Measures for the Administration of the Registration of Capital Contribution in the Form of Equity

(Promulgated by the State Administration for Industry and Commerce on January 14 2009 and effective as of March 1 2009.)

Order of the SAIC No.39

Article 1: These Measures have been formulated pursuant to laws and regulations such as the Company Law and the Regulations for the Administration of Company Registration in order to regulate the registration of capital contribution in the form of equity.

Article 2: The administration of the registration of capital contribution whereby investors, by using their equity in limited liability companies or companies limited by shares established in China (hereinafter collectively referred to as Equity Companies) as capital contribution, invest in other limited liability companies or companies limited by shares in China (hereinafter collectively referred to as Investee Companies) shall be governed by these Measures.

Article 3: Equity ownership that is to be used as capital contribution shall be clear, rights thereof shall be unencumbered and such equity shall be capable of being transferred in accordance with the law.

Equity may not be used as capital contribution if:

(1) the registered capital of the Equity Company has not been paid in full;

(2) a pledge has been created over the equity;

(3) the equity has been frozen in accordance with the law;

(4) the articles of association of the Equity Company specify that the equity may not be transferred;

(5) a law, a set of administrative regulations or a decision of the State Council specifies that shareholders of the Equity Company require approval to transfer their equity and such approval has not been obtained; or

(6) another circumstance as specified in laws, administrative regulations or a decision of the State Council under which such transfer is prohibited applies.

Article 4: The total of the amount of capital contribution in the form of valuated equity and of capital contribution in the form of other valuated non-monetary property by all of the shareholders may not exceed 70% of the registered capital of the Investee Company.

Article 5: Equity that is to be used for capital contribution shall have been appraised by a lawfully established appraisal firm.

Article 6: If, at the time of the establishment of a company, an investor makes its capital contribution in the form of equity, it shall pay in such capital contribution within one year of the establishment date of the Investee Company. The Investee Company shall then carry out the procedures for the registration of the change in its paid-in capital.

If, when a company increases its registered capital, an investor makes its capital contribution thereto in the form of equity, it shall pay in such contribution before the Investee Company applies for the registration of the change arising from an increase in its registered capital.

Article 7: If an investor pays in its capital contribution in the form of equity it holds in a limited liability company, the Equity Company shall apply to the company registration authority for registration of the change in the holder of the equity to the Investee Company.

If an investor pays in its capital contribution in the form of equity it holds in a company limited by shares and such equity is registered with a depository and clearing institution, the procedures for registration of the equity transfer and change in ownership shall be carried out with the stock exchange and the depository and clearing institution in accordance with provisions. Other equity shall be transferred to the Investee Company by the statutorily prescribed method.

If it is specified in laws, administrative regulations or a decision of the State Council that the shareholders of the Equity Company require approval to transfer their equity, such approval shall additionally be obtained in accordance with the law.

Article 8: Once a capital contribution made in the form of equity has been paid in, it shall be verified by a lawfully established capital verification institution which shall issue a capital verification certificate.

The capital verification certificate shall contain the following information:

(1) information on the registration of the change in the holder of the relevant equity carried out in accordance with Article 7 hereof, if the capital contribution is made in the form of equity in a limited liability company;

(2) information on the transfer of the relevant equity to the Investee Company carried out in accordance with Article 7 hereof, if the capital contribution is made in the form of equity in a company limited by shares;

(3) information on the appraisal of the equity, including the name of the appraisal firm, the number of the appraisal report, the reference date of the appraisal, the appraised value, etc.; and

(4) if the capital contribution made in the form of equity requires approval in accordance with the law, information on such approval.

Article 9: If an investor, at the time of the establishment of a company, makes, in accordance with the law, its capital contribution in the form of equity, the Investee Company shall, when carrying out the procedure for the registration of its establishment, carry out the procedures for the registration of the name of the investor that subscribed for the capital contribution to be made in the form of equity, the capital contribution amount, the method of capital contribution and the capital contribution date. After the investor has paid in the capital contribution in the form of equity, the Investee Company shall apply for the registration of the change in its paid-in capital and, if the Investee Company is a limited liability company or a company limited by shares established by way of sponsorship, it shall additionally apply for the registration of the change in the relevant investor's paid-in capital contribution amount and capital contribution date, etc.

If an investor, when a company increases its registered capital, pays in its capital contribution in the form of equity, the Investee Company shall apply for the registration of the change in its registered capital and paid-in capital. If the Investee Company is a limited liability company, it shall additionally apply for the registration of the name of the investor and the change in the amount of its subscribed for and paid-in capital contribution and capital contribution date, etc.

Article 10: The materials to be submitted by an Equity Company when applying for relevant registration in accordance with Article 7 hereof shall be handled in accordance with the Regulations for the Administration of Company Registration and provisions of the State Administration for Industry and Commerce on materials to be submitted for company registration.

Article 11: When applying for relevant registration in accordance with Article 9 hereof, an Investee Company shall, in addition to handling matters in accordance with the Regulations for the Administration of Company Registration and provisions of the State Administration for Industry and Commerce on materials to be submitted for company registration, submit the following materials:

(1) an undertaking for a subscription for capital contribution in the form of equity signed by the investor making its contribution in the form of equity; the relevant investor shall give an undertaking that the equity with which the capital contribution is subscribed for complies with the first paragraph of Article 3 hereof and that none of the circumstances specified in the second paragraph of said Article applies thereto; and

(2) a photocopy of the business licence of the Equity Company (bearing the seal of the Equity Company).

Article 12: If an act by an investor or the Investee Company relating to capital contribution in the form of equity violates the Company Law, the Regulations for the Administration of Company Registration or these Measures, or if a capital verification institution or an appraisal firm issues a fraudulent evidentiary document or, due to negligence, issues a report with material omissions, the company registration authority shall investigate and handle the matter in accordance with relevant provisions specified in the Company Law, Regulations for the Administration of Company Registration, etc.

Article 13: If a law, a set of administrative regulations or a decision of the State Council provides otherwise in respect of a matter addressed herein, such law, set of administrative regulations or decision of the State Council shall apply.

Article 14: These Measures shall be effective as of March 1 2009.