Tentative Measures for the Administration of the Entrusted Overseas Financial Management Business of Trust Companies

Article 2: For the purposes of these Measures, the term "entrusted overseas financial management business" means the business activity wherein a domestic organization or an individual resident (the Settlor) entrusts funds that it/he/she lawfully owns to a trust company to establish a trust, and the trust company engages in the investment in specified financial products and in asset management overseas in its own name in accordance with the provisions of a trust document. The investment returns and risks are enjoyed and borne by the relevant parties in accordance with laws, regulations and the trust document.

Article 3: When a trust company engages in entrusted overseas financial management business, it shall comply with relevant domestic and foreign laws and regulations and these Measures, and shall adopt genuinely effective measures to strengthen management of relevant risks.

Article 4: The China Banking Regulatory Commission (the CBRC) is responsible for the access administration and the business administration of the entrusted overseas financial management business of trust companies. The State Administration of Foreign Exchange (SAFE) is responsible for foreign exchange control in connection with the entrusted overseas financial management business of trust companies.

PART TWO: EXAMINATION AND APPROVAL OF BUSINESS QUALIFICATIONS

Article 5: The CBRC shall examine and approve the qualifications of trust companies that apply to engage in entrusted overseas financial management business in accordance with the relevant procedures and provisions for administrative permissions.

Article 6: A trust company wishing to engage in entrusted overseas financial management business shall satisfy the following conditions:

(1) having registered capital of not less than Rmb1 billion or the equivalent in a freely convertible currency; having approved qualifications to engage in foreign exchange business and having a good track record in engaging in foreign exchange business; and having a regulatory rating of 'good' or 'better' for two years in succession;

(2) having been profitable for the most recent two years in succession and having year-end net assets of not less than its registered capital after allocations to the various loss reserves; and not having been subjected to administrative penalties by the regulatory department during the most recent two years;

(3) having a sound and well implemented corporate governance structure, internal control systems and risk management mechanism;

(4) having professional personnel who are capable of satisfying the requirements of entrusted overseas financial management business and have overseas investment management skills and experience (with not less than two professional managers who have engaged in the trading of foreign currency denominated negotiable securities for at least two years); having an independent department responsible for engaging in entrusted overseas financial management business that centrally accepts and operates the entrusted overseas financial management business and manages the same in separate accounts;

(5) having risk analysis techniques and a risk control system that satisfy the requirements of entrusted overseas financial management business; having a place of business, computer system, security facilities and other related facilities that satisfy the requirements of entrusted overseas financial management business; and having erected an effective firewall mechanism between its trust business and the business conducted for its own account; and

(6) other prudential conditions as specified by the CBRC.

Article 7: When a trust company applies to the CBRC for the qualifications to engage in entrusted overseas financial management business, it shall submit the following materials (in triplicate);

(1) an application signed by the trust company's legal representative that, at minimum, includes the basic particulars of the applicant, the foreign exchange limit it intends to apply for and an investment plan;

(2) a feasibility study on the entrusted overseas financial management business to be engaged in by the trust company that, at minimum, shall include information on the company's qualifications, its business development plan, its target customers, a business feasibility analysis and details of resource allocation;

(3) internal control and risk management systems: its internal control and risk management systems shall, at minimum, include the systems for managing the entrusted overseas financial management business, for managing foreign exchange denominated investments or foreign exchange transactions and for managing market risks;

(4) a description of the personnel and department that will engage in the entrusted overseas financial management business, including the résumés of the professional personnel that will engage in overseas investment;

(5) relevant materials on the custodian and a draft agreement; the draft custodian agreement shall specify the custodian that the trust company intends to engage; if the custodian cannot be determined due to management procedures, commercial negotiations or other such reason, information on the custodian may be temporarily dispensed with, however, the main rights and obligations¹ of the trust company and the custodian shall be expressly set forth in the draft agreement and, once the custodian has been determined, the basic particulars of the custodian shall be submitted to the regulatory department in a timely manner;

(6) documentation evidencing the satisfaction of the conditions set forth in Article 6 hereof that shall, at minimum, include the evidentiary document for engaging in foreign exchange business and a photocopy thereof, and audited financial reports and statements for the most recent two years; and

(7) other documents as required by the CBRC.

