Tentative Measures for Equity Investment with Insurance Capital

Article 2: For the purposes of these Measures, the term “equity” means equity of companies limited by shares and limited liability companies lawfully established and registered in the People's Republic of China (China) and that are not publicly listed on a stock exchange in China (Enterprise Equity).

Article 3: Insurance capital may be directly or indirectly invested in Enterprise Equity (hereinafter referred to as “Direct Investment in Equity” and “Indirect Investment in Equity” respectively).

The term “Direct Investment in Equity” means the act whereby an insurance company (here and hereinafter including insurance group (holding) companies), as a contributor of capital, invests in and holds Enterprise Equity. The term “Indirect Investment in Equity” means the act whereby an insurance company invests in a financial product such as an equity investment fund (Investment Fund) promoted and established by an equity investment management institution (Investment Institution).

Article 4: For the purposes of these Measures, the term “Investment Institution” means an institution lawfully registered in China that engages in the management of equity investments.

For the purposes of these Measures, the term “professional service firm” (Service Firm) means a firm recognised by the relevant state department that has the relevant professional qualifications and that provides services such as investment advice, legal services, financial auditing and asset appraisal for the investment of insurance capital in Enterprise Equity.

Article 5: The property arising from the investment of insurance capital in an equity Investment Fund shall be separate from the property of, and other property managed by, the Investment Institution, custodian and other relevant institutions. The property and gains derived by the Investment Institution in investing, managing and disposing of the Investment Fund shall become a part of the Investment Fund property.

Article 6: When insurance capital is to be invested in Enterprise Equity, the principles of stability and safety shall be complied with, asset-liability matching management shall be adhered to, investment operations shall be run with prudence and risks shall be effectively guarded against.

Article 7: When engaging in the investment of insurance capital in Enterprise Equity, insurance companies, Investment Institutions and Service Firms shall comply with these Measures, scrupulously and earnestly perform their duties, act with due diligence, and perform their obligations in good faith, with prudence and abiding by the law.

Article 8: The CIRC is responsible for formulating the policies and regulations governing the investment of insurance capital in Enterprise Equity and exercising oversight over the investment of insurance capital in Enterprise Equity in accordance with the law.

Part Two: Qualification conditions

Article 9: An insurance company wishing to make a Direct Investment in Equity shall satisfy the following conditions:

(1) having sound corporate governance, management systems, decision-making procedures and internal controls;

(2) having a clear development strategy and market positioning, and if it is to make a material equity investment, having relatively strong acquisition integration capabilities and cross-industry management capabilities;

(3) having established an asset custody mechanism, and having compliant and transparent asset operations;

(4) its asset management department having not less than five professionals with at least three years of equity investment and related experience, and if it is to make a material equity investment, having professionals familiar with enterprise operations and management;

(5) having a solvency adequacy ratio of not less than 150% as at the end of the last financial year and, at the time of the investment, having a solvency adequacy ratio of not less than 150% as at the end of the last quarter;

(6) being profitable and having net assets of not less than Rmb1 billion during the last financial year;

(7) not having been found to have committed a major violation of laws or regulations during the most recent three years; and

(8) satisfying other prudential conditions as specified by the CIRC.

If it is to make an Indirect Investment in Equity, in addition to satisfying Items (1), (3), (5), (7) and (8) of the preceding paragraph, its asset management department shall have not less than two professionals with at least three years of equity investment and related experience.

If an insurance company is to invest in the equity of an insurance enterprise, it may be excluded from the restrictions set forth in Items (2) and (4) in the first paragraph.

For the purposes of the first paragraph, the term “material equity investment” means an investment that will grant control of the non-insurance financial enterprise or insurance business-linked enterprise into which the investment is to be made.

Article 10: If an insurance company is to invest in an equity Investment Fund, the Investment Institution that sponsored, established and manages such fund shall satisfy the following conditions:

(1) having sound corporate governance, management systems, decision-making procedures and internal controls;

(2) having registered capital of not less than Rmb100 million and having established a risk reserve system;

(3) its investment management being governed by laws, regulations and relevant policies of China;

(4) having a stable management team, having not less than 10 professionals with equity investment and related experience and who have completed the exit from not less than three projects, not less than two of those professionals having at least five years of relevant experience, not less than three having at least three years of relevant experience, and among its senior management personnel, having not less than one person with at least eight years of relevant experience; and having not less than three professionals familiar with enterprise operations, financial management and project financing;

(5) having extensive equity investment experience, the balance of assets under its management not being less than Rmb3 billion, and having outstanding historical performance and a good business reputation;

(6) having a sound project reserve system, and asset custody and risk segregation mechanisms;

(7) having established a rational incentive and constraint mechanism and investment tracking mechanism that have been effectively implemented;

(8) accepting inquiries by the CIRC with respect to investments of insurance capital and reporting relevant matters thereto;

(9) the Investment Institution and its major personnel not having been found to have committed a major violation of laws or regulations during the most recent three years; and

(10) satisfying other prudential conditions as specified by the CIRC.

