Articles of Association of
                    China Petroleum & Chemical Corporation

    (Approved by the extraordinary shareholders' meeting on April 22, 2003;
 approved by the State-owned Assets Administration Commission on June 5, 2003)

                         CHAPTER 1 GENERAL PROVISIONS

Article 1       These Articles of Association are drawn up in accordance with
                the "Company Law of the People's Republic of China" (the
                "Company Law"), "Special regulations of the State Council
                regarding the issue of shares overseas and the listing of
                shares overseas by companies limited by share" (the "Special
                Regulations"), "Mandatory provisions for the Articles of
                Association of the Company to be Listed Overseas" ("Mandatory
                Provisions"), "Guidelines for Articles of Association of
                Listed Companies", "Standards for the Governance of Listed
                Companies" and other relevant laws and regulations to maintain
                the legitimate interests of China Petroleum & Chemical
                Corporation (the "Company") and its shareholders and
                creditors, and to regulate the organization and conducts of
                the Company.

Article 2       These Articles of Association of the Company are effective
                on the date of incorporation of the Company. Any amendment to
                these Articles of Association involving the Mandatory
                Provisions shall be effective upon being passed by the
                shareholders in a general meeting and examined and approved by
                the company authorized by the State Council.
                From the date on which the Company's Articles of Association
                come into effect, the Company's Articles of Association shall
                constitute a legally binding document regulating the Company's
                organization and activities, and the rights and obligations
                between the Company and its shareholders and among the
                shareholders inter se.

Article 3       These Articles of Association are binding on the Company, its
                shareholders and directors, supervisors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors; all of whom are entitled, according to
                these Articles of Association, to make claims concerning the
                affairs of the Company. A shareholder may take action against
                the Company and the Company may take action against a
                shareholder or a director, a supervisor, the president, the
                vice-president, the Chief Financial Officer or the secretary
                of the board of directors pursuant to these Articles of
                Association. A shareholder may also take action against
                another shareholder or directors, supervisors, president,
                vice-president, Chief Financial Officer and the secretary of
                the board of directors of the Company pursuant to these
                Articles of Association.

                The actions referred to in the preceding paragraph include
                court proceedings and arbitration proceedings.

Article 4       The Company is a joint stock limited company established in
                accordance with the Company Law, the Special Regulations and
                other relevant laws and administrative regulations of the
                State.

                The Company was established by way of promotion with the
                approval of the State Economic and Trade Commission of the
                People's Republic of China ("PRC"), as evidenced by approval
                document Guo Jing Mao Qi Gai [2000] No. 154. It is registered
                with and has obtained a business licence from China's State
                Administration Bureau of Industry and Commerce on 25 February
                2000. The Company's business licence number is: 1000001003298.
                The promoter of the Company is: China Petrochemical
                Corporation.
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Article 5       The registered name of the Company:

<S>             <C>                            <C>
                In Chinese:                     [omitted]

                Abbreviation:                   [omitted]

                In English:                     China Petroleum & Chemical Corporation

                Abbreviation:                   SINOPEC Corp.

Article 6       The address of the Company:     A6, Huixindong Street, Chaoyang District, Beijing,China.

                Zip:                            100029

                Tel:                            (010) 64999295

                Fax:                            (010) 64999294

                Website:                        www.sinopec.com.cn
</TABLE>

Article 7       The Company's legal representative is the Chairman of the
                board of directors of the Company.

Article 8       The Company is a joint stock limited company which has
                perpetual existence. The capital of the Company is divided
                into shares of equal value. The rights and responsibilities of
                the Company's shareholders shall only be limited to the
                proportion of the shares as held by them; the Company shall be
                responsible for the Company's debts by all of its assets.
                The Company is an independent legal person, subject to the
                jurisdiction and under the protection of the laws and
                administrative rules of the PRC.

Article 9       The Company may set up wholly-owned or holding branch
                organizations such as subsidiaries, branches, representative
                offices and offices according to its business development
                needs. The wholly-owned or holding subsidiary may be named
                with China Petroleum & Chemical Corporation's abbreviation
                "SINOPEC". The branches, representative offices and offices
                are non-legal person branch organizations and shall be named
                with the full name of China Petroleum & Chemical Corporation.
                The Company may set up branch organizations (whether or not
                wholly-owned) outside the PRC and in the Hong Kong SAR, Macau
                SAR and Taiwan according to its business development needs and
                upon the approval of the relevant government body.

Article 10      The Company may invest in other limited liability companies
                or joint stock limited companies. The Company's liabilities to
                an invested company shall be limited to the amount of its
                capital contribution to the invested company. The Company
                shall not become the unlimited liability shareholder of other
                profit-making organizations.

                Upon approval of the companies approving department authorized
                by the State Council, the Company may, according to its
                operating and management needs, operate as a holding company
                as prescribed in Article 12(2) of the Company Law.

           CHAPTER 2 THE COMPANY'S OBJECTIVES AND SCOPE OF BUSINESS

Article 11      The operation objectives of the Company are: maximization of
                the Company's profits, maximization of shareholders' return.

Article 12      The Company's scope of business shall be consistent with and
                subject to the scope of business approved by the authority
                responsible for the registration of the Company. The Company's
                scope of business includes: the exploration, exploitation and
                sales of oil and natural gas; pipeline transportation of oil
                and natural gas; oil refining; the production, sales and
                storage of oil, petrochemical products, chemical fiber
                products and other chemical products; wholesaling, retailing
                and storage of oil and other oil products; operation of
                24-hour stores; power generation; manufacturing and
                installation of machinery; purchase and sales of raw
                materials, charcoal, equipment and parts; supervision of
                manufacturing of equipment; research, development and
                application of technology and information; import and export;
                and provision of technology and labour.

                    CHAPTER 3 SHARES AND REGISTERED CAPITAL

Article 13      There must, at all times, be ordinary shares in the Company,
                which include the "domestic-invested shares" and the
                "foreign-invested shares". Subject to the approval of the
                companies approving department authorized by the State
                Council, the Company may, according to its requirements,
                create different classes of shares.

Article 14      The shares issued by the Company shall each have a par value
                of Renminbi one yuan. "Renminbi" as mentioned above means the
                legal currency of the PRC.

Article 15      Shares of the Company are in the form of share certificates.
                Subject to the approval of the securities authority of the
                State Council, the Company may issue shares to Domestic
                Investors and Foreign Investors. The issue of shares by the
                Company shall adhere to the principle of openness and
                fairness.

                "Foreign Investors" means those investors who subscribe for
                the Company's shares and who are located in foreign countries
                and in the regions of Hong Kong, Macau and Taiwan. "Domestic
                Investors" means those investors who subscribe for the
                Company's shares and who are located within the territory of
                the PRC (except the areas referred to above).

Article 16      Shares which the Company issues to domestic investors for
                subscription in Renminbi are called "Domestic-Invested
                Shares". Domestic-invested shares listed domestically are
                called "Domestic-Listed Domestic-Invested shares" whilst other
                kinds of domestic-invested shares are called "Non-Listed
                Domestic-Invested Shares".

                Shares which the Company issues to foreign investors for
                subscription in foreign currencies are called
                "Foreign-Invested Shares". Foreign-invested shares which are
                listed overseas are called "Overseas-Listed Foreign-Invested
                Shares".

                "Foreign currencies" means the legal currencies of countries
                or districts outside the PRC which are recognized by the
                foreign exchange authority of the State and which can be used
                to pay the share price to the Company.

                The shareholders of "Domestic-Invested Shares" and the
                shareholders of "Overseas-Listed Foreign-Invested Shares"
                shall be shareholders of ordinary shares, possessing the same
                rights and undertaking the same obligations.

Article 17      Foreign-Invested Shares issued by the Company and which are
                listed in Hong Kong shall be referred to as "H Shares". "H
                Shares" means the shares which have been admitted for listing
                on The Stock Exchange of Hong Kong Limited (the "Stock
                Exchange"), the par value of which is denominated in Renminbi
                and which are subscribed for and traded in Hong Kong dollars.

Article 18      The Company's domestic-invested shares are held on trust by
                the Shanghai branch of the China Securities Registration and
                Clearing Company Limited. The Company's H shares are mainly
                held by the Hong Kong Securities Clearing Company Limited.

Article 19      The Company has at the time of its establishment issued to the
                promoter, China Petrochemical Corporation, 6,880,000 ordinary
                shares, representing 100% of the issued ordinary shares of the
                Company at that time.

Article 20      After the establishment of the Company and upon the approval
                of the companies approving department authorized by the State
                Council, the promoter, China Petrochemical Corporation,
                transferred 19,379,390,000 domestic-invested shares to holders
                of other non-listed domestic-invested shares; the Company
                issued 16,780,488,000 H shares (out of these, 15,102,439,000
                shares are new issue shares of the Company and 1,678,049,000
                shares are stock shares sold by the promoter, China
                Petrochemical Corporation). Upon completion of the H share
                issuance, the Company issued 2,800,000,000 domestic-listed
                domestic-invested shares.

                The existing structure of the Company's share capital is as
                follows: the total number of issued ordinary shares of the
                Company is 86,702,439,000 shares, out of these, 47,742,561,000
                shares representing 55.07% of the total number of issued
                ordinary shares of the Company are held by the promoter, China
                Petrochemical Corporation; 19,379,390,000 shares representing
                22.35% are held by other non-listed domestic-invested
                shareholders; 2,800,000,000 shares representing 3.23% are held
                by domestic-listed domestic-invested shareholders; and
                16,780,488,000 shares representing 19.35% are held by
                foreign-listed foreign-invested shareholders.

Article 21      The Company's board of directors may take all necessary action
                for the respective issuance of the Overseas-Listed
                Foreign-Invested Shares and Domestic-Invested Shares after the
                proposals for issuance of the same have been approved by the
                securities authority of the State Council.

                The Company may implement its proposal to issue
                Overseas-Listed Foreign-Invested Shares and Domestic-Invested
                Shares pursuant to the preceding paragraph within fifteen (15)
                months from the date of approval by the securities regulatory
                organ of the State Council.

Article 22      Where the total number of shares stated in the proposal for
                the issuance of shares include Overseas-Listed
                Foreign-Invested Shares and Domestic-Invested Shares, such
                shares should be fully subscribed for at their respective
                offerings. If the shares cannot be fully subscribed for all at
                once due to special circumstances, the shares may, subject to
                the approval of the securities regulatory organ of the State
                Council, be issued on separate occasions.

Article 23      The registered capital of the Company is RMB86,702,439,000.

Article 24      The Company may, based on its operating and development needs,
                authorize the increase of its capital pursuant to the
                Company's Articles of Association.

                The Company may increase its capital in the following ways:

                (1)   by offering new shares for subscription by unspecified
                      investors;

                (2)   by placing new shares to its existing shareholders;

                (3)   by allotting bonus shares to its existing shareholders;

                (4)   to increase the share capital with common reserve fund;

                (5)   by any other means which is permitted by the laws,
                      administrative regulations and the competent department
                      under the securities authority of the State Council.

                After the Company's increase of share capital by means of the
                issuance of new shares has been approved in accordance with
                the provisions of the Company's Articles of Association, the
                issuance thereof should be made in accordance with the
                procedures set out in the relevant laws and administrative
                regulations of the State.

Article 25      Unless otherwise stipulated in the relevant laws or
                administrative regulations, shares in the Company shall be
                freely transferable and are not subject to any lien.

            CHAPTER 4 REDUCTION OF CAPITAL AND REPURCHASE OF SHARES

Article 26      According to the provisions of the Company's Articles of
                Association, the Company may reduce its registered capital. In
                so doing, it shall act according to the Company Law, other
                relevant provisions and these Articles of Association.

Article 27      The Company must prepare a balance sheet and an inventory of
                assets when it reduces its registered capital.

                The Company shall notify its creditors within ten (10) days of
                the date of the Company's resolution for reduction of capital
                and shall publish an announcement in a newspaper at least
                three (3) times within thirty (30) days of the date of such
                resolution. A creditor has the right within thirty (30) days
                of receipt of the notice from the Company or, in the case of a
                creditor who does not receive such notice, within ninety (90)
                days of the date of the first public announcement, to require
                the Company to repay its debts or to provide a corresponding
                guarantee for such debt. The Company's registered capital may
                not, after the reduction in capital, be less than the minimum
                amount prescribed by law.

Article 28      The Company may, in accordance with the procedures set out in
                the Company's Articles of Association and with the approval of
                the relevant governing authority of the State, repurchase its
                outstanding shares under the following circumstances:

                (1)   cancellation of shares for the purposes of reducing its
                      capital;

                (2)   merging with another company that holds shares in the
                      Company;

                (3)   other circumstances permitted by laws and administrative
                      regulations.

                The Company shall repurchase its outstanding shares in
                accordance with the stipulations of Article 29 to Article 32.

Article 29      The Company may repurchase shares in one of the following
                ways, with the approval of the relevant governing authority of
                the State:

                (1)   by making an offer for the repurchase of shares to all
                      its shareholders on a pro rata basis;

                (2)   by repurchasing shares through public dealing on a stock
                      exchange;

                (3)   by repurchasing shares outside of the stock exchange
                      by means of an off-market agreement;

                (4)   by any other means which is permitted by the laws,
                      administrative regulations and the securities regulatory
                      organ of the State Council.

Article 30      The Company must obtain the prior approval of the shareholders
                in a general meeting in the manner stipulated in the Company's
                Articles of Association before it can repurchase shares
                outside the stock exchange by means of an off-market
                agreement. The Company may, by obtaining the prior approval of
                the shareholders in a general meeting (in the same manner),
                rescind or vary any contract which has been so entered into or
                waive any right thereof.

                A contract for the repurchase of shares referred to in the
                preceding paragraph includes (without limitation) an agreement
                to become liable to repurchase shares or an agreement to have
                the right to repurchase shares.

                The Company may not assign any contract for the repurchase of
                its shares or any right contained in such contract.

Article 31      Shares which have been legally repurchased by the Company
                shall be cancelled within 10 days of completion of the
                repurchase (or such other shorter period as required by law or
                administrative regulations), and the Company shall apply to
                the original companies registration authority for registration
                of the change in its registered capital. The aggregate par
                value of the cancelled shares shall be deducted from the
                Company's registered share capital.

Article 32      Unless the Company is in the course of liquidation, it must
                comply with the following provisions in relation to repurchase
                of its outstanding shares:

                (1)   where the Company repurchases shares at par value,
                      payment shall be made out of book surplus distributable
                      profits of the Company or out of proceeds of a new issue
                      of shares made for that purpose;

                (2)   where the Company repurchases shares of the Company at a
                      premium to its par value, payment up to the par value
                      may be made out of the book surplus of distributable
                      profits of the Company or out of the proceeds of a new
                      issue of shares made for that purpose. Payment of the
                      portion in excess of the par value shall be effected as
                      follows:

                     1.    if the shares being repurchased were issued at par
                           value, payment shall be made out of the book
                           surplus of distributable profits of the Company;

                     2.    if the shares being repurchased were issued at a
                           premium to its par value, payment shall be made out
                           of the book surplus of distributable profits of the
                           Company or out of the proceeds of a new issue of
                           shares made for that purpose, provided that the
                           amount paid out of the proceeds of the new issue
                           shall not exceed the aggregate amount of premiums
                           received by the Company on the issue of the shares
                           repurchased nor shall it exceed the book value of
                           the Company's capital common reserve fund account
                           (including the premiums on the new issue) at the
                           time of the repurchase;

                (3)   the Company shall make the following payments out of the
                      Company's distributable profits:

                      1.   payment for the acquisition of the right to
                           repurchase its own shares;

                      2.   payment for variation of any contract for the
                           repurchase of its shares;

                      3.   payment for the release of its obligation(s) under
                           any contract for the repurchase of shares;

                (4)   after the Company's registered capital has been reduced
                      by the aggregate par value of the cancelled shares in
                      accordance with the relevant provisions, the amount
                      deducted from the distributable profits of the Company
                      for payment of the par value of shares which have been
                      repurchased shall be transferred to the Company's
                      capital common reserve fund account.


           CHAPTER 5 FINANCIAL ASSISTANCE FOR ACQUISITION OF SHARES

Article 33      The Company and its subsidiaries shall not, at any time,
                provide any form of financial assistance to a person who is
                acquiring or is proposing to acquire shares in the Company.
                This includes any person who directly or indirectly incurs any
                obligations as a result of the acquisition of shares in the
                Company.

                The Company and its subsidiaries shall not, at any time,
                provide any form of financial assistance to the Obligor for
                the purposes of reducing or discharging the obligations
                assumed by such person.


                This Article shall not apply to the circumstances specified in
                Article 35 of this Chapter.

Article 34      For the purposes of this Chapter, "financial assistance"
                includes (without limitation) the following:

                (1)   gift;

                (2)   guarantee (including the assumption of liability by the
                      guarantor or the provision of assets by the guarantor to
                      secure the performance of obligations by the Obligor),
                      compensation (other than compensation in respect of the
                      Company's own default) or release or waiver of any
                      rights;

                (3)   provision of loan or the making of any other agreement
                      under which the obligations of the Company are to be
                      fulfilled before the obligations of another party, or
                      the change in parties to, or the assignment of rights
                      under, such loan or contract;

                (4)   any other form of financial assistance given by the
                      Company when the Company is insolvent or has no net
                      assets or when its net assets would thereby be reduced
                      to a material extent.

                For the purposes of this Chapter, "assumption of obligations"
                includes the assumption of obligations by way of contract or
                by way of arrangement (irrespective of whether such contract
                or arrangement is enforceable or not and irrespective of
                whether such obligation is to be borne solely by the Obligor
                or jointly with other persons) or by any other means which
                results in a change in his financial position.

Article 35      The following acts shall not be deemed to be acts prohibited
                by Article 33 of this Chapter:

                (1)   the provision of financial assistance by the Company
                      where the financial assistance is given in good faith in
                      the interests of the Company, and the principal purpose
                      of which is not for the acquisition of shares in the
                      Company, or the giving of the financial assistance is an
                      incidental part of a master plan of the Company;

                (2)   the lawful distribution of the Company's assets as
                      dividend;

                (3)   the distribution of dividends in the form of shares;

                (4)   a reduction of registered capital, a repurchase of
                      shares of the Company or a reorganization of the share
                      holding structure of the Company effected in accordance
                      with the Company's Articles of Association;

                (5)   the provision of loans by the Company within its scope
                      of business and in the ordinary course of its business,
                      where the provision of loans falls within part of the
                      scope of business of the Company (provided that the net
                      assets of the Company are not thereby reduced or that,
                      to the extent that the assets are thereby reduced, the
                      financial assistance is provided out of distributable
                      profits);

                (6)   contributions made by the Company to the employee share
                      ownership schemes (provided that the net assets of the
                      Company are not thereby reduced or that, to the extent
                      that the assets are thereby reduced, the financial
                      assistance is provided out of distributable profits).
                      CHAPTER 6 SHARE CERTIFICATES AND REGISTER OF SHAREHOLDERS

Article 36      Share certificates of the Company shall be in registered form.
                The shares of the Company shall bear the following main items:

                (1)   Name of the Company;

                (2)   Date of registration and establishment of the Company;

                (3)   Type of shares, par value and the number of shares it
                      represents;

                (4)   Code of share certificates;

                (5)   Other matters as required by the Company Law, Special
                      Regulations and the stock exchange on which the shares
                      of the Company are listed.

Article 37      The shares of the Company may be transferred, donated,
                inherited and pledged in accordance with the relevant laws,
                administrative rules, regulations of the competent
                department(s) as well as these Articles of Association.
                The transfer of shares shall be registered with the share
                registration organisation appointed by the Company.

