PROVISIONS CONCERNING THE ADMINISTRATION OF FOREIGN-FUNDED BUSINESS-STARTING INVESTMENT ENTERPRISES

The Ministry of Foreign Trade and Economic Cooperation, the Ministry of Science and Technology, the State Administration for Industry
and Commerce, the State Administration of Taxation, the State Administration of Foreign Exchange

Decree of the Ministry of Foreign Trade and Economic Cooperation, the Ministry of Science and Technology, the State Administration
for Industry and Commerce, the State Administration of Taxation and the State Administration of Foreign Exchange

No.2

The Provisions Concerning the Administration of Foreign-funded Business-starting Investment Enterprises were adopted at the 11th ministerial
meeting of the Ministry of Foreign Trade and Economic Cooperation. It is hereby promulgated and shall be implemented as of March
1, 2003.

Minister of the Ministry of Foreign Trade and Economic Cooperation Shi Guangsheng

Minister of the Ministry of Science and Technology Xu Guanhua

Director general of the State Administration for Industry and Commerce Wang Zongfu

Director general of the State Administration of Taxation Jin Renqing

Director general of the State Administration of Foreign Exchange Guo Shuqing

January 30, 2003

Provisions Concerning the Administration of Foreign-funded Business-starting Investment Enterprises

Chapter I General Provisions

Article 1

The present Provisions are formulated to encourage foreign-funded companies, enterprises and other economic organizations or individuals
(hereinafter referred to as foreign investors) to come to China to engage in business-starting investments, and to establish and
perfect the mechanism of business-starting investments in China in accordance with the Law of the People’s Republic of China on Chinese-foreign
Contractual Joint Ventures, the Law of the People’s Republic of China on Chinese-foreign Equity Joint Ventures, the Law of the People’s
Republic of China on Foreign-capital Enterprises, the Company Law of the People’s Republic of China and other related laws and regulations.

Article 2

The term “foreign-funded business-starting investment enterprise ” (hereinafter referred to as FBIE” refers to the foreign-funded
investment enterprises established by foreign investors or by foreign investors jointly with companies, enterprises or other economic
organizations established and registered in China in accordance with the Chinese law (hereinafter referred to as Chinese investors).
To establish an FBIE shall be in conformity with the present Provisions. It shall mainly engage in business-starting investments.

Article 3

The term “business-starting investment” means making principal equity investments to high and new tech enterprises that haven’t been
listed in the stock market (hereinafter referred to as invested enterprises), and providing management services to them for the prospective
capital gains.

Article 4

An FBIE is allowed to take the form of the non-legal-person organization or the corporate organization.

As to a non-legal-person organization, the investors shall bear joint liabilities for its debts. The investors may also specify in
the contract of the FBIE that: When the assets of an FBIE are not enough to clear the debts of this enterprise, the indispensable
investors as stated in Article 7 shall bear joint liabilities and the other investors shall bear the liabilities to the company
within the limit of contributions made by each of them.

For a corporate-form FBIE, the investors shall bear the liabilities to the company within the limit of the amount of investment made
by each of them.

Article 5

The FBIEs shall abide by relevant laws and regulations of China, shall be in conformity with the policies of foreign investment industries
and shall not damage the public interests of China. The legitimate businesses and lawful rights and interests of the FBIE within
the borders of China shall be subject to the protection of Chinese law.

Chapter II Establishment and Registration

Article 6

To establish an FBIE, the following requirements shall be met:

(1)

There are more than 2 but less than 50 investors, and at least one shall be an indispensable investor as stated in Article 7 ;

(2)

The investors of a non-legal-person organization shall subscribe to a minimum total contribution in the sum of 10, 000, 000 U.S. $.
The investors of an incorporated FBIE shall subscribe to a minimum total capital in the sum of 5, 000, 000 U.S. $. Except for the
indispensable investors as provided in Article 7 , each of the other investors shall subscribe to a minimum capital contribution
no less than 1, 000, 000 yuan. Foreign investors may contribute their investments in convertible currencies and Chinese investors
may contribute their investments in Renminbi.

(3)

It shall have definite organization form;

(4)

It shall have a definite and legitimate investment direction;

(5)

Except that the operations of such an enterprise are subject to the management of a business-starting investment management company
under authorization, an FBIE shall have at least 3 professional managerial persons who have practical experience in business-starting
investment;

(6)

It shall meet the other requirements as provided in laws and administrative regulations.

Article 7

An indispensable investor shall meet the following requirements:

(1)

Business-starting investment is its main business;

(2)

The accumulative total capital managed by it in the three years before the application is not less than 100, 000, 000 U.S. dollars,
and of which no less than 50, 000, 000 U.S. dollars have been used in business-starting investment If the indispensable investor
is a Chinese investor, the accumulative total capital managed thereby in the three years before the application is submitted is not
less than 100, 000, 000 Yuan, and of which no less than 50, 000, 000 yuan have been used in business-starting investment;

(3)

It shall have at least 3 professional managerial persons who have practical experience in business-starting investment;

(4)

If the affiliated entity of an investor meets the above-mentioned requirements, the investor may apply for the status of an indispensable
investor. The term “affiliated entity” in this paragraph refers to an entity controlled by the investor, or an entity that controls
the investor, or another entity that subject to the control of the same entity that controls the investor. The term “control” in
this paragraph means that the controlling party has a voting power of more than 50 % over the controlled party.

(5)

Neither the above-mentioned indispensable investor nor its affiliated entity shall have any record of being prohibited from engaging
in business-starting investment or business of investment consultancy, or being punished for the reason of cheat, by the judicial
departments and other relevant agencies of the country where it is located;

(6)

An indispensable investor of a non-legal-person enterprise shall subscribe to and actually pay not less than 1 % of the subscribed
contributions and the actual total contributions respectively, and it shall bear joint liabilities for the debts of this enterprise.
An indispensable investor of an incorporated FBIE shall subscribe to and actually pay not less than 30% of the subscribed contributions
and the actual total contributions respectively.

Article 8

The following procedures shall be observed in the establishment of an FBIE:

(1)

The investors shall submit the establishment application and relevant documents to the administrative departments in charge of foreign
trade and economic cooperation at the provincial level of the place where the FBIE is to be established.

(2)

The administrative departments in charge of foreign trade and economic cooperation at the provincial level shall complete the original
examination and report to the Ministry of Foreign Trade and Economic Cooperation (hereinafter referred to as the MOFTEC) within 15
days as of the acceptance of the above-mentioned materials.

(3)

The MOFTEC shall, with the consent of the Ministry of Science & Technologymake a written decision on approval or disapproval within
45 days as of the acceptance of all the above-mentioned materials. And it shall issue a Certificate of Approval for Foreign-invested
Enterprises to the approved enterprises.

(4)

With the approved of establishing an FBIE, the applicant shall file an application for registration at the State Administration of
Industry and Commerce or at local bureaus with its authorization by presenting the Certificate of Approval for Foreign-invested Enterprise
within one month as of the acceptance of the Certificate of Approval for Foreign-invested Enterprise.

Article 9

The following documents shall be submitted to the MOFTEC when applying for the establishment of an FBIE:

(1)

an establishment application signed by the indispensable investors;

(2)

contracts and articles of association of the FBIE signed by all the investors;

(3)

a written declaration made by the indispensable investors (covering: a. the investors meet the requirements as provided in Article
7 ; b. all the materials submitted are genuine; and c. the investors will strictly abide by the present provisions and other relevant
Chinese laws and regulations);

(4)

a letter of legal advice issued by a law firm affirms that the legal indispensable investors exist and the above-mentioned declaration
has got valid authorization and has been signed;

(5)

explanations of the business-starting operations of the foreign investors, explanations of the capital managed by them of the three
years before the application is submitted, explanations of the investment made among the capital managed by them of the three years
before the application is submitted, resumes of its professional managerial persons of business-starting investment;

(6)

the registration certificate of the investors (photocopy) and the certificate of the legal representative (photocopy);

(7)

the notice of pre-approval of the name of the FBIE issued by the name registration organ;

(8)

If the qualifications of the indispensable investors are based on the requirements as provided in paragraph (4) of Article 7 , they
shall submit relevant materials of the affiliated entity that meets the requirements;

(9)

other documents related to the establishment application as required by the examination and approval authority.

Article 10

The FBIEs shall give a clear indication of “Business-starting Investment” in its name. Except for business-starting investment enterprises,
none of the other foreign investment enterprises may use the aforesaid words in their name.

Article 11

In applying for establishing an FBIE, the following documents shall be submitted to the registration organ and shall be responsible
for their authenticity and effectiveness:

(1)

registration application signed by the chairman of the board of directors or by the person-in-charge of the joint management committee;

(2)

contracts, articles of association, the documents and certificate of approval issued by the approving authorities;

(3)

legal license to do business or the certification of the ID of the investor;

(4)

credit certification of the investor;

(5)

appointment documents and the certification of the ID of the legal representative and archival documents of the directors and managers
of this enterprise;

(6)

notice of pre-approval of its name;

(7)

the certification of the address of the enterprise and the certification of its business offices.

In the case of applying for establishing a non-legal-person organization, the applicant shall submit the articles or agreement of
overseas indispensable investors besides the aforesaid materials. Where an enterprise includes investors as provided in Article 7
(4) of the present Provisions, the applicant shall submit the letter of undertaking issued by its affiliated entity, which is to
bear the joint liabilities of investments. All of the aforesaid documents should be written in Chinese. Those written in foreign
languages other than Chinese shall be accompanied by good Chinese translations.

An FBIE should apply to the original registration organ for the modification registration of its modified registration matters.

Article 12

Upon the approval of the registration organ, the incorporated FBIEs shall be issued the business license of legal entity, and the
non-legal-person FBIEs shall be issued a business license.

A business license shall clearly states the total registered capital of the investors and the names of the dispensable investors.

Chapter III Capital Contributions and Relevant Modifications

Article 13

The capital contributions made by the investors of a business-starting enterprise without qualifications of legal entity and the relevant
modifications shall be in conformity with the following:

(1)

The investors may pay the their subscribed capital by installments according to the proceedings of the business-starting investment,
but the longest term shall be no more than 5 years. The amount of capital to be invested at each stage shall be decided by the FBIE
itself according to the contract of the enterprise and the agreement concluded by it and its invested enterprise. In the contract,
the investors shall stipulate liabilities of the investors who do not pay the subscribed capital contributions and relevant measures.

(2)

During the period of the continuous existence of the FBIE, the investors generally shall not reduce their subscribed amount of capital.
Upon approval of the examination and approval organ, an investor may reduce its subscribed amount of capital if the said amount exceeds
50 % of the total provided that it has obtained the consent of the indispensable investors and the business-starting FBIE isn’t in
violation of the requirement of minimum registered capital of 1, 000, 000 U.S. $ (The present provision shall not be applicable to
a case where an investor reduces its invested amount of capital in accordance with item (5) of this Article or the FBIE reduces the
untapped capital when its term of investment expires). In this case, the investors shall stipulate the conditions, procedure and
methods for reducing the subscribed amount of capital in the contract of the FBIE;

(3)

Indispensable investors shall not withdraw from the FBIE during the period of its continuous existence. A necessary withdrawal under
a special circumstance shall be upon the consent of the investor whose investment amount exceeds 50% of the total amount, and the
relevant rights and interests shall be assigned to the new investor who satisfies the conditions as provided in Article 7 . The contract
and the articles of association of this enterprise shall be modified and shall be reported to the check and approving authority for
approval.

The transference of the other investors’ subscribed amount of capital or invested amount of capital shall be done in compliance with
the contract of the FBIE and the assignee shall meet the requirements as provided in Article 6 . All investors shall make relevant
modifications in the contract and the articles of association of the FBIE and report to the examination and approval organ for archival
purposes.

(4)

After an FBIE has been established, the investment application of new investors shall be in conformity with the present Provisions
and the stipulations in the contract, and shall be consented by the indispensable investors. Relevant modifications shall be made
in the contract and the articles of association of the FBIE and shall be reported to the examination and approval organ for archival
purposes.

