February 4, 2006 

Dep ar t ment  of International Cooperation

(Zheng Jian Fa Yin [1999] No.126, approved by the State Council on September 6, 1999 and published by the China Securities Regulatory Commission on September 21, 1999)

T o ensure the orderly listing of domestic enterprises on the Growth Enterprise Board of Hong Kong (GEM HK), all state-owned enterprises, collectively-owned enterprises and enterprises in other patterns of ownership that conform to the conditions in the Guideline may, upon the establishment of the companies limited by shares, voluntarily assign the listing sponsors to apply to the China Securities Regulatory Commission (CSRC) for examination and approval according to the legal procedures. Once all the conditions are met, they will get the approval.

1. Conditions of applications for listing on the GEM HK by domestic enterprises

(1) a company limited by shares established according to law upon the approval of a provincial people ’ s government or the  State Economic and Trade Commission (SETC)  and under standardized  operation  (hereinafter shortened as the company);

(2) the company and its major sponsor abiding by the relevant state rules and policies, without significant violations in the last two years;

(3) in accordance with the conditions in the listing rules of GEM HK;

(4) with a listing sponsor who believes that the company ’ s stock issuance and listing is feasible, and assumes the sponsorship responsibilities according to regulation; and

(5) high-tech enterprises approved by the Ministry of Science and Technology shall have priority.

2. Documents to be submitted to the CSRC for applications for listing on the GEM HK by domestic enterprises

D omestic enterprises that apply for listing on the GEM HK shall submit the following documents to the CSRC:

(1) application report, including the company ’ s evolution, business introduction, equity structure, fund-raising usage and operational risk analysis, business development goal and fund-raising cost analysis;

(2) analysis opinions and underwriting intention report issued by the listing sponsor regarding the feasibility of stock issuance and listing of the company;

(3) approval documents of the company ’ s establishment ;

(4)  legal opinion s issued by domestic law firms  with qualifications for securities business  regarding whether the company and its major sponsor conform to the relevant state rules and policies and whether there are significant violations in the last two years (formulated accord ing  to  the “Rules No. 6  on Contents and Format of Information Disclosure by Companies Publicly Issuing S tock s  (Contents and Format of Legal Opinions));

(5) audit report issued by the accounting firm regarding the company ’ s accounting statements compiled according to China accounting standards and the accounting system of companies limited by shares and adjusted according to the international accounting standards;

(6)  approval documents  of state-owned assets management by  state-owned assets management authority  for company with  state-owned equity ; 

(7) relatively complete prospectus; and 

(8) other documents required by the CSRC.

3. Examination and approval procedures of applications for listing on the GEM HK by domestic enterprises

(1) 3 months before submitting the listing applications to the Hong Kong Exchanges and Clearing Limited (HKEx), the sponsor shall submit the documents required in Item (1) to (3) of Section 2 in the Guideline (in  quadruplicate , with one original) to the CSRC on behalf of the company, and send copies to relevant departments of provincial people ’ s government and the State Council.  I f relevant government authorities have objection, they may inform the CSRC in written form within 15 working days after receiving the company ’ s application documents.

(2) The CSRC shall discuss with the SETC regarding whether the company conforms to the state industry policies, foreign capital introduction policies and other relevant rules.

(3) After preliminary examination, the CSRC ’ s  Dep artment  of Public Offering Supervision  shall, within 20 working days since the day of receiving the above application documents, inform the company in letter whether it officially accepts the application and send copies to the Ministry of Finance (MOF), the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) as well as the State Administration of Foreign Exchange (SAFE); if it doesn ’ t accept the application, it shall specify the reasons.

(4) For a company whose application has been accepted by the CSRC, it shall submit the documents required in Item (4) to (8) of Section 2 in the Guideline (in du plicate , with one original) to the CSRC; the CSRC shall approve within 10 working days if the application documents are complete and comply to regulations upon examination, with no written objections by the MOFTEC, the SAFE, the MOF (if state-owned equity is involved) and other authorities; if the CSRC doesn ’ t approve the application, it shall specify the reasons.  T he company may apply for listing in GEM HK to the HKEx upon approval.

4. Supervision after listing

A fter listing on the GEM HK of domestic companies, the CSRC shall conduct supervision according to the requirements of the  memo on regulatory cooperation  and the supplementary provision signed with  Hong Kong's Securities and Futures Commission .

5.  Other  relevant issues

(1) The listing sponsor approved by the HKEx can serve as the sponsor for the listing of domestic enterprises on the GEM HK.  I n case of violations of regulations or other misconduct, the CSRC may decide whether to accept the listing application by the sponsor on behalf of the company  in line with the seriousness of cases . 

(2) The company whose application has been officially accepted by the CSRC shall, upon the confirmation of domestic and overseas intermediaries, report the name list of relevant intermediaries to the CSRC for record.

(3) The company shall submit the public information disclosure documents concerning the stock issuance and listing as well as the summary to the CSRC for record within 15 working days since the listing.

(4) The company shall abide by the relevant state rules of foreign exchange management.