PART THREE: BUSINESS ADMINISTRATION

Article 8: Once a trust company obtains the qualifications for entrusted overseas financial management business, the entrusted overseas financial management business that it engages in shall be subject to a reporting system. For the reporting procedure and requirements, reference shall be made to relevant provisions.

Article 9: When a trust company reports its intention to launch entrusted overseas financial management business, it shall submit the following materials:

(1) a feasibility analysis report on the product;

(2) a draft trust document;

(3) the custodian agreement;

(4) a risk statement;

(5) the plan for application of trust property;

(6) a description of the risk control techniques;

(7) the formats of information disclosure and risk management reports;

(8) the promotion plan;

(9) a brief description of the business department and personnel;

(10) a legal opinion issued by an external lawyer; and

(11) other materials as required by the CBRC.

Article 10: When engaging in entrusted overseas financial management business, a trust company may establish trusts for entrusted overseas financial management that target institutional investors as well as natural persons who have considerable risk identification, weighing and bearing capabilities.

Article 11: Trust business for entrusted overseas financial management includes single trust products for entrusted overseas financial management established for single Settlors and pooled trust plans for entrusted overseas financial management established for two or more Settlors. The respective rights and obligations of the parties shall be specified in the trust document. The trustee shall carry out investment management and entrusted management in respect of the trust property in accordance with the trust document.

Article 12: When a trust company receives funds from a Settlor, it shall verify if the Settlor duly has the relevant investment qualifications and if its/his/her investment activities comply with the laws of China and the country or region where its/his/her investments are made. The leasing or lending, or the leasing or lending in a disguised manner by a trust company of its available overseas investment accounts to an organization in China is strictly prohibited.

Article 13: When a trust company establishes a single or pooled trust for entrusted overseas financial management, the amount of funds it accepts from a single Settlor may not be less than
Rmb1 million or the equivalent in foreign exchange as calculated based on the median of the relevant rates posted by the China Foreign Exchange Trade System on the day preceding the establishment of the trust.

Article 14: A trust company shall set an appropriate time limit and sale threshold amount based on the risk profile of the trust plan for entrusted overseas financial management and conduct a survey of the risk adaptability of its target customers.

Article 15: The application of the funds of a pooled trust plan for entrusted overseas financial management by a trust company shall be limited to the following investment products or instruments:

(1) foreign bank deposits with a long-term credit rating of at least an investment grade during the most recent three years as rated by an internationally recognized rating agency;

(2) foreign government bonds, international financial organization bonds and foreign company bonds rated as of at least an investment grade by an internationally recognized rating agency;

(3) bonds issued overseas by the Chinese government or Chinese enterprises;

(4) bank bills, large negotiable certificates of deposit, money market funds and other such money market products rated as of at least an investment grade by an internationally recognized rating agency; and

(5) other investment products and instruments as specified by the CBRC.

Article 16: The application of the funds of a single trust product for entrusted overseas financial management by a trust company shall be limited to the following investment products or instruments:

(1) the investment products and instruments specified in Article 15;

(2) products and instruments involving financial derivatives transactions for the purpose of hedging the risks to which the single trust product for entrusted overseas financial management is exposed; the trust company shall have obtained the relevant business qualifications in accordance with the Tentative Measures for the Administration of Trading of Derivatives by Financial Institutions; the trust company shall conduct relevant trading as the end user of the financial derivatives, and may not invest in financial derivatives products or instruments as a financial derivatives trader or market maker; and

(3) other investment products or instruments as specified by the CBRC.

