(Adopted at the 6th Meeting of the Standing Committee of the Ninth National People’s Congress on December 29, 1998; amended in accordance with the Decision of the Standing Committee of the Tenth National People’s Congress on Amending the Securities Law of the People’s Republic of China adopted at its 11th Meeting on August 28, 2004; and revised by the Standing Committee of the Tenth National People’s Congress at its 18th Meeting on October 27, 2005)

Contents

Chapter I General Provisions

Chapter II Issuing of Securities

Chapter III Trading of Securities

Section 1 General Regulations

Section 2 Listing of Securities

Section 3 Continuous Disclosure of Information

Section 4 Prohibited Trading Activities

Chapter IV Acquisition of Listed Companies

Chapter V Stock Exchanges

Chapter VI Securities Companies

Chapter VII Securities Registrar and Clearance Institutions

Chapter VIII Securities Service Institutions

Chapter IX Securities Industry Association

Chapter X Securities Regulatory Authority

Chapter XI Legal Liability

Chapter XII Supplementary Provisions

Chapter I General Provisions

Article 1 This Law is enacted for the purpose of regulating the issuing and trading of securities, protecting the lawful rights and interests of investors, safeguarding the economic order and public interests of the society, and promoting the socialist market economy.

Article 2 Within the territory of the People’s Republic of China, this Law is applicable to the issuing and trading of shares, corporate bonds and such other securities as may be so described by the State Council pursuant to law; where not stipulated hereunder, the provisions of the Companies Law of People’s Republic of China and other laws and administrative regulations shall govern.

This Law shall be applicable to the listing and trading of government bonds and units of securities investment funds; where otherwise stipulated under other laws or administrative regulations, the provisions thereof shall be applicable.

The regulatory measures for the issuing and trading of the derivative varieties of securities shall be formulated by the State Council in adherence to the principles of this Law.

Article 3 The principles of openness, fairness and justice must be carried out in issuing and trading securities.

Article 4 All parties involved in the issuing and trading of securities shall stand equally in law and shall observe the principles of free will, compensation and honesty and trustworthiness.

Article 5 Securities shall be issued and traded in conformity with laws and administrative regulations. Fraud, insider trading and manipulation of the securities market are prohibited.

Article 6 The operation and administration of the securities industry shall be separated from the operation and administration of the industries of banking, trust and insurance and securities companies shall be established individually and separately from the institutions of banking, trust and insurance businesses, unless otherwise stipulated by the State.

Article 7 The securities regulatory authority under the State Council shall exercise centralized and unified regulation over the securities markets nationwide pursuant to law.

The securities regulatory authority under the State Council may establish local offices according to its needs, which shall perform regulatory functions as authorized.

Article 8 Subject to the centralized and unified regulation of the State over the issuing and trading of securities, an association of the securities industry shall be formed pursuant to law implementing self-regulatory governance.

Article 9 The State audit authority shall exercise auditing supervision over the stock exchanges, securities companies, securities registrar and clearance institutions and securities regulatory authorities pursuant to law.

Chapter II Issuing of Securities

Article 10 The conditions set forth by laws or administrative regulations must be satisfied in the public issuance of securities, and such issuance must, pursuant to law, be submitted to the securities regulatory authority under the State Council or the departments authorized by the State Council for examination and approval. Without such examination and approval pursuant to law, no entities or individuals shall issue securities publicly.

Any one of the following circumstances shall constitute a public issuance:

(1) issuing securities to non-specific persons;

(2) issuing securities to more than 200 specific persons in the aggregate; and

(3) such other issuing activities as may be so prescribed by laws or administrative regulations.

Where securities are issued in non-public manners, no advertising, public solicitation or any other covert ways in disguised form shall be employed.

Article 11 When an application is made for public issuance of shares or corporate bonds convertible into shares and such issuance shall take place by way of underwriting pursuant to law, or when an application is made for public issuance of other securities which is subject to the sponsorship system as prescribed by laws or administrative regulations, the issuer shall engage the institution with sponsorship qualifications to act as a sponsor. A sponsor shall observe business rules and industrial norms, act with integrity and good faith, discharge its responsibilities diligently and dutifully, scrupulously examine the issuer’s application documents and disclosure materials, and supervise and encourage the issuer to operate properly.

The qualifications of sponsors and the regulatory measures governing sponsors shall be formulated by the securities regulatory authority under the State Council.

Article 12 To establish a company limited by shares for public issuance of shares, the conditions set forth by the Companies Law of People’s Republic of China and such other conditions as may be so prescribed by the securities regulatory authority under the State Council and so approved by the State Council shall be met, and an application for share offering and the following documents shall be submitted to the securities regulatory authority under the State Council:

（1） the articles of association of the company;

（2） the agreement of promoters;

（3） the personal or business names of the promoters, the numbers of shares subscribed for by the promoters, the types of investment contribution and the verification documents of the investment;

（4） the prospectus;

（5） the name and address of the agent bank for the subscription funds; and

（6） the name of underwriting institution and relevant agreements.

Where a sponsor is engaged in accordance with the provisions of this Law, the instrument of sponsorship for issuance produced by such sponsor shall also be furnished.

Where the establishment of a company is subject to approval as required by laws or administrative regulations, the approving document thereof shall also be submitted accordingly.

Article 13 Where a company makes a public issuance of new shares, it shall meet the following conditions:

(1) having a sound and well-functioning organizational structure;

(2) having sustainable profitability and being financially sound;

(3) having had no false entries in its financial and accounting documents for three years immediately preceding the application, and no other major illegal activities attributable to it; and

(4) such other conditions as may be so prescribed by the securities regulatory authority under the State Council and so approved by the State Council.

Where a listed company is to make a non-public issuance of new shares, it shall meet the conditions as prescribed by the securities regulatory authority under the State Council and so approved by the State Council and it shall submit an application therefor to the securities regulatory authority under the State Council for examination and approval.