Article 38      The Company does not accept the pledging of its shares.

Article 39      The directors, supervisors, president, vice-president, Chief
                Financial Officer and secretary of the board of directors of
                the Company shall, during their term of office, declare to the
                Company regularly the Company's shares held by them. During
                their term of office and within 6 months of their leaving,
                they may not transfer the Company's shares held by them.

Article 40      If a shareholder who holds 5% or above of voting shares sells
                his shares in the Company within 6 months of his purchase or
                purchases again within 6 months of the sale, the profits thus
                made shall belong to the Company.

                The preceding provision shall apply to senior officers
                prescribed in the articles of association of a legal person
                shareholder holding 5% or above of the voting shares in the
                Company, including but without limitation to its directors,
                supervisors and the president.

Article 41      Share certificates of H-shares of the Company shall be signed
                by the Chairman of the Company's board of directors. Where the
                stock exchange(s) on which the Company's shares are listed
                require other directors and/or supervisors, president,
                vice-president, Chief Financial Officer and the secretary of
                the board of directors of the Company to sign on the share
                certificates, the share certificates shall also be signed by
                such officer(s). The share certificates shall take effect
                after being sealed or imprinted with the seal of the Company
                (or the Company chop for securities). The share certificate
                shall only be sealed with the Company's seal or securities
                chop under the authorization of the board of directors. The
                signatures of the Chairman of the board of directors or other
                officer(s) of the Company may be printed in printed form.

Article 42      The Company shall keep a register of shareholders which shall
                contain the following particulars:

                (1)   the name (title) and address (residence), the occupation
                      or nature of each shareholder;


                (2)   the class and quantity of shares held by each
                      shareholder;

                (3)   the amount paid-up on or agreed to be paid-up on the
                      shares held by each shareholder;

                (4)   the share certificate number(s) of the shares held by
                      each shareholder;

                (5)   the date on which each person was registered as a
                      shareholder;

                (6)   the date on which any shareholder ceased to be a
                      shareholder. Unless there is evidence to the contrary,
                      the register of shareholders shall be sufficient
                      evidence of the shareholders' shareholdings in the
                      Company.

Article 43      The Company may, in accordance with the mutual understanding
                and agreements made between the securities regulatory organ of
                the State Council and overseas securities regulatory
                organizations, maintain the register of shareholders of
                Overseas-Listed Foreign-Invested Shares overseas and appoint
                overseas agent(s) to manage such register of shareholders. The
                original register of shareholders for holders of H Shares
                shall be maintained in Hong Kong.

                A duplicate register of shareholders for the holders of
                Overseas-Listed Foreign-Invested Shares shall be maintained at
                the Company's residence. The appointed overseas agent(s) shall
                ensure consistency between the original and the duplicate
                register of shareholders at all times.

                If there is any inconsistency between the original and the
                duplicate register of shareholders for the holders of
                Overseas-Listed Foreign-Invested Shares, the original register
                of shareholders shall prevail.

Article 44      The Company shall have a complete register of shareholders
                which shall comprise the following parts:

                (1)   the register of shareholders which is maintained at the
                      Company's residence (other than those share registers
                      which are described in sub-paragraphs (2) and (3) of
                      this Article);

                (2)   the register of shareholders in respect of the holders
                      of Overseas-Listed Foreign-Invested Shares of the
                      Company which is maintained in the same place as the
                      overseas stock exchange on which the shares are listed;
                      and

                (3)   the register of shareholders which is maintained in such
                      other place as the board of directors may consider
                      necessary for the purposes of the listing of the
                      Company's shares.

Article 45      Different parts of the register of shareholders shall not
                overlap. No transfer of any shares registered in any part of
                the register shall, during the continuance of that
                registration, be registered in any other part of the register.

                All Overseas-Listed Foreign-Invested Shares listed in Hong
                Kong which have been fully paid-up may be freely transferred
                in accordance with the Company's Articles of Association.
                However, unless such transfer complies with the following
                requirements, the board of directors may refuse to recognize
                any instrument of transfer and would not need to provide any
                reason therefor:

                (1)   a fee of HK$2.50 per instrument of transfer or such
                      higher amount agreed by the Stock Exchange has been paid
                      to the Company for registration of the instrument of
                      transfer and other documents relating to or which will
                      affect the right of ownership of the shares;

                (2)   the instrument of transfer only relates to
                      Overseas-Listed Foreign-Invested Shares listed in Hong
                      Kong;

                (3)   the stamp duty which is chargeable on the instrument of
                      transfer has already been paid;

                (4)   the relevant share certificate(s) and any other evidence
                      which the board of directors may reasonably require to
                      show that the transferor has the right to transfer the
                      shares have been provided;

                (5)   if it is intended that the shares be transferred to
                      joint owners, the maximum number of joint owners shall
                      not be more than four (4); and

                (6)   the Company does not have any lien on the relevant
                      shares.

                All Overseas-Listed Foreign-Invested Shares listed in Hong
                Kong shall be transferred by an instrument in writing in any
                usual or common form or any other form which the directors may
                approve. The instrument of transfer of any share may only be
                executed by hand without seal, or if the assignor or the
                assignee is the recognized clearing house or its nominee, the
                share transfer form may be executed by hand or in
                mechanically-printed form. All instruments of transfer must be
                placed at the legal address of the Company or in other places
                as the Board of Directors may be specified at any time.

                Amendments or rectification of the register of shareholders
                shall be made in accordance with the laws of the place where
                the register of shareholders is maintained.

Article 46      No change may be made in the register of shareholders as a
                result of a transfer of shares within thirty (30) days prior
                to the date of a shareholders' general meeting or within five
                (5) days before the determination date for the Company's
                distribution of dividends.

Article 47      When the Company needs to convene a shareholders' meeting
                for the purposes of determination, dividend distribution, for
                liquidation or for any other purpose which need to determine
                shareholdings, the board of directors shall determine a record
                date for the determination of shareholdings. The shareholders
                of the Company shall be such persons who appear in the
                register of shareholders at the close of such record date.

Article 48      Any person who disputes the register of shareholders and
                asks for inclusion of his name in or removal of his name from
                the register of shareholders may apply to a court of competent
                jurisdiction for rectification of the register.

Article 49      For any person who is a registered shareholder or who
                claims to be entitled to have his name (title) entered in the
                register of shareholders in respect of shares in the Company
                may, if his share certificate (the "original certificate")
                relating to the shares is lost, he may apply to the Company
                for a replacement share certificate in respect of such shares
                (the "Relevant Shares").

                Application by a holder of Domestic-Invested Shares, who has
                lost his share certificate, for a replacement share
                certificate shall be dealt with in accordance with Article 150
                of the Company Law.

                Application by a holder of Overseas-Listed Foreign-Invested
                Shares, who has lost his share certificate, for a replacement
                share certificate may be dealt with in accordance with the law
                of the place where the original register of shareholders of
                holders of Overseas-Listed Foreign-Invested Shares is
                maintained, the rules of the stock exchange or other relevant
                regulations.

                The issue of a replacement share certificate to a holder of H
                Shares, who has lost his share certificate, shall comply with
                the following requirements:

                (1)   The applicant shall submit an application to the Company
                      in a prescribed form accompanied by a notarial
                      certificate or a statutory declaration, of which the
                      contents shall include the grounds upon which the
                      application is made and the circumstances and evidence
                      of the loss, and the declaration showing that no other
                      person is entitled to have his name entered in the
                      register of shareholders in respect of the Relevant
                      Shares.

                (2)   The Company has not received any declaration made by any
                      person other than the applicant declaring that his name
                      shall be entered in the register of shareholders in
                      respect of such shares before it decides to issue a
                      replacement share certificate to the applicant.

                (3)   The Company shall, if it intends to issue a replacement
                      share certificate, publish a notice of its intention to
                      do so at least once every thirty (30) days within a
                      period of ninety (90) consecutive days in such
                      newspapers as may be prescribed by the board of
                      directors.

                (4)   The Company shall, prior to publication of its intention
                      to issue a replacement share certificate, deliver to the
                      stock exchange on which its shares are listed, a copy of
                      the notice to be published and may publish the notice
                      upon receipt of confirmation from such stock exchange
                      that the notice has been exhibited in the premises of
                      the stock exchange. Such notice shall be exhibited in
                      the premises of the stock exchange for a period of
                      ninety (90) days. In the case of an application which is
                      made without the consent of the registered holder of the
                      Relevant Shares, the Company shall deliver by mail to
                      such registered shareholder a copy of the notice to be
                      published.

                (5)   If, by the expiration of the 90-day period referred to
                      in paragraphs (3) and (4) of this Article, the Company
                      has not received any objection from any person in
                      respect of the issuance of the replacement share
                      certificate, it may issue a replacement share
                      certificate to the applicant pursuant to his
                      application.

                (6)   Where the Company issues a replacement share certificate
                      pursuant to this Article, it shall forthwith cancel the
                      original share certificate and document the cancellation
                      of the original share certificate and issuance of a
                      replacement share certificate in the register of
                      shareholders accordingly.

                (7)   All expenses relating to the cancellation of an original
                      share certificate and the issuance of a replacement
                      share certificate shall be borne by the applicant and
                      the Company is entitled to refuse to take any action
                      until reasonable guarantee is provided by the applicant
                      therefor.

Article 50      Where the Company issues a replacement share certificate
                pursuant to the Company's Articles of Association, as for a
                bona fide purchaser obtaining new share certificates referred
                to above or a shareholder registered as a owner of the shares
                (in case of a bona fide purchaser), his name (title) shall not
                be removed from the register of shareholders.

Article 51      The Company shall not be liable for any damages sustained
                by any person by reason of the cancellation of the original
                share certificate or the issuance of the replacement share
                certificate unless the claimant is able to prove that the
                Company has acted in a deceitful manner.
                CHAPTER 7 SHAREHOLDERS' RIGHTS AND OBLIGATIONS

Article 52      A shareholder of the Company is a person who lawfully holds
                shares in the Company and whose name (title) is entered in the
                register of shareholders. A shareholder shall enjoy rights and
                assume obligations according to the class and amount of shares
                held by him; shareholders who hold shares of the same class
                shall enjoy the same rights and assume the same obligations.
                For the joint shareholders, if one of the joint shareholders
                has passed away, the surviving shareholder shall be deemed by
                the Company to have the ownership of the related shares, but
                the Board of Directors is entitled to ask for the provision of
                the suitable death certificate for the purpose of revision of
                the shareholders' register. For the joint shareholders, only
                the first named shareholder in the shareholders' register has
                the right to receive the share certificates of the related
                shares, receive the notice of the Company, attend the
                shareholders' general meeting and exercise his voting right;
                while, any notice delivered to the said shareholder shall be
                deemed as if the notice has been delivered to all of the joint
                shareholder of the related shares.

Article 53      The shareholders of ordinary shares of the Company shall enjoy
                the following rights:

                (1)   the right to receive dividends and other distributions
                      in proportion to their shareholdings;

                (2)   the right to attend or appoint a proxy to attend
                      shareholders' general meetings and to vote thereat
                      according to their shareholdings;

                (3)   the right to supervise the Company's business
                      operations, the right to present proposals or to raise
                      queries;

                (4)   the right to transfer, donate and pledge shares in
                      accordance with laws, administrative regulations and
                      provisions of the Company's Articles of Association;

                (5)   subject to production of the relevant proofs of the type
                      and quantity of shares that they are holding to the
                      Company and verification of their identities of
                      shareholders by the Company, the right to obtain
                      relevant information in accordance with laws,
                      administrative regulations and provisions of these
                      Articles of Association, which information includes:

                      i.    the right to obtain a copy of the Company's
                            Articles of Association, subject to payment of
                            costs;

                      ii.   the right to inspect and copy, subject to payment
                            of a reasonable fee:

                            (i) all parts of the register of shareholders;

                            (ii) personal particulars of each of the Company's
                                directors, supervisors, president,
                                vice-president, Chief Financial Officer and
                                secretary of the board of directors,
                                including:

                                (a)  present and former name and alias;

                                (b)  principal address (place of residence);

                                (c)  nationality;

                                (d)  primary and all other part-time
                                     occupations and duties;

                                (e)  identification documents and the numbers
                                     thereof;

                      (iii) report on the state of the Company's share
                            capital;

                      (iv)  reports showing the aggregate par value, quantity,
                            highest and lowest price paid in respect of each
                            class of shares repurchased by the Company since
                            the last accounting year and the aggregate amount
                            paid by the Company for this purpose;

                      (v)   minutes of shareholders' general meetings;

                      (vi)  regular reports and interim reports of the
                            Company.

                (6)   in the event of the termination or liquidation of the
                      Company, the right to participate in the distribution of
                      remaining assets of the Company in accordance with the
                      number of shares held;

                (7)   in the event that the resolution of a shareholders'
                      general meeting or board meeting is against the law or
                      administrative rules and has infringed the legitimate
                      interest of a shareholder, the shareholder shall have
                      the right to commence legal proceedings to stop the
                      illegal or infringing act and to ask the Company to
                      bring a claim for compensation;

                (8)   other rights conferred by laws, administrative
                      regulations and these Articles of Association.

Article 54      The shareholders of ordinary shares of the Company shall
                assume the following obligations:


                (1)   to comply with these Articles of Association;

                (2)   to pay subscription money according to the number of
                      shares subscribed and the method of subscription;

                (3)   not to retire from being a shareholder unless required
                      by law or administrative regulations;

                (4)   other obligations imposed by laws, administrative
                      regulations and these Articles of Association.

                Shareholders are not liable to make any further contribution
                to the share capital other than according to the terms which
                were agreed by the subscriber of the relevant shares at the
                time of subscription.

Article 55      In addition to the obligations imposed by laws and
                administrative regulations or required by the listing rules of
                the stock exchange on which the Company's shares are listed, a
                controlling shareholder shall not exercise his voting rights
                in respect of the following matters in a manner prejudicial to
                the interests of all or part of the shareholders of the
                Company:

                (1)   act honestly in the best interests of the Company in
                      removing a director or supervisor;

                (2)   to approve the expropriation by a director or supervisor
                      (for his own benefit or for the benefit of another
                      person) of the Company's assets in any way, including
                      (without limitation to) opportunities which are
                      beneficial to the Company;

                (3)   to approve the expropriation by a director or supervisor
                      (for his own benefit or for the benefit of another
                      person) of the individual interest of other
                      shareholders, including (but without limitation to)
                      rights to distributions and voting rights (excluding a
                      restructuring which has been submitted for approval by
                      the shareholders in a general meeting in accordance with
                      the Company's Articles of Association).

Article 56      For the purpose of the foregoing Article, a "controlling
                shareholder" means a person who satisfies any one of the
                following conditions:

                (1)   a person who, acting alone or in concert with others,
                      has the power to elect more than half of the board of
                      directors;

                (2)   a person who, acting alone or in concert with others,
                      has the power to exercise 30% or more or has power to
                      control the exercise of 30% or more of the voting rights
                      in the Company;

                (3)   a person who, acting alone or in concert with others,
                      holds 30% or more of the issued and outstanding shares
                      of the Company;

                (4)   a person who, acting alone or in concert with others,
                      has de facto control of the Company in any other way.

                "Acting in concert" referred to above means the acting of two
                or more persons by agreement (whether verbal or in writing) so
                as to gain or strengthen the control of the Company through
                the acquisition of voting rights in the Company by either of
                them.

                   CHAPTER 8 SHAREHOLDERS' GENERAL MEETINGS

Article 57      The shareholders' general meeting is the organ of authority
                of the Company and shall exercise its functions and powers in
                accordance with law.

                The Company shall draw up "Rules and Procedures for the
                Shareholders' General Meetings" for implementation after being
                approved by the shareholders in a general meeting. The Rules
                and Procedures for the Shareholders' General Meetings shall
                include the followings:

                (1)   functions and powers of the shareholders general
                      meetings;

                (2)   authorities given by the shareholders' general meetings
                      to the board of directors;

                (3)   procedures for the convening of a shareholders' general
                      meeting, which include the putting forward, collection
                      and approval of motions and notices of meetings and any
                      change thereto, registration of the meeting, convening
                      of, voting and resolutions made in the meeting,
                      adjournments, past-session matters and announcements,
                      etc.;

                (4)   other matters deemed necessary by the shareholders'
                      general meeting. The Rules and Procedures for the
                      Shareholders' General Meetings is an integral part of
                      and has the same legal effect as these Articles of
                      Association.

Article 58      The shareholders' general meeting shall have the following
                functions and powers:

                (1)   to decide on the Company's operational policies and
                      investment plans;

                (2)   to elect and replace directors and to decide on matters
                      relating to the remuneration and liability insurance of
                      directors;

                (3)   to elect and replace supervisors who are shareholder
                      representatives and to decide on matters relating to the
                      remuneration and liability insurance of supervisors;

                (4)   to examine and approve the board of directors' reports;

                (5)   to examine and approve the supervisory committee's
                      reports;

                (6)   to examine and approve the Company's profit distribution
                      plans and loss recovery plans;

                (7)   to examine and approve the Company's proposed annual
                      preliminary and final financial budgets;

                (8)   to pass resolutions on the increase or reduction of the
                      Company's registered capital;

                (9)   to pass resolutions on matters such as merger, division,
                      dissolution and liquidation of the Company;

                (10)  to pass resolutions on the issue of debentures by the
                      Company;

                (11)  to pass resolutions on the appointment, dismissal and
                      non-reappointment of the accountants of the Company;

                (12)  to amend the Company's Articles of Association and its
                      appendices (including the Rules and Procedures for the
                      Shareholders' General Meetings, Rules and Procedures for
                      the Board of Directors' Meetings and Rules and
                      Procedures for the Supervisors' Meetings);

                (13)  to consider motions raised by the supervisory committee
                      or shareholders who represent 5% or more of the total
                      number of voting shares of the Company at annual general
                      meetings;

                (14)  to decide on other matters which, according to laws,
                      administrative regulations, regulations of the competent
                      department(s) or these Articles of Association, need to
                      be approved by shareholders in general meetings;

Article 59      Matters which shall be determined by the shareholders in a
                general meeting according to the laws, administrative
                regulations, regulations of the competent departments or these
                Articles of Association must be discussed by the shareholders
                in a general meeting in order to protect the shareholders'
                right of decision on those matters. Where necessary and
                reasonable, the board of directors or its secretary may be
                appointed in a shareholders' general meeting to determine (if
                so authorized in the general meeting) specific matters which
                are related to the matters to be resolved and are not possible
                or not necessary to be determined in that general meeting.
                Please see the Rules and Procedures for the Shareholders'
                General Meetings for the form of authorization by shareholders
                to the board of directors in a shareholders' general meeting
                to determine major matters of the Company.

                If the shareholders authorize the board of directors or its
                secretary in a general meeting to determine matters which
                shall be determined by ordinary resolutions, the matter should
                be resolved by more than one-half of the attending
                shareholders (including their proxy) who have voting rights;
                if the authorization relates to matters which shall be
                determined by special resolutions, the matter should be
                resolved by more than two-thirds of the attending shareholders
                (including their proxy) who have voting rights. The
                authorization should be clear and specific.

Article 60      Unless prior approval of shareholders in the form of a
                special resolution is obtained in a general meeting, the
                Company shall not enter into any contract with any person
                other than the directors, supervisors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors of the Company pursuant to which such
                person shall be responsible for the management and
                administration of the whole or any substantial part of the
                Company's business.