(5)

Among the incomes of an FBIE arising from selling or disposing of the interests of its invested enterprise by other means, the part
equivalent to its original amount of investment may be directly allocated to all the investors. Such allocation constitutes a reduction
of the invested amount of the investors. An FBIE shall stipulate concrete methods of allocation in its contract, and at least 30
days before it makes such allocation, it shall submit an archival statement on the request of reducing the relevant invested amount
of the investors. In the said statement, it shall prove that the amount of the investments to be made by the investors and the other
capital it has at that time is at least in conformity with the investment obligations that the FBIE shall undertake at that time.
However, such allocation shall not be a plea to the litigation resulted from its violation of any of the investment obligations.

Article 14

When a non-legal-person organization files an application to the registration authority for modifying its registration, the archival
evidential documents issued by the above-mentioned examination and approval organ may replace relevant documents for examination
and approval.

Article 15

Having made investments according to the proceedings of business-starting investments and upon relevant capital verification report,
the investors of the FBIE shall file an application to the original registration organ for handling the archival procedures for their
investments. The registration organ shall fill up the number of its actual amount of capital behind the item of “Capital Amount”
on its Business License.

Where an FBIE makes no investment or fails to make the total investment, it shall be subject to penalties imposed by the registration
organ in accordance with the existing regulations.

Article 16

The investors of an FBIE shall make investments and relevant modifications in accordance with the existing regulations.

Chapter IV Institutional Structure

Article 17

An FBIE in the form of non-legal-person organization shall establish a joint management committee. An FBIE in the form of company
shall establish a board of directors. The investors shall stipulate on how to organize the joint management committee or the board
of directors in the contract and in the articles of association of the FBIE. The joint management committee and the board of directors
shall manage the enterprise on behalf of its investors.

Article 18

The subordinate administrative departments of the joint management committee and the board of directors shall, in accordance with
the power as specified in the contract and the articles of association of the FBIE, take charge of the routine managerial work and
execute the investment decisions made by the joint management committee and the board of directors.

Article 19

The person-in-charge of an administrative department shall satisfy the following conditions:

(1)

shall have full capacity for civil conduct;

(2)

shall have no record of criminal offence;

(3)

shall have no record of bad operations;

(4)

shall be experienced in business-starting investments and have no record of illegal practices.

(5)

shall meet the other requirements of the examination and approval organ.

Article 20

The administrative departments shall regularly report the following to the joint management committee and the board of directors:

(1)

significant investments under authorization;

(2)

metaphase & annual performance reports and financial statements;

(3)

other matters as provided in laws and regulations;

(4)

relevant matters as stipulated in the contract and in the articles of association of the FBIE.

Article 21

The joint management committee and the board of directors may grant the power of routine administration to a business-investment management
enterprise or another FBIE rather than establish administrative departments. The business-investment management enterprise may be
a domestically-funded business-starting investment enterprise or a foreign-funded one or an overseas enterprise. In this case, the
business-starting investment enterprise and the business-starting investment management enterprise shall conclude a managerial contract,
stipulating respective rights and interests. Such a contract shall not come into effect until it has been agreed by all the investors
and has been approved by the examination and approval organ.

Article 22

The investors of an FBIE may, by reference to the international practices, stipulate interior system for income allocations and incentive
mechanism in the business-starting investment contract.

Chapter V Business-Starting Investment Management Enterprise

Article 23

An entrusted business-starting investment management enterprise shall meet the following conditions:

(1)

To accept the entrustment of the FBIEs and to manage the investments made by them shall be its main business;

(2)

It shall have at least 3 professional managerial persons who have at least three years of practical experience in business-starting
investment;

(3)

Its registered capital or its total investments shall not be less than 1, 000, 000 yuan or equivalent foreign exchange;

(4)

It shall have a perfect interior control system.

Article 24

A business-starting investment management enterprise is allowed to take the form of the corporate organization or the partnership
organization.

Article 25

A business-starting investment management enterprise may be entrusted to manage different FBIEs.

Article 26

A business-starting investment management enterprise shall report the matters as listed in Article 20 to the joint management committee
and the board of directors of the entrusting party.

Article 27

The establishment of a foreign-funded business-starting investment management enterprise shall be in conformity with the conditions
as provided in Article 23 and shall be reported to the examination and approval organ for approval via the administrative departments
of foreign trade and economic cooperation at the provincial level where the company to be established is located. The examination
and approval organ shall make a written decision on whether to approve or not within 45 days as of the acceptance of the complete
set of the above-mentioned documents. It shall issue a Certificate of Approval for Foreign-invested Enterprises to the approved enterprises,
which shall file an application to the registration organ by holding the Certificate within a month as of their acceptance of the
Certificate.

Article 28

The following documents shall be submitted to the examination and approval organ in applying for the establishment of a foreign-invested
business-starting investment management company:

(1)

establishment application;

(2)

contract and articles of association of foreign-funded business-starting investment management company;

(3)

the investors’ registration certificate (photocopy) and the certificate of the legal representative (photocopy);

(4)

relevant documents required by the examination and approval organ;

Article 29

A foreign-invested business-starting investment management enterprise shall give a clear indication of “INVESTMENT MANAGEMENT” in
its name. Except for the foreign-invested business-starting investment management enterprises any other foreign-funded enterprises
shall not do so.

Article 30

An overseas business-starting investment management enterprise, which has acquired the approval of engaging in business-starting investment
management under the authorization of FBIEs, shall file an application to the registration organ to handle the business registration
procedures within 30 days as of the approval day of the management contract.

An applicant shall submit the following documents to the business registration organ and shall be responsible for their authenticity
and effectiveness:

(1)

an application for registration signed by the chairman of the board of directors of the overseas business-starting investment management
enterprise, or by a competent person;

(2)

a management contract and the approval documents of the examination and approval organ;

(3)

articles of association or partnership agreement of the overseas business-starting investment management enterprise;

(4)

the overseas business-starting investment management enterprise’ legal license to do business;

(5)

the credit certification of the overseas business-starting investment management enterprise;

(6)

the power of attorney, resume and the certification of the identification of the person-in-charge of the Chinese project appointed
by the overseas business-starting investment management enterprise;

(7)

the certification of its business offices in China; All of the aforesaid documents should be written in Chinese, those written in
foreign languages other than Chinese shall be accompanied by good Chinese translations

Chapter VI Business Management

Article 31

An FBIE may engage in the following businesses:

(1)

It may make equity investments with all of its own capital through establishing new enterprises, or investing into an established
enterprise, or accepting the stock equities transferred by the investors of an established enterprise, or through other means as
permitted in the laws and regulations of the state;

(2)

It may offer business-starting investment consultancy services;

(3)

It may offer management consultancy to the invested enterprises;

(4)

It may engage in other businesses as approved by the examination and approval organ. The capital of an FBIE may be largely used to
make equity investments into its invested enterprise.

Article 32

A business-starting enterprise shall not engage in the following activities:

(1)

It shall not make investments into the areas in which foreign investments are prohibited by the state;

(2)

It shall not make direct or indirect investments into the listed securities and bonds of an enterprise, but after the invested enterprise
is listed, the shares held by the FBIE shall be an exception.

(3)

It shall not make direct or indirect investments into real property not for its own use;

(4)

It shall not make investments by way of loans;

(5)

It shall not make investments by embezzling the capital not in its ownership;

(6)

It shall not provide a loan or guaranty to others, but the bonds with a term of more than 1 year issued by its invested enterprise
and the investments in the nature of bonds that may be converted into equity investments to the invested enterprise shall be excluded
(this paragraph doesn’t concern whether the invested enterprise is enpost_titled to issue such bonds or not);

(7)

It shall not engage in other activities as prohibited in the law and regulations and the contract of the FBIE.

Article 33

The investors shall stipulate a term for foreign investments in the contract of the FBIE.

Article 34

The incomes of an FBIE shall be generated largely from selling the stock equities it holds in the invested enterprise or from disposing
of the stock equities by other means. When an FBIE sell the stock equities it holds in the invested enterprise or dispose of the
stock equities by other means, it may, in accordance with the law, choose one of the following available methods of withdrawing:

(1)

It may transfer part of or all of the stock equities it holds to other investors;

(2)

It may sign an agreement of stock equity counter-purchase with the invested enterprise, which may counter-purchase the stock equities
held by the business-starting investment enterprise under certain circumstances;

(3)

Where the invested enterprise satisfies the conditions of listing as provided by laws and administrative regulations, it may apply
for listing in the securities markets of home and abroad. In accordance with the law, the FBIE may transfer the shares it holds in
the invested enterprise through the securities markets;

(4)

The other methods that are allowed by the laws and administrative regulations of China. The concrete regulatory measures concerning
the invested enterprise’ counter-purchase of the stock equities held by the FBIE shall be separately formulated by the examination
organ jointly with the registration organ.

Article 35

An FBIE shall make tax declaration in accordance with the tax laws of the state. As to a non-legal-person organization, in accordance
with the law, it may request all the investing parties to file returns for enterprise income taxes on their own, or file an application
by itself, after the application has been approved, it shall, in accordance with the law, calculate and pay the enterprise income
tax in a consolidated way.

The concrete regulatory measures concerning the levy of enterprise income tax upon the non-legal-person FBIEs shall be promulgated
separately by the State Administration of Taxation.

Article 36

Where the profit or other income obtained by a foreign investor from an FBIE is to be remitted abroad, it shall be paid from the foreign
currency account of the FBIE, or shall be remitted through an entrusted bank with the foreign currencies purchased from the bank.
Such payment or remittance shall be made on the basis of the allocation decision made by the joint management committee or the board
of directors, the audit report issued by an accountant office, the certification of inflow of foreign investments and the report
on the verification of capital, the certification of tax payment and the tax return (where an enterprise enjoys tax concession, it
shall present the evidential documents of tax concession issued by the tax authorities).

In accordance with the law, a foreign investor may request to purchase foreign currencies to remit the investments withdrawn from
the FBIE. As to an FBIE in the form of company, the opening and access of foreign currency account, changes of capital and other
matters involving the incomes and expenses of foreign currencies shall be handled pursuant to the existing regulations concerning
the administration of foreign exchange. But relevant regulations on the non-legal-person FBIEs shall be formulated separately by
the State Administration of Foreign Exchange.

Article 37

The investors shall stipulate the business term of the FBIE i

CIRCULAR ON INVESTIGATING ADOPTION OF THE ENTERPRISE ACCOUNTING SYSTEM BY ENTERPRISES WITH FOREIGN INVESTMENT

The Ministry of Finance

Circular on Investigating Adoption of the Enterprise Accounting System by Enterprises with Foreign Investment

CaiBanKuai [2003] No. 8

March 6, 2003

Financial Departments (Bureaus) of provinces, autonomous regions, municipalities directly under the Central Government and municipalities
separately listed on the state plan:

Enterprises with Foreign Investment have started adoption the Enterprise Accounting System as of January 11, 2002 and in order to
further understand the implementation of the Enterprise Accounting System by enterprises with foreign investment, please arrange
for the local certified public accountants firms engaged in auditing enterprises with foreign investment to fill in the attached
Questionnaires (Attachment 1). The certified public accountants firms shall provide opinions and materials on the following issues
according to the actual circumstances:

For enterprises with foreign investment that have adopted the Enterprise Accounting System, what problems exist in account reconciliation
and actual execution? What are the main reasons?

II.

For enterprises with foreign investment that have not adopted the Enterprise Accounting System, what are the main reasons for not
adopting the Enterprise Accounting System? What are the accounting standards that have been adopted by the certified public accountants
firms in auditing the annual reports of the enterprises with foreign investment? What type of auditing opinions has the certified
public accountants firms issued? In case the certified public accountants have issued non-standard auditing opinion, what are the
opinions from the relevant departments of the administration for industry and commerce and taxation?

III.

What are the opinions and suggestions of the certified public accountants firms on the implementation of the Enterprise Accounting
System by the enterprises with foreign investment? What are the opinions and suggestions of the enterprise with foreign investment
on execution of the Enterprise Accounting System?

The local accounting administration of financial department are required to summarize the questionnaires and the relevant materials
filled in by the certified public accountants firms, prepare a written report, which should be sent to the Accounting Department
of the Ministry of Finance together with the materials (original or copy) provided by the certified public accountants firms by May
30, 2003.