PART FOUR: CONTROL OF FOREIGN EXCHANGE PAYMENT LIMIT FOR INVESTMENTS

Article 17: When engaging in entrusted overseas financial management business, a trust company shall apply to SAFE for a foreign exchange payment limit for investments. A trust company that is directly overseen by the CBRC shall submit its application materials directly to SAFE. A trust company that is overseen by the local CBRC office shall submit its application materials to the branch, office, system sub-branch or sub-branch of SAFE (the Foreign Exchange Bureau) of the place where it is located. Once the Foreign Exchange Bureau has approved the application after a preliminary examination, it shall be forwarded upward through the hierarchy to SAFE for approval.

A trust company may promote its renminbi or foreign currency denominated pooled trust plan for entrusted overseas financial management to investors to the extent of its foreign exchange payment limit for investments approved by SAFE. A trust company's aggregate net amount remitted out may not exceed its foreign exchange payment limit for investments approved by SAFE.

Article 18: A trust company shall apply to SAFE or the local Foreign Exchange Bureau for a foreign exchange payment limit for investments on the strength of the following documents:

(1) an application: the application shall include, but not be limited to, the basic particulars of the applicant, the foreign exchange payment limit for investments that it intends to apply for, details of the single trust product for entrusted overseas financial management or the pooled trust plan for entrusted overseas financial management, etc.;

(2) the business qualification approval document from the CBRC;

(3) the draft custodian agreement;

(4) the draft trust document it intends to sign with the Settlor(s); the draft shall include the rights and obligations of the parties, the enjoyment and bearing of returns and risks, etc.; and

(5) other documents as required by the CBRC.

The SAFE shall issue an official reply granting or withholding its approval and notify the applicant in writing, with a copy to the CBRC and the local CBRC office, within 20 working days from the date of receipt of the complete set of application documents.

Article 19: A trust company may take effective measures to hedge and manage the foreign exchange risks arising from entrusted overseas financial management through means such as forward exchange settlement.

PART FIVE: ACCOUNTS AND FUND MANAGEMENT

Article 20: A trust company that engages in entrusted overseas financial management business shall adopt a custodial model that comprises a domestic custodian and an overseas custodial agent.

Article 21: A trust company that engages in entrusted overseas financial management business shall appoint a CBRC approved domestic commercial bank with custodial qualifications for overseas financial management business on the behalf of customers as its domestic custodian to keep custody of all of the assets it is to invest overseas.

Article 22: The domestic custodian shall, based on the principle of prudence and in accordance with risk management requirements and international practice, select an overseas financial institution with custody qualifications as its overseas custodial agent.

An overseas custodial agent shall satisfy the following conditions, which shall be examined by the domestic custodian:

(1) having custody qualifications recognized by the regulatory department of the country or region where it is located, or having a cooperative relationship with the domestic custodian, and not having a record of receiving major penalties in the country or region where it is located during the most recent three years;

(2) having paid-in capital of not less than US$2.5 billion or the equivalent in a freely convertible currency;

(3) having a long-term credit rating of at least 'A' or the equivalent during the most recent three years as rated by an internationally recognized rating agency;

(4) having a sound corporate governance structure, internal management systems and risk control mechanism and having a settlement and delivery system and a disaster response system that are secure and effective;

(5) its home country or region having a sound financial regulatory system, and the financial regulatory department having executed a memorandum of understanding on regulatory cooperation with and maintaining an effective regulatory cooperation relationship with the financial regulatory authority of China; and

(6) other prudential conditions as specified by the CBRC and SAFE.

Article 23: A trust company shall open custody accounts with the domestic custodian for the trust property entrusted to it for management. The domestic custodian and the overseas custodial agent must establish separate custody accounts for different trusts.

Article 24: When a trust company engages in entrusted overseas financial management business, it shall implement a separation of duties between the domestic custodian and overseas custodial agent and between the overseas custodial agent and overseas investment managers.

A trust company shall make its selection fairly in accordance with market principles. If affiliated parties of the domestic custodian are to serve as the overseas custodial agent and overseas investment manager for the entrusted overseas financial management business, the same shall be reported to the CBRC in advance.

Article 25: The domestic custodian shall open overseas accounts for application and settlement of foreign exchange funds and overseas securities custody accounts with the overseas custodial agent for the trust company's trusts for entrusted overseas financial management that shall be used for fund settlement and securities custody with the overseas securities depository and clearing institution.