Article 11: If insurance capital is to be invested in Enterprise Equity and a Service Firm is to be engaged to provide relevant services, such firm shall satisfy the following conditions:

(1) satisfying Items (1), (3), (8), (9) and (10) of Article 10 hereof;

(2) having business qualifications recognised by the relevant state department;

(3) being familiar with the laws, regulations and policies for, business procedures relating to, and transaction structures for, the investment of insurance capital in equity, having the experience and capabilities to undertake the services relating to equity investment and having a good business reputation; and

(4) not having an affiliated relationship with the parties involved in the investment of insurance capital in Enterprise Equity.

A firm providing investment advice shall, in addition to satisfying the provisions of the preceding paragraph, satisfy the following conditions:

(1) its professional team being mature and stable, and having not less than six professionals with equity investment and related experience, of whom not less than three have at least five years of relevant experience; and

(2) having registered capital of not less than Rmb2 million.

A commercial bank providing asset custody services for insurance capital shall accept inquiries by the CIRC with respect to investment of insurance capital and report relevant matters thereto.

Part Three: Subject matter of investments

Article 12: When insurance capital is to be directly or indirectly invested in the equity of an enterprise, such enterprise shall satisfy the following conditions:

(1) having been lawfully established and having legal personality;

(2) complying with state industrial policy and satisfying the qualification conditions specified by the relevant state department;

(3) its shareholders and senior management personnel having good integrity records and business reputations;

(4) its industry being in the growth stage or mature stage or being a strategic new industry, or the enterprise having an express intent to list and having a relatively high acquisition value;

(5) having market, technical, resource and competitive advantages and room for value appreciation, having expectations that it can generate good cash returns and having a clear dividend distribution system;

(6) the professional knowledge, industry expertise and management capabilities of the management team being consistent with the duties that it performs;

(7) not being involved in a material legal dispute, the title to its assets being complete and clear, and its equity or ownership being free of any legal defects;

(8) not having an affiliated relationship with the insurance company, Investment Institution or Service Firm, unless otherwise permitted by oversight provisions and the same having been reported and disclosed in advance; and

(9) satisfying other prudential conditions as specified by the CIRC.

Insurance capital may not be invested in the equity of enterprises that do not comply with state industrial policy, do not have a forecast of a stable cash flow return or asset appreciation prospects or which are highly polluting, energy hungry, do not meet state energy saving and environmental protection standards, have relatively low technology-added value, etc. Insurance capital may not be invested in venture or risk investment funds. Insurance capital may not be invested in the establishment of, or the taking of an equity interest in, Investment Institutions.

If insurance capital is to be invested in the equity of an insurance enterprise, it may be excluded from the restrictions of items (2), (4), (5) and (8).

The Direct Investment in Equity of insurance capital shall be limited solely to the equity of insurance enterprises, non-insurance financial enterprises and insurance business-linked old-age pension, medical, automobile service and other such enterprises.

Article 13: An Investment Fund into which insurance capital is to be invested shall satisfy the following conditions:

(1) the Investment Institution complying with Article 10 hereof;

(2) its investment orientation or the subject matter of investment complying with Article 12 hereof and other provisions of the financial regulator;

(3) having a clear investment objective, investment plan, investment strategy, investment standards, investment procedures, follow-up management and returns distribution and fund liquidation arrangements;

(4) its transaction structure being clear, risk warnings being sufficient and information disclosures being true and complete;

(5) having implemented an Investment Fund custody mechanism, size of the offer proceeds or funds subscribed for not being less than Rmb500 million, an exit arrangement that is expected to be practicable and sound and effective risk control measures, and being traded on a market specified by the regulatory authority; and

(6) satisfying other prudential conditions as specified by the CIRC.

