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Detailed Operating Rules for Acceptance of Transfer Applications

  Article 1 The Detailed Operating Rules for Acceptance of Transfer Applications were promulgated based on the Operating Rules for Transactions of Enterprises’ State-owned Property Rights in order to standardize the information release behaviors for the transactions of enterprises’ state-owned property rights.

   Article 2 The transaction agencies shall adopt commission system. The transferor can independently select a broker member in list of broker members released on website of the transaction agencies and sign commission contract with the broker member to establish commission relationships.

   Article 3 The transferor shall submit the application for transfer of property rights to the transaction agencies through broker member, submit the Application for Transfer of Property Rights, the Notice on Transfer of Property Rights and related materials, and entrust the transaction agencies to release the information on transfer of property rights publicly.

   If the information on transfer of property rights should be filed before information release in line with related regulations, the transferor shall complete the filing procedures.

   Article 4 The Application for Release of Information on Transfer of Property Rights shall clearly specify the right and obligation relationships as well as related liabilities for breach of contracts between the transferor, the entrusted broker member and the transaction agencies.

   Article 5 The transferor shall be responsible for faithfulness, completeness and effectiveness of the contents in the Application for Release of Information on Transfer of Property Rights and the Notice on Transfer of Property Rights, as well as materials submitted.

   Article 6 Broker member of the transferor shall conduct due diligence investigation on items released by it under the entrustment of the transferor, and shall review the faithfulness, completeness, effectiveness and law-compliance of materials submitted by the transferor. The investigation shall mainly include:

  (1)    Whether the information released is faithful and complete, and are these any major misses, fraud records or misguiding statements;

  (2)    Whether the contents of the information release are consistent with related attached materials;

  (3)     Whether attached materials of the information release are legal and effective, are there any standardization issues, and are they comply with related regulations on transfer of enterprises’ state-owned property rights.

   Article 7 If the Application for Transfer of Property Rights submitted by the transferor and attached materials comply with the completeness requirements, the transaction agencies shall accept and register the applications, and issue the Notice on Receiving the Application Materials for Release of Information on Transfer of Property Rights. If the completeness requirements are not satisfied, the transaction agencies can require the transferor to supplement the materials or re-submit the application through its broker member.

   Article 8 The transaction agencies shall review the law-compliance of the Application for Release of Information on Transfer of Property Rights and its attached materials within three days upon receiving the application materials for information release. The review shall focus on sufficiency and accuracy of the information release of transfer object in the Notice on Transfer of Property Rights, fairness and reasonability of the transaction conditions and qualification requirements of the transferees, as well as selection of the price competition methods. If the information requirements are satisfied, the transaction agencies shall issue the Notice on Acceptance of the Application for Information Release on Transfer of Property Rights, and issue the Notice on Transfer of Property Rights. If the information requirements are not satisfied, the transaction agencies shall inform the transferees the reviewing opinions through the broker member.

   Article 9 The transferor shall disclose the basic information of transfer objects, transaction conditions, qualifications of transferees, information that may have great influences on property rights transactions, selection of price competition mode and setup of transaction deposit in the Notice on Transfer of Property Rights in line with the plans for transfer of property rights made and approved through international decision-making procedures.

   Article 10 The Notice on Transfer of Property Rights shall include but not limited to following basic information of the transfer object:

  (1) Name of the transferor, transfer object and entrusted broker member;

  (2) Nature, foundation date, registration place, industry, main business, registered capital and number of employees of the transfer objects;

  (3) Nature of the transferors and their investment proportion in the transfer objects;

  (4) Name and investment proportion of top 10 investors of the transfer objects;

  (5) Main financial figures in audit report of the latest year and the latest financial reports of the transfer objects, such as owners’ equities, liabilities, operating revenue and net profits;

  (6) Filing or approval of assets appraisal of the transfer objects (enterprises of the transfer objects), appraisal value of total assets, total liabilities and net assets in the assets appraisal report and audited book values correspondingly;

  (7) Internal decisions and approval conditions of property rights transferring behaviors.

   Article 11 The transferors shall clearly specify, in the notice on transfer of property rights, the main transaction conditions need to be accepted by the transferees. These include but not limited to

  (1) Listing price of the transfer objects, payment method and time limit;

  (2) Are there any requirements on continuous employment of employees in the transfer objects;

  (3) Requirements on disposal of creditors’ rights and liabilities involved in the transfer of property rights;

  (4) Requirements on continuous development of the transfer objects.

   Article 12 The transferor can, based on practical situations of the transfer object, set requirements on qualifications of the transferees reasonably. The requirements on qualifications of the transferees shall not include any contents with clear direction or violate the rules of fair competition. The transaction agencies, when deem as necessary, can require the transferor to provide written explanation or detailed descriptions to judging standards for qualifications of the transferees, which shall be released in the Notice on Transfer of Propriety Rights after being reviewed and approved by the transaction agencies.

  The qualifications of the transferees can include main body qualifications, management ability and asset scale.

   Article 13 The transferors shall fully disclose related information that may have key influences on property rights transaction in the notice on transfer of property rights. The information shall include but not limited to:

  (1) Whether the audit reports or the appraisal reports have qualified opinions or important cues;

  (2) If the members of the management team or its correlated parties are to be involved in the transfer, information such as their shareholding proportion of the transfer object, list of persons or companies to be involved in the transfer of state-owned property rights, and the proportion of shares to be transferred.

  (3) Whether other shareholders of the limited liability companies or other parties of the joint venture had given up the right of preemption.

   Article 14 The transferor clearly indicate in the Notice on Transfer of Property Rights that what kind of fair price competition mode to be adopted when there are two or more qualified interested transferees. If the bidding mode is selected, the bid assessing methods and standards shall also be disclosed.

   Article 15 The transferors can put forward the requirements on payment of transaction deposit in the notice on transfer of property rights in line with related regulations. The amount of deposit shall be no less than 30% of the listing price of the transfer object.

   Article 16 The Rules shall take effects as of the promulgation.