The Ministry of Finance
2003-03-06

CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE ON THE TRANSITIONAL POLICY AND MEASURES AFTER CANCELING ADMINISTRATIVE EXAMINATION AND APPROVAL OF FOREIGN EXCHANGE ADMINISTRATION OF SOME CAPITAL PROJECTS

The State Administration of Foreign Exchange

Circular of the State Administration of Foreign Exchange on the Transitional Policy and Measures after Canceling Administrative Examination
and Approval of Foreign Exchange Administration of Some Capital Projects

HuiFa [2003] No.50

April 3, 2003

Branches and foreign exchange administration departments under the State Administration of Foreign Exchange in provinces, autonomous
regions and municipalities directly under the Central Government, and branch administrations of Shenzhen, Dalian, Qingdao, Xiamen,
Ningbo:

Decisions of the State Council on Canceling the First Batch of Administration Examination and Approval Projects (GuoFa [2002] No.24)
and the Decisions of the State Council on Canceling the Second Batch of Administration Examination and Approval Projects and Altering
the Administrative Methods for Some Administration Examination and Approval Projects (GuoFa [2003] No.5) have been promulgated. In
order to ensure the smooth linking of the administration of capital projects and avoid disjoint after cancellation of relevant administration
examination and approval projects, relevant policy and measures for the transitional period are hereby made as follows:

Cancellation of examinations and approvals on the financing conditions of long-and-medium-term foreign debts of domestic Chinese-capital
organizations, on the financial conditions of financing and leasing of domestic Chinese-capital organizations, on the time selection
and financing conditions for issuing debts abroad, and on the financial conditions for project financing.

After cancellation of relevant examinations and approvals, in borrowing medium-long term foreign debts, issuing medium-long term bonds
denominated in foreign exchange, conducting aircraft financial leasing and project financing, Chinese-capital organizations shall
no longer be required to go through examination and approval formalities with administration of foreign exchange on terms of relevant
financing as they shall only be obliged to handle procedures on registration of foreign debts on a case by case basis after conclusion
of borrowing contracts.

During the course of the Chinese-capital organizations going through formalities of registration of foreign debts for above items
and during the course of enterprises with foreign investment going through formalities of registration of foreign debts for project
financing, capital raising and aircraft financial leasing, the branches and sub-branches of administration of foreign exchange shall
handle the registration in accordance with following procedures:

(I)

All branches and sub-branches of the administrations of foreign exchange shall verify borrowing qualifications of borrowers according
to operational procedures on borrowing qualifications concerning medium-long term international commercial loans, project financing,
aircraft financial leasing, issuance of bonds denominated in foreign exchange(see Attachment 1, Attachment 2, Attachment 3, Attachment
4). Qualification verifications for aircraft financial leasing, project financing and issuance of bonds denominated in foreign exchange
shall be conducted according to corresponding operational procedures for borrowing qualifications while checks on other forms of
medium-long term overseas borrowing (except for those made by enterprises with foreign investment) shall be conducted according to
operational procedures for borrowing qualifications concerning medium-long term international commercial loans.

(II)

Where the borrower meets the above verification requirements on borrowing qualifications, the branches and sub-branches of administration
of foreign exchange shall handle procedures of registration of conclusion of foreign debt contracts and of payment withdrawal, establishment
of special foreign debt account and settlement of foreign exchange and repayment of principals and interests and shall not require
the debtor to present prior approval documents issued by administrations of foreign exchanges.

(III)

Where the borrower does not meet the verification requirements on borrowing qualifications or where registration procedures does not
conform with requirements or where relevant articles in overseas borrowing arrangements do not conform with prevailing provisions
on administration of foreign exchange (such as account arrangement, guarantee arrangement, value preserving clause, etc.), the borrower
shall obtain written approval from the State Administration of Foreign Exchange in advance. The branches and sub-branches of administrations
of foreign exchange shall not handle registration procedures for the borrower without the written approval from the State Administration
of Foreign Exchange.

(IV)

Debtors shall handle withdrawal of payment after they have obtained certificates of registration of foreign debt issued by administration
of foreign exchange.

(V)

The branches and sub-branches shall handle registration of foreign debts of medium-long term overseas borrowings by Chinese-capital
organizations within the following time limits from the date on which all materials required by administration of foreign exchange
are presented by enterprises: 1. The branches and sub-branches shall grant the registration within 10 working days if no report to
and approval from the State Administration of Foreign Exchange is required. 2. The branches and sub-branches shall grant the registration
within 30 working days if no report to and approval from The State Administration of Foreign Exchange is required (which shall include
10 working days for The State Administration of Foreign Exchange to handle procedures).

II.

Cancellation of examination and approval on large amount financing by overseas branches of domestic Chinese-capital financial institutions

After cancellation of examination and approval on large amount financing by overseas branches of domestic Chinese-capital financial
institutions, the institutions shall not be required to handle prior examination and approval procedures with administration of foreign
exchange provided that they shall report the financing to administration of foreign exchange for the record in advance, which means
where a overseas branch of a domestic Chinese-capital financial institution raises commercial loans in a sum of 50,000,000 United
States dollars (inclusive) equivalent in one time, it shall report to the State Administration of Foreign Exchange for the record
10 working days in advance by its head office.

III.

Cancellation of examination and approval on establishment, alteration and cancellation of B share’s margin account opened with domestic
foreign-capital banks by securities companies

After cancellation of the examination and approval, the ways of management of administration of foreign exchange on establishment,
alteration and cancellation of B share’s settlement account (now referred to as the “clients transaction settlement account”) by
securities companies shall be as follows:

(I)

A securities company authorized to conduct foreign exchange business shall open domestic investor’s B share’s settlement account and
foreign investor’s B share’s settlement account separately with banks at its locality by presenting valid License for Conducting
Foreign Exchange Business in Securities Transactions and evidencing documents granting authorizations to conduct relevant businesses
issued by the CSRC etc.

A business department of a securities company authorized to conduct foreign exchange business shall open domestic investor’s B share’s
settlement account and foreign investor’s B share’s settlement account with banks at its locality by presenting power of attorney
of its head office, duplicate of License for Conducting Foreign Exchange Business in Securities Transactions of the securities company,
duplicates of evidencing documents granting authorization to conduct relevant businesses issued by the CSRC etc.

(II)

Within 3 days of establishment, alteration or cancellation of domestic investors’ B share’s settlement account and foreign investors’
B share’s settlement account, the securities companies or their business departments shall report to administration of foreign exchange
for the record.

(III)

The scope of receipt of a domestic investor’s B share’s settlement account shall be the foreign exchange funds transferred from its
domestic foreign exchange non-cash savings account or cash savings account and foreign exchange proceeds from foreign exchange securities
transactions. Its scope of payment shall be the foreign exchange needed in its foreign exchange securities transactions and transfers
therefrom to foreign exchange cash accounts opened with domestic commercial banks. No payment shall be remitted abroad.

The scope of receipt of a foreign investor’s B share’s settlement account shall be foreign exchange funds remitted from aboard by
the foreign investor or transferred from its domestic foreign exchange non-cash savings account and foreign exchange proceeds from
its foreign exchange securities transactions. Its scope of payment shall be the foreign exchange needed in its foreign exchange securities
transactions, transfers therefrom to foreign exchange non-cash accounts opened with domestic commercial banks and foreign exchange
funds to be remitted abroad.

IV.

Cancellation of examination on foreign exchange risks in making investment abroad by domestic institutions

Administration of foreign exchange shall no longer conduct examination on foreign exchange risks in making investment abroad and shall
simultaneously simplify examination procedures on source of foreign exchange capital for making investment abroad. For detailed rules
of operation please refer to the Circular of the State Administration of Foreign Exchange on Simplifying the Examination of Foreign
Exchange Capital Source of Investment Abroad (HuiFa [2003] No.43)

All Branches of the administrations of foreign exchange shall promptly transmit this Circular to designated banks of foreign exchange
at their locality and shall handle relevant business strictly according to requirements of the Circular.

This is hereby the notification.

Attachments:

1. Examination on the Qualifications of Chinese-capital Organizations for Borrowing Medium-long Term International Commercial Loans
(omitted)

2. Examination on the Qualifications for Borrowing under Project Financing (omitted)

3. Examination on the Qualifications for Borrowing under Aircraft Financial Leasing (omitted)

4. Examination on the Qualifications for Borrowing under Issuing Bonds Overseas (omitted)

The State Administration of Foreign Exchange
2003-04-03

MEASURES FOR THE QUARANTINE AND ADMINISTRATION OF HEREDITARY SUBSTANCE OF ENTRY ANIMALS

The State Administration of Quality Supervision, Inspection and Quarantine

Decree of the State Administration of Quality Supervision, Inspection and Quarantine

No. 47

The Measures for the Quarantine and Administration of Hereditary Substance of Entry Animals, which were examined and adopted at the
administration affairs meeting of the State Administration of Quality Supervision, Inspection and Quarantine on April 3, 2003, are
hereby promulgated, and shall come into force on July 1, 2003.

Director General Li Changjiang

May 14, 2003

Measures for the Quarantine and Administration of Hereditary Substance of Entry Animals

Chapter I General Provisions

Article 1

The present Measures are formulated in accordance with the Law of the Peoples Republic of China on Quarantine of Entry and Exit
Animals and Plants and the Regulation for the Implementation thereof as well as other laws and regulations with a view to regulating
the quarantine, supervision and administration of hereditary substance of entry animals, and protecting the production safety of
the animal husbandry in China.

Article 2

The present Measures shall be applicable to the quarantine, supervision and administration of hereditary substances of entry animals.

Article 3

Hereditary substances of animals mentioned in the present Measures means the semen, embryos and egg cells of mammals.

Article 4

The State Administration of Quality Supervision, Inspection and Quarantine (hereinafter referred to as the SAQSIQ) shall be uniformly
responsible for the quarantine, supervision and administration of hereditary substance of entry animals nationwide.

The entry and exit inspection and quarantine institutions set up by the SAQSIQ in all places (hereinafter referred to as the inspection
and quarantine institutions) shall be responsible for the quarantine, supervision and administration of hereditary substance of entry
animals within their respective jurisdictions.

Article 5

The SAQSIQ shall apply risk analysis administration to the hereditary substance of entry animals. On the basis of the result from
risk analysis, the SAQSIQ may conclude a bilateral quarantine agreement (including agreement, protocol, or memorandum, etc.) with
the relevant competent institution of the government of the country or region from which the hereditary substance of animals is to
be exported to China.

Chapter II Quarantine Examination and Approval

Article 6

Whoever intends to import hereditary substance of animals must go through the formalities of quarantine approval in advance, obtain
the Permit of the People Republic of China on Quarantine of Entry Animals and Plants (hereinafter referred to as the Quarantine Permit,
and stipulate in the trade contract or the relevant agreement the quarantine requirements of China.

Article 7

Whoever intends to apply for the examination and approval of quarantine of hereditary substance of animals shall submit the following
materials to the local inspection and quarantine administration directly under the SAQSIQ:

(1)

The Application Form for the Permit of the People Republic of China on Quarantine of Entry Animals and Plants;

(2)

For hereditary substance of animals imported by agency, a photocopy of the contract or agreement with the consignor for import by
agency shall be provided.

Article 8

The inspection and quarantine administration directly under the SAQSIQ shall finish the preliminary examination within the time prescribed
by the SAQSIQ. If the hereditary substance of animals is preliminarily examined as qualified, it shall be submitted to the SAQSIQ
for verification, and the SAQSIQ shall finish the verification within the prescribed time. If it is verified as qualified, the Quarantine
Permit shall be issued; if it is verified as unqualified, the Notice on Failure of the Application to be approved for the Permit
of the People Republic of China on Quarantine of Entry Animals and Plants shall be issued.

Chapter III Entry Quarantine

Article 9

Before the hereditary substance of animals is imported, the SAQSIQ may, on the basis of the needs in quarantine, send quarantine officers
to go to the exporting country or region to carry out pre-inspection of the place of origin of the hereditary substance of animals.

Article 10

The SAQSIQ shall apply quarantine registration to the foreign producers which export hereditary substance of animals to China, and
shall send quarantine officers either regularly or irregularly to appraise the registered foreign producers.

Article 11

Imported hereditary substances of animals shall enter the territory via the port designated by the Quarantine Permit.