Article 61      Shareholders' general meetings are divided into annual
                general meetings ("AGM") and extraordinary general meetings
                ("EGM"). Unless otherwise provided in these Articles of
                Association and the Rules and Procedures for the Shareholders'
                General Meetings, shareholders' general meetings shall be
                convened by the board of directors.

Article 62      AGMs are held once every year and within six (6) months from
                the end of the preceding accounting year. At least the
                following matters should be resolved in an AGM:

                (1)   examination of the board of directors' annual report;

                (2)   examination of the supervisory committee's annual
                      report;

                (3)   examination of the Company's profit distribution
                      proposal;

                (4)   examination of the Company's audited final budgets for
                      the preceding year;

                (5)   engagement, removal or non-renewal of the appointment of
                      the accounting firm by the Company and determination of
                      the remuneration of the accounting firm so engaged.

                Matters to be considered in an AGM including but without
                limitation to the above matters, and any matter that could be
                considered in a general meeting may be considered in an AGM.
                In an AGM, the supervisory committee and shareholders who
                individually or jointly hold 5% or more of the Company's
                voting shares shall have the right to put forward provisional
                motions.

Article 63      The board of directors shall convene an EGM within two (2)
                months after the occurrence of any one of the following
                events:

                (1)   where the number of directors is less than the number
                      stipulated in the Company Law or two-thirds of the
                      number specified in the Company's Articles of
                      Association;

                (2)   where the unrecovered losses of the Company amount to
                      one-third of the total amount of its share capital;

                (3)   where shareholder(s) who individually or jointly hold
                      10% or more of the Company's issued and outstanding
                      voting shares (not including voting by proxy) request(s)
                      in writing for the convening of an EGM;

                (4)   whenever the board of directors deems necessary or the
                      supervisory committee so requests;

                (5)   other circumstances provided by these Articles of
                      Association. The shareholdings referred to in item (3)
                      above shall be calculated as at the date of written
                      request of the shareholders.

Article 64      Any request for the board of directors to hold an AGM or class
                meeting made by the supervisory committee or shareholders who
                individually or jointly hold 10% of the Company's voting
                shares entitling them to vote in that proposed meeting shall
                be dealt with according to the provisions of the Rules and
                Procedures for the Shareholders' General Meetings.

                If a meeting is convened by the shareholders themselves where
                the board of directors has not given the required consent
                under the Rules and Procedures for the Shareholders' General
                Meetings to the same, the reasonable expenses thus incurred
                shall be borne by the Company and paid out of the money
                payable by the Company to the negligent director(s).

Article 65      If the number of members of the board of directors falls short
                of the number prescribed by the Company Law or is less than
                two-thirds of the number prescribed in these Articles of
                Association, or if the Company's non-recovered loss has
                amounted to one third of the share capital and the board of
                directors has failed to call for an EGM in the prescribed
                time, shareholders may call for an EGM on their own according
                to the prescribed procedures of the Rules and Procedures for
                the Shareholders' General Meetings.

Article 66      Any shareholders who individually or jointly hold 10% or
                more of the voting shares entitling them to vote in the
                proposed meeting have any dispute as to the board of
                directors' non-inclusion of their motion into the agenda may,
                according to the prescribed procedures of the Rules and
                Procedures for the Shareholders' General Meetings, ask for the
                convening of an EGM.

Article 67      A motion of a shareholders' general meeting is a discussion
                paper of a matter which should be discussed in a general
                meeting and shareholders should resolve on the specific motion
                in a general meeting. The contents, form and issuing
                procedures of a motion shall comply with the requirements of
                the Rules and Procedures for the Shareholders' General
                Meetings.

Article 68      When the Company convenes a shareholders' general meeting,
                written notice of the meeting shall be given forty-five (45)
                days (including the date of the meeting) before the date of
                the meeting to notify all of the shareholders whose names
                appear in the share register of the matters to be considered
                and the date and place of the meeting. The contents, form and
                issuing procedures of the notice shall comply with the
                requirements of the Rules and Procedures for the Shareholders'
                General Meetings.

Article 69      Any shareholder who is entitled to attend and vote at a
                general meeting of the Company shall be entitled to appoint
                one (1) or more persons (whether such person is a shareholder
                or not) as his proxy or proxies to attend and vote on his
                behalf, and a proxy so appointed shall be entitled to exercise
                the following rights pursuant to the authorization from that
                shareholder:

                (1)   the shareholders' right to speak at the meeting;

                (2)   the right to demand or join in demanding a poll;

                (3)   the right to vote by hand or on a poll, but a proxy of a
                      shareholder who has appointed more than one (1) proxy
                      may only vote on a poll.

                If the said shareholder is a recognized clearing house as
                defined by Securities and Futures (Clearing House) Ordinance
                (Chapter 420 of Hong Kong Law) or the Securities and Futures
                Ordinance, the shareholder may authorize one or more suitable
                person to act as its representative at any shareholders'
                general meeting or any kinds of shareholders' general meeting;
                however, if more than one person are authorized, the power of
                attorney shall clearly indicate the number and types of the
                stocks involved by way of the said authorization. The persons
                after such authorization may represent the recognized clearing
                house (or its "proxy") to exercise the rights, as if they were
                the individual shareholders of the Company.

Article 70      The instrument appointing a proxy to attend the general
                meeting shall be in writing clearly indicating the number of
                shares of the appointor represented by the proxy and shall be
                under the hand of the appointor or his attorney duly
                authorized in writing, or if the appointor is a legal person,
                either under seal or under the hand of a director or a duly
                authorized attorney. If several proxies are appointed, such
                written instrument shall clearly indicate the number of shares
                of the appointor represented by each proxy. The remaining
                contents and form of the instrument shall comply with the
                requirements of the Rules and Procedures for the Shareholders'
                General Meetings.

Article 71      Any form given to a shareholder by the directors for use by
                such shareholder for the appointment of a proxy to attend and
                vote at meetings of the Company shall be such as to enable the
                shareholder to freely instruct the proxy to vote in favour of
                or against the motions, such instructions being given in
                respect of each individual matter to be voted on at the
                meeting. Such a form shall contain a statement that, in the
                absence of specific instructions from the shareholder, the
                proxy may vote as he thinks fit.

Article 72      A vote made in accordance with the terms of a proxy shall
                be valid notwithstanding the death or loss of capacity of the
                appointor or revocation of the proxy or the authority under
                which the proxy was executed, or the transfer of the shares in
                respect of which the proxy is given, provided that the Company
                did not receive any written notice in respect of such matters
                before the commencement of the relevant meeting.

Article 73      Apart from the independent directors, the Company's board
                of directors and shareholders who meet the relevant
                requirements may also collect from other shareholders of the
                Company the rights to vote in a shareholders' general meeting.
                The collection of voting rights shall be without consideration
                with sufficient disclosure of information to the shareholders
                from whom voting rights are being collected.

Article 74      When a connected transaction is discussed in a
                shareholders' general meeting, the connected shareholders
                shall not take part in the voting and the number of voting
                shares represented by him will not be counted in.
                Announcements of resolutions made in the shareholders in a
                general meeting shall make full disclosure of the votes cast
                by non-connected shareholders.

Article 75      A shareholder (including a proxy), when voting at a
                shareholders' general meeting, may exercise such voting rights
                as are attached to the number of voting shares which he
                represents except when the accumulated voting system under
                Article 103 hereof regarding election of directors is adopted
                in which case one (1) vote is attached to each share. Please
                refer to the Rules and Procedures for the Shareholders'
                General Meetings for the implementation of the accumulated
                voting system.

Article 76      At any shareholders' general meeting, a resolution shall be
                decided on a show of hands unless a poll is demanded:

                (1)   by the chairman of the meeting;

                (2)   by at least two (2) shareholders present in person or by
                      proxy entitled to vote thereat;

                (3)   by one (1) or more shareholders present in person or by
                      proxy and representing 10 % or more of all shares
                      carrying the right to vote at the meeting singly or in
                      aggregate, before or after a vote is carried out by a
                      show of hands.

                Unless a poll is demanded, a declaration by the chairman that
                a resolution has been passed on a show of hands and the record
                of such in the minutes of the meeting shall be conclusive
                evidence of the fact that such resolution has been passed.
                There is no need to provide evidence of the number or
                proportion of votes in favour of or against such resolution.
                The demand for a poll may be withdrawn by the person who
                demands the same.

Article 77      A poll demanded on the election of the chairman of the
                meeting, or on a question of adjournment of the meeting, shall
                be taken forthwith. A poll demanded on any other question
                shall be taken at such time as the chairman of the meeting
                directs, and any business other than that upon which a poll
                has been demanded may be proceeded with, pending the taking of
                the poll. The result of the poll shall be deemed to be a
                resolution of the meeting at which the poll was demanded.

Article 78      On a poll taken at a meeting, a shareholder (including a
                proxy) entitled to two (2) or more votes need not cast all his
                votes in the same way.

Article 79      In the case of an equality of votes, whether on a show of
                hands or on a poll, the chairman of the meeting at which the
                show of hands takes place or at which the poll is demanded
                shall have a casting vote.

Article 80      Resolutions of shareholders' general meetings shall be
                divided into ordinary resolutions and special resolutions. An
                ordinary resolution must be passed by votes representing more
                than one-half of the voting rights represented by the
                shareholders (including their proxy) present at the meeting.
                A special resolution must be passed by votes representing more
                than two-thirds of the voting rights represented by the
                shareholders (including their proxy) present at the meeting.
                The shareholders (including their proxy) attending the meeting
                shall clearly show approval or objection to every matter to be
                voted on. As for the unpolled vote or abstention, the Company
                will not treat it as the vote with voting right when
                calculating the voting result of this matter.

Article 81      The following matters shall be resolved by an ordinary
                resolution at a shareholders' general meeting:

                (1)   work reports of the board of directors and the
                      supervisory committee;

                (2)   profit distribution plans and loss recovery plans
                      formulated by the board of directors;

                (3)   removal of members of the board of directors and members
                      of the supervisory committee who are shareholders'
                      representatives, their remuneration and manner of
                      payment and their liability insurance;

                (4)   annual preliminary and final budgets, balance sheets and
                      profit and loss accounts and other financial statements
                      of the Company;

                (5)   matters other than those which are required by the laws
                      and administrative regulations or by the Company's
                      Articles of Association to be adopted by special
                      resolution.

Article 82      The following matters shall be resolved by a special
                resolution at a shareholders' general meeting:

                (1)   the increase or reduction in share capital and the issue
                      of shares of any class, warrants and other similar
                      securities;

                (2)   the issue of debentures of the Company;

                (3)   the division, merger, dissolution and liquidation of the
                      Company;

                (4)   amendment of the Company's Articles of Association;

                (5)   repurchase of the Company's shares;

                (6)   any other matters considered by the shareholders in
                      general meeting, and resolved by way of an ordinary
                      resolution, to be of a nature which may have a material
                      impact on the Company and should be adopted by special
                      resolutions.

Article  83     The chairman of the meeting shall be responsible for
                determining whether a resolution has been passed. His
                decision, which shall be final and conclusive, shall be
                announced at the meeting and recorded in the minutes.

Article 84      If the chairman of the meeting has any doubt as to the
                result of a resolution which has been put to vote at a
                shareholders' meeting, he may have the votes counted. If the
                chairman of the meeting has not counted the votes, any
                shareholder who is present in person or by proxy and who
                objects to the result announced by the chairman of the meeting
                may, immediately after the declaration of the result, demand
                that the votes be counted and the chairman of the meeting
                shall have the votes counted immediately.

Article 85      If votes are counted at a shareholders' general meeting,
                the result of the count shall be recorded in the minutes.

Article 86      Records of Meetings shall be prepared for shareholders'
                general meetings and signed by attending directors and the
                recording person. If there is no director attending in the
                general meeting, the records of meeting shall be signed by the
                shareholder or proxy of shareholder chairing the meeting and
                the recording person. The contents and form of the records of
                meeting shall comply with the requirements of the Rules and
                Procedures for the Shareholders' General Meetings.

                The minutes of meeting shall be prepared for all resolutions
                adopted at shareholders' general meetings. The records and
                minutes of the meeting shall be made in Chinese. The minutes,
                together with the shareholders' attendance lists and proxy
                forms shall be treated as a Company file and kept by the
                secretary of the board of directors at the Company's place of
                residence.

Article 87      Copies of the minutes of proceedings of any shareholders'
                meeting shall, during business hours of the Company, be open
                for inspection by any shareholder without charge. If a
                shareholder requests for a copy of such minutes from the
                Company, the Company shall send a copy of such minutes to him
                within seven (7) days after receipt of reasonable fees
                therefor.

      CHAPTER 9 SPECIAL PROCEDURES FOR VOTING BY A CLASS OF SHAREHOLDERS

Article 88      Those shareholders who hold different classes of shares are
                class shareholders. Class shareholders shall enjoy rights and
                assume obligations in accordance with laws, administrative
                regulations and the Company's Articles of Association.

Article 89      Rights conferred on any class of shareholders ("class
                rights") may not be varied or abrogated save with the approval
                of a special resolution of shareholders in a general meeting
                and by holders of shares of that class at a separate meeting
                conducted in accordance with Articles 91 to 95 hereof.

Article 90      The following circumstances shall be deemed to be variation
                or abrogation of the rights attaching to a particular class of
                shares:

                (1)   to increase or decrease the number of shares of that
                      class, or to increase or decrease the number of shares
                      of a class having voting or equity rights or privileges
                      distribution or superior to those of shares of that
                      class;

                (2)   to exchange all or part of the shares of that class for
                      shares of another class or to exchange or to create a
                      right to exchange all or part of the shares of another
                      class for shares of that class;

                (3)   to remove or reduce rights to accrued dividends or
                      rights to cumulative dividends attached to shares of
                      that class;

                (4)   to reduce or remove preferential rights attached to
                      shares of that class to receive dividends or to the
                      distribution of assets in the event that the Company is
                      liquidated;

                (5)   to add, remove or reduce conversion privileges, options,
                      voting rights, transfer or pre-emptive rights, or rights
                      to acquire securities of the Company attached to shares
                      of that class;

                (6)   to remove or reduce rights to receive payment payable by
                      the Company in specific currencies attached to shares of
                      that class;

                (7)   to create a new class of shares having voting or
                      distribution rights or privileges equal or superior to
                      those of the shares of that class;

                (8)   to restrict the transfer or ownership of shares of that
                      class or to increase the types of restrictions attaching
                      thereto;

                (9)   to issue rights to subscribe for, or to convert the
                      existing shares into, shares in the Company of that
                      class or another class;

                (10)  to increase the rights or privileges of shares of
                      another class;

                (11)  to restructure the Company in such a way so as to result
                      in the disproportionate distribution of obligations
                      between the various classes of shareholders;

                (12)  to vary or abrogate the provisions of this Chapter.

Article 91      Affected class shareholders, whether or not otherwise having
                the right to vote at shareholders' general meetings, have the
                right to vote at class meetings in respect of matters
                concerning sub-paragraphs (2) to (8), (11) and (12) of Article
                90 hereof, but interested shareholder(s) shall not be entitled
                to vote at such class meetings. "(An) interested
                shareholder(s)", as such term is used in the preceding
                paragraph, means:

                (1)   in the case of a repurchase of shares by way of a
                      general offer to all shareholders of the Company or by
                      way of public dealing on a stock exchange pursuant to
                      Article 29 hereof, an interested shareholder is a
                      "controlling shareholder" within the meaning of Article
                      56 hereof;

                (2)   in the case of a repurchase of shares by an off-market
                      agreement pursuant to Article 29 hereof, a holder of the
                      shares to which the proposed agreement relates;

                (3)   in the case of a restructuring of the Company, a
                      shareholder who assumes a relatively lower proportion of
                      obligation than the obligations imposed on shareholders
                      of that class under the proposed restructuring or who
                      has an interest in the proposed restructuring different
                      from the general interests of the shareholders of that
                      class.

Article 92      Resolutions of a class of shareholders shall be passed by
                votes representing more than two-thirds of the voting rights
                of shareholders of that class represented at the relevant
                meeting who, according to Article 91, are entitled to vote
                thereat.

Article 93      A written notice of a class meeting shall be given to all
                shareholders who are registered as holders of that class in
                the register of shareholders forty-five (45) days before the
                date of the class meeting (not including the date of meeting).
                Such notice shall give such shareholders notice of the matters
                to be considered at such meeting, the date and the place of
                the class meeting. A shareholder who intends to attend the
                class meeting shall deliver his written reply in respect
                thereof to the Company twenty (20) days before the date of the
                class meeting.

                If the shareholders who intend to attend such class meeting
                represent more than half of the total number of shares of that
                class which have the right to vote at such meeting, the
                Company may hold the class meeting; if not, the Company shall
                within five (5) days give the shareholders further notice of
                the matters to be considered, the date and the place of the
                class meeting by way of public announcement. The Company may
                then hold the class meeting after such public announcement has
                been made.

Article 94      Notice of class meetings need only be served on
                shareholders entitled to vote thereat. Class meetings shall be
                conducted in a manner which is as similar as possible to that
                of shareholders' general meetings. The provisions of the
                Company's Articles of Association relating to the manner for
                the conduct of shareholders' general meetings are also
                applicable to class meetings.

Article 95      Apart from the holders of other classes of shares, the
                holders of the Domestic-Invested Shares and holders of
                Overseas-Listed Foreign-Invested Shares shall be deemed to be
                holders of different classes of shares.

                The special procedures for approval by a class of shareholders
                shall not apply in the following circumstances:

                (1)   where the Company issues, upon the approval by special
                      resolution of its shareholders in a general meeting,
                      either separately or concurrently once every twelve (12)
                      months, not more than 20% of each of its existing issued
                      Domestic-Invested Shares and Overseas-Listed
                      Foreign-Invested Shares; or

                (2)   where the Company's plan to issue Domestic-Invested
                      Shares and Overseas-Listed Foreign-Invested Shares at
                      the time of its establishment is carried out within
                      fifteen (15) months from the date of approval of the
                      securities regulatory organ of the State Council.

                         CHAPTER 10 BOARD OF DIRECTORS

Article 96      The Company shall have a board of directors which is
                accountable to shareholders. The Company shall draw up Rules
                and Procedures for the Board of Directors' Meetings for
                implementation after being approved by the shareholders in a
                general meeting. The Rules and Procedures for the Board of
                Directors' Meetings shall include the following items:

                (1)   functions and powers and authorizations of the board of
                      directors;

                (2)   establishment of the board of directors and its
                      subordinated offices;

                (3)   secretary of the board of directors;

                (4)   discussion system of a board meeting;

                (5)   discussion procedures of a board meeting;

                (6)   disclosure of information of a board meeting;

                (7)   implementation and feedback of resolutions of a board
                      meeting;

                (8)   other matters deemed necessary by the shareholders'
                      general meeting. The Rules and Procedures for the Board
                      of Directors' Meetings is an integral part of and shall
                      have the same legal effect as these Articles of
                      Association.

Article 97      The board of directors shall consist of thirteen (13)
                directors and there shall be one (1) Chairman and one (1)
                Vice-chairman.

Article 98      Directors of the Company shall be natural persons and they are
                not required to hold any shares in the Company.

                Directors shall be elected at the shareholders' general
                meeting each for a term of three (3) years. The term of office
                of a director shall be calculated from the date of the passing
                of the resolution approving the appointment of such director
                at the shareholders' general meeting until the expiry of the
                term of the present session of the board of directors. At the
                expiry of the term of office of a director, the term is
                renewable upon re-election. A director may not be removed by
                the shareholders in a general meeting without any reason
                before his term of office expires. The term of office of any
                independent director may not be renewed for more than 6 years.

