INTERIM MEASURES FOR THE SUPERVISION AND ADMINISTRATION OF THE INVESTMENTS BY CENTRAL ENTERPRISES

No.16

The Interim Measures for the Supervision and Administration of the Investments by Central Enterprises have been deliberated and adopted
at the 39th executive meeting of Directors of the State-owned Assets Supervision and Administration Commission of the State Council,
and are hereby promulgated, and shall come into force as of July 1, 2006.
Director of the State-owned Assets Supervision and Administration Commission of the State Council Li Rongrong

June 28, 2006

Interim Measures for the Supervision and Administration of the Investments by Central Enterprises

Article 1

In order to implement the duties of the contributor, regulate the investment activities of central enterprises, improve the scientific
and democratic character of investment decision-making of central enterprises and effectively prevent investment risks, these Measures
are formulated according to the Company Law of the People￿￿s Republic of China, the Interim Regulation of the Supervision and Administration
of State-owned Assets of Enterprises and other laws and regulations.

Article 2

Central enterprises hereof referred to in the present Measures are the enterprises for which the State-owned Assets Supervision and
Administration Commission of the State Council (hereinafter referred to as the SASAC) implements the duties of the contributor (hereinafter
referred to as these enterprises).

Article 3

Investments hereof referred to in the present Measures are the following investment activities conducted by the enterprises within
the territory of China:

(1)

investments in fixed-assets;

(2)

property acquisition; and

(3)

long-term equity investment

Article 4

The SASAC shall, in accordance with laws, supervise and administrate the investment activities of these enterprises, and guide them
to establish and improve the procedures of investment decision-making and management systems.

Article 5

These enterprises are the subjects of investment activities, and shall formulate and implement the procedures of investment decision-making
and management systems, establish and improve management organs accordingly, and report them to the SASAC for filing.

Article 6

The investment activities of these enterprises, as well as the supervision and administration of the SASAC to these activities, shall
follow the principles as follows:

(1)

In conformity to the development plans and industrial policies of the State;

(2)

In conformity to the distribution and structural adjustment direction of these enterprises;

(3)

In conformity to the development strategies and plans of these enterprises;

(4)

Giving prominence to the main industry which is in favor of enhancing the core competitiveness of these enterprises;

(5)

The investments in minor industries shall be in conformity to the direction of adjustment and reform of these enterprises and shall
not affect the development of the main industry;

(6)

In conformity to the procedures of investment decision-making and management systems of these enterprises;

(7)

The investment scale shall be in conformity to the scale of assets and business, the level of assets and liabilities and the actual
capital raising capacity of these enterprises; and

(8)

Having carried through adequate scientific authentication, and the anticipatory investment proceeds shall not be lower than the average
level of the same domestic industry at the same term.

Main industry hereof refers to the major business operations as determined in the development strategies and plans of these enterprises,
and as confirmed and publicized by the SASAC; and minor industry hereof refers to the business operations other than the main industry.

Article 7

An enterprise shall, in line with its development strategies and layouts, weave annual investment plans, and the major investment
activities of an enterprise shall be brought into the annual investment plans.

The annual investment plans of an enterprise shall cover the following contents:

(1)

the overall investment scale, sources and composition of funds;

(2)

the investment scale of both main industry and minor industry; and

(3)

the basic information about the investment project (including the contents, investment amount, composition of funds, anticipatory
investment proceeds and implementing years, etc. of the project).

Investment projects as mentioned in the annual investment plans of an enterprise refers to those investment projects which are studied
and decided by the board of directors or the executive meeting of general managers of the enterprise (including the investment projects
of its subsidiary companies) in accordance with the investment management systems of the enterprise.

Article 8

These enterprises shall submit the annual investment plans within the prescribed time limit as required by the SASAC.

The uniform format, time limit or any other requirement about the submission of the annual investment plans of these enterprises shall
be separately prescribed by the SASAC.

Article 9

The SASAC shall implement the classified supervision and administration of the investment activities of these enterprises:

(1)

In respect of the solely state-owned companies, which have established the normalized board of directors pursuant to the relevant
provisions of the SASAC, the SASAC shall implement the filing administration of investment projects in accordance with the annual
investment plans of these enterprises.

(2)

In respect of the solely state-owned enterprises and solely state-owned companies which have not established the normalized board
of directors yet, the SASAC shall, in accordance with the annual investment plans of these enterprises, implement the filing administration
of investment projects in the main industry; and shall implement the approval of the investment projects in the minor industry, and
make examination decisions within 20 working days.

(3)

The state holding companies shall submit the annual investment plans to the SASAC in accordance with these Measures.

(4)

The enterprises of other types shall be executed with reference to the state holding companies.

Article 10

Where an enterprise superadds any project beyond the annual investment plans, it shall report the relevant information to the SASAC
in time, and the SASAC shall implement the administration pursuant to Article 9 of these Measures.

Article 11

An enterprise shall report any of the following significant investment matters to the SASAC in time:

(1)

As to the investment projects which need to be approved by the State Council or by the relevant departments of the State Council in
accordance with the present investment administrative provisions of the State, the enterprise shall submit relevant documents to
the State Council or the relevant departments of the State Council with copies sent to the SASAC.

(2)

If any of the following cases occurs during the implementation course of an investment project of the enterprise, this enterprise
shall go through the procedure of investment decision-making again, and report the decision-making opinions to the SASAC in written
form timely:

a.

Significant adjustment of the investment amount, sources or composition of funds, which causes excessive corporate debts and exceeds
the affordability of the enterprise or affects the normal development of the enterprise;

b.

Significant alternation of the equity structure, which causes the transfer of the enterprise controlling right; or

c.

Serious breach of the contact by the investment partner, which damages the rights and interests of contributors.

(3)

Other significant investment matters that need to be reported to the SASAC.

Article 12

The SASAC shall establish a statistical and analysis system about the investments by these enterprises, and an enterprise shall submit
the information concerning annual investment implementations and the analysis materials as required by the SASAC, and some key enterprises
shall submit the information concerning quarterly investment implementations.

Article 13

An enterprise shall implement the follow-up appraisal and management of investment projects, and the specific work contents and requirements
shall be executed with reference to the Guidelines for the Follow-up Appraisal of Fixed Assets Investment Projects of Central Enterprises.
The SASAC shall choose some investment projects that have been completed by these enterprises for the follow-up appraisal in accordance
with the requirements.

Article 14

The SASAC has the obligation of the keeping secret of the materials submitted by the enterprise in accordance with the present Measures.

Article 15

Where an enterprise acts against the present Measures or the provisions on the procedures of its investment decision-makings, it
shall be ordered to make correction by the SASAC; if the cases are so serious as to bring great loss to the enterprise, the responsibilities
of the relevant personnel of the enterprise shall be investigated pursuant to the relevant provisions.

If any relevant responsible person of the SASAC violates the present Measures, he shall be ordered to make corrections by the SASAC;
if the cases are serious, administrative punishments shall be imposed on him according to laws.

Article 16

The specific provisions concerning the supervision and administration of the overseas investments of these enterprises shall be prescribed
otherwise by the SASAC.

Article 17

The present Measures are subject to the interpretation by the SASAC.

Article 18

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