of foreign investment promoting.

V.

In order to achieve the aforementioned objectives, the competent departments of commerce at various levels shall work on the following
9 aspects

1.

Study the principles of the 16th CPC National Congress, the relevant documents released since the 3rd Plenary Session of the 16th
Central Committee of CPC and the National Conference on Economic Work and change the mindset on absorbing foreign investment in line
with the latest development.

The competent departments of commerce shall fully implement a scientific outlook on development and, by focusing on the strategic
objectives of building a harmonious society and an innovative country, study and comprehend the guiding principles of the Central
Committee of the Party and the State Council on adhering to opening up and raising the quality and level of utilizing foreign investment.
The competent departments of commerce shall fully understand the significance and effects of absorbing foreign investment in the
new era, strengthen the function of public service of the government, investigate and research on the situation of foreign investment
in different regions and, considering the overall distribution of national economy, flexibly formulate the policies and measures
of raising the quality and level of absorbing foreign investment.

2.

Further transform government functions and actively improve the overall investment environment.

The competent departments of commerce shall, facing the new situation of foreign investment absorption and researching on the latest
development, conduct all the preparatory work of publicity, explanation and implementation for policy adjustment and keep the relative
consistency and continuity of the policies concerning absorbing foreign investment; the competent departments of commerce shall timely
put forward proposals for formulation and revision of relevant laws, regulations and policies and make further improvement on them;
the competent departments of commerce shall accelerate transforming government functions, enhance their awareness of providing service
to the public, take steps to make administrative affairs more open, promote administrative efficiency and administrative level in
accordance with the law, further simplify the approving procedures, enhance the capacity of online administration and improve transparency;
the competent departments of commerce shall make further amendments to the measures of handling complaints arising from the foreign
investment, intensify law enforcement in intellectual property protection and protect the lawful rights and interests of investors
at home and abroad; the competent departments of commerce shall innovate the forms of publicity, intensify the positive publicity
activities and cultivate favorable public opinions of raising the quality and level of absorbing foreign investment.

3.

Appropriately lead the orientation of foreign investment and optimize the industrial structure.

The competent departments of commerce shall implement the state macroeconomic policies, strengthen the research on the industrial
policies and the current development, lead the orientation of foreign investment flexibly on the basis of the Catalogue for the Guidance
of Foreign Investment Industries and Catalogue of Encouraged Hi-tech Products for Foreign Investment, further encourage foreign investment
in modern agriculture, modern service industry and service outsourcing industry and in the technological renovation and upgrading
of traditional industries and encourage transnational corporations to set up in China regional headquarters, purchasing centres,
logistics centres and training centres; the competent departments of commerce shall take effective measures to restrict foreign investment
in real estate and in the industries with high energy consumption, high pollution emission and low production efficiency, help the
restructuring and upgrading of processing trade, promote the joint investment and cooperation of foreign businesses and domestic
private enterprises, fully utilize overseas resources to develop capital market, and guide and standardize strategic foreign investment
in listed enterprises.

4.

Advance “the Project of Encouraging Investment in Central-Western Region” and promote the coordinated development of regional economy.

The competent departments of commerce shall speed up the revision of Catalogue of Priority Industries for Foreign Investment in the
Central-Western Region, moderately relax the access conditions for foreign investment in the central-western region, implement various
policies concerning the rise of central China, development of the western region and rejuvenating the old industrial bases in northeast
China, promote regional cooperation, encourage East China to speed up its industrial system and mechanism innovation and industrial
restructuring and upgrading, assist the central-western and the northeastern regions in creating conditions for the transfer of open
industries in the eastern part and foreign industries; the competent departments of commerce shall strive to make the 2nd Central
China Trade and Investment Expo a success as a new platform for the further opening up and cooperation with others for the 6 provinces
in central China, deepen the opening up across the border and, considering the bearing capacity of the resources and environment,
advantages for development and potentials of the region, improve the regional development policies.

5.

Develop Modern Service Industry and Undertake the International Service Outsourcing Business.

The competent departments of commerce shall promote the opening up of the service industry in an active and reliable manner, increase
the proportion of foreign investment in it and lead foreign businesses to invest in modern service industries with high added-value
such as finance, logistics, chain stores, IT, software and technological research & development.