Article 99      The list of candidates for directors shall be submitted to
                the shareholders' general meeting in the form of motion for
                approval. Candidates other than those for independent
                directors shall be nominated by the board of directors, the
                supervisory committee or shareholders who individually or
                jointly hold 5% or more of the Company's voting shares and be
                elected by the shareholders in a general meeting.

                Candidates for independent directors of the Company shall be
                nominated by the Company's board of directors, the supervisory
                committee or shareholders who individually or jointly hold 1%
                or more of the Company's voting shares and be elected by the
                shareholders in a general meeting.

Article 100     Independent directors shall be elected in the following manner:

                (1)   the nominator of a candidate for independent director
                      shall seek the consent of the nominee, find out the
                      occupation, academic qualification, rank and detailed
                      working experience including all part-time jobs of the
                      nominee and provide written proofs of the same to the
                      Company before making the nomination. The candidate
                      shall give a written undertaking to the Company agreeing
                      to be nominated, undertaking the truthfulness and
                      completeness of his particulars disclosed and
                      guaranteeing the performance of a director's duties
                      after being elected.

                (2)   the nominator of an independent director shall give
                      opinion on the qualification and independence of the
                      nominee to act as an independent director. The nominee
                      shall make an open announcement as to the absence of any
                      relation between the Company and him which would affect
                      his independent and objective judgment.

                (3)   if the nomination of candidates for independent
                      directors is made before the Company's convening of a
                      board meeting, the written proofs of the nominee
                      referred to in sub-paragraphs (1) and (2) above shall be
                      disclosed together with the board resolution.

                (4)   if the shareholders who individually or jointly hold 5%
                      or more of the Company's voting shares or the
                      supervisory committee puts forward a provisional motion
                      in an AGM of the Company for election of independent
                      directors, a written notice stating their intention to
                      nominate a candidate for directors and the nominee's
                      consent to be nominated together with the written proofs
                      and undertaking of the nominee referred to in
                      sub-paragraphs (1) and (2) above shall be delivered to
                      the Company seven (7) days before the AGM.

                (5)   before the shareholders' general meeting for election of
                      independent directors is convened, the Company shall
                      submit the relevant information of all nominees to the
                      securities regulatory authority of the State Council,
                      the organ appointed by the securities regulatory
                      authority of the State Council in the place of residence
                      of the Company and the stock exchange on which the
                      Company's shares are listed. The written opinions of the
                      board of directors shall also be submitted in case the
                      Company's board has any dispute as to the particulars of
                      the nominee. If the securities regulatory authority of
                      the State Council opposes to the nomination of any
                      nominee, this nominee may not be included as a candidate
                      for independent directors. In convening a general
                      meeting to elect independent directors, the Company's
                      board shall specify if the securities regulatory
                      authority of the State Council has any dispute as to the
                      candidates for independent directors.

Article 101     Non-independent directors shall be elected in the following
                manner:

                (1)   the nominator of a candidate for non-independent
                      director shall seek the consent of the nominee, find out
                      the occupation, academic qualification, rank and
                      detailed working experience including all part-time jobs
                      of the nominee and provide written proofs of the same to
                      the Company before making the nomination. The candidate
                      shall give a written undertaking to the Company agreeing
                      to be nominated, undertaking the truthfulness and
                      completeness of his particulars disclosed and
                      guaranteeing the performance of a director's duties
                      after being elected.

                (2)   if the nomination of candidates for non-independent
                      directors is made before the Company's convening of a
                      board meeting, the written proofs of the nominee
                      referred to in sub-paragraph (1) above shall be
                      disclosed together with the board resolution.

                (3)   if the shareholders who individually or jointly hold 5%
                      or more of the Company's voting shares or the
                      supervisory committee puts forward a provisional motion
                      in an AGM of the Company for election of non-independent
                      directors, a written notice stating their intention to
                      nominate a candidate for directors and the nominee's
                      consent to be nominated together with the written proofs
                      and undertaking of the nominee referred to in
                      sub-paragraph (1) above shall be delivered to the
                      Company seven (7) days before the AGM.

Article 102     The following basic requirements shall be met in order to be
                an independent director:

                (1)   qualified to be a director of a listed company under the
                      laws, administrative regulations and other relevant
                      provisions;

                (2)   has the independence required by these Articles of
                      Association;

                (3)   has basic knowledge of the operation of a listed
                      company, familiar with the relevant laws, administrative
                      rules, regulations and rules;

                (4)   has 5 years or more of legal or financial experience or
                      other experience in performing the duties of an
                      independent director;

                (5)   other requirements stipulated in these Articles of
                      Association. Article 103 If the controlling shareholders
                      of the Company control 30% or more of the Company's
                      shares, the accumulative voting system shall be adopted
                      when voting on the election of directors in a
                      shareholders' general meeting, that is, in electing two
                      or more directors in a shareholders' general meeting,
                      the number of votes attached to each share held by a
                      participating shareholder shall be equal to the number
                      of candidates, in which case the shareholder may cast
                      his votes for one candidate or for several candidates.
                      Please refer to the Rules and Procedures for the
                      Shareholders' General Meetings for details of
                      implementation of the accumulative voting system.

Article 104     Provided that the relevant laws and administrative rules
                are observed, a director whose term of office has not yet been
                expired may be removed in a general meeting by way of ordinary
                resolution (but the right to lodge a claim under a contract is
                not affected).

                If a director has failed to attend a board meeting personally
                nor appoint a proxy to attend on his behalf on two consecutive
                occasions, it shall be treated as a failure to discharge his
                duties. The board of directors shall propose in a
                shareholders' general meeting to remove and replace this
                director.

                If an independent director has failed to attend a board
                meeting personally on three consecutive occasions, the board
                of directors shall propose in a shareholders' general meeting
                to remove and replace this director. Unless in the above
                circumstances and in circumstances as provided in the Company
                Law where a person is prohibited from acting as a director, no
                independent director may be removed before his term of office
                expires. In case of early removal, the Company shall disclose
                it by way of special disclosure. If the removed independent
                director considers that he is removed by the Company
                improperly, he may make an open declaration.

Article 105     A director may resign before his term of office expires.
                In resigning his duties, a director shall tender a resignation
                to the board in writing and in the case of an independent
                director, he shall also specify any matter which is related to
                his resignation or which he considers necessary to bring to
                the attention of the Company's shareholders and creditors.

Article 106     If the resignation of a director causes the board members of
                the Company to fall below the minimum number of members to
                form a quorum, the resignation of this director shall be
                effective only after the succeeding director has filled his
                vacancy. The board shall call an EGM as soon as possible to
                elect a director to fill the vacancy caused by his
                resignation. Before a resolution is made in a shareholders'
                general meeting in relation to the election of directors, the
                functions and powers of this resigning director and other
                remaining directors shall be subject to reasonable
                restrictions. If the resignation of an independent director
                causes the proportion of independent directors in the board of
                the Company to fall below the minimum requirements of the
                relevant regulatory authorities, the resignation of this
                independent director shall be effective only after the
                succeeding independent director has filled his vacancy.

Article 107     The board of directors shall exercise the following functions
                and powers:

                (1)   to be responsible for the convening of the shareholders'
                      general meeting and to report on its work to the
                      shareholders in general meetings;

                (2)   to implement the resolutions passed by the shareholders
                      in general meetings;

                (3)   to determine the Company's business plans and investment
                      proposals;

                (4)   to formulate the Company's annual preliminary and final
                      financial budgets;

                (5)   to formulate the Company's profit distribution proposal
                      and loss recovery proposal;

                (6)   to formulate proposals for the credit and financial
                      policies of the Company, the increase or reduction of
                      the Company's registered capital and for the issue of
                      any kind of securities of the Company's (including but
                      without limitation to the Company's debentures) and
                      proposals for listing and repurchase of the Company's
                      shares;

                (7)   to draw up plans for significant acquisition or disposal
                      proposals, the merger, division or dissolution of the
                      Company;

                (8)   to determine the risks investment and security
                      (including pledging of assets) of the Company according
                      to the authority given in the shareholders' general
                      meeting;

                (9)   to decide on the Company's internal management
                      structure;

                (10)  to appoint or remove the Company's president and to
                      appoint or remove the vice-president and Chief Financial
                      Officer of the Company according to the recommendations
                      of the president; to appoint or remove the secretary of
                      the board of directors and to decide on their
                      remuneration;

                (11)  to appoint or replace the members of the board of
                      directors and the supervisory committee of its
                      wholly-owned subsidiary, appoint, replace or recommend
                      the shareholders' proxies, directors (candidates) and
                      supervisors (candidates) of its subsidiary(ies) which
                      are controlled or invested by the Company.

                (12)  to determine the establishment of Company's branch
                      offices;

                (13)  to formulate proposals for any amendment of the
                      Company's Articles of Association and its appendices;

                (14)  to formulate the Company's basic management system; (15)
                      to manage the disclosure of information of the Company;

                (16)  to propose in a shareholders' general meeting to engage
                      or replace the accounting firm which undertakes auditing
                      work of the Company;

                (17)  to listen to the president's work report and check the
                      president's work;

                (18)  to determine important matters and administrative
                      matters of the Company other than those which should be
                      determined by resolution of a shareholders' general
                      meeting of the Company except for the matters as
                      specified by law, administrative rules, regulations of
                      the competent department(s) and these Articles of
                      Association, and to sign other important agreements;

                (19)  to exercise any other powers stipulated by laws,
                      administrative rules, regulations of the competent
                      department(s) or these Articles of Association and
                      conferred by the shareholders in a general meeting.

                Other than the board of directors' resolutions in respect of
                the matters specified in sub-paragraphs (6), (7) and (13) of
                this Article which shall be passed by the affirmative vote of
                more than two-thirds of all the directors, the board of
                directors' resolutions in respect of all other matters may be
                passed by the affirmative vote of a simple majority of the
                directors.

Article 108     The above functions and powers of board meetings may be
                authorized to one or more directors upon the agreement of all
                directors, but matters concerning material interests of the
                Company shall be determined by the board collectively. The
                authorization of the board shall be clear and specific.

Article 109     An independent director shall have the following special
                functions and powers in addition to those conferred by the
                Company Law, other relevant laws, administrative rules and
                these Articles of Association:

                (1)   material connected transactions (determined according to
                      the standards issued from time to time by the relevant
                      regulatory authorities in the place where the Company's
                      shares are listed) which should be approved by the board
                      of directors or the shareholders' general meeting
                      according to law shall, upon the recognition of
                      independent directors, be submitted to the board of
                      directors for discussion. Any resolution made by the
                      board of directors regarding the Company's connected
                      transactions must only be effective after it has been
                      signed by the independent directors. The independent
                      directors may, before making a judgment, engage an
                      intermediary to issue an independent financial report
                      for them to rely upon in making the judgment;

                (2)   to propose to the board of directors to engage or remove
                      an accounting firm;

                (3)   two or more than one-half of the independent directors
                      may propose to the board of directors to convene an EGM;

                (4)   to propose the calling of a board meeting;

                (5)   to engage an external auditing or advisory organ
                      independently;

                (6)   to collect voting rights from shareholders prior to the
                      convening of a shareholders' general meeting;

                (7)   to report directly to the shareholders' general
                      meetings, securities regulatory organ under the State
                      Council and other relevant departments.

                The independent directors shall seek the consent of more than
                half of the independent directors in exercising their
                functions and powers other than sub-paragraphs (1) and (3)
                above.

                If the above proposal is not accepted or the above functions
                and powers are not exercised properly, the Company shall
                disclose the same.

Article 110     When the board of directors make the decisions in respect of
                market development, mergers and acquisitions and the
                investment in new areas etc., in case the investment amount or
                the asset value thus merged and acquired exceeds more than 10
                (ten) percent of total assets of the Company, the board of
                directors shall invite the consulting organizations for their
                professional opinions, these opinions shall serve as the
                important basis for decision-making by the board of directors.

                The board of directors shall lay down strict procedures to
                inspect and decide on risks investments. For major investment
                projects in excess of the approval limit of the board of
                directors, the board of directors shall organize the relevant
                experts and professional officers to conduct assessment for
                approval of the shareholders in a general meeting. Matters
                regarding risks investments have been provided explicitly in
                the Rules and Procedures for the Board of Directors' Meetings.

Article 111     The Chairman and the Vice-Chairman shall be directors of
                the Company and be appointed and removed by affirmative vote
                of a simple majority of all directors. The term of office of
                the Chairman or the Vice-Chairman shall be three (3) years
                which term is renewable upon re-election.

Article 112     The Chairman of the board of directors shall exercise the
                following functions and powers:

                (1)   to preside over shareholders' general meetings and to
                      convene and preside over meetings of the board of
                      directors;

                (2)   to co-ordinate and perform the responsibilities of the
                      board of directors and review on the implementation of
                      resolutions passed by the board of directors at
                      directors' meetings;

                (3)   to sign the certificates of shares, debentures and other
                      valuable securities issued by the Company;

                (4)   to sign important documents of the board and other
                      documents which should be signed by the Company's legal
                      representative;

                (5)   to exercise the functions and powers of a legal
                      representative;

                (6)   where it is lawful and in the interest of the Company,
                      to exercise the special right to deal with the Company's
                      affairs during emergency such as the occurrence of
                      natural disasters, and to report to the Company's board
                      of directors and general meetings thereafter;

                (7)   to exercise other powers conferred by the board of
                      directors. Whenever the Chairman is unable to exercise
                      his powers, such powers shall be exercised by the
                      Vice-Chairman or other directors who have been
                      designated by the Chairman to exercise such powers on
                      his behalf.

Article 113     Board meetings shall be convened regularly at least four
                times a year. An EGM shall be called for on occurrence of any
                of the events set out in the Rules and Procedures for the
                Board of Directors' Meetings.

                In convening a regular board meeting or an EGM, a notice shall
                be given to all directors 10 days before the meeting. The
                calling for a board meeting, and the contents and form of a
                notice of meeting shall comply with the requirements of the
                Rules and Procedures for the Board of Directors' Meetings.

Article 114     Meetings of the board of directors shall be held only if
                more than half of the directors (including any alternate
                director appointed) are present. Each director shall have one
                (1) vote. Where there is an equality of votes cast both for
                and against a resolution, the Chairman of the board of
                directors shall have an additional vote.

Article 115     Directors shall attend the meetings of the board of
                directors in person. Where a director is unable to attend a
                meeting for any reason, he may by a written power of attorney
                appoint another director to attend the meeting on his behalf.
                The power of attorney shall set out the scope of
                authorization.

                A director appointed as a representative of another director
                to attend the meeting shall exercise the rights of a director
                within the scope of authority conferred by the appointing
                director. Where a director is unable to attend a meeting of
                the board of directors and has not appointed a representative
                to attend the meeting on his behalf, he shall be deemed to
                have waived his right to vote at the meeting. All expenses
                incurred by the directors for attending the board meeting
                shall be borne by the Company, including the traffic expense
                from the place where the director is located to the place
                where the meeting is convened, as well as the board and
                lodging expenses during the term of meeting. The miscellaneous
                expenses such as the rental of meeting room and the local
                traffic expenses etc. shall also be borne by the Company.

Article 116     The board of directors may accept the preparation of a
                written resolution instead of convening a board meeting
                provided that the contents and form of the written resolution
                are in compliance with the Rules and Procedures for the Board
                of Directors' Meetings.

Article 117     Matters determined in a board meeting shall be recorded in
                Chinese in the form of Records of Meeting. The contents and
                form of Records of Board Meetings shall comply with the Rules
                and Procedures for the Board of Directors' Meetings.

Article 118     If a written motion of a board meeting is not prepared in
                accordance with the stipulated procedures, it will not have
                the effect of a board resolution even if each director has
                expressed his view thereto. Directors shall be liable for
                board resolutions. If a board resolution is against the law,
                administrative rules or these Articles of Association and thus
                causes the Company to suffer any loss, the directors who cast
                an affirmative vote for the motion shall assume direct
                liability (including the liability to compensate); directors
                who are proved to have cast a dissenting vote against the
                motion during the voting as recorded in the records of meeting
                shall be exempted from liability; directors who abstained from
                voting or failed to attend nor appoint a proxy to attend the
                board meeting shall not be exempted from liability; and
                directors who opposed to the motion but did not cast a
                dissenting vote against it in the voting shall not be exempted
                from liability either.

                CHAPTER 11 SECRETARY OF THE BOARD OF DIRECTORS

Article 119     The Company shall have one (1) secretary of the board of
                directors. The secretary shall be a senior officer of the
                Company accountable to the Company. The Company shall draw up
                "Work Regulations for the Secretary of the Board" to promote
                the management of the Company and make provisions for
                disclosure of information. The Work Regulations for the
                Secretary of the Board shall be effective upon the approval of
                the board of directors.

                The board of directors may establish its secretarial
                department when necessary.

Article 120     A director or the president, vice-president, Chief Financial
                Officer of the Company may concurrently act as the secretary
                of the Company's board of directors. No accountant of the
                accounting firm or solicitor of the solicitors' firm engaged
                by the Company may concurrently act as the secretary of the
                Company's board of directors.

                The secretary of the Company's board of directors shall be a
                natural person who has the requisite professional knowledge
                and experience, and shall be nominated by the Chairman of the
                Board and appointed or removed by the board of directors. In
                the case of a director acting concurrently as the secretary of
                the board, if an act has to be performed by a director and the
                secretary of the board respectively, this director acting
                concurrently as the secretary of the board may not act in both
                identities.

Article 121     The main duties of the secretary of the board of directors
                include:

                (1)   to assist directors to deal with the daily matters of
                      the board of directors, continuously provide, remind and
                      ensure directors and the president, etc. to be well
                      informed of the laws, regulations, policies and
                      requirements of both domestic and overseas regulatory
                      organizations concerning the operation of the Company,
                      and assist directors and managers to practically
                      implement the domestic and foreign laws, regulations,
                      Company's Articles of Association and other regulations
                      when performing their duties and powers;

                (2)   to be responsible for the organization and preparation
                      of the documents of the board of directors and
                      shareholders' general meeting, well prepare the meeting
                      record work, ensure the meeting policies in conformity
                      with the legal procedures, and to keep abreast of the
                      execution of the resolutions of the board of directors;

                (3)   to be responsible for the organization and coordination
                      of information disclosure, to ensure of a timely,
                      accurate, lawful, true and complete disclosure of
                      information, coordination of the relationship with the
                      investors, and enhancement of the transparency of the
                      Company;

                (4)   to participate in and organize the financing in capital
                      market;

                (5)   to deal with the relationships with the intermediary
                      organs, regulatory authorities and the media, and
                      maintain a good public relationship. Article 122 The
                      secretary of the board of directors shall discharge his
                      duties diligently according to these Articles of
                      Association. The secretary of the board of directors
                      shall assist the Company to comply with the relevant PRC
                      law and regulations of the securities regulatory organ
                      of the place where the Company's shares are listed.

                             CHAPTER 12 PRESIDENT

Article 123     The Company shall have a president who is accountable to
                the board of directors. The president shall be nominated by
                the Chairman of the board of directors and appointed or
                removed by the board of directors.

                The Company shall have several vice-presidents, and one Chief
                Financial Officer who shall assist the president in work. The
                vice-presidents and the Chief Financial Officer shall be
                nominated by the president and appointed or removed by the
                board of directors.

                A director may also be engaged to act concurrently as the
                president, vice-president, Chief Financial Officer or
                secretary of the board of directors, but the number of
                directors acting concurrently as the president,
                vice-president, Chief Financial Officer or secretary of the
                board of directors may not exceed one-half of the total number
                of directors of the Company.

