(Promulgated by the People's Bank of China on September 28, 1987)

(Promulgated by the People's Bank of China on September 28, 1987) Whole Doc.

Article 1 These Provisions are hereby formulated with a view to utilizing foreign investment, supporting the development of national economy, assuring the raise of funds on the international financial market based on a plan, making a rational arrangement for use of borrowed funds and strengthening the control of issuing bonds abroad.

Article 2 Legal entities which are registered in China (hereinafter referred to as "institute within China" shall abide by these Provisions in respect of issuing bonds abroad.

Article 3 The head office of the People's Bank of China is the examination and approval authority in charge of issuing bonds abroad. The State Administration of Exchange Control and its branch offices (hereinafter referred to as "exchange control authorities") are the organs regulating the issue of bonds abroad by resident institutions, and shall take the responsibility of examining, adjusting and supervising the issue of bonds and controlling the use and repayment of the raised funds.

Article 4 In need of issuing bonds abroad, resident institutions shall make a written application to the local exchange control authority and submit relevant documents and materials in light of Articles 6, 7 and 8 of these Provisions. with suggestions made by the local exchange control authority upon examination, the application shall be subject to the check-up by the State control Administration of exchange and approval by the head office of the People's Bank of China.

Article 5 In applying for issuing bonds abroad, resident institutions shall submit the following documents and materials: 1) the report on business, finance and the status of receipt and disbursement of foreign exchange of bonds issuing institution within the recent consecutive three years; 2) matters as the market, types, amount, forms of currency, length, interest rate and various expenditure of bonds issued; 3) the status of main secretaries in charge and main entrusted banks; 4) controlling methods for the funds raised through issuing bonds and for exchange rate and rate risk; 5) arrangements of bond issuing institutions for paying back principal plus interest of bonds; Article 6 In case that funds raised through issuing bonds are to be used for fixed assets investment, the following materials shall also be provided: 1) feasibility report on investment project; 2) documentation which shows that the plan about fixed assets investment has been brought into line of the state's or local plan; 3) documentation of necessary Renminbi (RMB) Funds and necessary goods and materials; 4) the plan for utilizing the funds raised through issuing bonds.

Article 7 In the event that funds raised through issuing bonds are to be relent to domestic enterprises, the applicants shall present the following materials in the meanwhile: 1) reports on conditions for the business, finance and receipts and expenditure of foreign exchange of the domestic enterprises; 2) reports on the purpose of the loan used by the domestic enterprise and its necessary Renminbi funds and necessary goods and materials; 3) the document testifying that the borrowed funds which are used for the investment in fixed assets have been brought into line of the state's or local plan; 4) arrangement for the use and repayment of the funds borrowed by the domestic enterprise; 5) feasibility report of such domestic enterprise on the project for investment in fixed assets; 6) a loan agreement signed between the bond issuer and the borrower.

Article 8 If the issuance of bonds is entrusted by a domestic institution, the following documents and materials shall be provided upon application by the entrusted institution and the local exchange control authority respectively: 1) bonds agreement signed between the entrusting and entrusted institutions, being submitted by the entrusted party; 2) relevant documents and materials submitted by the entrusted institution according to these Provisions; 3) examination reports on issuing bonds in entrusting and entrusted ways, which shall be presented respectively by the local exchange control authorities where the entrusting and entrusted institutions are located, in light of relevant provisions of the State Administration of Exchange Control.

Article 9 If in need of application for grading, the institution which issues bonds abroad for the first time, shall present the exchange control authority a written application with materials concerning the name of the institution for grading, materials useful for grading, grading procedures, etc. the issuing institution shall not apply for grading abroad until the approval is given, The issuing institution shall make a report on the grading results to the exchange control authority within 3 days after the grading. The head office of the People's Bank of China shall, in light of the results of grading, decide to approve its issue of bonds or not. In need of another grading, the institution shall give a report on the results and reasons of the grading to the exchange control authority if the results of grading differ from that of the last time.

Article 10 If the bonds are issued for the need of its own operation of the issuing institution, such funds raised shall be used for the purpose as approved, and the issuing institution shall take the full responsibility of paying off the principal and interest of bonds.

Article 11 In case the issue of bonds is entrusted by a local government, the raised funds shall be used for the projects arranged by the local government, and the repayment of principal plus interest is brought into line with the local plan for the expenditure of foreign exchange. The local government shall be responsible for the repayment.

Article 12 If the issue of bonds is entrusted by the State, the raised funds shall be used according to the State arrangements and the repayment of the principal and interests is brought into line with the State plan for the expenses of foreign exchange, The State shall undertake the responsibility of the repayment.

Article 13 The bond issuing institution shall report the conditions of the issuing to the exchange control authority, the same day on which bonds are issued and file the documents and materials concerning the issue (including the directions for the issuing of bonds, etc.) with the exchange control authority within 20 days after the issue.

Article 14 If the bonds are to be marketed in a financial market other than the place in which the bonds are issued after the issuance, the issuing institution shall in advance report it to the exchange control authority for the record, and shall provide a report to the exchange control authority at any time when there are any changes in price after the bonds went on the market.

Article 15 After the bonds are issued, the issuing institution shall, in the light of requirement of the exchange control authority, submit quarterly the reports concerning the use of the funds, operation of the investment and loan project and the repayment of the funds. If the purpose of the using the funds is necessary to be changed, the issuing institution shall obtain the consent from the exchange control authority in advance.

Article 16 The exchange control authority has the right to examine the use and repayment of the funds, and the issuing institution shall cooperate with the exchange control authority, presenting relevant documents and materials.

Article 17 In case of violation of these Provisions, the exchange control authority may make the punishment of disciplinary warning, fining and even canceling the qualification for issuing bonds according to the seriousness of the case.

Article 18 The authority to interpret these Provisions resides in the State Administration of Exchange Control.