Article 12

The consignor of hereditary substance of animals or his agent shall bring the Quarantine Permit, the trade contract or agreement,
the letter of credit, the invoices and other effective documents to report to the inspection and quarantine institution at the port
of entry for inspection before the hereditary substance of animals enters the territory; and shall, when the hereditary substance
of animals enters the territory, submit to the inspection and quarantine institution at the port of entry the original of the quarantine
certificate issued by the governmental quarantine institution of the exporting country or region.

Article 13

If, with respect to some certain hereditary substance of entry animals, there is no effective quarantine certificate issued by the
governmental quarantine institution of the exporting country or region, or the formalities for quarantine approval have not been
gone through, the inspection and quarantine institution at the port of entry may, in light of the specific situation, return or destroy
the said substance.

Article 14

When the imported hereditary substance of animals is carried to the port, the quarantine officers shall carry out the on-the-spot
quarantine:

(1)

Inspecting whether the quarantine certificate conforms to the Quarantine Permit and the requirements in the bilateral quarantine agreement
between China and the exporting country or region;

(2)

Checking whether the goods and the certificate are in conformity with each other;

(3)

Inspecting the packing and preservation of the goods.

Article 15

If the hereditary substance of animals is quarantined on the spot as qualified, the inspection and quarantine institution at the port
of entry shall issue the List for Customs Release of Entry Goods, and transfer the said substance to the place designated by the
Quarantine Permit carry out quarantine.

Article 16

If the hereditary substance of animals needs to be taken away from the port of entry, the consignor or his agent shall declare to
the inspection and quarantine institution at the destination, and provide the photocopies of the documents prescribed in Article
12 of the present Measures and the List for Customs Release of Entry Goods?issued by the inspection and quarantine institution
at the port of entry.

Article 17

The inspection and quarantine institution shall make quarantine as required by the Quarantine Permit. The hereditary substance of
animals quarantined as qualified shall be under the lawful quarantine supervision and administration of the inspection and quarantine
institution; while the one quarantined as unqualified shall be returned or destroyed under the supervision of the inspection and
quarantine institution.

Chapter IV Supervision of Quarantine

Article 18

The inspection and quarantine institution shall conduct quarantine supervision and administration on the processing, deposition and
use of the hereditary substance of entry animals (hereinafter uniformly referred to as use); and shall record the first generation
of descendents of the hereditary substance of animals.

Article 19

The entity using the hereditary substance of entry animals shall go to the inspection and quarantine administration directly under
the SAQSIQ at its locality to make the record

Article 20

The using entity shall fill out the Form on Record of the Entity Using Hereditary Substance of Entry Animals (Attachment 1), and provide
the following statement documents:

(1)

A photocopy of the document on proof of the entity status as a legal person;

(2)

Document stating that it has professionals familiar with the preservation, transport and use of the hereditary substance of animals;

(3)

Document stating that it has special depositary of hereditary substance of entry animals and other necessary facilities;

(4)

The relevant systems on administering the use of hereditary substance of entry animals.

Article 21

The inspection and quarantine administration directly under the SAQSIQ shall report to the SAQSIQ the using entities that have made
the record.

Article 22

The using entity shall fill out the File on Quarantine and Supervision of Hereditary Substance of Entry Animals (Attachment 2), and
accept the supervision of the inspection and quarantine institution; and shall, after the end of use of each batch of hereditary
substance of entry animals, submit the File on Quarantine and Supervision of Hereditary Substance of Entry Animals to the inspection
and quarantine institution for record.

Article 23

The inspection and quarantine institution may, when necessary, monitor the health of the descendents of the hereditary substance of
entry animals, and the relevant entities shall cooperate with the institution.

Chapter V Supplementary Provisions

Article 24

Whoever violates the present Measures shall be punished by the inspection and quarantine institution in accordance with the relevant
laws and regulations.

Article 25

The responsibility to interpret the present Measures shall remain with the SAQSIQ.

Article 26

The present Measures shall come into force on July 1, 2003.

htm/e03153.htmAttachment 1

Attachment 1:

Form on Filing of the Entity Using Hereditary Substance of Entry Animals

Applying unit
Address:
Legal representative		Legal person code
Tel:		Fax:	Email:
Nature of the unit	sp; State-owned enterprise titutional unit nt venture sp;Foreign-invested enterprise vate enterprise ers
According to the Measures for the Quarantine and Administration of Hereditary Substance of Entry Animals, our unit is here to apply to use hereditary substances of entry animals. Our unit will in strict accordance with the Law of Entry and Exit Quarantine of Animals and Plants and the Regulation for the Implementation thereof as well as other laws and regulations accept supervision and instruction of the inspection and quarantine institutions, thus performing duties as stipulated in Measures for the Quarantine and Administration of Hereditary Substance of Entry Animals. Applying unitseal Legal representative (signature) Date:
Review opinions of the inspection and quarantine institutions: Responsible personsignature Date:

Formulated under supervision of the Administration of the Peoples Republic of China on Inspection and Quarantine of Entry and Exit.

Attachment 2:

File on Quarantine and Supervision of Hereditary Substance of Entry Animals

Filled by:

Filling dateFrom to

Formulated under supervision of the Administration of the Peoples Republic of China on Inspection and Quarantine of Entry and Exit.

Basic Situation of Hereditary Substance of Entry Animals

Used by		Contact person and telephone
Address		Legal representative and telephone
License of inspection and quarantine	Variety of hereditary substance	Exporting country
Import quality	Entry date	Entry port
Hereditary substance logo/quality

Service Condition of Hereditary Substance of Entry Animals

Used by (individual)

Address

Legal representative

Legal person code
(ID card)

Contact telephone

Service Condition

Hereditary substance logo

Time of use

Receptor logo

Effect of use

Birth date of descendant

Descendant logo

Descendant gender

CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE AND CHINA INSURANCE REGULATORY COMMISSION ON THE RELEVANT ISSUES CONCERNING THE ADMINISTRATION OF SALE AND PAYMENT OF FOREIGN EXCHANGE IN OVERSEAS REINSURANCE CEDING

The State Administration of Foreign Exchange, China Insurance Regulatory Commission

Circular of the State Administration of Foreign Exchange and China Insurance Regulatory Commission on the Relevant Issues Concerning
the Administration of Sale and Payment of Foreign Exchange in Overseas Reinsurance Ceding

HuiFa [2003] No.75

June 20, 2003

The branches and departments of foreign exchange administration of the State Administration of Foreign Exchange (SAFE) in the provinces,
autonomous regions, and municipalities directly under the Central Government, the branches in Shenzhen, Dalian, Qingdao, Xiamen,
and Ningbo; the designated foreign exchange banks; and the insurance companies:

In order to implement the Interim Provisions on the Foreign Exchange Administration of Insurance Services, to regulate the reinsurance
made in foreign exchange, and to effectively disperse insurance risks, the following circular is hereby made concerning the relevant
matters of the administration of sale and payment of foreign exchange in overseas reinsurance ceding:

The domestic Chinese-invested insurance companies, Sino-foreign equity joint insurance companies, and branches of foreign insurance
companies in China (hereinafter referred as domestic insurance companies) that engage in overseas reinsurance ceding upon ratification
by the SAFE may, pursuant to the relevant provisions of China Insurance Regulatory Commission (CIRC), undertake overseas reinsurance
ceding of domestic insurances, and go through the formalities for purchase and payment of foreign exchange under overseas reinsurance
ceding pursuant to the provisions hereof. Branches of domestic insurance companies may not go through the formalities for purchase
and payment of foreign exchange under overseas reinsurance ceding.

Where a domestic insurance company reinsured overseas any domestic insurance made in foreign exchange, that company shall, by taking
with it the valid proofs, such as reinsurance bill or reinsurance payment list, etc., make the reinsurance payments from its foreign
exchange operation account with a domestic commercial bank, and may not purchase any foreign exchange to make the payment.

Where a domestic insurance company reinsured overseas any insurance made in RMB, it may, by taking with it the valid proofs, such
as the reinsurance bill or reinsurance payment list, etc., make the reinsurance payment from its foreign exchange operation account
with a domestic commercial bank; either may it, pursuant to Articles 4 through 7 hereof, apply to SAFE, and purchase foreign exchange
to make the reinsurance payment with a designated foreign exchange bank on the strength of the ratification document of the SAFE.

Where a domestic insurance company makes overseas excess of loss ratio reinsurance of any of its insurance made in RMB, it may apply
for purchasing foreign exchange to make the reinsurance payment according to the actual business needs.

Where a domestic insurance company make overseas reinsurance through contract or temporarily of the enterprise property insurance,
freight insurance, ship insurance, aviation insurance, space insurance, oil insurance, energy insurance, construction and installment
project insurance, liability insurance, nuclear station insurance, or any other type of insurance ratified by the CIRC that are made
in RMB, that insurance company may apply to the SAFE for purchasing foreign exchange to make the reinsurance payment if either of
the following conditions is satisfied:

(1)

The maximum insurance liability for a single insurance contract exceeds RMB50m;

(2)

The accumulative RMB premium income for a single insurance type exceeds the sum of the capital and the accumulation fund of that company.

Where a domestic insurance company meets the conditions for purchasing foreign exchange under overseas reinsurance specified in Articles
4 and 5, that company shall file the application with SAFE on a quarterly basis by taking with it the relevant documents, such as
the application for purchase of foreign exchange, the relevant insurance contracts or insurance data statistics, the audited balance
sheet and profit statement of the company of the previous year, the copy of the License for Foreign Exchange Services, etc. A once-and-only
application shall be filed with the SAFE with respect to any reinsurance contract for which the payment is made by installments.
In the application for purchase of foreign exchange, the insurance company shall respectively specify the amount of foreign exchange
purchased for excess of loss ratio reinsurances and contracts, and for temporary reinsurances.

Where the application for purchase of foreign exchange under overseas reinsurance has been ratified by the SAFE, the domestic insurance
company shall, when paying for the overseas reinsurance to overseas, make the payment with the designated foreign exchange bank through
purchase of foreign exchange on the strength of the valid proofs, such as the ratification document of SAFE, and the reinsurance
bill or reinsurance payment list, etc.

A domestic insurance company shall fill out the “Quarterly Statements of Foreign Exchange Services of Insurance Company” in an accurate
and timely manner (see HuiFa [2003] No.27), and shall indicate in the “Remarks” the overseas reinsurance operations of the previous
quarter; in the case of payment by purchase of foreign exchange, the amount of foreign exchange purchased, the time of purchase and
the bank for purchase, etc., shall be specified.

This Circular shall enter into force as of July 1, 2003.

Upon receipt of this Circular, the branches shall transmit it as soon as possible to the insurance companies and designated foreign
exchange banks within their respective jurisdictions; and the Chinese-funded designated foreign exchange banks shall transmit it
as soon as possible to their respective branches and sub-branches. Please promptly report any problem encountered in the execution
to the SAFE and the CIRC.

The State Administration of Foreign Exchange, China Insurance Regulatory Commission
2003-06-20

MEASURES FOR THE CLASSIFIED ADMINISTRATION OF ENTERPRISES MANUFACTURING EXPORT INDUSTRIAL PRODUCTS

The General Administration of Quality Supervision, Inspection and Quarantine

Decree of the General Administration of Quality Supervision, Inspection and Quarantine

No. 51

The Measures for the Classified Administration of Enterprises Manufacturing Export Industrial Products was adopted upon discussion
at the executive meeting of the General Administration of Quality Supervision, Inspection and Quarantine on June 19, 2003 and are
hereby promulgated. They shall come into force on October 1, 2003.

Li Changjiang, Minister

July 18, 2003

Measures for the Classified Administration of Enterprises Manufacturing Export Industrial Products

Chapter I General Provisions

Article 1

The Measures are formulated according to provisions stipulated in the Law of the People’s Republic of China on Import and Export Commodity
Inspection (hereinafter referred to as the Law of Commodity Inspection) and in its Regulations for Implementation, and for the purpose
of facilitating foreign trade, encouraging enterprises manufacturing export industrial products to improve their management level
and product quality, and of standardizing inspection and administration activities thereof.

Article 2

The Measures shall apply to the inspection, supervision and administration of enterprises manufacturing those export industrial products
as listed in the Catalogue of Import and Export Commodities Subject to Inspection and Quarantine by the Import and Export Inspection
and Quarantine Authorities.

The Measures shall not apply to administration of enterprises manufacturing dangerous products and package thereof, products with
unsteady quality or products that need to be transported in bulk.