Article 124     The president shall exercise the following duties and powers:

                (1)   to be in charge of the Company's production, operation
                      and management, to co-ordinate the implementation of the
                      resolutions of the board of directors and to report his
                      work to the board of directors;

                (2)   to organize the implementation of the Company's annual
                      business plan and investment proposal;

                (3)   to draft plans for the establishment of the Company's
                      internal management structure;

                (4)   to draft plans for the establishment of the branch
                      company of the Company;

                (5)   to draft the Company's basic management system;

                (6)   to formulate specific rules and regulations for the
                      Company;

                (7)   to propose the appointment or dismissal of the Company's
                      vice-president(s) and Chief Financial Officer;

                (8)   to appoint or dismiss management personnel other than
                      those required to be appointed or dismissed by the board
                      of directors;

                (9)   to determine the wages, fringe benefits, rewards and
                      punishments of the Company's staff, to determine the
                      appointment and dismissal of the Company's staff;

                (10)  to propose the convening of extraordinary meetings of
                      directors;

                (11)  other powers conferred by the Company's Articles of
                      Association and the board of directors.

Article 125     The president or vice-president who is not a director
                shall have the right to attend board meetings and to receive
                notices of meetings and other relevant documents but does not
                have any voting rights at board meetings.

Article 126     The president shall at the request of the board of
                directors or the supervisory committee make report of the
                signing and performance of major contracts, use of funds and
                profit and loss of the Company. The president must ensure the
                truthfulness of the report.

Article 127     The president shall seek the opinions of the staff members
                in determining matters which are closely related to staff
                members such as the wages, fringe benefits, safe production
                and work, labour insurance, dismissal (or discharge) of staff
                members of the Company.

Article 128     The president shall draw up "Work Regulations for the
                President" for implementation upon the approval of the board
                of directors. The Work Regulations for the President shall
                include:

                (1)   requirements and procedures for the convening of a
                      presidents' meeting and the officers attending;

                (2)   the president, vice-presidents and Chief Financial
                      Officer shall divide their duties among themselves and
                      perform their own duties;

                (3)   use of the Company's funds and assets, authority to sign
                      major contracts and the system to report to the board of
                      directors and to the supervisory committee at the
                      request of the supervisory committee;

                (4)   other matters as the board of directors may consider
                      necessary.

Article 129     In performing their functions and powers, the president,
                vice-presidents and the Chief Financial Officer shall act
                honestly and diligently and in accordance with laws,
                administrative regulations and these Articles of Association.
                They may not alter the resolutions of a shareholders' general
                meeting or of a board meeting nor act ultra vires.

Article 130     In retiring from their office, the president,
                vice-president or Chief Financial Officer shall, as required
                by the relevant labour contract between the above personnel
                and the Company, give prior notice to the Company and shall
                adhere to the relevant procedures and methods of resignation
                provided in the labour contract.

                       CHAPTER 13 SUPERVISORY COMMITTEE

Article 131     The Company shall have a supervisory committee which is
                accountable to the shareholders' general meetings.

                The Company shall draw up "Rules and Procedures for the
                Supervisors' Meetings" for implementation upon being approved
                by the shareholders in a general meeting. The Rules and
                Procedures for the Supervisors' Meetings shall include the
                followings:

                (1)   the formation and business system of the supervisory
                      committee;

                (2)   the functions and powers of the supervisory committee;

                (3)   the system of discussion of the supervisors' meetings;

                (4)   the procedures of discussion of the supervisory
                      committee;

                (5)   the disclosure of information of the supervisors'
                      meetings;

                (6)   implementation and feedback of resolutions of the
                      supervisory committee;

                (7)   other matters as the shareholders' general meetings may
                      consider necessary.

                The Rules and Procedures for the Supervisors' Meetings shall
                be an integral part of and have the same legal effect as these
                Articles of Association.

Article 132     The supervisory committee shall compose of twelve (12)
                supervisors. Of which, eight (8) of them shall be shareholder
                representatives (including those who are eligible to be
                external supervisors); four (4) of them shall be
                representatives of workers and staff of the Company. Each
                supervisor shall serve for a term of three (3) years, which
                term is renewable upon re-election and re-appointment. The
                supervisory committee shall have one (1) Chairman who shall be
                a supervisor. The election or removal of the Chairman of the
                supervisory committee shall be determined by two-thirds or
                more of the members of the supervisory committee. The Chairman
                of the supervisory committee shall co-ordinate and exercise
                the duties and powers of the supervisory committee.

Article 133     If necessary, the supervisory committee may establish its
                offices responsible for daily affairs of the supervisory
                committee.

Article 134     A director, president, vice-president or Chief Financial
                Officer may not act concurrently as a supervisor.

Article 135     The list of candidates for the supervisors who are shareholder
                representatives shall be submitted to the shareholders'
                general meeting in the form of motion for approval. Amongst
                the candidates for supervisors who are shareholder
                representatives, candidates other than those for independent
                supervisors shall be nominated by the Company's board of
                directors, the supervisory committee or shareholders who
                individually or jointly hold 5% or more of the Company's
                voting shares and be elected by the shareholders in a general
                meeting.

                Amongst the candidates for supervisors who are shareholder
                representative, candidates for independent supervisors shall
                be nominated by the Company's board of directors, the
                supervisory committee or shareholders who individually or
                jointly hold 1% or more of the Company's voting shares and be
                elected by the shareholders in a general meeting.

Article 136     Independent directors shall be elected in the following manner:


                (1)   the nominator of a candidate for supervisor who is a
                      shareholder representative shall seek the consent of the
                      nominee, find out the occupation, academic
                      qualification, rank and detailed working experience
                      including all part-time jobs of the nominee and provide
                      written proofs of the same to the Company before making
                      the nomination. The candidate shall give a written
                      undertaking to the Company agreeing to be nominated,
                      undertaking the truthfulness and completeness of his
                      particulars disclosed and guaranteeing the performance
                      of a director's duties after being elected.

                (2)   If the nomination of a candidate for supervisor who is a
                      shareholder representative is made before the Company's
                      convening of a board meeting, the written proofs of the
                      nominee referred to in sub-paragraphs (1) above shall be
                      disclosed together with the board resolution.

                (3)   If the shareholders who individually or jointly hold 5%
                      or more of the Company's voting shares or the
                      supervisory committee puts forward a provisional motion
                      in an AGM of the Company for election of a supervisor
                      who is a shareholder representative, a written notice
                      stating their intention to nominate a candidate for a
                      supervisor and the nominee's consent to be nominated
                      together with the written proofs and undertaking of the
                      nominee referred to in sub-paragraph (1) above shall be
                      delivered to the Company seven (7) days before the AGM.

Article 137     Any supervisor who fails to attend a supervisors' meeting
                personally on two consecutive occasions shall be treated as a
                failure to discharge his duties. In that case he shall be
                removed and replaced in a shareholders' general meeting or
                staff representatives' meeting.

                A supervisor may resign before his term expires and Chapter 10
                hereof regarding resignation of directors shall also be
                applicable to supervisors.

Article 138     Supervisors' meetings shall be convened regularly at least
                four times a year. An extraordinary supervisors' meeting shall
                be convened on occurrence of any of the events specified in
                the Rules and Procedures for the Supervisors' Meetings. A 10
                days' prior notice shall be given to all supervisors for the
                convening of a regular or extraordinary supervisors' meeting.
                The convening of a supervisors' meeting and the contents and
                form of the notice of meeting shall comply with the Rules and
                Procedures for the Supervisors' Meetings.

Article 139     The supervisory committee shall exercise the following
                functions and powers in accordance with law:

                (1)   to review the Company's financial position; to appoint
                      another accounting firm in the name of the Company to
                      review the Company's financial condition independently;

                (2)   to supervise the directors, president, vice-presidents,
                      Chief Financial Officer and secretary of the board to
                      ensure that they do not act in contravention of any law,
                      regulation or these Articles of Association;

                (3)   to demand the directors, president, vice-presidents,
                      Chief Financial Officer or secretary of the board to
                      rectify their error or even to report it in a
                      shareholders' general meeting or to the competent State
                      organ if they have acted in a harmful manner to the
                      Company's interest;

                (4)   to check and inspect the financial information such as
                      the financial report, business report and plans for
                      distribution of profits to be submitted by the board of
                      directors to the shareholders' general meetings and to
                      authorize, in the Company's name, publicly certified and
                      practicing accountants to assist in the review on such
                      information should any doubt arise in respect thereof;

                (5)   to make recommendations of accounting firms for
                      engagement by the Company;

                (6)   to make provisional motions in an AGM;

                (7)   to propose to convene an EGM;

                (8)   to propose to convene an extraordinary board meeting;

                (9)   to represent the Company in negotiations with or in
                      bringing actions against a director;

                (10)  other duties and powers as may be specified by law,
                      administrative rules, regulations of the competent
                      department and these Articles of Association and
                      conferred by the general meeting.

                Supervisors shall attend meetings of the board of directors.

Article 140     The supervisory committee may require the directors,
                president, vice-president, Chief Financial Officer, secretary
                of the board of directors of the Company, internal and
                external auditors to attend supervisors' meetings and answer
                any question that the supervisory committee may have regarding
                matter it cares about.

Article 141     Resolutions of the supervisory committee shall be passed
                by the affirmative vote of more than two-thirds of all of its
                members.

Article 142     Records shall be made for all supervisors' meetings and be
                signed by all attending supervisors and the recording person.
                Supervisors shall have the right to ask for the making of a
                descriptive record of what he speaks in the meeting. Records
                of supervisors' meetings shall be treated as the Company's
                files and kept permanently in the business system of the
                supervisory committee.

Article 143     All reasonable fees incurred in respect of the employment
                of professionals (such as, lawyers, certified public
                accountants or practicing auditors) which are required by the
                supervisory committee in the exercise of its functions and
                powers shall be borne by the Company.

Article 144     A supervisor shall carry out his duties faithfully and
                bona fide in accordance with laws, administrative regulations
                and the Company's Articles of Association.

              CHAPTER 14     QUALIFICATIONS AND OBLIGATIONS OF THE DIRECTORS,
                             SUPERVISORS, PRESIDENT, VICE-PRESIDENT, CHIEF
                             FINANCIAL OFFICER AND SECRETARY OF THE BOARD OF
                             DIRECTORS OF THE COMPANY

Article 145     A person may not serve as a director, supervisor,
                president, vice-president, Chief Financial Officer and
                secretary of the board of directors of the Company if any of
                the following circumstances apply:

                (1)   a person who does not have or who has limited capacity
                      for civil conduct;

                (2)   a person who has been found guilty of for corruption,
                      bribery, infringement of property or misappropriation of
                      property or other crimes which destroy the social
                      economic order, and the sentence is enforced for less
                      than five (5) years or a person who has been deprived of
                      his political rights and not more than five (5) years
                      have lapsed since the sentence was served;

                (3)   a person who is a former director, factory manager or
                      president of a company or enterprise which has been
                      dissolved or put into liquidation as a result of
                      mismanagement and who was personally liable for the
                      winding up of such company or enterprise, where less
                      than three (3) years have elapsed since the date of
                      completion of the insolvent liquidation of the company
                      or enterprise;

                (4)   a person who is a former legal representative of a
                      company or enterprise the business licence of which was
                      revoked due to violation of law and who are personally
                      liable therefor, where less than three (3) years have
                      elapsed since the date of the cancellation of the
                      business licence;

                (5)   a person who has a relatively large amount of debts
                      which have become due and outstanding;

                (6)   a government servant of the country;

                (7)   a person who is currently under investigation by the
                      judicial authorities for violation of criminal law;

                (8)   a person who, according to laws and administrative
                      regulations, cannot act as a leader of an enterprise;

                (9)   a person other than a natural person;

                (10)  a person who has been adjudged by the competent
                      authority for violation of relevant securities
                      regulations and such conviction involves a finding that
                      such person has acted fraudulently or dishonestly, where
                      not more than five (5) years have lapsed from the date
                      of such conviction;

                (11)  a person who has been prohibited by the securities
                      regulatory authority of the State Council to participate
                      in market activities and the prohibition has still not
                      been uplifted.

Article 146     The chairman, vice-chairman and directors of the Company's
                controlling shareholder acting concurrently as the chairman,
                vice-chairman or director of the Company may not exceed two in
                number. Managers of the Company's controlling shareholder may
                not act concurrently as the Company's president,
                vice-president, Chief Financial Officer, sales supervisor or
                secretary of the board.

Article 147     The following people may not act as an independent director
                of the Company:

                (1)   persons employed by the Company or its subsidiaries and
                      their immediate family members and major social
                      connections (immediate family members shall mean spouse,
                      parents and issues, etc. and major social connections
                      shall mean siblings, parents-in-law,
                      sons/daughters-in-law, spouse of siblings, siblings of
                      spouse, etc.);

                (2)   natural person shareholders who directly or indirectly
                      hold 1% or more of the Company's issued shares or who
                      are top ten shareholders and their immediate family
                      members;

                (3)   persons employed by the shareholder company which
                      directly or indirectly holds 1% or more of the Company's
                      issued shares or by the top five shareholder companies
                      of the Company and their immediate family members;

                (4)   persons who once belonged to categories (1) to (3) above
                      in the past 3 years;

                (5)   persons who provide financial or legal advice to the
                      Company or its subsidiaries;

                (6)   any independent director who is already the director of
                      five listed companies;

                (7)   other persons determined by the securities regulatory
                      authority of the State Counsel.

Article 148     The validity of an act carried out by a director, a
                supervisor, the president, vice-president, Chief Financial
                Officer or secretary of the board of directors of the Company
                on its behalf shall, as against a bona fide third party, not
                be affected by any irregularity in his office, election or any
                defect in his qualification.

Article 149     Without the lawful authorization of these Articles of
                Association or the board of directors, a director of the
                Company may not act personally on behalf of the Company or the
                board of directors. If he acts personally, he shall declare
                his own position and identity in advance where the acting
                would cause a third party to believe reasonably that he is
                acting on behalf of the Company or the board of directors.

Article 150     In addition to the obligations imposed by laws,
                administrative regulations or the listing rules of the stock
                exchange on which shares of the Company are listed, each of
                the Company's directors, supervisors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors owes a duty to each shareholder, in the
                exercise of the duties and powers of the Company entrusted to
                him:

                (1)   not to procure the Company to do anything ultra vires to
                      the scope of business as stipulated in its business
                      licence;

                (2)   to act honestly and in the best interests of the
                      Company;

                (3)   not to expropriate the Company's property in any way,
                      including (without limitation to) usurpation of
                      opportunities which may benefit the Company;

                (4)   not to deprive of the individual interest of
                      shareholders, including (without limitation to) rights
                      to distribution and voting rights, save and except
                      pursuant to a restructuring of the Company which has
                      been submitted to the shareholders in general meeting
                      for approval in accordance with the Company's Articles
                      of Association.

Article 151     Each of the Company's directors, supervisors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors owes a duty, in the exercise of his powers
                and in the discharge of his duties, to exercise the care,
                diligence and skill that a reasonably prudent person would
                exercise in comparable circumstances.

Article 152     Each of the Company's directors, supervisors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors shall exercise his powers or perform his
                duties in accordance with the fiduciary principle, and shall
                not put himself in a position where his duty and his interest
                may conflict. This principle includes (without limitation to)
                discharging of the following obligations:

                (1)   to act bona fide in the best interests of the Company;

                (2)   to act within the scope of his powers and not to exceed
                      such powers;

                (3)   to exercise the discretion vested in him personally and
                      not to allow himself to act under the control of another
                      and, unless and to the extent permitted by laws,
                      administrative regulations or with the informed consent
                      of shareholders given in a general meeting, not to
                      transfer the exercise of his discretion;

                (4)   to treat shareholders of the same class equally and to
                      treat shareholders of different classes fairly;

                (5)   unless otherwise provided for in the Company's Articles
                      of Association or except with the informed consent of
                      the shareholders given in a general meeting, not to
                      enter into any contract, transaction or arrangement with
                      the Company;

                (6)   not to use the Company's property for his own benefit,
                      without the informed consent of the shareholders given
                      in a general meeting;

                (7)   not to abuse his position to accept bribes or other
                      illegal income or expropriate the Company's property in
                      any way, including (without limitation to) opportunities
                      which benefit the Company;

                (8)   not to accept commissions in connection with the
                      Company's transactions, without the informed consent of
                      the shareholders given in a general meeting;

                (9)   to comply with the Company's Articles of Association, to
                      perform his official duties faithfully, to protect the
                      Company's interests and not to exploit his position and
                      power in the Company to advance his own interests;

                (10)  not to compete with the Company in any way, save with
                      the informed consent of the shareholders given in a
                      general meeting;

                (11)  not to misappropriate the Company's funds or to lend
                      such funds to any other person, not to use the Company's
                      assets to set up deposit accounts in his own name or in
                      the any other name or to use such assets to guarantee
                      the debts of a shareholder of the Company or any other
                      personal liabilities;

                (12)  not to divulge any confidential information which he has
                      obtained during his term of office, without the informed
                      consent of the shareholders in a general meeting; nor
                      shall he use such information otherwise than for the
                      Company's benefit, unless disclosure of such information
                      to the court or other governmental authorities is made
                      in the following circumstances:

                      1.   disclosure is required by law;

                      2.   public interests so warrants;

                      3.   the interests of the relevant director, supervisor,
                           president, vice-president, Chief Financial Officer
                           and secretary of the board of directors so
                           requires.

Article 153     Each director, supervisor, president, vice-president, Chief
                Financial Officer and secretary of the board of directors of
                the Company shall not direct the following persons or
                institutions ("associates") to act in a manner which he is
                prohibited from so acting:

                (1)   the spouse or minor children of the director,
                      supervisor, president, vice-president, Chief Financial
                      Officer or secretary of the board of directors;

                (2)   the trustee of the director, supervisor, president,
                      vice-president, Chief Financial Officer or secretary of
                      the board of directors or of any person described in
                      sub-paragraph (1) above;

                (3)   partners of directors, supervisors, president,
                      vice-president, Chief Financial Officer or secretary of
                      the board of directors of the Company or any person
                      referred to in sub-paragraphs (1) and (2) of this
                      Article;

                (4)   a company in which a director, supervisor, the
                      president, vice-president, Chief Financial Officer or
                      secretary of the board of directors, whether alone or
                      jointly with one (1) or more of the persons referred to
                      in sub-paragraphs (l), (2) and (3) of this Article and
                      other directors, supervisors, president, vice-president,
                      Chief Financial Officer and secretary of the board of
                      directors, has de facto controlling interest;

                (5)   the senior officers of a company which is being
                      controlled in the manner set out in sub-paragraph (4)
                      above, including but without limitation to directors,
                      supervisors and president.

Article 154     On submission of a resignation or termination of the tenure of
                a director, supervisor, the president, vice-president, Chief
                Financial Officer or secretary of the board of directors of
                the Company, the fiduciary duties owed by this senior officer
                to the Company and its shareholders do not necessarily cease
                when his resignation has not yet been effective or within a
                reasonable period of the resignation and within a reasonable
                period of the termination of tenure. His duty of
                confidentiality in respect of trade secrets of the Company
                survives the termination of his tenure until the same has
                become open information. Other duties may continue for such
                period as the principle of fairness may require depending on
                the length of time which has lapsed between the termination
                and the act concerned and on the circumstances and the terms
                under which the relationship between the relevant director,
                supervisor, manager and the senior officer on the on hand and
                the Company on the other hand was terminated.