The competent departments of commerce shall seize the opportunities of international service outsourcing, further improve the relevant
policies of encouraging the development of service outsourcing industry, fully implement the released supporting measures in the
fields of finance, banking, personnel training, quality authentication of enterprises, international market development, public information
and technology service and intellectual property protection, accelerate the cultivation of cities and enterprises as the bases for
China’s service outsourcing industry, promote the investment and encourage transnational corporations to have China as their important
partner in their service outsourcing business.

6.

Strengthen the Administration of Foreign Investment and Guide and Standardize the Merger & Acquisition of Foreign Investment.

The competent departments of commerce shall further improve the all-caliber statistic work of foreign investment in terms of scope
and depth, better the statistic system of foreign investment, raise the level of joint annual survey, strengthen the monitoring and
analysis of foreign investment, establish the announcement and administration mechanism of key foreign-invested projects the information
work mechanism of foreign investment to provide support for the decision-making of the government.

The competent departments of commerce shall improve the relevant laws, rules and regulations, encourage fair competition, guide and
standardize the merger and acquisition of foreign investment, guard against monopolized and hostile merger and acquisition and maintain
the control force in key industries and areas with a view to ensuring the national economic security.

7.

Build Harmonious Development Zones and Create New Advantages.

The competent departments of commerce shall, on the basis of adaptation to the adjustment of relevant policies and research on the
counter-measures, formulate the measures of sustainable development in the national economic and technological development zones,
give scope to the role of the zones of demonstration, radiation and promotion, develop special zones with vigorous economic growth
and large foreign investment, which absorb domestic investment as well; the competent departments of commerce shall guide and encourage
the development zones to develop new and high-tech industries, modern service industries which are energy-saving and environmental
friendly, enhance the capabilities of independent innovation, give play to the industrial clustering effects of the development zones
in East China and extend their industrial chain, support those in central-western region and the old industrial bases in northeastern
China to speed up infrastructure construction and personnel training to make preparations for the transfer of some industries from
East China, promote regional collaboration in establishing cooperation parks and lead eastern development zones to assist the western
region in improving the comprehensive investment environment.

8.

Improve the Investment Promoting System and Standardize the Foreign Investment Inviting.

The competent departments of commerce shall formulate the investment promoting strategy on the basis of the regional characteristics,
establish and improve the national investment promoting system, innovate the forms of investment promotion and make it institutionalized
and systemized, give full play the role of bilateral and multilateral investment promoting mechanism, research on and determine the
quality appraisal system of absorbed foreign investment, prohibit all disguised preferential policies in foreign investment inviting
in contravention of laws and regulations and correct the practices of assigning quotas to the subordinate departments.

9.

Promote Independent Innovation by Utilizing Foreign Investment.

The competent departments of commerce shall, comprehensively and objectively research on and sum up the experience of promoting independent
innovation by utilizing foreign investment in the context of opening up to the outside world, publicize and utilize the relevant
state policies of encouraging scientific innovation and develop new patterns of promoting innovation by utilizing foreign investment;
the competent departments of commerce shall promote foreign-invested enterprises to assimilate, absorb and re-innovate the technologies
after importing them, encourage transnational corporations to conduct joint cooperation with domestic research and development institutions
and enterprise and expand the spillover effect of foreign-invested technologies; the competent departments of commerce shall encourage
the establishment of foreign-invested enterprises for venture investment and improve the withdrawal mechanism.

The Ministry of Commerce of People’s Republic of China

March 6, 2007



 
The General Office of the Ministry of Commerce
2007-03-06

 






CIRCULAR OF THE MINISTRY OF FINANCE CONCERNING THE RELATED MATTERS ON IMPLEMENTING THE AMENDED GENERAL RULES FOR ENTERPRISE FINANCE

Circular of the Ministry of Finance Concerning the Related Matters on Implementing the Amended General Rules for Enterprise Finance

Cai Qi [2007] No. 48

For the purpose of implementing the amended General Rules for Enterprise Finance (Decree No. 41 of the Ministry of Finance), doing
well in the conversion from the old enterprise financial system to the new one, and propelling the reform of the enterprise financial
system, the related matters are hereby informed as follows:

1.

On the Link-up Matter on Employees’ Welfare Funds in the Financial System Reform

After the amended General Rules for Enterprise Finance comes into effect, an enterprise may not reserve the employees’ welfare funds
at a rate of 14% of the total wage amount, and shall charge back the employees’ welfare funds as reserved in 2007. Up to December
31, 2006, the book balance of payable welfare funds (not including the balance of employees’ welfare funds and awards that are reserved
by foreign-invested enterprises from the after-tax profits) shall be dealt with in accordance with the following conditions. In the
case of any separate provisions formulated by listed company, such provisions shall prevail:

(1)

Where the balance is in red ink, it should be converted into the undistributed profits at the beginning of 2007, and they shall be
made up by free or statutory common reserve funds if the undistributed profits at the beginning of 2007 thus become negative, , and
where there is still balance, such balance shall be made up by the net profits generated in 2007 or later.