Part Four: Investment code

Article 14: An insurance company wishing to invest in Enterprise Equity shall comply with the following provisions:

(1) if it is to make an equity investment that will grant it control, it shall apply capital;

(2) if it is to make another Direct Investment in Equity, it may apply capital or funds from its liability reserve that has a term matching the asset investment term;

(3) if it is to make an Indirect Investment in Equity, it may apply capital and its liability reserves for insurance products; if a life insurance company is to apply funds from universal, participating or investment-linked insurance products or a property insurance company is to apply funds from non-life investment insurance products without fixed returns, it shall satisfy the characteristics of the product and requirements of the investment plan; and

(4) it may not apply funds derived from a loan, bond issue or buyback, or borrowed on the interbank market to invest in Enterprise Equity, unless the CIRC provides otherwise with respect to the issuance of bonds.

Article 15: If an insurance company is to invest in Enterprise Equity, it shall comply with the following percentages:

(1) the book balance of its investments in the equity of unlisted enterprises may not be greater than 5% of its total assets as at the end of the previous quarter; the book value of its investments in financial products linked to the equity of unlisted enterprises, such as equity Investment Funds, may not be greater than 4% of its total assets as at the end of the previous quarter and the total of both may not be greater than 5% of its total assets as at the end of the previous quarter;

(2) the book balance of Direct Investments in Equity may not exceed its net assets, and except in the case of a material equity investment, the book balance of its investment in the equity of a single enterprise may not exceed 30% of its net assets; and

(3) the book value of its investment in one Investment Fund may not exceed 20% of the issue size of such fund.

Article 16: When it is to invest in Enterprise Equity, an insurance company shall, in accordance with oversight provisions and internal control requirements, standardise and enhance its decision-making procedure and authorisation mechanism, and determine the decision-making authority and approval authority of the shareholders' (general) meeting, board of directors and management. It shall duly make the relevant system arrangements based on factors such as its solvency, investment management capabilities and investment methods, objectives and size.

The decision-making level and executive level shall each perform its duties, make decisions prudently, act with due diligence, fully take into account the risks involved in equity investment, carefully assess the effect of the equity investment on solvency and profit level based on asset recognition standards and capital constraints, stringently carry out relevant procedures and bear liability for the decision and operation thereof. When insurance capital is to be invested in Enterprise Equity, the vote may not be taken in a manner other than in person.

If additional insurance capital is to be invested in the equity of the same enterprise, the relevant procedures shall be carried out in accordance with these Measures.

Article 17: If an investment of insurance capital in equity involves an affiliated relationship, the investment decision and specific execution procedures therefor shall accord with provisions on affiliated transactions and effective measures shall be taken to prevent shareholders, directors, supervisors, senior management personnel and other affiliated parties from using their special positions to harm the interests of the insurance company and the insured through the affiliated transaction or otherwise. Insider trading or diversion of benefits may not be engaged in.

Article 18: If a Direct Investment in Equity of insurance capital is to be made, a Service Firm satisfying Article 11 hereof shall be engaged to provide professional services such as due diligence investigation, investment advice and legal advice.

In an Indirect Investment in Equity, the investment management capabilities of the Investment Institution and the Investment Funds issued by it shall be assessed. An assessment of investment management capabilities shall, at minimum, include the contents of Article 10 hereof; and an Investment Fund assessment shall, at minimum, include the contents of Article 13 hereof.

In an Indirect Investment in Equity, the Investment Institution shall additionally be required to provide documents such as the Investment Fund prospectus or, in accordance with the provisions of the agreement, provide the relevant supporting report or due diligence report.

Article 19: When insurance capital is invested in Enterprise Equity, the rights specified in law shall be fully exercised and, through lawful and effective means, the lawful rights and interests of the insurance parties shall be safeguarded.

In a material equity investment, control over the enterprise shall be ensured and the effectiveness of the investment decision-making and of operations and management safeguarded through the nomination or appointment of directors, supervisors, members of the senior management personnel or key personnel. In other Direct Investments in Equity, lawful rights and interests of the insurance parties such as the right to know and the right to returns shall be safeguarded through participation in and influence over system arrangements, contractual provisions, transaction structure and the transaction procedure.

In an Indirect Investment in Equity, an investment contract or agreement specifying the management fee rate, performance remuneration, changes in the key personnel of the management team, replacement of the Investment Institution, handling of conflicts of interest, handling of irregular circumstances, etc. shall be executed with the Investment Institution. Additionally, information shall be exchanged with other investors in the Investment Fund, relevant reports of the fund invested in and the fund industry shall be analysed, the management situation of different Investment Institutions shall be compared and the investment acts of the Investment Fund shall be monitored through means such as communication and exchanges with the Investment Institution and on-the-spot examinations of the enterprises in which the Investment Fund invests.