Article 3

The term “classified administration” in the Measures refers to an inspection administration method through which different inspection
supervision and management modes be applied to different enterprises manufacturing export industrial products, according to their
manufacturing conditions, management level, inspecting efficiency, product quality and the product risk degree and with a view to
reaching the goal of scientific management and effective supervision, and to promoting the export industry of China.

Article 4

General Administration of Quality Supervision, Inspection and Quarantine (hereinafter referred to as the AQSIQ) shall be responsible
for the unified management of classified administration of enterprises manufacturing export industrial products across the country.

Local entry-exit inspection and quarantine bureaus established by and directly under the General Administration of Quality Supervision,
Inspection and Quarantine (hereinafter referred to as the inspection and quarantine bureaus directly under the AQSIQ) shall be responsible
for the supervision and management of classified administration of enterprises manufacturing export industrial products within areas
under their jurisdiction.

Local entry-exit inspection and quarantine authorities established by the General Administration of Quality Supervision, Inspection
and Quarantine (hereinafter referred to as the inspection and quarantine authorities) shall be responsible for the application acceptance,
examination and daily inspection, supervision and management of the classified administration of enterprises manufacturing export
industrial products within areas under their jurisdiction.

Article 5

The inspection and quarantine authorities shall classify enterprises manufacturing export industrial products into three classes,
the first class, the second class and the third class, according to relevant regulations and shall exercise corresponding inspection
supervision and management.

Chapter II Enterprise Classification

Article 6

The first-class enterprise shall meet the following conditions:

(1)

It sticks to the Law of Commodity Inspection as well as its Regulations for Implementation, and to other relevant rules stipulated
by the AQSIQ;

(2)

It has sound quality management system, and has passed the ISO 9000 Quality Management System Certification or is equally competent
to effectively guarantee the product quality;

(3)

It has obtained relevant certificates if the export products it manufactures are subject to Safety License System or Compulsory Product
Certification System;

(4)

It has a certain large scale of export volume with steady product quality;

(5)

Its products have passed random safety, healthy and environment protection inspection or testing and are proved to have met relevant
requirements. For those export products subject to yearly safety and quality type of test by a designated laboratory according to
rules stipulated by the AQSIQ, and it must pass such a type of test;

(6)

It has established relevant export inspection systems and bodies, and has sound testing equipments and competent checkers who have
received relevant training and been registered by the inspection and quarantine authority;

(7)

The pass rate of the yearly block inspection by the inspection and quarantine authority is no lower than 98%;

(8)

The enterprise has a high reputation for its good product quality, and no rejected goods, counterclaim or other accidents for the
sake of product quality has occurred within the recent two years.

Article 7

The second-class enterprise shall meet the following conditions:

(1)

It sticks to the Law of Commodity Inspection as well as its Regulations for Implementation, and other relevant rules stipulated by
the AQSIQ;

(2)

It has sound and effective quality management system;

(3)

It has obtained relevant certificates if the export products it manufactures are subject to Safety License System or Compulsory Product
Certification System;

(4)

It has a certain large scale of export volume;

(5)

Its products have passed random safety, healthy and environment protection inspection or testing and are proved to have met relevant
requirements. For those export products subject to yearly safety and quality test by a designated laboratory according to rules stipulated
by the AQSIQ, they shall pass such type of test;

(6)

It has necessary testing equipments and competent checkers who have received relevant training and been registered by the inspection
and quarantine authority;

(7)

The pass rate of the yearly block inspection by the inspection and quarantine authority is not less than 95%;

(8)

The products have good quality, and no rejected goods, counterclaim or other accidents due to the quality of the products occurred
within the late one year.

Article 8

Those enterprises which have not been listed into the first or second class, and which have engaged in export manufacture for less
than one year shall be classified as third-class enterprises.

Article 9

Export products manufactured by one enterprise but fall into different types or subject to different technical requirements may be
classified into different classes and be controlled respectively according to differences between their manufacturing conditions
and product quality.

Chapter III Application and Examination

Article 10

The enterprise manufacturing export industrial products which apply for the first or second class enterprise (hereinafter referred
to as the application enterprise) shall apply to the inspection and quarantine authority at its locality, and shall submit the following
materials:

(1)

a written application which includes the class to be applied, the name of the enterprise, the specification and type of the export
products, etc;

(2)

the qualified certificate of safety and quality test conducted according to rules stipulated by the AQSIQ;

(3)

certificates for quality management system certification and documents of quality management system;

(4)

certificates for the pass rate of yearly block inspection of the previous year produced by the inspection and quarantine authority
at its locality;

(5)

other relevant certificates if the enterprise and its export products are subject to Safety License System or Compulsory Product Certification
System.

Article 11

The inspection and quarantine authority shall organize examination to the application enterprise without undue delay.

The first-class-enterprise application shall be subject to the examination of the inspection and quarantine bureau directly under
the AQSIQ. If the applicant is qualified, the bureau shall report to the AQSIQ its initial examination conclusion and relevant materials.
The second-class-enterprise application shall be subject to the examination of the inspection and quarantine authority at its locality.
If the applicant is qualified, the authority shall report its initial examination conclusion and relevant materials to the inspection
and quarantine bureau directly under the AQSIQ.

Article 12

The inspection and quarantine authority shall, sticking to the relevant requirements and in light of the actual local situation, conduct
examination to the applicant’s product quality, quality management system, personnel, manufacturing and testing equipment and so
on.

The inspection and quarantine authority shall not conduct overlapped test or examination to any item of one enterprise during a same
year.

Article 13

the AQSIQ shall review the qualified first-class application and publicize the list of final approved enterprises.

The inspection and quarantine bureau directly under the AQSIQ shall review the qualified second-class applications and publicize the
list of final approved enterprises.

Chapter IV Inspection Supervision and Management

Article 14

The inspection and quarantine authority shall conduct random block inspection or inspection for each batch of industrial products
to be exported and manufactured by enterprises subject to classified administration according to their different classes.

(1)

The first-class enterprises: yearly random block inspection rate shall be 5% to 15%;

(2)

The second-class enterprises: yearly random block inspection rate shall be 30% to 45%;

(3)

The third-class enterprises: yearly random block inspection rate shall be 60% to 100%.

Article 15

The inspection and quarantine authorities shall have strict control on the yearly random block inspection rate, and shall work out
a suitable inspection supervision and management plan and keep relevant inspection records.

Article 16

The inspection and quarantine authority may, according to the actual circumstances, degrade an enterprise subject to classified administration
to a lower class if the enterprise commits any of the following wrongdoings:

(1)

the pass rate of yearly block inspection by the inspection and quarantine authority does not meet the requirements;

(2)

a foreign counterclaim arises due to serious quality problem;

(3)

unqualified products are incessantly found in the random inspections by the inspection and quarantine authority;

(4)

the enterprise’s checker makes false statements in the inspection;

(5)

other wrongdoings violating laws and regulations.

The degraded enterprise shall not apply for recovering its former class until 6 months later, and the application must be subject
to examination, review and publicity again.

Article 17

The enterprise manufacturing export industrial products subject to the classified administration shall submit its product quality
control and analysis report to the inspection and quarantine authority each year.

Article 18

The inspection and quarantine authority may choose different inspection supervision and management mode and apply it to the enterprise
manufacturing industrial products to supervise its product quality before they are marketed, according to the enterprise’s class,
the nature and risk degree of its products and in terms of relevant provisions.

Article 19

The period of validity of the classified administration to the enterprises manufacturing industrial products is two years, which shall
be counted as of the day of publication by the inspection and quarantine authority. If an enterprise wishes to continue the classified
administration, it shall, in terms of provisions in Article 10 of the Measures, go through the application procedure again 60 days
before the period of validity expires.

Article 20

As for the enterprise reapplying for classified administration, the inspection and quarantine authority shall streamline examination
procedures upon consideration of the ordinary supervision and management results, and if the enterprise is qualified, the authority
shall publicize the case after review and approval.

Article 21

If any important change occurs to the product designs, manufacturing techniques, technical conditions, and so on, of the enterprise
manufacturing export industrial products, the enterprise shall report it without delay to the inspection and quarantine authority,
and the authority shall newly recognize its class.

Chapter V Supplementary Provisions

Article 22

The inspection and quarantine bureaus directly under the AQSIQ shall formulate the implementation regulations for the Measures, according
to principles stipulated in the Measures and taking the actual local situations of their own areas into consideration, and shall
exercise the regulations after reporting it to the AQSIQ for record.

Article 23

The inspection and quarantine authority shall carry out annual reviews on the classified administration activities, and the inspection
and quarantine bureaus directly under the AQSIQ shall collect relevant materials and report them to the AQSIQ before the end of February
of the next year.

Article 24

The right to interpret the Measures shall remain with the AQSIQ.

Article 25

The Measures shall come into force on October 1, 2003.

The General Administration of Quality Supervision, Inspection and Quarantine
2003-07-18

INTERIM PROVISIONS CONCERNING THE MANAGEMENT OF CHINESE-FOREIGN JOINT JOB INTERMEDIARIES

Ministry of Personnel, Ministry of Commerce, State Administration for Industry and Commerce

Order of the Ministry of Personnel, Ministry of Commerce and the State Administration of Industry and Commerce

No.2

The Interim Provisions Concerning the Management of Chinese-foreign Joint Job Intermediaries, which has been examined and approved
by the executive meetings of the Ministry of Personnel, the Ministry of Commerce and the State Administration for Industry and Commerce,
is hereby issued and shall be put into effect as of November 1, 2003.

Zhang Bailin, Minister of the Ministry of Personnel

Lv Fuyuan, Minister of the Ministry of Commerce

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

September 4, 2003

Interim Provisions Concerning the Management of Chinese-foreign Joint Job Intermediaries

Chapter I General Provisions

Article 1

The present Provisions are developed in accordance with the Law of the People’s Republic of China on Chinese-foreign Joint Ventures
and other relevant laws and regulations, with an aim to strengthen the management of Chinese-foreign joint job Intermediaries, to
secure the order and to facilitate the healthy development of the employment market.

Article 2

The term “Chinese-foreign Joint Job Intermediaries” in the present Provisions refers to job intermediaries jointly established in
China by any foreign company, enterprise or other economic organization providing job intermediary services and any Chinese company,
enterprise or other economic organization providing job intermediary services.

Article 3

Any foreign company, enterprise or other economic organization providing job intermediary services that wants to set foot in job intermediary
services in China must operate jointly with a Chinese company, enterprise or other economic organization for offering job intermediary
services through a jointly-established intermediaries.

No wholly foreign-owned job intermediaries are permitted to found. Such organizations as foreign enterprises’ resident representative
office in China, or chambers of commerce established in China by any foreign enterprise are permitted to provide job intermediary
services in China.

Article 4

All Chinese-foreign joint job intermediaries shall comply with the laws and regulations of the People’s Republic of China and may
not do anything detrimental to the public interests or national security of the People’s Republic of China.

The legitimate business activities and legal rights and interests of Chinese-foreign joint job intermediary agencies shall be protected
by the law of the People’s Republic of China.

Article 5

The administrative department of personnel, administrative department of Commerce and the administrative department of industry and
commerce of the people’s governments at the level of province, autonomous region or municipality directly under the jurisdiction
of the central government shall, in accordance with the division of functions and roles take charge of the examination and approval,
registration, management and supervision of Chinese-foreign joint job intermediaries in their administrative region.

Chapter II Incorporation and Registration

Article 6

The incorporation of any Chinese-foreign joint job intermediaries shall meet the following requirements:

(1)

The Chinese investor who applies to be incorporated into Chinese-foreign joint job intermediaries must be a job intermediary existed
for not less than three years. On the other hand, the foreign investor must be a foreign company, enterprise or other economic organization
having been offering job intermediary services for not less than three years, and both of the two investors must have good reputations;

(2)

The intermediary to be incorporated shall have a sound organization structure, have personnel who are familiar with the management
of human resources, including five or more full-time employees who are graduates of junior college or above and have a qualification
certificate for job intermediary services;

(3)

The intermediary to be incorporated shall have an appropriate permanent office, adequate funds and office facilities necessary for
the business it applies, with a registered capital of 300,000 US dollars or more, of which the contribution made by the foreign investor
shall be at least 25% and the share of the Chinese investor shall be over 51%;

(4)

The intermediary to be incorporated shall have sound and practical articles of association, management system, working rules and definite
scope of business;

(5)

The intermediary to be incorporated shall have independent civil rights and obligations; and

(6)

Other requirements as prescribed by laws or regulations.