Article 155     Any serving director, supervisor, the president,
                vice-president, Chief Financial Officer or secretary of the
                board of directors of the Company who leaves his post without
                permission thereby causing loss to the Company shall be liable
                for compensation. Article 156 A director, supervisor, the
                president, vice-president, Chief Financial Officer or
                secretary of the board of directors of the Company may be
                relieved of liability for specific breaches of his duty with
                the informed consent of the shareholders given at a general
                meeting, save under the circumstances of Article 55 hereof.

Article 157     Where a director, supervisor, the president, vice-president,
                Chief Financial Officer or secretary of the board of directors
                of the Company is in any way, directly or indirectly,
                materially interested in a contract, transaction or
                arrangement or proposed contract, transaction or arrangement
                with the Company, (other than his contract of service with the
                Company), he shall declare the nature and extent of his
                interests to the board of directors at the earliest
                opportunity, whether or not the contract, transaction or
                arrangement or proposal therefor is otherwise subject to the
                approval of the board of directors.

                Directors shall not vote on the contract, transaction and
                arrangement where they own the major rights and interests, and
                shall not be listed in the quorum of the meeting.

                Unless the interested director, supervisor, the president,
                vice-president, Chief Financial Officer or secretary of the
                board of directors discloses his interests in accordance with
                the preceding sub-paragraph of this Article and the contract,
                transaction or arrangement is approved by the board of
                directors at a meeting in which the director, supervisor, the
                president, vice-president, Chief Financial Officer or
                secretary of the board of directors is not counted as part of
                the quorum and refrains from voting, or from entering into a
                contract, transaction or arrangement in which that senior
                officer is materially interested is voidable at the instance
                of the Company except as against a bona fide party thereto who
                does not have notice of the breach of duty by the interested
                senior officer.

                For the purposes of this Article, a director, supervisor, the
                president, vice-president, Chief Financial Officer or
                secretary of the board of directors of the Company is deemed
                to be interested in a contract, transaction or arrangement in
                which his associate is interested.

Article 158     Where a director, supervisor, the president, vice-president,
                Chief Financial Officer or secretary of the board of directors
                of the Company gives to the board of directors a notice in
                writing stating that, by reason of the facts specified in the
                notice, he is interested in contracts, transactions or
                arrangements which may subsequently be made by the Company,
                that notice shall be deemed for the purposes of the preceding
                Article to be a sufficient disclosure of his interests, so far
                as the content stated in such notice is concerned, provided
                that such notice shall have been given before the date on
                which the question of entering into the relevant contract,
                transaction or arrangement is first taken into consideration
                by the Company.

Article 159     The Company shall not pay taxes for or on behalf
                of a director, supervisor, the president, vice-president,
                Chief Financial Officer or secretary of the board of directors
                in any manner.

Article 160     The Company shall not directly or indirectly make a loan to or
                provide any guarantee in connection with the making of a loan
                to a director, supervisor, the president, vice-president,
                Chief Financial Officer or secretary of the board of directors
                of the Company or a senior officer (including but without
                limitation to a director, supervisor and the president) of the
                holding company of the Company or any of their respective
                associates. The foregoing prohibition shall not apply to the
                following circumstances:

                (1)   provision of a loan or guarantee for a loan by the
                      Company to its subsidiary;

                (2)   the provision by the Company of a loan or a guarantee in
                      connection with the making of a loan or any other funds
                      available to its directors, supervisors, president,
                      vice-president, Chief Financial Officer or the secretary
                      of the board of directors to meet expenditure incurred
                      or to be incurred by him for the purposes of the Company
                      or for the purpose of enabling him to perform his duties
                      properly, in accordance with the terms of a service
                      contract approved by the shareholders in a general
                      meeting;

                (3)   if the ordinary course of business of the Company
                      includes the lending of money or the giving of
                      guarantees, the Company may make a loan to or provide a
                      guarantee in connection with the making of a loan to a
                      director, supervisor, the president, vice-president,
                      Chief Financial Officer or secretary of the board of
                      directors or his associates in the ordinary course of
                      its business on normal commercial terms.

Article 161     Any person who receives funds from a loan which has been made
                by the Company acting in breach of the preceding Article
                shall, irrespective of the terms of the loan, forthwith repay
                such funds.

Article 162     A guarantee for the repayment of a loan which has been
                provided by the Company acting in breach of Article 158(1)
                shall not be enforceable against the Company, save in respect
                of the following circumstances:

                (1)   the guarantee was provided in connection with a loan
                      which was made to an associate of a director,
                      supervisor, the president, vice-president, Chief
                      Financial Officer or secretary of the board of directors
                      of the Company or a senior officer (including but
                      without limitation to a director, supervisor and the
                      president) of the Company's holding company and the
                      lender of such funds did not know of the relevant
                      circumstances at the time of the making of the loan; or

                (2)   the collateral which has been provided by the Company
                      has already been lawfully disposed of by the lender to a
                      bona fide purchaser.

Article 163     For the purposes of the foregoing provisions of this Chapter,
                a "guarantee" includes an undertaking or property provided to
                secure the obligor's performance of his obligations.

Article 164     In addition to any rights and remedies provided by the laws
                and administrative regulations, where a director, supervisor,
                the president, vice-president, Chief Financial Officer or
                secretary of the board of directors of the Company breaches
                the duties which he owes to the Company, the Company has a
                right:

                (1)   to demand such a director, supervisor, the president,
                      vice-president, Chief Financial Officer or secretary of
                      the board of directors to compensate it for losses
                      sustained by the Company as a result of such breach;

                (2)   to rescind any contract or transaction which has been
                      entered into between the Company and such a director,
                      supervisor, the president, vice-president, Chief
                      Financial Officer or secretary of the board of directors
                      or between the Company and a third party (where such
                      third party knows or should have known that such a
                      director, supervisor, the president, vice-president,
                      Chief Financial Officer or secretary of the board of
                      directors representing the Company has breached his
                      duties owed to the Company);

                (3)   to demand such a director, supervisor, the president,
                      vice-president, Chief Financial Officer or secretary of
                      the board of directors to surrender the gains made as
                      result of the breach of his obligations;

                (4)   to recover any monies which should have been received by
                      the Company and which were received by such a director,
                      supervisor, the president, vice-president, Chief
                      Financial Officer or secretary of the board of directors
                      instead, including (without limitation to) commissions;
                      and

                (5)   to demand repayment of interest earned or which may have
                      been earned by a director, supervisor, the president,
                      vice-president, Chief Financial Officer or secretary of
                      the board of directors officer on money that should have
                      been paid to the Company.

Article 165     If a director, supervisor, the president, vice-president,
                Chief Financial Officer or secretary of the board of directors
                has violated the law, administrative rules or these Articles
                of Association in discharging his duties thereby causing
                damage to the Company, he shall be liable for compensation.
                Shareholders shall have the right to ask the Company to
                commence legal or arbitration proceedings to claim for
                compensation according to law.

Article 166    The Company shall make written contract with a director or
                supervisor in relation to the rights and duties of the Company
                and the director/supervisor, emoluments and term of office of
                the director/supervisor, liability of the director/supervisor
                for breach of law, regulations and these Articles of
                Association and compensation for early termination of the
                contract, etc. The emoluments shall be approved in advance by
                the shareholders in a general meeting. The aforesaid
                emoluments include:

                (1)   emoluments in respect of his service as director,
                      supervisor, president, vice-president, Chief Financial
                      Officer or secretary of the board of directors of the
                      Company;

                (2)   emoluments in respect of his acting as a senior officer
                      (including but without limitation to a director,
                      supervisor and the president) of any subsidiary of the
                      Company;

                (3)   emoluments in respect of the provision of other services
                      in connection with the management of the affairs of the
                      Company and any of its subsidiaries;

                (4)   payment by way of compensation for loss of office, or as
                      consideration for or in connection with his retirement
                      from office.

                No proceedings may be brought by a director or supervisor
                against the Company for anything due to him in respect of the
                matters mentioned in this Article except pursuant to the
                contract mentioned above.

Article 167     The contract concerning the emoluments between the
                Company and its directors or supervisors should provide that
                in the event that the Company is acquired, the Company's
                directors and supervisors shall, subject to the prior approval
                of shareholders in a general meeting, have the right to
                receive compensation or other payment in respect of his loss
                of office or retirement. For the purposes of this paragraph,
                the acquisition of the Company includes any of the following:

                (1)   an offer made by any person to the general body of
                      shareholders;

                (2)   an offer made by any person with a view to the offeror
                      becoming a "controlling shareholder" within the meaning
                      of Article 56 hereof.

                If the relevant director or supervisor does not comply with
                this Article, any sum so received by him shall belong to those
                persons who have sold their shares as a result of such offer.
                The expenses incurred in distributing such sum on a pro rata
                basis amongst such persons shall be borne by the relevant
                director or supervisor and shall not be paid out of such sum.

     CHAPTER 15      FINANCIAL AND ACCOUNTING SYSTEMS, PROFIT DISTRIBUTION AND
                     AUDITING

Article 168     The Company shall establish its financial and accounting
                systems in accordance with laws, administrative regulations
                and PRC accounting standards formulated by the finance
                regulatory department of the State Council.

Article 169     The accounting year of the Company shall adopt the
                calendar year, i.e. starting from the 1 January of every
                calendar year and to 31 December of every calendar year. The
                Company shall adopt Renminbi as its denominated currency for
                booking and accounting purposes , the account books shall be
                recorded in Chinese. At the end of each fiscal year, the
                Company shall prepare a financial report which shall be
                examined and verified in a manner prescribed by law.

Article 170     The board of directors of the Company shall place before
                the shareholders at every annual general meeting such
                financial reports which the relevant laws, administrative
                regulations and directives promulgated by competent regional
                and central governmental authorities require the Company to
                prepare. These reports shall be verified.

Article 171     The Company's financial reports shall be made available
                for shareholders' inspection at the Company twenty (20) days
                before the date of every shareholders' annual general meeting.
                Each shareholder shall be entitled to have a copy of the
                financial reports referred to in this Chapter.

                The Company shall deliver or send to each shareholder of
                Overseas-Listed Foreign-Invested Shares by prepaid mail at the
                address registered in the register of shareholders the said
                reports not later than twenty-one (21) days prior to the date
                of every annual general meeting of the shareholders.

Article 172     The financial statements of the Company shall, in addition to
                being prepared in accordance with PRC accounting standards and
                regulations, be prepared in accordance with either
                international accounting standards, or that of the place
                outside the PRC where the Company's shares are listed. If
                there is any material difference between the financial
                statements prepared respectively in accordance with the two
                accounting standards, such difference shall be stated in the
                financial statements. In distributing its profits after tax,
                the lower of the two amounts shown in the financial statements
                shall be adopted.

Article 173     Any interim results or financial information published or
                disclosed by the Company must also be prepared and presented
                in accordance with PRC accounting standards and regulations,
                and also in accordance with either international accounting
                standards or that of the place overseas where the Company's
                shares are listed.

Article 174     The Company shall publish its financial reports four times in
                each fiscal year, that is, the report for the first quarter
                shall be published within thirty (30) days after the
                expiration of the first three (3) months of each fiscal year;
                the biannual financial report shall be published within sixty
                (60) days after the expiration of the first six (6) months of
                each fiscal year; the report for the third quarter shall be
                published within thirty (30) days after the expiration of the
                first nine (9) months of each fiscal year; and the annual
                financial report shall be published within one hundred and
                twenty (120) days after the expiration of each fiscal year.
                Annual financial reports shall be checked and verified as
                required by law.

Article 175     Annual financial reports and biannual financial reports
                which deal with biannual profit distribution shall include the
                followings:

                (1)   balance sheet;

                (2)   statement of profit;

                (3)   statement of profit distribution;

                (4)   cash flow statement;

                (5)   explanatory notes to accounting statements.

                If the Company does not make biannual profit distribution, the
                biannual financial report shall include the above accounting
                statements and explanatory notes save sub-paragraph (3).

Article 176     The Company shall not keep accounts other than those
                required by law. Assets of the Company will not be deposited
                into any account opened in the name of an individual.

Article 177     When allocating the after-tax profits of the current year,
                the Company shall allocate (10) ten percent of its profit to
                the statutory common reserve fund, and allocate (5) five
                percent to (10) ten percent of its profit to the statutory
                public welfare fund. In the event that the accumulated
                statutory common reserve fund of the Company has reached more
                than (50) fifty percent of the registered capital of the
                Company, no allocation is needed.

                In the event that the statutory common reserve fund of the
                Company is insufficient to make up the losses of the Company
                on the previous year, before allocating the statutory common
                reserve fund and the statutory public welfare fund in
                accordance with the stipulations of the previous paragraph,
                the Company shall first make up the losses by using the
                profits of the current year.

                After allocating the statutory common reserve fund and public
                welfare fund from the after-tax profits of the Company, the
                Company can allocate the arbitrary common reserve fund
                according to the resolution of shareholders' general meeting.
                The remaining profits after making-up the losses, allocating
                the common reserve funds and the statutory public welfare fund
                shall be distributed in accordance with the proportion of
                shares held by the shareholders.

Article 178     Before making-up the losses, allocating the surplus common
                reserve funds and the statutory public welfare fund, the
                Company shall not allocate the dividends or carry out other
                allocations by way of bonus.

Article 179     Capital common reserve fund includes the following items:

                (1)   premium on shares issued at a premium price;

                (2)   any other income designated for the capital common
                      reserve fund by the regulations of the finance
                      regulatory department of the State Council.

Article 180     The common reserve fund of the Company shall be applied for
                compensating the losses or converting the common reserve fund
                into the capital of the Company. When such conversion takes
                place upon the approval of shareholders in a general meeting,
                the Company shall distribute new shares in proportion to the
                existing shareholders' number of shares, provided, however,
                that when the statutory common reserve fund is converted to
                capital nature, the balance of the statutory common reserve
                fund may not fall below 25% of the registered capital.

Article 181     The Company's statutory public welfare fund is used for
                the collective welfare of the Company's employees.

Article 182     After the Company's shareholders have approved in a
                general meeting the proposal for profit distribution or for
                conversion of the common reserve fund into capital of the
                Company, the Company's board of directors shall complete the
                distribution or conversion of dividends (or shares) within two
                (2) months of the general meeting.

Article 183     The Company may distribute dividends in the form of:

                (1)   cash;

                (2)   shares.

Article 184     The Company shall calculate, declare and pay dividends and
                other amounts which are payable to holders of
                Domestic-Invested Shares in Renminbi. The Company shall
                calculate and declare dividends and other payments which are
                payable to holders of Overseas-Listed Foreign-Invested Shares
                in Renminbi, and shall pay such amounts in Hong Kong Dollars.
                As for the foreign currency needed by the Company for payment
                of cash dividends and other funds which are payable to the
                holders of the Overseas-Listed Foreign-Invested Shares, it
                shall be handled in accordance with any related national
                regulations on foreign exchange control.

Article 185     Unless otherwise provided by the relevant laws and
                administrative regulations, as regards dividends and other
                amounts payable in Hong Kong dollars, the applicable exchange
                rate shall be the average benchmark rate for the relevant
                foreign currency determined by the Peoples' Bank of China and
                announced by the State Administration of Foreign Exchange
                during the week prior to the announcement of payment of
                dividend and other amounts.

Article 186     Unless the shareholders have approved otherwise in a
                general meeting, the board of directors may determine to make
                half-yearly dividends distribution. Unless otherwise provided
                by the relevant laws and administrative regulations, the
                amount of the half-yearly dividends distribution shall not
                exceed 50% of the profits shown in the biannual statement of
                profit of the Company.

Article 187     In the event of allocating the dividends to shareholders
                of the Company, the payable taxes on the dividend incomes of
                the shareholders shall be withdrawn in accordance with the
                requirements of Taxation Law of China and in consideration of
                the allocated sum.

Article 188     The Company shall appoint receiving agents for holders of the
                Overseas-Listed Foreign-Invested Shares. Such receiving agents
                shall receive dividends which have been declared by the
                Company and all other amounts which the Company should pay to
                holders of Overseas-Listed Foreign-Invested Shares on such
                shareholders' behalf. The receiving agents appointed by the
                Company shall meet the relevant requirements of the laws of
                the place at which the stock exchange on which the Company's
                shares are listed or the relevant regulations of such stock
                exchange.

                The receiving agents appointed for holders of Overseas-Listed
                Foreign-Invested Shares listed in Hong Kong shall each be a
                company registered as a trust company under the Trustee
                Ordinance of Hong Kong.

Article 189     The Company adopts the system of internal auditing and
                hires professional auditors to undertake internal auditing of
                the Company's financial income and expenditure and economic
                activities.

Article 190     The Company's internal auditing system and duties of the
                auditors shall be implemented after they have been approved by
                the board of directors.

                  CHAPTER 16 APPOINTMENT OF ACCOUNTING FIRMS

Article 191     The Company shall appoint an independent firm of
                accountants which is qualified under the relevant regulations
                of the State to audit the Company's annual financial report
                and review other financial reports, to conduct verification of
                net asset value and other relevant consulting service
                business.

                Engagement of the firm of accountants shall be determined in a
                shareholders' general meeting.

Article 192     The auditors appointed by the Company shall hold office
                from the conclusion of the annual general meeting of
                shareholders at which they were appointed until the conclusion
                of the next annual general meeting of shareholders.

Article 193     The auditors appointed by the Company shall enjoy the
                following rights:

                (1)   a right to review to the books, records and vouchers of
                      the Company at any time, the right to require the
                      directors, supervisors, president, vice-president, Chief
                      Financial Officer and secretary of the board of
                      directors of the Company to supply relevant information
                      and explanations;

                (2)   a right to require the Company to take all reasonable
                      steps to obtain from its subsidiaries such information
                      and explanation as are necessary for the discharge of
                      its duties;

                (3)   a right to attend shareholders' general meetings and to
                      receive all notices of, and other communications
                      relating to, any shareholders' general meeting which any
                      shareholder is entitled to receive, and to speak at any
                      shareholders' general meeting in relation to matters
                      concerning its role as the Company's accounting firm.

Article 194     If there is a vacancy in the position of the accounting
                firm, the board of directors may appoint an accounting firm to
                fill such vacancy before the convening of the shareholders'
                general meeting. Any other accounting firm which has been
                appointed by the Company may continue to act during the period
                during which a vacancy arises.

Article 195     The shareholders in a general meeting may by ordinary
                resolution remove the accounting firm before the expiration of
                its term of office, irrespective of the provisions in the
                contract between the Company and the accounting firm. However,
                the right of the accounting firm in claiming for damages which
                arise from its removal shall not be affected thereby.

Article 196     The remuneration of an accounting firm or the manner in
                which such firm is to be remunerated shall be determined by
                the shareholders in a general meeting. The remuneration of an
                accounting firm appointed by the board of directors which is
                to fill the vacancy shall be determined by the board of
                directors and approved by the shareholders' general meeting.

Article 197     The Company's appointment, removal or non-reappointment of
                an accounting firm shall be resolved by the shareholders in a
                general meeting and disclosed in the relevant newspapers and
                publications stating the reasons for removal, if necessary.
                Such resolution shall be filed with the securities authority
                of the State Council and The Chinese Institute of Certified
                Public Accountants.

                Where a resolution at a general meeting of shareholders is
                passed to appoint an accounting firm other than an incumbent
                accounting firm, to fill a casual vacancy in the office of the
                accounting firm, to reappoint an accounting firm who was
                appointed by the board of directors to fill a casual vacancy
                or to remove an accounting firm before expiry of its term of
                office, the following provisions shall apply:

                (1)   A copy of the appointment or removal proposal shall be
                      sent (before issue of the notice of meeting) to the firm
                      proposed to be appointed or proposing to leave its post
                      or the firm which has left its post in the relevant
                      fiscal year. Reference as leaving herein includes
                      leaving by removal, resignation and retirement.