If an Investment Fund takes the form of a company, it shall establish an independent director system and enhance its governance structure; if it takes the form of a contract, it shall establish a beneficiaries' general meeting; and if it takes the form of a partnership, it shall establish an investment advisory committee. In an Indirect Investment in Equity, the Investment Institution may be required to make follow-up investments at an agreed upon percentage that shall be specified in the investment contract or promotion and establishment agreement.

Article 20: When an insurance company invests in Enterprise Equity, it shall strengthen the follow-up management of the investment project during the investment term and establish a total management system with asset value appreciation and risk control as its guiding principles. In addition to implementing Article 19 hereof, the following measures shall be adopted:

(1) in a material equity investment, enterprise synergy shall be planned and developed, the enterprise's operations and management shall be improved and operational and investment risks shall be guarded against; professionals familiar with fields such as industry operations, financial management, capital markets, etc. shall be engaged, the operations and management of the enterprise shall be participated in and guided, and governance enhancement, resource integration, debt restructuring, equity optimisation, encouragement of listing and other such comprehensive measures shall be taken to increase the value of the enterprise;

(2) in other Direct Investments in Equity, specific persons shall be designated to manage each investment project, to be responsible for liaising with the enterprises' management teams, to examine the enterprises' financial and operational performance, to require the investee enterprises to regularly report on their operations and management, to stay apprised of the operational process and major decisions, to prepare analytical reports and put forth recommendations and, when necessary, to engage a Service Firm to conduct a financial audit or due diligence investigation of an investee enterprise; and

(3) in an Indirect Investment in Equity, the Investment Institution shall be required to take measures not limited to those specified in this Article so as to increase the value of the enterprises and achieve the objective of maximising returns.

Article 21: When insurance capital is invested in Enterprise Equity, the investment management fee rate and the level of performance remuneration shall be determined through consultations by referring to international practice and based on market principles, and the same shall be specified in the investment contract. An Investment Institution shall comprehensively consider factors such as asset quality, and investment risks and returns in determining its investment management fee rate, realise the performance remuneration level, promote positive incentives and guidance and guard against adverse choices and moral hazard.

Article 22: When insurance capital is invested in Enterprise Equity, a Service Firm satisfying Article 11 hereof shall be engaged to use two or more internationally recognised valuation and appraisal methods to value and conduct stress tests on the invested equity assets on an ongoing basis, arrive at prudent and reasonable valuation results and report the same to the CIRC. The valuation methods shall include but not be limited to the asset-based book value method, replacement cost method, market comparison approach, discounted cash flow method and multiples method.

Article 23: When insurance capital is invested in Enterprise Equity, these Measures and related provisions shall be complied with, social responsibility shall be assumed, ethical codes shall be scrupulously adhered to and the environment shall be fully protected so that the investor acts as a responsible institutional investor.

Part Five: Risk control

Article 24: When insurance capital is invested in Enterprise Equity, emphasis shall be placed on fundamental structures such as the investment management systems, risk control mechanism, code of investment conduct and incentive and constraint arrangements, business procedures such as project assessment, investment decision-making, risk control, asset custody, follow-up management, emergency response, etc. shall be established, risk budgeting management policies and crisis solutions shall be formulated, comprehensive risk management and ongoing risk monitoring shall be implemented and operational risks and moral hazard shall be guarded against.

Article 25: When an insurance company invests in Enterprise Equity, it shall prudently consider solvency and liquidity requirements, rationally apply capital based on the characteristics of its insurance products, capital structure, liability matching management requirements and relevant oversight provisions, allocate assets in a diversified manner and spread investment risks.

Article 26: When insurance capital is invested in Enterprise Equity, these Measures and related provisions shall be complied with so as to ensure that the investment project and operation method are lawful and compliant. The investee enterprise shall be compliant with state laws and regulations and these Measures and satisfy all of the important conditions for running a business.

Article 27: When insurance capital is invested in Enterprise Equity, a mechanism for responding to major contingencies shall be established. The emergency response mechanism shall include but not be limited to risk situations, contingency plan, work objectives, reporting hierarchy, operational procedure, handling measures, etc. and, when necessary, the emergency response mechanism shall be promptly activated so as to control and minimise losses to the greatest extent possible.