Article 7

Any application for incorporating a Chinese-foreign joint job intermediary shall be submitted to be examined and approved by the administrative
department of personnel of the people’s government of the province, autonomous region or municipality directly under the jurisdiction
of the central government where the agency is to be located, and the related records shall be submitted to the administrative department
of personnel of the State Council.

Article 8

One that wants to apply for the incorporation of any Chinese-foreign joint job intermediary must submit the following materials to
the administrative department of personnel of the local government of the province, autonomous region or municipality directly under
the jurisdiction of the central government:

(1)

a written application and a feasibility study report;

(2)

an agreement and a statute with signature of all investors;

(3)

qualification certificates showing that all of the investors have been providing job intermediary services for not less than three
years;

(4)

the Notice of Advance Approval of Enterprise Name issued by the administrative department of industry and commerce; and

(5)

other materials required by laws, regulations or the administrative department of personnel of provincial government, autonomous region
or municipality directly under the jurisdiction of the Central Government.

If any of the materials stated above is written in any foreign language, the Chinese version of that material shall be attached thereto.

Article 9

The administrative department of personnel of the provincial government, autonomous region or municipality directly under the jurisdiction
of the Central Government shall accomplish the examination and approval procedures within 30 working days from receipt of the application
for the incorporation of any Chinese-foreign joint job intermediary. A License for Job Intermediary Service (hereinafter referred
to as “license”) shall be issued if the application has been approved, and a related report shall be submitted to the administrative
department of personnel of the State Council to be kept in archives; If the application has been rejected, a written notice shall
be sent to the applicant explaining the reasons for such disapproval.

Article 10

According to regulations the applicant shall carry out the approval formalities with the administrative department of Commerce within
30 days from receipt of the license, and shall carry out the registration formalities with the administrative department of industry
and commerce within 30 days from the issuance of the approval certificate.

Chapter III Scope of Business and Management

Article 11

The administrative department of personnel of provincial government, autonomous region or municipality directly under the jurisdiction
of the Central Government shall, in the light of the capital, personnel and management level of the Chinese-foreign joint job intermediary,
approve it to enter one or more of the businesses listed below:

(1)

Collection, classification, storage and publication of information about the employment market and related advisory services;

(2)

Talent recommendation;

(3)

Talent recruitment;

(4)

Career test and appraisal;

(5)

Career training within China; and

(6)

Other relevant businesses ordained by laws and regulations.

Article 12

Any Chinese-foreign joint job intermediaries must comply with the principles of voluntary participation, impartiality and good credit,
as well as professional ethics, conduct business activities within the approved scope of business, and may not commit any act of
unfair competition.

Article 13

Any Chinese-foreign joint job intermediary that recruit talents to be employed outside China shall carry out formalities in accordance
with the relevant ordains of the Chinese government. None of the following persons may be recruited for jobs outside China if he:

(1)

is a technician or administrative person who is charged with key engineering or scientific research projects at the national or provincial
level, and if such employment outside China is not permitted by the entity he belongs to or by the competent administrative department;

(2)

is a civil servant in active service;

(3)

is assigned by the government to support the development of the Western Region of China and whose period of service in the west region
has not expired;

(4)

is involved in any confidential work, whether he is in service or out of service but still within the confidential period;

(5)

is suspected of any illegal commitment and is under investigations; or

(6)

is anyone at a special post who, according the relevant ordains of laws or regulations, is forbidden to flow for the time being, or
anyone whose exit is subject to approval according to the relevant ordains of any law or regulations.

Article 14

The foundation of a branch office, increase or decrease of registered capital, transfer of shares, and change of shareholders of a
Chinese-foreign joint job intermediary shall be subject to the approval of the initial examination and approval authorities and the
modification registration with the administrative department of industry and commerce is required.

Any Chinese-foreign joint job intermediary that changes its name, legal representative or location of its office shall, within 30
days after the registration of amendment with the administrative department of industry and commerce, carry out the relevant formalities
of modification for archival purposes with the initial examination and approval authorities.

Article 15

The administrative department of personnel of the State Council and of the people’s governments at the level of province, autonomous
region, and municipality directly under the jurisdiction of the Central Government shall, according to law, direct, examine and supervise
the daily management and business development of Chinese-foreign joint job intermediaries.

Each year the administrative department of personnel of the people’s governments at the level of province, autonomous region, and
municipality directly under the jurisdiction of the Central Government shall make examination of the licenses of Chinese-foreign
joint job intermediaries. The measures to be taken in such annual examinations shall be developed by the administrative department
of personnel of the people’s government of the province, autonomous region or municipality directly under the jurisdiction of the
Central Government. The result of such annual examination shall be submitted to the administrative department of personnel of the
State Council by the administrative department of personnel of the people’s governments at the level of province, autonomous region,
and municipality directly under the jurisdiction of the Central Government.

Chapter IV Penalty Provisions

Article 16

Any Chinese-foreign joint job intermediary who fails to duly undertake annual examination of the license, provides untrue information
or deceive the employers or people who are doing job hunting by any other means shall be given a warning or be punished with a fine
not exceeding 10,000 Yuan or both which depend on the severity of the activities; If the case is very serious, the amount of the
fine shall not exceed three times of the illegal income but in any event not exceeding 30,000 Yuan. The Penalty shall be enforced
by the administrative department of personnel of the people’s government of the province, autonomous region or municipality directly
under the jurisdiction of the Central Government combined with the administrative department of industry and commerce of the same
level.

Article 17

Anyone who violates the present Provisions and founds any Chinese-foreign joint job intermediary without the approval or anyone who
undertakes business activities beyond the approved and registered scope of business shall be punished in accordance with the Regulations
on the Management of Company Registration, Measures for Dealing with and Banning Licenseless Business Activities and other relevant
provisions. Anyone who commits any act of unfair competition shall be punished in accordance with the Law Against Unfair Competition.

Article 18

Anyone who serves in the government and neglects his duties, commits any embezzlement or malpractice and infringes on any legal rights
and interests of any entity, individual or investor shall be given a disciplinary penalty by the relevant authorities according to
the relevant competence or, if any crime is committed, be subject to criminal liabilities.

Chapter V Supplementary Provisions

Article 19

Any company, enterprise or other economic organization of Hong Kong Special Administrative Region, Macao Special Administrative Region
or Taiwan who establishes job intermediary in the mainland, shall be dealt by referring to the present Provisions.

Article 20

Business activities involving foreign citizens conducted in China by any Chinese-foreign joint job intermediary shall be handled in
accordance with relevant provisions.

Article 21

The power to interpret the present Provisions shall remain with the Ministry of Personnel, Ministry of Commerce and the State Administration
of Industry and Commerce.

Article 22

The present Provisions shall come into force as of November 1, 2003.

Ministry of Personnel, Ministry of Commerce, State Administration for Industry and Commerce
2003-09-04

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON DELEGATING THE POWER TO APPROVE ENTERPRISES OF CATEGORY A FOR ENJOYING EXPORT TAX REFUND TO LOWER LEVELS

20040601

State Administration of Taxation

Circular of the State Administration of Taxation on Delegating the Power to Approve Enterprises of Category A for Enjoying Export
Tax Refund to Lower Levels

GuoShuiFa [2003] No. 117

October 11th, 2003

The administration of State taxation of all provinces, autonomous regions, municipalities directly under the Central Government, and
the cities directly under State planning, as well as all entities under the administration of State taxation:

With a view to streamlining the measures for the classified administration of the enterprises enjoying tax refund or exemption for
exported goods, the State Administration of Taxation has, after deliberation with the Ministry of Commerce, made decisions to delegate
the power to approve export enterprises of Category A to lower levels in light of the spirits of the Opinions on Doing Well the Follow-up
Work for the Projects Whose Examination and Approval Has Been Adjusted as issued by the Leading Group of the State Council for the
Reform of Administrative Approval System (GuoShenGaiFa [2003] No. 1). We hereby make the following notice on relevant matters:

The power to approve export enterprises of Category A as prescribed in the Circular of the General State Administration of Taxation
concerning Carrying Out the Classified Management According to Enterprises on Tax Refund or Exemption for Exported Goods (GuoShuiFa
[1998] No. 95) and the Supplementary Circular of the General State Administration of Taxation concerning Carrying Out the Classified
Management According to Enterprises on Tax Refund or Exemption for Exported Goods (GuoShuiFa [2001] No. 83) shall be delegated without
exception to the administration of State taxes of all provinces, autonomous regions, municipalities directly under the State Council,
and the cities directly under the State planning, and is not subject to reporting to the State Administration of Taxation.

II.

The administration of state taxes of all provinces, autonomous regions, municipalities directly under the Central Governments, and
the cities directly under the State planning shall be responsible for the examination and approval of the export enterprises of Category
A and the administration on the tax refund or exemption of exported goods strictly in conformity with the requirements and standards
for the Category A export enterprises as prescribed in the Circular of the General State Administration of Taxation concerning Carrying
Out the Classified Management According to Enterprises on Tax Refund or Exemption for Exported Goods (GuoShuiFa [1998] No.95) and
the Supplementary Circular of the General State Administration of Taxation concerning Carrying Out the Classified Management According
to Enterprises on Tax Refund or Exemption for Exported Goods (GuoShuiFa [2001] No. 83). The name list of the Category A export enterprises
determined after approval shall be submitted to and put on archival files at the State Administration of Taxation.

State Administration of Taxation
2003-10-11

DETAILED RULES FOR THE IMPLEMENTATION OF THE MEASURES FOR THE ADMINISTRATION OF AUTO FINANCING COMPANIES

China Banking Regulatory Commission

Notice of China Banking Regulatory Commission on Printing and Issuing Detailed Rules for the Implementation of the Measures for the
Administration of Auto Financing Companies

Yin Jian Fa [2003] No. 23

Detailed Rules for the Implementation of the Measures for the Administration of Auto Financing Companies adopted at 8th president
meeting of China Banking Regulatory Commission on November 3rd, 2003 are hereby printed and issued, please carry out graveness.

China Banking Regulatory Commission

November 12th, 2003

Detailed Rules for the Implementation of the Measures for the Administration of Auto Financing Companies

Chapter I General Provisions

Article 1

The present Rules are formulated in accordance with the Measures for the Administration of Auto Financing Companies (hereinafter referred
to as “Measures”) and other relevant administrative regulations.

Article 2

The China Banking Regulatory Commission (hereinafter referred to as “CBRC”) and its agencies shall make supervision over and administration
of the auto financing companies according to the Measures and the present Rules.

Chapter II Establishment

Article 3

The application for establishing an auto financing company shall include the application for preparing the establishment and the application
for starting the operation.

The banking regulatory bureau (CBRC’s dispatched agency at the provincial level) at the place where an auto financing company is to
be established shall be the examining and verifying authority for the application for establishing such auto financing company. CBRC
shall be the examining and approving authority for applications for the establishments of all auto financing companies.

Article 4

The banking regulatory bureau shall implement a system of signing the receipt of the application documents for preparing the establishment
and for starting the operation of an auto financing company.

Article 5

The applicant meeting the requirements of Article 5 of the Measures shall submit to the banking regulatory bureau an application
form for preparing the establishment of an auto financing company and the materials required in Article 9 of the Measures.

Article 6

The banking regulatory bureau shall make examination on whether all the required documents have been submitted within five working
days after signing the receipt of the application documents for preparing the establishment of an auto financing company. In case
the application documents submitted are not complete or not in the specified forms, the banking regulatory bureau shall inform the
applicant all by one written notice, and require the applicant to further submit the materials that need to be added. Where the application
documents are complete and all in specified forms, the banking regulatory bureau shall accept and handle the application and give
the applicant a written notice concerning that.

In case the banking regulatory bureau proclaims no objections within five working days, the application shall be regarded as accepted
automatically.

Article 7

The banking regulatory bureau shall examine and verify the application documents for preparing the establishment of an auto financing
company, give its opinion on whether or not to approve the application and submit such opinions to CBRC.

CBRC shall complete the examination and verification within 20 days after accepting the application documents.