                (2)   If the accounting firm leaving its post makes
                      representations in writing and requests the Company to
                      give the shareholders notice of such representations,
                      the Company shall (unless the representations have been
                      received too late) take the following measures:

                      (i)   in any notice of the resolution given to
                            shareholders, state the fact of the
                            representations having been made by the accounting
                            firm leaving its post; and

                      (ii)  attach a copy of the representations to the notice
                            and deliver it to the shareholders in the manner
                            stipulated in the Company's Articles of
                            Association.

                (3)   If the Company fails to circulate the accounting firm's
                      representations in the manner set out in sub-paragraph
                      (2) above, such accounting firm may (in addition to its
                      right to be heard) require that the representations be
                      read out at the meeting.

                (4)   An auditor which is retired from its office shall be
                      entitled to attend the following shareholders' general
                      meetings:

                      (i)   the general meeting at which its term of office
                            would otherwise have expired;

                      (ii)  the general meeting at which it is proposed to
                            fill the vacancy caused by its removal; and

                      (iii) the general meeting which convened as a result of
                            its voluntary resignation:

                      The leaving accounting firm has the right to receive all
                      notices of, and other communications relating to, any
                      such meeting, and to speak at any such meeting which it
                      attends on any part of the business of the meeting which
                      concerns it as the former accounting firm of the
                      Company.

Article 198     Prior notice should be given to the accounting firm 30 days in
                advance if the Company decides to remove such accounting firm
                or not to renew the appointment thereof. Such accounting firm
                shall be entitled to make representations at the shareholders'
                general meeting. Where the accounting firm considers that
                there is no proper reason for the removal or the non-renewal
                of appointment, it may appeal to the securities regulatory
                authority of the State Council and The Chinese Institute of
                Certified Public Accountants. Where the accounting firm
                resigns from its position as the Company's auditors, it shall
                make clear to the shareholders in a general meeting whether
                there has been any impropriety on the part of the Company.

                An accounting firm may resign its office by depositing at the
                Company's domicile a resignation notice which shall become
                effective on the date of such deposit or on such later date as
                may be stipulated in such notice. Such notice shall contain
                the following statements:

                (1)   a statement to the effect that there are no
                      circumstances connected with its resignation which it
                      considers should be brought to the notice of the
                      shareholders or creditors of the Company; or

                (2)   a statement of any such circumstances.

                Where a notice is deposited under the preceding sub-paragraph,
                the Company shall within fourteen (14) days send a copy of the
                notice to the relevant governing authority. If the notice
                contains a statement under the preceding sub-paragraph (2), a
                copy of such statement shall be placed at the Company for
                shareholders' inspection. The Company should also send a copy
                of such statement by prepaid mail to every shareholder of
                Overseas-Listed Foreign Shares at the address registered in
                the register of shareholders.

                Where the accounting firm's notice of resignation contains a
                statement in respect of the above, it may require the board of
                directors to convene a shareholders' extraordinary general
                meeting for the purpose of receiving an explanation of the
                circumstances connected with its resignation.

                 CHAPTER 17 MERGER AND DIVISION OF THE COMPANY

Article 199     The Company may carry out mergers or division in accordance
                with law. In the event of merger or division of the Company,
                the following procedures shall be adopted:

                (1)   a proposal for merger or division be drawn up in a board
                      meeting;

                (2)   a resolution be made in a shareholders' general meeting
                      in accordance with these Articles of Association;

                (3)   a contract for merger or division be made by the
                      relevant parties;

                (4)   the relevant procedures for approval be gone through
                      according to law;

                (5)   disposal of credit rights and liabilities in the merger
                      or division;

                (6)   registration of dissolution or modification.

                In the case of merger or division of the Company, the board of
                directors of the Company shall take necessary measures to
                protect the legitimate interests of the shareholders who
                object to the plan of merger or division. A shareholder who
                objects to the plan of merger or division shall have the right
                to demand the Company or the shareholders who consent to the
                plan of merger or division to acquire such dissenting
                shareholders' shareholding at a fair price.

                The contents of the resolution of merger or division of the
                Company shall constitute special documents which shall be
                available for inspection by the shareholders of the Company.
                Such special documents shall be sent by mail to holders of
                Overseas-Listed Foreign-Invested Shares.

Article 200     The merger of the Company may take the form of either merger
                by absorption or merger by the establishment of a new company.

                In the event of a merger, the merging parties shall execute a
                merger agreement and prepare a balance sheet and an inventory
                of assets. The Company shall notify its creditors within ten
                (10) days from the date of the Company's merger resolution
                which is passed at a shareholders' general meeting and shall
                publish a public notice in a newspaper at least three (3)
                times within thirty (30) days of the date of the Company's
                merger resolution.

Article 201     Where there is a division of the Company, its assets shall be
                divided up accordingly. In the event of division of the
                Company, the parties to such division shall execute a division
                agreement and prepare a balance sheet and an inventory of
                assets. The Company shall notify its creditors within ten (10)
                days from the date of the Company's division resolution which
                is passed at a shareholders' general meeting and shall publish
                a public notice in a newspaper at least three (3) times within
                thirty (30) days of the date of the Company's division
                resolution.

Article 202     A creditor shall have the right either within 30 days of
                receipt of the notice if he has received a notice or within 90
                days of the first announcement if he has not received a notice
                to require the Company to settle indebtedness or provide the
                relevant security. If the Company fails to settle the
                indebtedness or provide the relevant security, the merger or
                division shall not be proceeded with.

Article 203     Disposal of the assets, credit rights and liabilities of
                the parties to the merger or division shall be provided
                explicitly in a contract. After the merger, the rights against
                debtors and the indebtedness of each of the parties to the
                merger shall be inherited by the company which survives the
                merger or the newly established company.

                Debts of the Company prior to division shall be assumed by the
                companies which exist after the division in accordance with
                the agreement of the parties.

Article 204     The Company shall, in accordance with law, apply for
                change in its registration with the companies registration
                authority where a change in any item in its registration
                arises as a result of any merger or division. Where the
                Company is dissolved, the Company shall apply for cancellation
                of its registration in accordance with law. Where a new
                company is established, the Company shall apply for
                registration thereof in accordance with law.

                    CHAPTER 18 DISSOLUTION AND LIQUIDATION

Article 205     The Company shall be dissolved and liquidated upon the
                occurrence of any of the following events:

                (1)   a resolution regarding the dissolution is passed by
                      shareholders at a general meeting;

                (2)   dissolution is necessary due to a merger or division of
                      the Company;

                (3)   the Company is legally declared insolvent due to its
                      failure to repay debts as they become due; and

                (4)   the Company is ordered to close down because of its
                      violation of laws and administrative regulations.

Article 206     Where the Company is dissolved under sub-paragraph (1) of the
                preceding paragraph, a liquidation committee shall be set up
                within fifteen (15) days thereafter, and the composition of
                the liquidation committee of the Company shall be determined
                by an ordinary resolution of shareholders in a general
                meeting. Where a liquidation committee is not established
                according to schedule, the creditor may apply to the People's
                Court to organize the relevant personnel to establish a
                liquidation committee to proceed the liquidation.

                Where the Company is dissolved under sub-paragraph (2) of the
                preceding Article, the liquidation shall be conducted by the
                parties to the merger or division in accordance with the
                contract or agreement made at the time of merger or division.
                Where the Company is dissolved under sub-paragraph (3) of the
                preceding Article, the People's Court shall in accordance with
                the provisions of relevant laws organize the shareholders,
                relevant organizations and relevant professional personnel to
                establish a liquidation committee to proceed the liquidation.
                Where the Company is dissolved under sub-paragraph (4) of the
                preceding Article, the relevant governing authorities shall
                organize the shareholders, relevant organizations and
                professional personnel to establish a liquidation committee to
                proceed with the liquidation.

Article 207     Where the board of directors proposes to liquidate the Company
                for any reason other than the Company's declaration of its own
                insolvency, the board shall include a statement in its notice
                convening a shareholders' general meeting to consider the
                proposal to the effect that, after making full inquiry into
                the affairs of the Company, the board of directors is of the
                opinion that the Company will be able to pay its debts in full
                within twelve (12) months from the commencement of the
                liquidation.

                Upon the passing of the resolution by the shareholders in a
                general meeting in relation to the liquidation of the Company,
                all duties and powers of the board of directors and the
                president shall cease.

                The liquidation committee shall act in accordance with the
                instructions of the shareholders' general meeting to make a
                report at least once every year to the shareholders' general
                meeting on the committee's income and expenses, the business
                of the Company and the progress of the liquidation; and to
                present a final report to the shareholders' general meeting on
                completion of the liquidation.

Article 208     The liquidation committee shall, within ten (10) days of
                its establishment, send notices to creditors and shall, within
                sixty (60) days of its establishment, publish a public
                announcement at least three (3) times in a newspaper published
                by the securities regulatory authority of the State Council.
                The liquidation committee shall register the creditors'
                rights.

Article 209     During the liquidation period, the liquidation committee
                shall exercise the following functions and powers:

                (1)   to categorise the Company's assets and prepare a balance
                      sheet and an inventory of assets respectively;

                (2)   to notify the creditors or to publish public
                      announcements;

                (3)   to dispose of and liquidate any unfinished businesses of
                      the Company;

                (4)   to pay all outstanding taxes;

                (5)   to settle claims and debts;

                (6)   to deal with the surplus assets remaining after
                      repayment by the Company of its debts;

                (7)   to represent the Company in any civil proceedings.

Article 210     After it has categories the Company's assets and after it
                has prepared the balance sheet and an inventory of assets, the
                liquidation committee shall formulate a liquidation plan and
                present it to a shareholders' general meeting or to the
                relevant governing authority for confirmation.

                After the initial payment of the settlement expense, the
                assets of the Company shall be liquidated in the following
                order:

                (i)   salary and labor insurance expenses of the staff members
                      of the Company;

                (ii)  outstanding taxes;

                (iii) bank loans, debentures and debts to other companies.

                Any surplus assets of the Company remaining after its debts
                have been repaid in accordance with the provisions of the
                preceding paragraph shall be distributed to its shareholders
                according to the class of shares and the proportion of shares
                held:

                (1)   In case of the preferred shares, the allocation shall be
                      first given to the holders of the preferred shares in
                      accordance with the face value of the preferred shares;
                      if it is insufficient to repay the preferred shares, the
                      allocation shall be carried out in accordance with the
                      proportions of the preferred shares held by them
                      respectively;

                (2)   The allocation shall be carried out in accordance with
                      proportions of shares held by the holders of ordinary
                      shares.

                During the liquidation period, the Company shall not commence
                any new business activities.

Article 211     Upon completion of the categorisation of the Company's assets
                and preparation a balance sheet and an inventory of assets in
                connection with the liquidation of the Company, the
                liquidation committee discovers that the Company's assets are
                insufficient to repay the Company's debts in full, the
                liquidation committee shall immediately apply to the People's
                Court for a declaration of insolvency. After a Company is
                declared insolvent by a ruling of the People's Court, the
                liquidation committee shall transfer all matters arising from
                the liquidation to the People's Court.

Article 212     Following the completion of the liquidation, the
                liquidation committee shall prepare a liquidation report, a
                statement of income and expenses received and made during the
                liquidation period and a financial report, which shall be
                verified by a Chinese registered accountant and submitted to
                the shareholders' general meeting or the relevant governing
                authority for confirmation.

                The liquidation committee shall, within thirty (30) days after
                the confirmation of the liquidation report, submit the
                documents referred to in the preceding paragraph to the
                companies registration authority and apply for cancellation of
                registration of the Company, and publish a public announcement
                relating to the termination of the Company.

 CHAPTER 19 PROCEDURES FOR AMENDMENT OF THE COMPANY'S ARTICLES OF ASSOCIATION

Article 213     The Company may amend its Articles of Association in
                accordance with the requirements of laws, administrative
                regulations and the Company's Articles of Association.

Article 214     The Company shall amend these Articles of Association on
                the occurrence of any of the following events:

                (1)   the Company Law or the relevant laws or administrative
                      regulations are amended and these Articles of
                      Association are in conflict with the amended laws or
                      administrative regulations;

                (2)   there is change to the Company which makes it not
                      consistent with these Articles of Association;

                (3)   it has been approved by the shareholders in a general
                      meeting to amend these Articles of Association.

Article 215     Any amendment of these Articles of Association shall be made
                in the following manner:

                (1)   The Board of Directors shall pass a resolution to draw
                      up a proposal for amendment of the Company's Article of
                      Association in accordance with these Articles of
                      Association;

                (2)   The foregoing proposal shall be furnished to the
                      shareholders in writing and a shareholders' meeting
                      shall be convened;

                (3)   The amendments shall be approved by a special resolution
                      in a shareholders' general meeting.

                The board of directors shall amend these Articles of
                Association pursuant to the resolution of shareholders in a
                general meeting for amendment of these Articles of Association
                and the approval opinions of the competent authority.

                Amendment of these Articles of Association involving the
                contents of the Mandatory Provisions shall become effective
                upon receipt of approvals from the companies approving
                department authorized by the State Council.

Article 216     If there is any change relating to the registered
                particulars of the Company, application shall be made for
                change in registration in accordance with law. If the
                amendment to the Articles of Association is a matter which is
                required by the relevant laws and regulations to be disclosed,
                an announcement shall be made in accordance with the
                provisions of those laws and regulations.

                               CHAPTER 20 NOTICE

Article 217     Notices of the Company shall be issued in the following
                manner: (1) by hand; (2) by post; (3) by public announcement;
                (4) any other manner as provided in these Articles of
                Association.

                If a notice of the Company is issued by public announcement,
                it shall be deemed received by the relevant officers once
                announced.

                Unless otherwise provided in these Articles of Association,
                notices, information or written statement issued by the
                Company to holders of Overseas-Listed Foreign-Invested Shares
                shall be personally delivered to the registered address of
                each of such shareholders, or sent by pre-paid mail to each of
                such shareholders.

Article 218     If a notice of the Company is issued by hand, the date
                when the recipient signed or stamped to acknowledge receipt of
                the same shall be regarded as the date of service of the
                notice.

                If a notice of the Company is issued by public announcement,
                the date of the first publication of the announcement shall be
                regarded as the date of service of the announcement.

                All notices which are to be sent by mail shall be clearly
                addressed, postage pre-paid, and shall be put into envelopes
                before being posted by mail. Such letters of notice shall be
                deemed to have been received by shareholders on the third
                working day since it is left with the post office.

Article 219     If a notice of meeting is accidentally omitted to be sent
                to any person who is entitled to receive the same or that
                person has not received such a notice of meeting, it will not
                cause the meeting and any resolution made therein to be void.

                       CHAPTER 21 RESOLUTION OF DISPUTES

Article 220     The Company shall abide by the following principles for
                dispute resolution:

                (1)   Whenever any disputes or claims arise between: holders
                      of the Overseas-Listed Foreign-Invested Shares and the
                      Company; holders of the Overseas-Listed Foreign-Invested
                      Shares and the Company's, directors, supervisors,
                      president, vice-presidents, Chief Financial Officer or
                      the secretary of the board of directors; or holders of
                      the Overseas-Listed Foreign-Invested Shares and holders
                      of Domestic-Invested Shares, in respect of any disputes
                      or claims in relation to the affairs of the Company
                      arising as a result of any rights or obligations arising
                      from these Articles of Association, the Company Law or
                      other relevant laws and administrative regulations, such
                      disputes or claims shall be referred by the relevant
                      parties to arbitration.

                      Where a dispute or claim of rights referred to in the
                      preceding paragraph is referred to arbitration, the
                      entire claim or dispute must be referred to arbitration,
                      and all persons who have a cause of action based on the
                      same facts giving rise to the dispute or claim or whose
                      participation is necessary for the resolution of such
                      dispute or claim, shall, where such person is the
                      Company or the Company's shareholders, directors,
                      supervisors, president, vice-presidents, Chief Financial
                      Officer or the secretary of the board of directors,
                      comply with the decisions made in the arbitration.
                      Disputes in respect of the definition of shareholders
                      and disputes in relation to the register of shareholders
                      need not be resolved by arbitration.

                (2)   A claimant may elect for arbitration to be carried out
                      at either the China International Economic and Trade
                      Arbitration Commission in accordance with its Rules or
                      the Hong Kong International Arbitration Center in
                      accordance with its Securities Arbitration Rules. Once a
                      claimant refers a dispute or claim to arbitration, the
                      other party must submit to the arbitral body elected by
                      the claimant.

                      If a claimant elects for arbitration to be carried out
                      at Hong Kong International Arbitration Center, any party
                      to the dispute or claim may apply for a hearing to take
                      place in Shenzhen in accordance with the Securities
                      Arbitration Rules of the Hong Kong International
                      Arbitration Center.

                (3)   If any disputes or claims of rights are settled by way
                      of arbitration in accordance with sub-paragraph (1) of
                      this Article, the laws of the PRC shall apply, save as
                      otherwise provided in the laws and administrative
                      regulations.

                (4)   The judgement of an arbitral body shall be final and
                      conclusive and binding on all parties.

                           CHAPTER 22 SUPPLEMENTARY

Article 221     These Articles of Association are written in Chinese and
                English. If there is any conflict between the two versions,
                the Chinese version shall prevail.

Article 222     The expressions of "above", "within" and "below" shall
                include the figures mentioned whilst the expressions of "short
                of" and "less than" shall not include the figures mentioned.

Article 223     The right to interpret these Articles of Association vests
                with the board of directors of the Company, and the right to
                revise these Articles of Association vests with shareholders'
                general meeting.

Article 224     If these Articles of Association are in conflict with the
                laws, administrative regulations or provisions of other
                regulatory documents promulgated from time to time, the laws,
                administrative regulations and provisions of other regulatory
                documents shall prevail.

Article 225     In these Articles of Association, references to
                "accounting firm" shall have the same meaning as "auditors".
                In these Articles of Association, references to "president"
                shall have the same meaning as "manager".


Appendix II       Rules and Procedures for the Shareholders' General Meetings

                         Chapter 1 General Provisions

Article 1       In order to safeguard the legitimate interests of China
                Petroleum & Chemical Corporation (the "Company") and its
                shareholders, to specify the duties, responsibilities and
                authority of the shareholders' general meetings, to ensure the
                proper, efficient and smooth operation of the shareholders'
                general meeting and to ensure the shareholders' general
                meeting exercises its functions and powers according to law,
                these Rules are formulated according to the "Company Law of
                the People's Republic of China" (the "Company Law"),
                "Mandatory Provisions for the Articles of Association of
                Companies to be Listed Overseas", "Guidelines for the Articles
                of Association of Listed Companies", "Standards for the
                Governance of Listed Companies" and "Regulatory Opinions
                Regarding General Meetings of Listed Companies" and other
                relevant laws and regulations regulating listed companies
                inside and outside the PRC and the Articles of Association of
                China Petroleum & Chemical Corporation ("Articles of
                Association").

Article 2       These Rules apply to the shareholders' general meetings of the
                Company and shall be binding on the Company, all shareholders,
                authorised proxies of the shareholders, directors,
                supervisors, president, vice-president, Chief Financial
                Officer, secretary of the board of directors and other
                relevant personnel present at the meeting.

Article 3       Shareholders' general meetings are divided into annual general
                meetings (hereinafter referred to as "AGM"), extraordinary
                general meetings; or all shareholders' general meetings or
                class shareholders' general meetings.