An insurance company shall establish a liability pursuit system, and when a member of the senior management personnel or major business personnel violates oversight provisions or the company's management systems, or fails to perform or fails to correctly perform his or her duties, thereby causing an asset loss, his or her liability shall be pursued. If a member of the senior management personnel or major business personnel of other than an insurance institution is involved, the insurance company shall pursue his or her liability in accordance with relevant provisions and the contract.

Article 28: When insurance capital is invested in Enterprise Equity, an effective exit mechanism shall be established. Exit methods shall include but not be limited to listing, buyback and transfer by agreement of the enterprise's equity, trading or liquidation of the Investment Fund, etc.

When insurance capital is invested in Enterprise Equity, the entry may be effected through a debt for equity swap and the exit may be effected through an equity for debt swap.

Article 29: When an insurance company invests in Enterprise Equity, it shall require the Investment Institution to perform its obligation of disclosing information to it and relevant parties in accordance with relevant provisions and the contract. Information disclosure shall at minimum include information on the investment team, investment operation, project operation, asset value, follow-up management, changes in key personnel, as well as the operations, management, main risks and material events of the investee enterprise. Material events include but are not limited to equity disputes, debt disputes, legal actions, etc.

Information disclosure may not contain false or misleading statements, material omissions or fraud. An Investment Institution shall be legally liable for the timeliness, accuracy, truthfulness and completeness of information disclosure.

Part Six: Oversight

Article 30: An insurance company wishing to make a material equity investment shall apply to the CIRC for check and approval, and submit the following written materials:

(1) the resolution on the investment adopted by the shareholders' (general) meeting or board of directors;

(2) the main business plan, size of the investment and an account as to the extent the businesses are related;

(3) the financial advice report, due diligence report and legal opinion provided by the Service Firms;

(4) an investment feasibility study report, compliance report, affiliated transaction explanation, follow-up management plan and business integration plan;

(5) an account of the examination of the shareholders' qualifications by the regulatory department or the recognition of their qualifications by the authority in charge;

(6) a description of the investment team and its management experience;

(7) the investment agreement with its conditions for entry into effect, particularly noting that it will enter into effect after approval by the relevant regulatory authority or department; and

(8) other prudential information as specified by the CIRC.

If any of the following circumstances arises and applies to the proposed investee enterprise while the CIRC is conducting its examination, the CIRC may require the insurance company to halt the equity investment:

(1) it suffers or is facing a significant loss, significant civil damages, change in tax policies or other such material adverse financial event;

(2) it suffers or is facing a great loss of core business personnel, loss of its target market or core business competitiveness or other such material adverse change;

(3) a relevant authority imposes major punitive regulatory measures against it; or

(4) another adverse event that the CIRC believes could have a material impact on the investment arises.

For a transfer of the equity in, or the exit from, a material equity investment, a report shall be submitted to the CIRC explaining the reason and the plan for the transfer or exit and be accompanied by the relevant resolutions of the shareholders' (general) meeting or board of directors.

Article 31: An insurance company wishing to make a non-material equity investment or investment in an Investment Fund shall submit a report to the CIRC within five working days after execution of the investment agreement and, in addition to submitting the items specified in Items (3), (6) and (8) of Article30 hereof, shall submit the following materials:

(1) the investment resolution adopted by the board of directors or the body authorised by it;

(2) an investment feasibility study report, compliance report, affiliated transaction explanation, follow-up management plan, legal opinion and the investment agreement or subscription agreement; and

(3) the report on the assessment of the Investment Institution and the Investment Fund.

If the CIRC discovers that an investment act violates a law, regulations or these Measures, it has the right to order the insurance company to rectify the same.

Article 32: When an insurance company invests in Enterprise Equity, it shall, within 15 working days after the end of each quarter and by March 31 of each year, submit quarterly reports and an annual report to the CIRC accompanied by the following information in writing:

(1) investment details;

(2) application of capital;

(3) asset management and operation;

(4) asset valuation;

(5) asset quality and principal risks;

(6) material contingencies and the handling thereof; and

(7) other prudential information as specified by the CIRC.

In addition to the foregoing information, the annual report shall also provide information on investment returns and distribution thereof, asset recognition and changes in solvency and investment capacity, etc., and be accompanied by the relevant reports audited by a Service Firm.