CBRC shall be responsible for the examination and approval of the application for preparing the establishment, and shall make a decision
in writing on whether or not to approve the application within six months after the banking regulatory bureau’s acceptance of the
application for preparing the establishment.

Article 8

In the event of disapproval, CBRC shall give the applicant a written notice stating the ground for such disapproval. The applicant
may not make further application for the same purpose within six months from the date on which such disapproval is given.

Article 9

Any applicant having obtained the permit for preparing the establishment wishes to extend the period of preparations shall submit
to the banking regulatory bureau an application form for extension and a report on application for extension, explaining the reasons
for the extension. After examined and verified by the banking regulatory bureau, the application for extension shall be submitted
to CBRC for verification and approval.

Such extension shall be limited to one time for each case and the period of extension shall not exceed three months.

Article 10

The applicant shall, after the preparations for establishment have been completed, submit to the banking regulatory bureau an application
form for starting the operation and the materials required in Article 12 of the Measures.

Article 11

The banking regulatory bureau shall be responsible for the acceptance, and examination and verification of the application documents
for starting the operation. The procedures for such acceptance, examination and verification shall be the same as those specified
in Articles 6 and 7 of these detailed Rules.

CBRC shall make a decision in written form on whether or not to approve the application within three months after the banking regulatory
bureau’s acceptance of the application for starting the operation.

Article 12

CBRC shall be responsible for the verification and approval of the applications for starting the operation and the business scopes
of auto financing companies. In the event of a solely foreign-owned auto financing company or a Chinese-foreign joint auto financing
company, the Financial License shall be issued by CBRC. In the event of a Chinese-investment auto financing company, the Financial
License shall be issued by the banking regulatory bureau.

The Financial Licenses of auto financing companies shall be governed by the Measures for the Control of Financial Licenses and other
relevant provisions.

Article 13

CBRC is authorized by the Ministry of Commerce of the People’s Republic of China to issue the Approval Certificate of the People’s
Republic of China for an Enterprise with Foreign Investment to the solely foreign-owned and Chinese-foreign joint auto financing
companies who have been approved to start operation. After receiving the approval document for starting the operation, the solely
foreign-owned or Chinese-foreign joint auto financing company shall go through the relevant formalities with CBRC and make enterprise
registration by the approval document issued by CBRC, the Financial License and the aforesaid approval certificate. CBRC shall, on
the same day as issuing the approval certificate, submit to the Ministry of Commerce the approval certificate stub.

Article 14

The articles of association of an auto financing company shall at least cover the company’s name, place of business, type of ownership,
registered capital, scope of business, form of association, operation and management, and termination and liquidation.

Article 15

With regard to each auto financing company, there must be at least 60% persons of its personnel who have the experience in financial
field or are graduates of college or secondary specialized school majoring in finance. The application documents for starting the
operation of an auto financing company shall cover the information on the percentage of persons who have the experience in financial
field or are graduates of college or secondary specialized school majoring in finance.

Article 16

All the application documents either for preparing the establishment or for starting the operation shall be submitted in triplicate
and in Chinese.

Chapter III Qualifications for the Senior Administrative Personnel

Article 17

The term “senior administrative personnel of an auto financing company” means the legal representative of the company and the persons
who have decision-making power with regard to the operation and management of the company or who play a major role in risk control
of the company, that is, the directors, supervisors, general manager, deputy general manager, chief financial officer, manager of
the department of internal audit or inspection, and the administrative persons who are in other post_titles but have the same functions
and duties as mentioned above.

Article 18

The senior administrative personnel of an auto financing company must meet the following basic requirements:

(1)

Being well acquainted with and complying with the relevant economic and financial laws and regulations of the state; and

(2)

Having the professional knowledge, work experience and organizational and administrative abilities necessary for his post.

Article 19

Anyone who is under any of the following circumstances may not be the senior administrative personnel of any auto financing company:

(1)

Having a record of crime or having been severely punished for his illegal act;

(2)

Having caused grievous losses to the financial institution or other enterprise or company where he worked due to his serous mistakes
in his work in the past five years;

(3)

Bearing the major responsibility or the direct leader’s responsibility for any major improper act, revocation of the financial license
or business license or bankruptcy of the financial institution or other enterprise or company where he worked, and such event occurred
in the past five years; or

(4)

Other circumstances prescribed in laws and regulations under which one person may not be the senior administrative personnel of a
financial institution.

Article 20

The qualifications and appointments of the chairmen of board of directors, vice chairmen of board of directors, executive directors,
directors, general managers, deputy general managers and chief financial officers of auto financing companies shall be subject to
the examination and approval of CBRC and its agency. And the qualifications and appointments of other senior administrative personnel
of auto financing companies shall be subject to submission to CBRC and its agency for archival purposes.

Article 21

The senior administrative personnel of auto financing companies to whom the examination and approval system applies shall meet the
following conditions:

(1)

A person to be the chairman of board of directors, executive director or general manager must be a graduate of college or above, and
have experience in financial field of at least five years or in the management of auto production or sales of at least ten years.
In case he is not a graduate of college or above, he shall have experience in financial field of at least eight years or in the management
of auto production or sales of at least 15 years;

(2)

A person to be the vice chairman of board of directors or deputy general manager must be a graduate of college or above, and have
experience in financial field of at least three years or in the management of auto production or sales of at least six years. In
case he is not a graduate of college or above, he shall have experience in financial field of at least six years or in the management
of auto production or sales of at least 11 years;

(3)

A person to be the chief financial officer must be a graduate of college or above, and have experience of financial, accounting or
auditing work of at least six years. In case he is not a graduate of college or above, he shall have experience of financial, accounting
or auditing work of at least 14 years; and

(4)

A person to be a director must be a graduate of junior college or above, and have experience in enterprise operation and management
of at least six years. In case he is not a graduate of junior college or above, he shall have experience in enterprise operation
and management of at least ten years.

Article 22

With the appointment of senior administrative personnel to whom the examination and approval system is applied, the auto financing
company shall submit the following application documents (in triplicate) to the local agency of CBRC:

(1)

The qualifications form for examination and approval;

(2)

The application for verifying the qualifications of the person to be appointed;

(3)

The comprehensive appraisal on the conduct, professional ability, administrative ability and achievements of the person to be appointed
by the board of directors and board of supervisors of the company to make the appointment and by the present employer of the person
to be appointed;

(4)

A copy of the ID card of the person to be appointed;

(5)

The copies of the academic credentials and the certificate of professional skill, as recognized by the state, of the person to be
appointed; and

(6)

Other materials as may be required by CBRC or its agency.

Article 23

In the event of submission of information about senior administrative personnel of an auto financing company for CBRC’s and its agency’s
examination and approval, CBRC and its agency shall, within 90 days from the receipt of all the required application documents, give
a reply on whether or not to approve. In the event of disapproval, a written notice shall be given to the applicant explaining the
reasons for this disapproval.

Article 24

CBRC and its agency may hold examinations or tests for or talks with a person who is to be appointed to a senior administrative post
and whose qualifications and appointment are subject to the examination and approval of CBRC and its agency.

Article 25

With regard to the appointment of senior administrative personnel to whom the system of submission for archival purposes is applied,
the auto financing company shall submit the following materials (in triplicate) to the local agency of CBRC:

(1)

The qualifications form for archival purposes;

(2)

The copy of the ID card of the person to be appointed;

(3)

The copies of the academic credentials and the certificate of professional skill, as recognized by the state, of the person to be
appointed; and

(4)

Other materials as may be required by CBRC or its agency.

Article 26

In the event of submission of information about senior administrative personnel of an auto financing company for archival purposes,
in case the local agency of CBRC does not make any objection in written form within 30 days after the receipt of all the required
information, it shall be regarded as recognized.

Article 27

Without the approval of CBRC and its agency, the senior administrative personnel of an auto financing company, such as the chairman
of board of directors, vice chairman of board of directors, executive director, general manager, deputy general manager, chief financial
officer or manager of the department of internal audit or inspection, may not concurrently hold any post in any Party or government
organization or any post of senior management in any other company.

Article 28

The chairman of board of directors of an auto financing company may not concurrently hold the post of general manager. The director
of an auto financing company may not concurrently hold any post of senior management in any other company that is in a competitive
relation with the auto financing company.

Article 29

Where the chairman of board of directors or the general manager of an auto financing company fails to perform his duties for one month
or more in succession for any reason, other senior administrative personnel shall be appointed as the acting chairman of board of
directors or general manager, provided that such appointment shall be subject to the submission to the local agency of CBRC for archival
purposes in advance. Where the chairman of board of directors or the general manager fails to perform his duties for three months
or more in succession, he shall be replaced.

Article 30

When senior administrative personnel of an auto financing company is to leave his post, the company shall engage an external auditor
as approved by CBRC and its agency to make an audit on post-leaving.

Article 31

An audit report on post-leaving shall at least cover the following:

(1)

The situation of the business under the person’s charge;

(2)

Whether the business under the person’s charge was conducted in accordance with laws and regulations;

(3)

The situation of the internal control and risk management with regard to the business under the person’s charge;

(4)

The great economic or criminal cases occurred in the person’s scope of official duty and the person’s responsibility for such cases;
and

(5)

The conclusion of the audit.

Article 32

CBRC and its agencies shall establish and keep the archives of senior administrative personnel of auto financing companies. Such archives
shall at least cover the followings:

(1)

The application documents for appointments;

(2)

The documents and materials examined and verified by CBRC and its agencies;

(3)

The documents of CBRC and its agencies on approving the appointments;

(4)

The decisions made by CBRC and its agencies on sanctions on the senior administrative personnel or the documents of CBRC and its agencies
on disqualifying the senior administrative personnel;

(5)

The decisions made by the auto financing companies on sanctions on the senior administrative personnel;

(6)

The audit reports on post-leaving; and

(7)

Other important materials.

Article 33

Where any of senior administrative personnel bears personal responsibility or bear the direct leader’s responsibility for any of the
following circumstances, CBRC and its agency shall, according to the circumstances and the consequences, disqualify the person, for
a fixed period or for his whole life, from being such senior administrative personnel:

(1)

The person is subject to any criminal responsibility;

(2)

The person refuses, interferes with, obstructs or seriously affects the legal supervision and administration by CBRC or its agency
on the auto financing company;

(3)

The poor internal control system or ineffective management has caused heavy losses of assets or resulted in any great financial crime;

(4)

The company has conducted extremely improper operations. It has been in poor management and administration for a long period of time
and suffered heavy losses or it has been taken over, dissolved, enforced to merge or declared bankrupt;

(5)

In the event of any great financial crime, the company fails to report the case without delay, fails to take proper measures, or fails
to cooperate with the competent authorities in the latter’s investigation or handling of the case, or interferes with or obstructs
the investigation and handling of the case;

(6)

The senior administrative personnel is found, after the appointment, to have committed any illegal or improper act or have other circumstances
that preclude his being a senior administrative personnel; and

(7)

Other circumstances as specified by CBRC or its agency.

Article 34

CBRC and its agencies may circulate a notice on the disqualification of senior administrative personnel of an auto financing company.

Chapter IV Risk Control, Supervision and Management

Article 35

Any auto financing company shall set up a sound risk management system aiming at risk control, which includes the following:

(1)

Setting up an organizational structure for good management of the company, with the duties and responsibilities reasonably and clearly
divided and the accounting relations clearly specified, and setting up the scientific and highly efficient decision-making and encouraging
and restricting mechanisms; and

(2)

Establishing and improving the internal control system by referring to the Guidance for Internal Control of Commercial Banks and under
the principles of generality, discretion, effectiveness and independence, and submitting that to the local agency of CBRC for archival
purposes.

Article 36

Any auto financing company shall establish a board of directors, other than in the event of a solely foreign-owned auto financing
company which has only a single director, and which shall engage an external independent director.

Article 37

Any auto financing company shall have its assets divided into five classes and, by referring to the Guiding Principles for Classified
Loan Risks, formulate rules for operating different classes of asset risks and implement them after submitting them to the local
agency of CBRC for archival purposes. It shall, in accordance with the Guidance for the Provision of Reverses for Loan Losses, set
up a cautious system of reserves for loan losses, and make timely and adequate provision of reserves for losses of assets.

Article 38

The formula for the calculation of the capital adequacy ratio of an auto financing company shall be: capital/risk-weighed assets.