Article 26: Once a trust company has received the approval document for its foreign exchange payment limit for investments from SAFE, it shall execute a custodian agreement with the domestic custodian on the strength of such approval document and open domestic custody accounts. Domestic custody accounts may contain both renminbi accounts and foreign exchange accounts. The trust company shall submit its official custodian agreement to SAFE within five working days from the date of opening of the domestic custody accounts.

Article 27: The scope of the receipts of a trust company's domestic foreign exchange custody account shall be funds transferred from the trust for entrusted overseas financial management's dedicated foreign exchange account based on the trust project for entrusted overseas financial management, funds from the domestic renminbi custody account converted into foreign exchange based on the trust project for entrusted overseas financial management, the invested principal and returns remitted back from abroad and other receipts approved by SAFE.

Article 28: The scope of the expenditures from a trust company's domestic foreign exchange custody account shall be funds remitted outward to the overseas account for application and settlement of foreign exchange funds, funds remitted back to the dedicated foreign exchange account for the trust for entrusted overseas financial management, foreign exchange funds settled based on the trust project for entrusted overseas financial management, currency conversion fees, custody fees, asset management fees and other such handling fees, as well as other expenditures approved by SAFE.

Article 29: If a trust company accepts funds in foreign exchange from Settlors for financial management overseas, it shall open with its fund receipt and payment correspondent bank a dedicated foreign exchange account for each trust project for entrusted overseas financial management, which accounts shall be used to deposit the entrusted funds for the trust product or plan and foreign exchange funds repatriated in the form of dividends from, or at the termination of, the trust product or plan, etc. The trust company shall report the opening of such account to the Foreign Exchange Bureau of the place where it is located within five working days of the opening of the account.

Article 30: The scope of the receipts of a trust company's dedicated foreign exchange account for a trust for entrusted overseas financial management shall be the trust funds in foreign exchange transferred into it by the Settlor(s), funds transferred back into it from the domestic custody account and other receipts approved by the Foreign Exchange Bureau. The scope of the expenditures from a foreign exchange trust account shall be trust funds in foreign exchange transferred back into the domestic custody account for the purpose designated in the foreign exchange trust product or plan, distributions of the trust funds in foreign exchange and the returns at the termination of the trust product or plan, withholding tax, other expenses to be borne from the trust property as specified in the trust contract and other expenditures² approved by the Foreign Exchange Bureau.

Article 31: When a trust company offers a trust plan for entrusted overseas financial management, it shall transfer the trust funds in their original currency into the domestic custody account after the conclusion of the promotion period and the establishment of the trust plan.

The purchase of foreign exchange with the renminbi funds transferred into a domestic custody account by a trust company shall be handled based on the model for the settlement and sale of foreign exchange for and to customers, and the operational procedures for appropriate payment of renminbi and receipt of foreign exchange shall be completed by the domestic custodian through the domestic custody account pursuant to a fund payment instruction. The trust company shall specify in the trust contracts executed with the Settlors the principles for determining the renminbi exchange rate used when purchasing foreign exchange with the renminbi funds.

Article 32: Where an individual resident of China uses his/her own foreign exchange funds to buy into a trust company's trust plan for entrusted overseas financial management, he/she may not use foreign currency cash directly and may only use funds in his/her foreign exchange savings account or in his/her account for the capital account. He/she may not use funds from a personal foreign exchange settlement account. Once principal and returns are remitted back, they shall be transferred into the beneficiary's foreign exchange savings account from the domestic custody account through the trust's dedicated foreign exchange account. The direct withdrawal of cash or settlement of foreign exchange is not permitted.

A domestic organization may not use debt-type foreign exchange funds to buy into a trust company's trust plan for entrusted overseas financial management. If it uses its own foreign exchange funds to do so, the principal and returns shall be remitted back into the domestic organization's original foreign exchange account from the domestic custody account through the trust's dedicated foreign exchange account.