(2)

Where there is surplus, the surplus shall be used in accordance with the original provisions, and after the surplus has been used
up, the amended General Rules for Enterprise Finance shall apply. Where an enterprise restructures into a corporation or alienates
its property rights, it shall increase the capital reserves in accordance with the Supplementary Circular of the Ministry of Finance
on the Related Matters about the Provisional Provisions on the Administration and Financial Treatment of the Corporation Restructuring
of Related State-owned Assets (Cai Qi [2005] No. 12).

2.

On Organizing the Implementation of the Amended General Rules for Enterprise Finance

Each region, department and enterprise group shall earnestly organize the implementation of the Amended General Rules for Enterprise
Finance, conduct business trainings in light of their respective situations, do well in disseminating the policies for the enterprise
financial system reform, and adjust, amend and perfect the enterprise financial management systems in accordance with the amended
General Rules for Enterprise Finance (Order No. 41 of the Ministry of Finance), and guarantee the smooth conversion of new and old
enterprise financial systems.

The Ministry of Finance

March 20, 2007



 
The Ministry of Finance
2007-03-20

 






CIRCULAR OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION CONCERNING THE RELATED TAX POLICIES ON THE SERVICE SPONSORSHIP OF THE 29TH OLYMPIC GAMES BY ATOS ORIGIN (BEIJING) COMPANY AND OMEGA (SWITZERLAND) COMPANY

Circular of the Ministry of Finance and the State Administration of Taxation Concerning the Related Tax Policies on the Service Sponsorship
of the 29th Olympic Games by Atos Origin (Beijing) Company and Omega (Switzerland) Company

Cai Shui [2007] No. 38

The public finance departments (bureaus), state taxation bureaus and local taxation bureaus of each province, autonomous region, municipality
directly under the Central Government and city specifically designated in the state plan,

For the purpose of ensuring the success of the 29th Olympic Games held in China, upon study, the related tax matters on the service
sponsorship to the 29th Olympic Games in the forms of cash and goods, etc. by Atos Origin (Beijing) Company and Omega (Switzerland)
Company are hereby clarified as follows:

1.

As regards the 82,510,000 USD of expenses for Atos Origin (Beijing) Company to provide the service sponsorship to the Beijing Organizing
Committee in accordance with the sponsorship agreement, when calculating the taxable enterprise incomes, the actual amount occurred
in the current year shall be totally deducted according to Item 4 of Article 2 of the Notice of the Ministry of Finance, the State
Administration of Taxation and the General Administration of Taxation on the Related Tax Policies for the 29th Olympic Games (Cai
Shui [2003] No. 10).

2.

As regards the 53,110,000 USD of expenses for Omega (Switzerland) Company to provide the service sponsorship to the BOCOG in accordance
with the sponsorship agreement, where no permanent institution has been set up within the territory of China in accordance with the
Agreement between the Government of the People’s Republic of China and the Swiss Federal Council on Avoiding Double Taxation on Incomes
and Properties, the matter of pre-tax deduction is not involved; where a permanent institution has been established within the territory
of China, in accordance with Item 4 of Article 2 of the Circular of the Ministry of Finance, the State Administration of Taxation
and the General Administration of Taxation on the Related Tax Policies for the 29th Olympic Games (Cai Shui [2003] No. 10), when
calculating the taxable enterprise incomes, the actual amount occurred in the current year shall be totally deducted. Where the enterprise
income tax is levied by way of verifying profits, the expenses for such service sponsorship may be deducted directly from the income
amount, on basis of which, the taxes to be levied are verified.

3.

As regards the sponsorship services gratuitously provided to the BOCOG by Atos Origin (Beijing) Company or Omega (Switzerland) Companyin
accordance with the sponsorship agreement, no business tax may be levied.

4.

Except for the service sponsorship, in case Atos Origin (Beijing) Company or Omega (Switzerland) Company collects other service incomes
from the BOCOG, related taxes shall be paid in accordance with the tax law or the treaty of China.