Article 33: An Investment Institution shall submit to the CIRC annual reports on the investment of insurance capital in equity Investment Funds by March 31 of each year.

Article 34: A custodian shall, within 15 working days after the end of each quarter and by March 31 of each year, submit quarterly reports and an annual report on the investment of insurance capital in Enterprise Equity and Investment Funds to the CIRC accompanied by the following materials:

(1) details of the investment of insurance capital;

(2) details of the lawfulness and compliance of investments;

(3) irregular transactions and matters that require attention;

(4) details of asset valuations;

(5) principal risk factors;

(6) details of affiliated transactions; and

(7) other prudential information as specified by the CIRC.

Article 35: When the CIRC formulates equity investment capacity standards, insurance companies and relevant Investment Institutions shall carry out assessments themselves based on such standards and submit the assessment reports to the CIRC. The CIRC will inspect and closely monitor the equity investment capacity of insurance companies and relevant Investment Institutions.

In line with market requirements, the CIRC may suitably revise investment percentages, qualification conditions of relevant parties and the materials to be submitted. The relevant materials submitted to the CIRC by parties involved in the investment of insurance capital in Enterprise Equity shall comply with oversight provisions and such parties shall be liable for the truthfulness of the materials.

Article 36: The CIRC will conduct onsite oversight and offsite oversight of the investment of insurance capital in Enterprise Equity in accordance with the law and, when necessary, may engage Service Firms to assist it in its inspections.

If the solvency of an insurance company that invests in Enterprise Equity becomes inadequate, such company experiences material operational problems, faces material investment risks or could have an adverse effect on the financial system, financial industry or financial market, the CIRC shall take regulatory measures against it such as suspending its investment business, limiting its investment percentages, replacing its investment personnel, ordering it to dispose of its equity assets, restricting the distribution of dividends to shareholders and the remuneration of senior management personnel as specified in relevant laws and regulations. If an insurance company, after investing in Enterprise Equity, fails to satisfy the provisions of Article 9 on an ongoing basis, the CIRC shall order it to rectify the matter.

The CIRC will not, in accordance with relevant provisions, count Enterprise Equity assets invested in in violation of regulations as part of recognised assets. If, due to a non-subjective factor, such as a contingency or market change, the percentage of an investment in Enterprise Equity exceeds that specified herein, the insurance company shall adjust such investment percentage in accordance with provisions within three months. The standards and methods for asset appraisals and rules on risk factors relating to the investment of insurance capital in Enterprise Equity will be formulated separately by the CIRC.

Article 37: If it is discovered, while a member of the senior management personnel or major business personnel is in the employment of an insurance company or after he or she leaves such company, that he or she violated a relevant law, administrative regulations or these Measures in investing in Enterprise Equity while working for the company, the CIRC will pursue his or her liability in accordance with the law.

If an Investment Institution or Service Firm, in participating in equity investment with insurance capital, violates a relevant law, administrative regulations or these Measures, the CIRC shall have the right to record a demerit and report relevant matters to its regulatory department or department in charge. If the circumstances are serious, the CIRC will order the insurance company to halt its business with such firm and discuss with the relevant regulatory department or department in charge on the imposition of administrative penalties in accordance with the law.

An insurance company may not have business dealings with an Investment Institution or Service Firm included on the list of entities with records of improper activity.

Part Seven: Supplementary provisions

Article 38: An insurance asset management firm satisfying Items (1), (3), (7) and (8) of Article 9 hereof, that was profitable during the preceding financial year and that has net assets of not less than Rmb500 million may directly invest capital in the equity of non-insurance financial enterprises.

Article 39: The investment of insurance capital in the equity of unlisted overseas enterprises shall be handled in accordance with the Tentative Measures for the Administration of Overseas Investment of Insurance Capital and relevant CIRC provisions. When insurance capital is invested in the equity of both domestic and overseas unlisted enterprises and financial products linked to the equity of unlisted enterprises, the investment percentages shall be calculated together.

The investment of insurance capital in the equity of infrastructure enterprises shall be handled in accordance with relevant provisions hereof.

In the event of a discrepancy between these Measures and existing provisions on equity investment with insurance capital, these Measures shall prevail.

Where other provisions govern the scope and percentages of the investment of its own capital by an insurance group (holding) company that does not engage in insurance business, such provisions shall be complied with.

Article 40: The CIRC is in charge of interpreting and revising these Measures. These Measures shall be effective as of the date of issuance.