Article 33: Upon the termination of a trust plan, a trust company shall, in accordance with the provisions of the trust document, pay the trust benefits to the beneficiary or to the person specified in the trust document.

Where an individual in China uses his/her own renminbi funds to buy into a trust company's trust plan for entrusted overseas financial management, the principal and returns may, after remittance, be paid to the beneficiary by the trust company after foreign exchange settlement or, alternatively, may be transferred to the beneficiary's foreign exchange savings account from the domestic custody account through the trust's dedicated foreign exchange account. Where a domestic organization uses its own renminbi funds to buy into a trust company's trust plan for entrusted overseas financial management, the principal and returns may, after remittance, be paid by the trust company after foreign exchange settlement or, alternatively, may be transferred to the domestic organization's domestic foreign exchange account from the domestic custody account through the trust's dedicated foreign exchange account. Matters relating to the settlement of foreign exchange shall be handled with reference to the foreign exchange purchase principles specified in Article 31.

If entrusted funds are in foreign exchange, the trust company shall transfer the principal and returns that are remitted into the dedicated foreign exchange account for the trust for entrusted overseas financial management into the account designated by the beneficiary or by the person specified in the trust document.

Article 34: In addition to its duties specified in relevant laws and regulations, a custodian shall perform the following duties:

(1) open domestic custody accounts, overseas accounts for application and settlement of foreign exchange funds and securities custody accounts for the trust company;

(2) monitor the trust company's investment operations, and if it discovers that the trust company's investment instructions violate laws or regulations, report the same to the regulatory department and SAFE in a timely manner;

(3) preserve relevant information, such as records of the trust company's outward and inward remittance of funds, currency exchanges, receipts and payments of foreign exchange and fund transactions for no less than 15 years;

(4) carry out statistical reporting of international receipts and expenditures in accordance with provisions;

(5) assist SAFE in inspecting the overseas application of funds by the trust company; and

(6) other duties specified by the regulatory department and SAFE based on the principle of prudential regulation.

Article 35: A custodian shall submit relevant reports in accordance with the following requirements:

(1) within five working days from the date of opening the domestic custody accounts, overseas accounts for application and settlement of foreign exchange funds and securities custody accounts for the trust company, submit a report to the CBRC, SAFE and the CBRC office of the place where it is located;

(2) within five working days from the date on which the trust company remits the principal outward or remits the principal and returns back, submit a report on the outward or inward remittance of the relevant funds to SAFE;

(3) within five working days after the end of each month, submit to SAFE a report on the receipts into and expenditures from the trust company's domestic custody accounts;

(4) within one month after the end of each financial year, submit to SAFE statements on the overseas application of foreign exchange funds by the trust company during the previous year;

(5) if it discovers that the investment instructions of the trust company are in violation of laws or regulations, it shall report the same to the CBRC, SAFE and the CBRC office of the place where it is located in a timely manner; and

(6) other matters to be reported as specified by the CBRC and SAFE.

Article 36: The Foreign Exchange Bureaus of the places where trust companies are located shall collate information each month on the opening and closing of domestic custody accounts and dedicated foreign exchange accounts for trusts for entrusted overseas financial management by the trust companies within their jurisdictions and submit the same to SAFE.

PART SIX: BUSINESS OPERATIONS AND RISK CONTROL

Article 37: A trust company that is to engage in entrusted overseas financial management business shall establish the appropriate risk management system and shall include management of the risks attaching to its entrusted overseas financial management business in its risk management system. The risk management system for a trust company's entrusted overseas financial management business shall cover all the risks to which its entrusted overseas financial management business is exposed and the trust company shall formulate effective control rules and regulations for the relevant risks. Risk control rules and regulations shall, at minimum, include the procedure for making investment decisions, rules and regulations for investment authorization, research reports and risk weighing, the system for performance assessment indicators, etc.

Article 38: A trust company shall establish and specify the management department responsible for its entrusted overseas financial management business, formulate management rules and regulations and specify the responsibilities of the relevant departments and personnel. It shall comprehensively regulate specific product research and development, pricing, risk management, sales, fund management and application, account treatment, distribution of returns, etc., establish and enhance relevant rules and regulations and the internal review procedure, implement strict monitoring and management of internal examinations and audits, and establish and enhance internal control and regular inspection systems.