The Ministry of Finance

The State Administration of Taxation

March 29, 2007



 
The Ministry of Finance, the State Administration of Taxation
2007-03-29

 






ANNOUNCEMENT NO 41, 2007 OF MINISTRY OF COMMERCE AND GENERAL ADMINISTRATION OF CUSTOMS ON PROMULGATING LICENSE ADMINISTRATION ON EXPORT OF A PART OF STEELS

Announcement No 41, 2007 of Ministry of Commerce and General Administration of Customs on Promulgating License Administration on Export
of A Part of Steels

In accordance with Foreign Trade Law of the People’s Republic of China and Administrative Regulations on Commodity Import and Export
of the People’s Republic of China, related issues on license administration on export of a part of steels are now announced as follows:

1.

As from May 20, 2007, export license administration (please refer to appendix for commodity code of the customs) shall be carried
out on a part of steels in line with Administrative Measures on Commodity Export License (Announcement No.28, 2004 of Ministry of
Commerce).

2.

When exporting steels listed in this announcement, enterprises shall apply for export license to provincial (province, autonomous
regions, municipalities, cities separately listed in the sate plan and Xinjiang production and construction corps) license-issuing
authorities of local place where the enterprises are located in accordance with Administrative Measures on Commodity Export License.

3.

Trade mode of export license of steels listed in the announcement shall only applicable to general export (loan payment export and
international bidding export are excluded).

4.

“One license for one approval” is adopted on export license of steels listed in the announcement. Related regulations of Administrative
Regulations on Commodity Import and Export shall be implemented to deal with related issues on foreign-invested enterprises.

5.

The export license of steels listed in the announcement shall be effective in 3 months as from release of the license.

6.

Ministry of Commerce and General Administration of Customs shall be responsible for interpretation of this announcement.

Appendix: List of Steels under Export License Administration (omitted)

Ministry of Commerce

General Administration on Customs

Apr 30, 2007



 
Ministry of Commerce and General Administration of Customs
2007-04-30

 






INTERIM MEASURES FOR THE ADMINISTRATION OF THE ISSUANCE OF RMB BONDS IN HONG KONG SPECIAL ADMINISTRATIVE REGION BY FINANCIAL INSTITUTIONS WITHIN THE TERRITORY OF CHINA

Announcement No. 12, 2007 of the People’s Bank of China and the National Development and Reform Commission

The Interim Measures for the Administration of the Issuance of RMB Bonds in Hong Kong Special Administrative Region by Financial Institutions
Within the Territory of China have been formulated jointly by the People’s Bank of China and the National Development and Reform
Commission. They are hereby promulgated for entry into force.

People’s Bank of China

National Development and Reform Commission

June 8, 2007

Interim Measures for the Administration of the Issuance of RMB Bonds in Hong Kong Special Administrative Region by Financial Institutions
Within the Territory of China

Article 1

In order to further promote the development of RMB business in Hong Kong Special Administrative Region (hereinafter referred to as
Hong Kong) and regulate the issuance of RMB bonds in Hong Kong by financial institutions within the territory of China, the present
Interim Measures are formulated in accordance with the Law of the People’s Republic of China on the People’s Bank of China and other
relevant laws and administrative regulations.

Article 2

Financial institutions within the territory of China herein means the policy banks and commercial banks that are established within
the territory of the People’s Republic of China (excluding those in Hong Kong SAR, Macao SAR or Taiwan Area) according to relevant
laws.

Article 3

RMB bonds herein means the securities that are issued in Hong Kong by financial institutions within the territory of China, valued
by RMB, have a term of one year or more, and for which the principal and interests are repaid according to stipulation. The detailed
term for bond issuance may be determined in light of the macro economic and financial status of the Mainland and the convertibility
process of capital accounts.

Article 4

In the case of issuing RMB bonds in Hong Kong, a financial institution within the territory of China shall submit application materials
to the People’s Bank of China (PBC), and transmit a photocopy thereof to the National Development and Reform Commission (NDRC) as
well. The PBC shall, jointly with the NDRC, verify the qualification and scale of RMB bonds to be issued by financial institutions
within the territory of China in Hong Kong, and report the decision to the State Council.

Article 5

The State Administration of Foreign Exchange (SAFE) shall make registration and statistical monitoring upon the RMB bonds that are
issued in Hong Kong by financial institutions within the territory of China, check and ratify the repayment of principal and interests
by financial institutions within the territory of China as well.