Article 39

The capital of an auto financing company consists of the core capital and the subordinated capital. The core capital consists of paid-up
capital, capital reserves, surplus reserves and undivided profits. The subordinated capital consists of revalued reserves and general
reserves.

The core capital of an auto financing company shall be not less than 50% of all its capital.

Article 40

The calculation of the risk-weighed assets and different asset risk weights of an auto financing company are as follows:

Risk-weighed assets=claims against commercial banks0%+claims guaranteed by a commercial bank0%+claims with a guarantee of other
forms0%+assets in other forms00%+balance of guarantee business00%

A guarantee of other forms means a guarantee other than those provided by a commercial bank; assets in other forms do not include
cash.

At the calculation of the risk assets of each loan, the special-purpose reserve shall be first deducted from the book value of the
loan, and the devaluation reserves for other assets shall also be deducted from the book value of the relevant asset account.

Article 41

The ratio between the balance of credit provided by an auto financing company to a single borrower and the company’s registered capital
shall not exceed 15%.

The credit balance comprises stated accounts and unstated accounts.

Article 42

The ratio between the balance of credits provided by an auto financing company to the biggest ten clients shall not exceed 50% of
its registered capital.

Article 43

No auto financing company may give any unsecured loan to any of its affiliated persons, nor may it extend any credit to any of its
affiliated persons on terms more favorable than those offered to other borrowers with the same kind of credit.

Article 44

The balance of the credit extended by an auto financing company to any single director of the company and the affiliated persons of
the director shall not exceed 100% of the investment by the director to the company.

Article 45

The credit balance under Articles 41, 42 and 44 of the present Rules refers to the balance after deducting the cash and money equivalent
given in pledge by the borrower.

Article 46

The guarantee balance of an auto financing company shall not be more than 200% of its registered capital.

Article 47

The ratio between the fixed assets for its own use and the registered capital of an auto financing company shall not be more than
40%.

Article 48

The ratio between the current assets and current liabilities of an auto financing company shall be not lower than 100%.

The current assets cover cash, loans matured in a month, accounts receivable in a month and other assets that may be realized in a
month, provided that the amounts that are anticipated as not receivable shall be deducted from the aforesaid assets. The current
liabilities include deposits matured in a month, loans repayable in a month to financial institutions and other liabilities due in
a month.

Article 49

The loans for auto exhibition halls shall only be used for the construction of places required for the exhibition of finished motors.

Article 50

The interest rate of loans obtained by an auto financing company from other financial institutions shall apply the banker’s rates
mutatis mutandis. The interest rate of auto loans granted by an auto financing company may fluctuate by ?0-30% based on the legal
rate of interest as quoted by the People’s Bank.

Article 51

All the auto financing companies shall, in accordance with the provisions made by BCRC and its agency concerning the relevant supervision
and control, regularly submit to the local agency of CBRC their financial and accounting statements and reports on the implementation
of supervision and control indexes signed by its legal representative, and other materials as may be required by CBRC and its agency.

The legal representative of an auto financing company is held finally responsible for the authenticity of the aforesaid materials.

Article 52

CBRC and its agencies shall, by on-the-spot inspection and off-the-spot supervision and control, conduct overall check and appraisement
on each auto financing company’s implementation of the risk management system in which the legal person’s administrative structure
and internal control system serve as the key elements, of the capital adequacy ratio and other risk control indexes and of the systems
of classification of assets risks and asset loss reserves. CBRC and its agencies shall be enpost_titled to order any auto financing company
failing to meet the relevant requirements to make reform and consolidation, or suspend part or all of its business for reorganization.

CBRC and its agencies may designate an intermediary agency with proper credentials to make spot inspection on auto financing companies.

Chapter V Supplementary Provisions

Article 53

The term “auto financing business” means the business specified in Article 18 of the Measures.

Article 54

The term “the distributor” mentioned in Article 2 of the Measures means distributors who specially engage in the sales of motors
and does not include auto manufacturers or other sellers of motors.

Article 55

The enterprise legal person mentioned in Article 5 (1) of the Measures does not include any bank either in or out of China.

Article 56

The term “the buyer and seller of motors in China” mentioned in Article 2 of the Measures mean the buyers and sellers of motors in
China’s mainland and do not include those in Hong Kong, Macao or Taiwan.

Article 57

In the present Rules, the term “affiliated person” includes affiliated legal persons and affiliated natural persons.

The affiliated legal person of an enterprise means:

(1)

A legal person who directly or indirectly controls the enterprise or who is, together with the enterprise, under the common control
of any third person; or

(2)

An enterprise under the direct or indirect control of an affiliated natural person.

The term “affiliated natural person of an enterprise” means the senior administrative personnel of the enterprise and the close relatives
thereof. The affiliated natural persons of an auto financing company include in addition the personnel engaging in the credit business
and the close relatives thereof.

Article 58

The present Rules shall be implemented as of the promulgation. The responsibility to interpret the present Rules shall remain with
CBRC.

China Banking Regulatory Commission
2003-11-12

SUPPLEMENTARY NOTICE OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON ADJUSTING THE TAX REFUND RATE FOR EXPORTED GOODS

Ministry of Finance, State Administration of Taxation

Supplementary Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting the Tax Refund Rate for Exported
Goods

Caishui [2003] No. 238

December 2, 2003

The departments (bureaus) of finance and the bureaus of State taxes of all provinces, autonomous regions, municipalities directly
under the Central Government, and cities directly under State planning, the Bureau of Finance of Xinjiang Production and Construction
Army Corps:

The “Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting the Tax Refund Rate for Exported Goods”
(Caishui [2003] No. 222) has prescribed the tax refund rates applicable to exported goods since January 1, 2004. Our supplementary
notice concerning other relevant policies on tax refund for export is hereby giver as follows:

Where the goods are exported by small-scale taxpayers on their own or by means of authorization, it shall continue to implement the
tax exemption policies, and their tax amount on purchase items shall neither be deducted nor be refunded. If taxes are permitted
to be refunded to export enterprises for their export of goods purchased from small-scale taxpayers, it shall apply a tax refund
rate of 5% to any goods whose tax refund rate for export is prescribed by Document Caishui [2003] No. 222 to be 5%; and it shall
apply to a tax refund rate of 6% to any goods whose tax refund rate for export is prescribed by Document Caishui [2003] No. 222 to
be higher than 5%.

II.

Where products are exported within the “Catalogue on Export of Hi-tech Products” (2003 Edition), it shall uniformly comply with the
tax refund rate prescribed in Document Caishui [2003] No. 222.

III.

Computer software in export (Customs Export Code: 9803) shall be exempted from taxes, and their tax amount on purchase items shall
neither be deducted nor be refunded.

IV.

For the Chinese domestically produced articles and domestic labor services purchased by foreign embassies (consulates) to China and
their diplomats, the domestically produced equipment purchased by foreign-funded enterprises and qualified for tax-refund conditions,
as well as the mechanical and electronic products for which the domestic enterprise won the bid and for which international bid invitation
was held by using loans of foreign governments and international financial organizations prescribed in Article 9 of the “Notice
of the State Administration of Taxation on Some Issues Concerning Tax Refund for Export” (GuoshuiFa [2000] No. 165), as well as the
ocean engineering structures sold by the production enterprises prescribed in the “Notice of the Ministry of Finance and the State
Administrative Institution of Taxation on Applying VAT Refund to Ocean Engineering Structures” (Caishui [2003] No. 46) to domestic
maritime petroleum and natural gas exploitation enterprises, taxes shall still be refunded, deducted or exempted according to the
original policies.

The domestically produced equipment purchased by foreign-funded enterprises, with the taxes on which permitted to be refunded, covers
a scope of domestically produced equipment purchased within China, which conforms to the investment projects in the catalogue of
encouraged foreign investment industries in the “Catalogue for the Guidance of Foreign Investment Industries”, that is, Order No.
21 jointly promulgated by the former State Planning Commission, the former State Economic and Trade Commission and the former Ministry
of Foreign Trade and Economic Cooperation.

The tax refund rate that is applicable to the “exemption or deduction” policies for the steel “specially used for processing export”
sold by the named steel enterprises prescribed in the “Notice of the State Administration of Taxation, the State Economic and Trade
Commission, the Ministry of Finance, the General Administration of Customs, and the State Administration of Foreign Exchange on Printing
and Distributing the Detailed Rules for the Implementation of the Measures for Promoting Steel Production in Place of Steel Import”
(GuoshuiFa [1999] No. 68) to processing trade enterprises shall be notified separately.

The domestically sold or purchased goods other than those prescribed in Article 4 of the present Notice shall be deemed as the goods
whose taxes are permitted to be refunded or exempted upon export. The “exemption, deduction or refund” of taxes shall be handled
or the amount of “exempted or deducted” taxes shall be computed uniformly according to the tax refund rate prescribed in Document
CaishuiFa [2003] No. 222. For such goods, the “tax amount not permitted to be exempted or deducted” shall be calculated and be converted
into the costs.

The tax amount not permitted to be exempted or deducted = the sales amount named on common invoicestax levying rate of the sold
goods tax refund rate of the sold goods)

VI.

The present Notice shall enter into force as of January 1, 2004. The export date indicated by the customs on the “Customs Declaration
List for Exported Goods (the sheet of tax refund for export)” shall be deemed as the time criterion for Articles 1 through 3 of the
present Notice; while the time of issuance by the seller of common invoices shall be deemed as the time criterion for Articles 4
and 5.

Ministry of Finance, State Administration of Taxation
2003-12-02

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Constitution

The basic law

Concluding and Transitional Provisions

PROVISIONS CONCERNING THE ADMINISTRATION OF FOREIGN-FUNDED BUSINESS-STARTING INVESTMENT ENTERPRISES

CIRCULAR ON INVESTIGATING ADOPTION OF THE ENTERPRISE ACCOUNTING SYSTEM BY ENTERPRISES WITH FOREIGN INVESTMENT

CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE ON THE TRANSITIONAL POLICY AND MEASURES AFTER CANCELING ADMINISTRATIVE EXAMINATION AND APPROVAL OF FOREIGN EXCHANGE ADMINISTRATION OF SOME CAPITAL PROJECTS

MEASURES FOR THE QUARANTINE AND ADMINISTRATION OF HEREDITARY SUBSTANCE OF ENTRY ANIMALS

CIRCULAR OF THE STATE ADMINISTRATION OF FOREIGN EXCHANGE AND CHINA INSURANCE REGULATORY COMMISSION ON THE RELEVANT ISSUES CONCERNING THE ADMINISTRATION OF SALE AND PAYMENT OF FOREIGN EXCHANGE IN OVERSEAS REINSURANCE CEDING

MEASURES FOR THE CLASSIFIED ADMINISTRATION OF ENTERPRISES MANUFACTURING EXPORT INDUSTRIAL PRODUCTS

INTERIM PROVISIONS CONCERNING THE MANAGEMENT OF CHINESE-FOREIGN JOINT JOB INTERMEDIARIES

CIRCULAR OF THE STATE ADMINISTRATION OF TAXATION ON DELEGATING THE POWER TO APPROVE ENTERPRISES OF CATEGORY A FOR ENJOYING EXPORT TAX REFUND TO LOWER LEVELS

DETAILED RULES FOR THE IMPLEMENTATION OF THE MEASURES FOR THE ADMINISTRATION OF AUTO FINANCING COMPANIES

SUPPLEMENTARY NOTICE OF THE MINISTRY OF FINANCE AND THE STATE ADMINISTRATION OF TAXATION ON ADJUSTING THE TAX REFUND RATE FOR EXPORTED GOODS

CONSTITUTION ACT, 1982 – page 22

CONSTITUTION ACT, 1982 – page 21

CONSTITUTION ACT, 1982 – page 20

CONSTITUTION ACT, 1982 – page 19

CONSTITUTION ACT, 1982 – page 18

CONSTITUTION ACT, 1982 – page 17

CONSTITUTION ACT, 1982 – page 16

CONSTITUTION ACT, 1982 – page 12

CONSTITUTION ACT, 1982 – page 11

CONSTITUTION ACT, 1982 – page 10

CONSTITUTION ACT, 1982 – page 9

CONSTITUTION ACT, 1982 – page 8

CONSTITUTION ACT, 1982 – page 7