Article 39: When a trust company engages in entrusted overseas financial management business, it shall conduct strict compliance examinations, accurately delineate the various legal relationships included in the entrusted overseas financial management business, clarify the legal and policy issues that may be involved, consider and formulate appropriate solutions and duly guard against legal risks.

Article 40: A trust company shall formulate the procedures for the research, development and design of trust projects or plans for entrusted overseas financial management, formulate the internal examination and approval procedure, clarify the principal risks and the risk management measures that are required and report the same to the regulatory department in accordance with relevant requirements.

Article 41: A trust company shall separately calculate the capital costs of, and the returns from, a trust plan for entrusted overseas financial management and use a scientific and reasonable calculation method to predict the rate of return on the financial management investment portfolio.

Article 42: A trust company shall set market risk monitoring indicators for its trust plans for entrusted overseas financial management and establish an effective market risk identification, weighing, monitoring and control system.

If a trust company treats relevant market risk monitoring indicators as termination conditions or termination reference conditions for a trust project or plan for entrusted overseas financial management, it shall clearly define, and explain the method of calculating, the relevant indicators in the trust document.

Article 43: A trust company that engages in entrusted overseas financial management business shall, when managing relevant market risks, carry out full stress testing of reforms and revisions to major finance policies, such as those on interest rates and exchange rates, assess the effect that they could have on its business activities and formulate appropriate risk handling and contingency plans.

Article 44: A trust company shall formulate an emergency response plan for its entrusted overseas financial management business and include the same in its master business emergency response plan so as to ensure the continuity and efficiency of its trust and financial management services.

Article 45: If the entrusted overseas financial management business engaged in by a trust company involves a financial management product of another financial institution, it shall conduct an assessment of the product provider's credit status, business management capabilities, market investment capabilities and risk handling capabilities, etc., clearly demarcate the rights and obligations of the parties and delineate the responsibilities for bearing relevant risks and the method of transferring the same.

Article 46: The trust company shall require the financial institution that provides the product to provide a detailed description of the product, a relevant market analysis report and a risk and return estimation report.

Article 47: If the financial management product portfolio that it offers includes a financial management product of another financial institution, the trust company shall conduct a full analysis of such product and carry out the necessary verification of the relevant risk and return forecast data for the product. The trust company shall, in accordance with the principle of prudence, prepare new descriptive materials and publicity materials for the product based on the relevant materials provided by the product provider and its own analysis of the product.

Article 48: If a trust company wishes to develop a new financial management product, it shall formulate a product development examination and approval procedure, conduct an analysis of the background and feasibility of the product to be developed, the potential target customers thereof, etc., and submit the same to senior management for approval.

Article 49: When a new product is developed, a product development report shall be prepared that shall set forth in detail the definition, nature and features of the product, the target customers, sales method, major risks and the method of estimating and controlling the same, risk limits, the authority and responsibility of the risk control department to manage the relevant risks, accounting and financial management methods, follow-up services, emergency response plan, etc.

Article 50: The trust company shall establish a system for follow-up assessments of new product risks to carry out regular assessments of the risk status of a new product after its release.

Article 51: A trust company shall, in accordance with relevant state laws and regulations and the Measures for the Accounting of Trust Business, adopt appropriate accounting and tax treatment methods based on the nature of its entrusted overseas financial management business.

If current laws and regulations are silent on a matter, a trust company shall actively communicate with the relevant department and draw up specific explanatory documents concerning the accounting and tax treatment methods it has adopted for the inspection by the relevant departments.

Article 52: If a trust company that engages in entrusted overseas financial management business discovers that a customer may be engaging in illegal acts, such as money laundering, malicious tax evasion, etc., it shall report the same to the relevant departments in accordance with relevant state provisions in a timely manner.