Article 6

In the case of issuing RMB bonds in Hong Kong, a commercial bank shall satisfy the requirements as follows:

1.

It has a sound corporate governance mechanism;

2.

With adequacy ratio of the core capital not less than 4 percent;

3.

It has had continuous profits for the last three years;

4.

It has adequate reserves for loan losses;

5.

Its risk surveillant indicator is consistent with the relevant provisions of the regulatory organ;

6.

It has committed no major illegal or law-breaking act in the last three years; and

7.

Other requirements as prescribed by the PBC.

As for the issuance of RMB bonds in Hong Kong by a policy bank, it shall be handled by referring to the requirements for commercial
banks.

Article 7

The application materials for the issuance of RMB bonds by a financial institution shall include:

1.

an application report concerning the issuance of RMB bonds;

2.

the resolution of the board of directors on the approval of the issuance of RMB bonds or documents with equal legal force;

3.

the scale and term of the bonds to be issued;

4.

the introduction for collecting RMB bonds (with an attachment of issuance scheme);

5.

financial statements of the financial institution within the territory of China for the last three years as audited by certified public
accountants, and the full text of audit opinions in written form;

6.

legal opinions in written form as issued by attorneys;

7.

the (duplicate) photocopy of the Enterprise Legal Person Business License, and the (duplicate) photocopy of the Financial Permit;
and

8.

other documents as required by the PBC.

Article 8

The PBC shall, jointly with the NDRC, make a decision of approval or disapproval to the application for the issuance of RMB bonds
by a financial institution within the territory of China within the time limit as provided in the Administrative License Law of the
People’s Republic of China. The NDRC shall give a reply on the scale of RMB bonds at the same time if approved.

Article 9

A financial institution within the territory of China shall initiate the issuance of RMB bonds in Hong Kong within 60 workdays as
of the approval of the PBC on issuance of RMB bonds, and complete the issuance within the time limit as prescribed. Where a financial
institution within the territory of China fails to complete the issuance within the time limit as prescribed, the document relating
to approving the issuance of RMB bonds shall be invalid automatically, and this issuance of bonds shall not be continued; if it is
necessary to issue such bonds, a new application shall be separately submitted in accordance with the present Interim Measures. The
standards for the completion of issuance within the time limit as prescribed shall be determined in accordance with the legal provisions
of Hong Kong on the administration of the financial market.

Article 10

The financial institution within the territory of China and the underwriting institution shall determine the interest rate or price
for the issuance of RMB bonds through negotiations.

Article 11

A financial institution within the territory of China shall report the circumstances concerning the issuance of RMB bonds to the
PBC, the NDRC and the SAFE within 10 workdays after conclusion of the issuance of RMB bonds, and apply for the registration of bond
funds to the local SAFE branch office subject to the relevant provisions.

Article 12

The funds involving the return of money raised through issuance of RMB bonds by financial institutions within the territory of China
as well as the repayment of principal and interests of bonds shall be transferred through the clearing bank for RMB business in Hong
Kong.

Article 13

A financial institution within the territory of China shall transfer back the money as deducted by relevant issuance expenses to
the Mainland within 30 workdays after the money raised through issuance of RMB bonds is in place, and such money shall be used in
strict accordance with the purposes as disclosed in the introduction.

Article 14

The principal and interests of RMB bonds shall be repaid in RMB. In the case of paying the principal and interests of RMB bonds,
a financial institution within the territory of China shall submit an application to the local SAFE branch office prior to five workdays.
The bank shall go through the formalities for overseas repayment of the principal and interests of RMB bonds for the financial institution
within the territory of China upon an approval document as issued by the local SAFE branch office.

Article 15

With respect to the return of the money as raised through issuance of RMB bonds and the follow-up funds as well as the repayment
of the principal and interests, a financial institution within the territory of China shall make a report on the international balance
of payments in accordance with the Operational Rules for the Overseas Assets, Liabilities, Losses and Proceeds of Financial Institutions
(Hui Guo Fa Zi [1996] No. 13).

Article 16

The sales, trading, registration, trusteeship, settlement of and information disclosure regarding RMB bonds in Hong Kong shall be
subject to the relevant provisions as prescribed by Hong Kong.

Article 17

The present Interim Measures are subject to the interpretation of the PBC.

Article 18

The present Interim Measures shall enter into force as of the promulgation date.



 
People’s Bank of China, National Development and Reform Commission
2007-06-08

 






1...818283Page 83 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

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