Article 61 The securities firm shall not provide financing or warranty to other people using the assets of the securities brokerage customers or securities assets management customers.

Section 4 Securities Assets Management Business

Article 45 A securities firm can be engaged in securities assets management business by accepting customer s entrustment or using customer s assets according to the Securities Law and this Regulation.

No units or individuals shall force, incite, assist or accept the securities firm to provide financing or warranty with the assets of the securities brokerage customers or securities assets management customers.

If a securities firm is engaged in securities assets management business, it should sign securities assets management contract with customers, defining investment scope, investment ratio, management period, management cost and so on.

4 Trade between self run securities account and securities assets management account, or among different securities assets management accounts, and has no sufficient evidence proving that it has legally realized effective separation

Article 46 A securities firm engaged in securities assets management business shall not have the following act

Securities account opened by the securities firm for securities assets management customer should be submitted to stock exchange for filing within 3 trading days.

3 Engage in unnecessary securities trade by using customer s assets

The assets custodian organs shall perform duties of safeguarding the customer s trust assets, handling the collection and payment of the funds and supervising the investment activities of the securities firm according to the provisions of the securities regulatory agency under the State Council and the securities assets management contract.

Article 58 A securities firm that carries out securities assets management business shall hand the customer trust assets over to the custody of the designated bank as stipulated in Item 4 of Article 57 of this Regulation or other assets custodian organs recognized by the securities regulatory agency under the State Council.

Article 15 If a securities firm is to be merged or divided, its major assets transfer that relates to customer s interests should be evaluated by assets evaluation agency with securities related qualification.

A description of the nature of the assets frozen (i.e. bank deposits, securities, business assets, precious commodities, works of art, real estate property and other assets) The value of assets frozen

Article 20 If a securities firm has two or more kinds of securities brokerage business, securities assets management business, financing with capital and securities, securities underwriting, securities sponsors, its board should set up remuneration and nomination committee, auditing committee and risk control committee to perform rights prescribed in company regulation.

Article 31 If a securities firm is engaged in such businesses as securities assets management and capital and securities financing, it should develop reconciliation statement and send it to customers on monthly basis.

Article 3 Shareholders and actual controllers of securities firms shall not abuse their rights, occupy assets of the securities firm or customers, or impair the legal rights of the securities firm or its customers.

Article 30 Before the securities firm signs securities dealing entrustment, securities assets management, capital and securities financing contracts with customers, it should appoint specialist to introduce business rule and contract content to customers and let customer sign and confirm on risk disclosure letter.

(2) Where a securities firm undertakes collective investments with assets of several clients or invests its client s assets in specific targeting products without any approval.

Capital contribution from shareholder of securities firms should be verified with evidence by accounting firm with related qualification of securities and futures the nonmonetary property should be evaluated by assets evaluation agency with securities related qualification.

Where the price of the transaction price is based on the assets evaluation results, the listed company shall retain assets evaluation organs with qualification for securities business to issue assets evaluation report.

Identification(s) of the person of entities whose assets have been frozen A description of the nature of the assets frozen (i.e., bank deposits securities, business assets, precious commodities, work of art, real estate property and other assets) The value of assets frozen.

Article 47 If a securities firm is engaged in collective investment by using assets of multiple customers or specially invests customer s assets into particular target products, it should comply with related prescription of the securities regulatory agency under the State Council and report to the securities regulatory agency under the State Council for approval.

Article 29 The securities firm that is engaged in securities assets management business, capital and securities financing business, securities related finance product sales should get knowledge of identity, property, income status, securities investment experience and risk preference of customers according to prescribed procedure, and record as well as keep the information in written or electronic form.

Article 15 The listed company shall retain such securities service organs as independent financial consultants, law firms and accounting firms with qualification for securities business to give opinions regarding the material assets reorganization.

(5) Where an asset management agency and a securities registration and clearing agency does not report to the securities regulatory agency of the State Council when it finds trust funds and assets and securities in secured accounts of clients are used in violation of provisions.

(2) Where any shareholder and actual holder of a securities firm force, incite, assist or accept the securities firm to provide financing or warranty with assets of stock brokerage clients or stock asset management clients

(4) Where an asset management agency and a securities registration and clearing agency approves and executes applications and instructions which use trust funds and assets and securities in secured accounts of clients in violation of provisions

(d) Inter bank payment systems, inter bank payment agreements or clearance and settlement systems relating to securities or other financial assets or instruments

The Notice of the China Securities Regulatory Commission on Several Issues Concerning Major Purchases, Sales and Exchanges of Assets by Listed Companies (No.105 2001 of the China Securities Regulatory Commission) will be repealed at the same time.

2 Assets value entrusted by customer in single transaction is lower than minimum level prescribed by the securities regulatory agency under the State Council

(2) Approving and executing applications and instructions which use trust funds and assets and securities in secured accounts of clients in violation of provisions

(b) (i) Transactions on a regulated exchange (ii) foreign exchange transactions (iii) inter bank payment systems, inter bank payment agreements or clearance and settlement systems relating to securities or other financial assets or instruments (iv) the transfer of security rights in sale, loan or holding of or agreement to repurchase securities or other financial assets or instruments held with an intermediary.

That is because global investors seeking a safe haven automatically turn to US Treasury securities in times of global financial turmoil. Foreign investors now hold more than 5.7 trillion of these low yielding securities, not to mention large quantities of other dollar assets.

(d) The transfer of security rights in sale, loan, holding of or agreement to repurchase securities or other financial assets or instruments held with an intermediary

(e) The transfer of security rights in, sale, loan or holding of or agreement to repurchase securities or other financial assets or instruments held with an intermediary

(b) The proceeds are held by the assignor for the benefit of the assignee separately and are reasonably identifiable from the assets of the assignor, such as in the case of a separate deposit or securities account containing only proceeds consisting of cash or securities.

Any units and individuals are forbidden to use the information of material assets reorganization to conduct unlawful activities such as inside dealings and manipulation of the securities market.

By offering to lend freely against collateral, they liquify assets and prevent banks from being forced to unload loans or securities at fire sale prices. Anticipating such liquidity insurance, banks can make illiquid long term loans or hold other illiquid financial assets.

Where major events occur that affect or may affect the business operation, financial status and risk control indicators of the securities firm or the safety of the customer s assets, the securities firm shall immediately submit interim report to the securities regulatory agency under the State Council, stating the cause of the events, the current status, possible consequences and corresponding measures to be taken.

The Measures are not applicable to activities of purchasing assets or making investment overseas by listed companies using the raised fund in accordance with the usage of the raised fund disclosed in the securities issuance documents approved by China Securities Regulatory Commission (hereinafter referred to the CSRC ).

The securities firm should sign entrustment contracts with securities brokers who accept such entrustment, issue securities broker certificate, define authorized scope of securities broker and supervise working behavior of securities broker.

Without securities business license, the securities firm and its domestic branch shall not run securities business.

The securities broker should have securities working qualification.

(c) Economic resources mean securities of any kind, tangible or intangible, transferable or untransferable, in particular real estate and luxury items, other than assets within the meaning of subparagraph (a)

Securities brokers should work within authorized scope of the securities firm and show securities broker certificates to customer.