PART SEVEN: INFORMATION DISCLOSURE AND OVERSIGHT

Article 53: When a trust company promotes a trust plan to customers either directly or though an agent, it shall learn the customers' risk preferences, risk awareness and risk tolerance, assess their financial position, offer appropriate financial management products from which they may freely choose, explain to them the market and method of operation for the relevant investment instruments and disclose to them the relevant risks.

Article 54: When disclosing the risks attached to a trust plan for entrusted overseas financial management, a trust company shall provide the necessary explanation. The explanation shall, at minimum inform the investors of the features of the trust plan and relevant risks in full, clear, accurate, conspicuous and easily understandable language so as to ensure that the investors has a correct understanding of the contents of the risk disclosure.

Before a trust company executes the relevant contract with a customer, it shall provide the customer with an estimate of the anticipated return rate of the trust plan for entrusted overseas financial management, the method of arriving at such estimate and the main basis for the estimate.

Article 55: A trust company shall, within five working days after completion of the promotion and establishment of each trust plan for entrusted overseas financial management, disclose the total fund amount of the trust plan, the number of trust contracts, the amount of foreign exchange purchased and the amount of self-owned foreign exchange funds, etc., to the CBRC and SAFE or the CBRC office and Foreign Exchange Bureau of the place where it is located.

A trust company shall duly preserve the records on its assessment of customers, its advisory services, customer information and other documents and information.

Article 56: During the life of a trust plan for entrusted overseas financial management, the trust company shall disclose to the beneficiaries the value of the property and unit value each week at the close of trading, and submit the relevant disclosed information to the regulatory department on a quarterly basis.

A trust company shall prepare quarterly financial statements and details of the market performance of each of the investment instruments in a trust plan for entrusted overseas financial management and relevant materials. Relevant customers shall have the right to make inquiries about, or require the trust company to provide them with, the aforementioned information.

Article 57: A trust company shall provide to customers a detailed report on the investments and returns of a trust plan for entrusted overseas financial management at the time of termination of such plan or at the time of distribution of the investment returns under such plan.

Article 58: The overseas financial products purchased by a trust company must comply with relevant risk management provisions of the CBRC.

Article 59: SAFE may, as required to maintain the international balance of payments, revise the foreign exchange payment limits for investments of entrusted overseas financial management of trust companies.

Article 60: If a trust company is characterized by any of the circumstances set forth below, it shall report the same to the CBRC and SAFE within five working days after such circumstance arises:

(1) a change in its custodian or custodial agent;

(2) a material change in its registered capital and equity structure;

(3) it becomes involved in a legal action or is subjected to a major penalty; or

(4) another circumstance as specified by the CBRC and SAFE.

Article 61: If the domestic custodian of a trust company is characterized by any of the circumstances set forth below, the same shall be reported to the CBRC and SAFE within five working days after such circumstance arises:

(1) a material change in its registered capital and equity structure;

(2) it becomes involved in a legal action or is subjected to a major penalty; or

(3) another circumstance as specified by the CBRC and SAFE.

Article 62: If a trust company or its domestic custodian violates these Measures, it shall be penalized by the CBRC and SAFE in accordance with relevant laws and regulations. If the circumstances are serious, the CBRC and SAFE shall have the authority to require the trust company to replace its domestic custodian or to revoke the trust company's foreign exchange payment limits for investments of entrusted overseas financial management. If the overseas custodial agent refuses to provide relevant information, the CBRC and SAFE shall have the authority to require its replacement.

PART EIGHT: SUPPLEMENTARY PROVISIONS

Article 63: The investment by trust companies in financial products of the Hong Kong Special Administrative Region and Macao Special Administrative Region shall be handled mutatis mutandis in accordance with the relevant provisions hereof.

Article 64: The CBRC and SAFE are in charge of the interpretation hereof.

Article 65: These Measures shall be effective as of the date of issuance.

Translator's notes

1. There appears to be a typographical error in the Chinese version as it reads "business" (??). The term should be read as "obligations" (??).

2. There appears to be a typographical error in the Chinese version as it reads "receipts" (??). The term should be read as "expenditures" (??).