Article 4       AGMs are held once every year within six months from the end
                of the previous accounting year.

Article 5       For the shareholders' general meetings convened each year, all
                of them are extraordinary general meetings except the AGM. The
                extraordinary general meetings shall be arranged in the order
                of the year in which they are convened.

Article 6       Holders of different classes of shares are class shareholders.
                Except other class shareholders, holders of domestic shares
                and holders of H shares are deemed to be shareholders of
                different classes. If the Company intends to alter or annul
                the rights of class shareholders, it shall have such
                alteration or annulment approved by a special resolution at
                the shareholders' general meeting and shall convene a class
                shareholders' meeting in accordance with the provisions of the
                Articles of Association. Only class shareholders are entitled
                to attend class shareholders' meetings.

Article 7       The board of directors of the Company shall strictly comply
                with the provisions of the Company Law and other laws and
                regulations regarding the convening of shareholders' general
                meetings, and shall properly organise the shareholders'
                general meeting in a conscientious manner and on schedule. All
                directors of the Company are under a bona fide duty to ensure
                that the shareholders' general meeting is convened in order,
                and shall not obstruct the exercise of powers by the
                shareholders' general meeting according to law.

                The directors present at the meeting shall perform their
                duties in good faith, and shall ensure that the contents of
                the resolutions passed at the meeting are true, accurate and
                complete and shall not use any words and expressions that may
                easily cause ambiguity.

Article 8       Any shareholder who holds the shares of the Company legally
                and validly are entitled to attend or authorise a proxy to
                attend the shareholders' general meeting, and shall have the
                right to know the Company's affairs, the right to speak, the
                right to raise questions and the right to vote pursuant to law
                and these Rules.

                Shareholders and their proxies attending the shareholders'
                general meeting shall comply with the provisions of the
                relevant laws and regulations, Articles of Association and
                these Rules, and shall take the initiative to maintain the
                order of the meeting and shall not infringe the legitimate
                rights and interests of other shareholders.

Article 9       The Secretary to the board of directors of the Company shall
                be responsible for implementing the preparatory and
                organisation work for convening a shareholders' general
                meeting.

Article 10      In convening a shareholders' general meeting, the principle of
                cost-saving and simplicity shall be adhered to. No extra
                benefits shall be given to the shareholders (or their proxies)
                present at the meeting.

      Chapter 2 Functions and Powers of the Shareholders' General Meeting

Article 11      The shareholders' general meeting is the authority organ of
                the Company and shall exercise the following functions and
                powers according to law:

                (1)   to decide on the Company's operational policies and
                      investment plans;

                (2)   to elect and replace directors and to decide on matters
                      relating to the remuneration and liability insurance of
                      directors;

                (3)   to elect and replace supervisors who are shareholder
                      representatives and to decide on matters relating to the
                      remuneration and liability insurance of supervisors;

                (4)   to examine and approve the board of directors' reports;

                (5)   to examine and approve the supervisory committee's
                      reports;

                (6)   to examine and approve the Company's profit distribution
                      plans and loss recovery plans;

                (7)   to examine and approve the Company's proposed annual
                      preliminary and final financial budgets;

                (8)   to pass resolutions on the increase or reduction of the
                      Company's registered capital;

                (9)   to pass resolutions on matters such as merger, division,
                      dissolution and liquidation of the Company;

                (10)  to pass resolutions on the issue of debentures by the
                      Company;

                (11)  to pass resolutions on the appointment, dismissal and
                      non-reappointment of the accounting firm by the Company;

                (12)  to amend the Articles of Association and its appendices
                      (including the Rules and Procedures for the
                      Shareholders' General Meetings, Rules and Procedures for
                      the Board of Directors' Meetings and Rules and
                      Procedures for the Supervisors' Meetings);

                (13)  to consider motions raised by the supervisory committee
                      or shareholders who represent 5% or more of the total
                      number of voting shares of the Company at the annual
                      general meetings;

                (14)  to decide on other matters which, according to laws,
                      administrative regulations, rules of the competent
                      authorities and the Articles of Association, shall be
                      approved by the shareholders' general meetings.

                The shareholders' general meetings shall exercise its powers
                within the scope stipulated by the Company Law and shall not
                interfere with the decision of shareholders regarding their
                own rights.

           Chapter 3 Authority of the Shareholders' General Meetings

Article 12     Matters which, in accordance with laws, administrative
               regulations, rules of the relevant government authorities and
               provisions of the Articles of Association, fall within the
               scope of the authority of the shareholders' general meeting
               must be examined at such meeting so as to protect the
               decision-making power of the shareholders of the Company on
               such matters.

Article 13     In order to ensure and increase the stability and efficiency
               of the daily operations of the Company, the shareholders'
               general meeting authorises the board of directors of the
               Company, on a partial basis, to exercise the following powers
               on investment plans, asset disposals and external guarantees:

                (1)   Investment:

                      (i)   The shareholders' general meetings shall examine
                            and approve medium and long-term investment plans
                            and annual investment plans of the Company. The
                            board of directors is authorised to make
                            adjustments of not more than 15% of the amount of
                            the capital expenditure for the current year as
                            approved at the shareholders' general meeting.

                      (ii)  Individual project investments (including but not
                            limited to exploration and development, fixed
                            assets, external shareholdings) shall be approved
                            by the shareholders' general meeting if the
                            investment amounts are more than 5% of the latest
                            audited net asset value of the Company. The board
                            of directors is authorised to examine and approve
                            projects if the investment amount is not more than
                            5% of the latest audited net asset value of the
                            Company.

                      (iii) Where the Company uses its own assets to make
                            risky investment in areas not related to the
                            business of the Company (including but not limited
                            to debentures, futures, shares), risky investments
                            shall be approved by the shareholders' general
                            meeting if the amount of investment is more than
                            1% of the latest audited net asset value of the
                            Company. The board of directors is authorised to
                            examine and approve projects if the investment
                            amount is not more than 1% of the latest audited
                            net asset value of the Company.

                (2)   Asset disposal:

                      (i)   When the Company acquires or sells assets, it has
                            to take into account of the following 4 testing
                            indices: (1) total asset ratio: the total amount
                            of the assets to be acquired or sold (according to
                            the latest audited financial report, valuation
                            report or capital verification report) divided by
                            the latest audited total asset value of the
                            Company; (2) net profit (loss) ratio of the
                            acquisition: the absolute value of the net profit
                            or loss relating to the assets to be acquired
                            (according to the audited financial report of the
                            preceding year) divided by the absolute value of
                            the audited net profit or loss of the Company for
                            the preceding year; (3) net profit (loss) ratio of
                            the sale: the absolute value of the net profit or
                            loss relating to the assets to be sold (according
                            to the audited financial report of the preceding
                            year) or the absolute value of the profit or loss
                            arising from such transaction divided by the
                            absolute value of the audited net profit or loss
                            of the Company for the preceding year; (4)
                            transaction amount ratio: the transaction amount
                            (taking into account of the assumed liabilities
                            and costs, etc) of the acquired assets divided by
                            the total amount of the latest audited net asset
                            value of the Company.

                            The shareholders' general meeting shall examine
                            and approve any of the above projects with a ratio
                            of not less than 50%. The board of directors is
                            authorised to examine and approve any of the above
                            projects with a ratio of less than 50%.

                      (ii)  In disposing of fixed assets, where the total
                            value of the expected value of the fixed assets to
                            be disposed of and the value of the fixed assets
                            which have been disposed of in the four months
                            prior to such proposed disposal exceeds 33% of the
                            value of the fixed assets as shown in the latest
                            balance sheet considered by the shareholders'
                            general meeting, the shareholders' general meeting
                            shall examine and approve such disposal, and the
                            board of directors is authorised to examine and
                            approve those fixed asset disposals of less than
                            33%.

                            The disposal of fixed assets referred to in this
                            Article includes the transfer of certain asset
                            interests but excludes the provision of guarantee
                            by way of fixed assets.

                            The validity of the transactions for disposal of
                            fixed assets by the Company shall not be affected
                            by any breach of paragraph (2)(i) of this Article.

                      (iii) Regarding others (including but not limited to the
                            entering into, varying and termination of
                            important contracts relating to entrustment of
                            operation, entrusted operation, entrusted
                            financial management, contracting and leasing),
                            the relevant amount or the amount accumulated in
                            12 months shall be calculated according to one of
                            four testing indices referred to in paragraph
                            (2)(i) of this Article.

                            Any of the above projects with a ratio of more
                            than 5% shall be examined and approved by the
                            shareholders' general meeting. The board of
                            directors is authorised to examine and approve any
                            of the above projects with a ratio of not more
                            than 5%.

                 (3)  External guarantees

                      The Company shall not provide guarantees for its
                      shareholders, controlling subsidiaries of its
                      shareholders, subsidiary enterprises of shareholders or
                      personal liability. If the Company provides guarantees
                      to others, the guaranteed person shall provide
                      counter-guarantee to the Company or take other necessary
                      risk preventive measures.

                      If the guarantee amount exceeds 5% of the latest audited
                      net asset value of the Company, such guarantees shall be
                      examined and approved by the shareholders' general
                      meeting. The board of directors is authorised to examine
                      and approve guarantees of not more than 5% of the latest
                      audited net asset value of the Company.

                 (4)  If, when applying the relevant standards as set out
                      above, the approving offices of any investment, asset
                      disposal and external guarantee matters as referred to
                      above include both shareholders' general meeting and the
                      board of directors, such matters shall be submitted to
                      the shareholders' general meeting for approval.

                 (5)  If the above investment, asset disposal and external
                      guarantee matters constitute connected transactions
                      according to the regulatory stipulations of the places
                      where the Company is listed, the relevant matters shall
                      be dealt with according to the relevant stipulations.

Article 14      Under necessary and reasonable circumstances, as regards
                specific matters related to the matters to be resolved and
                those which cannot or are not required to be decided at the
                shareholders' general meeting, the shareholders' general
                meeting may authorise the board of directors or the secretary
                to the board of directors to decide within the scope of
                authority authorised by the shareholders' general meeting.

      CHAPTER 4 PROCEDURES FOR CONVENING A SHAREHOLDERS' GENERAL MEETING

Section 1       Putting Forward, Collecting and Examining Motions

Article 15      Motions put forward in a shareholders' general meeting shall
                be specific and shall relate to the matters which shall be
                discussed at a shareholders' general meeting.

Article 16      Motions at the shareholders' general meeting are usually put
                forward by the board of directors.

Article 17      Where two or more than half of the independent directors
                request the board of directors to convene an extraordinary
                general meeting, they shall be responsible for putting forward
                the motions to be examined at the meeting. If the board of
                directors disagrees with the convening of an extraordinary
                general meeting, it shall disclose the relevant details.

Article 18      Where the Company convenes an AGM, the supervisory committee
                or shareholders individually or jointly holding more than 5%
                of the total voting shares of the Company are entitled to put
                forward provisional motions. If the proposing shareholders
                have any objection to the decision of the board of directors
                of not including their motions in the agenda, they may request
                the convening of an extraordinary general meeting according to
                the provisions of these Rules.

Article 19      Where the supervisory committee proposes to convene a
                shareholders' general meeting, it shall be responsible for
                putting forward motions.

Article 20      Where shareholders individually or jointly holding more than
                10% of the Company's voting shares propose to convene a
                shareholders' general meeting, the proposing shareholders
                shall be responsible for putting forward the motions, whether
                or not the meeting is convened by the board of directors.

Article 21      Before the Chairman of the board of directors issues a notice
                of the board meeting relating to the convening of a
                shareholders' general meeting, the secretary to the board of
                directors may collect motions from shareholders individually
                holding more than 5% of the Company's voting shares (at the
                time of proposing to convene an AGM) or shareholders
                individually holding more than 10% of the Company's voting
                shares (at the time of proposing to convene an extraordinary
                general meeting), supervisors and independent directors and
                submit the same to the board of directors for examination and
                approval and subsequently submit the same as motions to the
                shareholders' general meeting for examination.

Article 22      The following motions shall be put forward at the AGM for
                consideration:

                (1)   to examine the board of directors' annual reports,
                      including the investment plans and operation strategy
                      for the following year;

                (2)   to examine the supervisory committee's annual reports;

                (3)   to examine the Company's audited final budget proposal
                      for the preceding year;

                (4)   to examine and approve the Company's profit distribution
                      plans and loss recovery plans for the preceding year;

                (5)   to appoint, dismiss or not to reappoint the accounting
                      firm.

Article 23      Shareholders individually or jointly holding more than 5% of
                the Company's voting shares are entitled to put forward
                provisional motions at an AGM. The board of directors shall
                examine and approve such shareholders' motions according to
                the following principles:

                (1)   Relevance. The board of directors shall conduct
                      preliminary examination of a motion, that is, the motion
                      should be submitted or delivered to the board of
                      directors or chairman of the meeting in a written form,
                      and the contents of the motion shall comply with laws,
                      administrative regulations and the Articles of
                      Association, shall fall within the scope of business of
                      the Company and the duties of the shareholders' general
                      meeting, and shall cover a specific subject for
                      discussion with concrete matters to be resolved. If the
                      motion complies with the above requirements, it shall be
                      submitted to the AGM for discussion. Otherwise no such
                      submission shall be effected. If the board of directors
                      decides not to submit the shareholders' motion to the
                      AGM for voting, it shall give an explanation and
                      statement at the AGM.

                (2)   Procedures. The board of directors may decide on the
                      procedural issues relating to the motion. Where a motion
                      needs to be divided into different motions or merged
                      with other motions to be voted on, consent of the person
                      putting forward the original motion is required. If the
                      person putting forward the original motion does not
                      agree with any change, the chairman of the meeting may
                      request the AGM to decide on the procedural issues and
                      conduct discussion according to the procedures decided
                      by the AGM.

Article 24      Where the supervisory committee or shareholders individually
                or jointly holding more than 10% of the Company's voting
                shares propose to convene an extraordinary general meeting or
                class shareholders' general meeting, they may sign one or more
                written request(s) of identical form and contents stating the
                topics for discussion at the meeting, and at the same time
                submit motions complying with the above requirements of these
                Rules to the board of directors.

Article 25      Motions involving the following circumstances shall be deemed
                to lead to a change or abrogation of the rights of a class
                shareholder and the board of directors shall submit them to a
                class shareholders' general meeting for examination:

                (1)   to increase or decrease the number of shares of such
                      class, or to increase or decrease the number of shares
                      of a class having voting rights, distribution rights or
                      other privileges equal or superior to those of the
                      shares of such class;

                (2)   to change all or part of the shares of such class into
                      shares of another class or to change all or part of the
                      shares of another class into shares of that class or to
                      grant such conversion right;

                (3)   to cancel or reduce rights to accrued dividends or
                      cumulative dividends attached to shares of such class;

                (4)   to reduce or remove preferential rights attached to
                      shares of such class to receive dividends or to the
                      distribution of assets in the event that the Company is
                      liquidated;

                (5)   to add, cancel or reduce share conversion rights,
                      options, voting rights, transfer rights, pre-emptive
                      placing rights, or rights to acquire securities of the
                      Company attached to shares of such class;

                (6)   to cancel or reduce rights to receive payment payable by
                      the Company in a particular currency attached to shares
                      of such class;

                (7)   to create a new class of shares with voting rights,
                      distribution rights or other privileges equal or
                      superior to those of the shares of such class;

                (8)   to restrict the transfer or ownership of shares of such
                      class or to impose additional restrictions;

                (9)   To issue rights to subscribe for, or to convert into,
                      shares of such class or another class;

                (10)  To increase the rights or privileges of shares of
                      another class;

                (11)  to restructure the Company in such a way so as to cause
                      the shareholders of different classes to bear liability
                      to different extents during the restructuring;

                (12)  to amend or abrogate the provisions of Chapter 9 of the
                      Articles of Association "Special Procedures for Voting
                      by a Class of Shareholders".

Section 2       Notice of Meeting and its Alterations

Article 26      The notice of a shareholders' general meeting shall be issued
                by the convenors of the meeting. Convenors of the meeting
                include the board of directors or shareholders individually or
                jointly holding more than 10% of the Company's voting shares.

Article 27      A written notice shall be issued 45 days (excluding the date
                of the meeting) prior to the meeting, informing all
                shareholders of the matters to be considered at the meeting,
                and the date and place of the meeting.

                The notice of a shareholders' general meeting shall be
                delivered to the shareholders (whether or not such
                shareholders are entitled to vote at the meeting) by hand or
                by pre-paid mail to the addresses of the shareholders as shown
                in the register of shareholders of the Company. For the
                holders of domestic shares, the notice of the meeting may also
                be given by way of public announcement.

                The public announcement referred to in the preceding paragraph
                shall be published in one or more newspapers designated by the
                securities regulatory authority of the State Council during
                the period between forty-five to fifty days before the date of
                the meeting. Once the announcement is made, the holders of
                domestic shares shall be deemed to have received the notice of
                the relevant shareholders' general meeting.

                Where the Company fails to issue a notice of meeting according
                to schedule thus resulting in the failure of the Company to
                convene an AGM within six months from the end of the preceding
                accounting year, it shall report the same immediately to the
                stock exchanges on which its shares are listed stating the
                reasons and shall make an announcement accordingly.

Article 28      The notice of a class shareholders' general meeting shall be
                delivered only to the shareholders who are entitled to vote at
                such meeting.

Article 29      The notice of a shareholders' general meeting shall satisfy
                the following requirements:

                (1)   in writing;

                (2)   specify the place, date and time of the meeting;

                (3)   set out the matters to be discussed at the meeting and
                      fully disclose the contents of the motions. If it is
                      required to alter matters involved in the resolutions of
                      the previous shareholders' general meeting, the contents
                      of the motion shall be complete and not only the
                      contents of the changes are stated. Items included under
                      "any other businesses" without specific contents shall
                      not be deemed as a motion and the same shall not be
                      voted at a shareholders' general meeting;

                (4)   enable the shareholders to make an informed decision on
                      the proposals put before them. Such principle includes
                      (but not limited to) where a proposal is made to
                      amalgamate the Company with another, to repurchase
                      shares of the Company, to reorganize its share capital,
                      or to restructure the Company in any other way, the
                      terms of the proposed transaction must be provided in
                      detail together with contracts (if any) and the cause
                      and effect of such proposal must be properly explained;

                (5)   director, supervisor, president, vice-president, Chief
                      Financial Officer and secretary of the board of
                      directors in the proposed transaction and the effect
                      which the proposed transaction will have on them in
                      their capacity as shareholders in so far as it is
                      different from the effect on the interests of
                      shareholders of the same class;

                (6)   contain the full text of any special resolution to be
                      proposed at the meeting;

                (7)   contain a clear statement that a shareholder entitled to
                      attend and vote at such meeting is entitled to appoint
                      one or more proxies to attend and vote at such meeting
                      on his behalf and that such proxy needs not be a
                      shareholder;

                (8)   specify the shareholding registration date for the
                      shareholders who are entitled to attend the
                      shareholders' general meeting;

                (9)   specify the time and place for lodging proxy forms for
                      the meeting;

                (10)  state names and telephone numbers of the contact persons
                      for the meeting.

Article 30      The board of directors shall issue a notice to convene the
                shareholders' general meeting within fifteen days upon receipt
                of a written request for convening a shareholders' general
                meeting from the supervisory committee which is in compliance
                with the relevant requirements.

Article 31      After the board of directors has received a written request
                for convening an extraordinary general meeting in compliance
                with the relevant requirements from shareholders individually
                or jointly holding more than 10% of the Company's voting
                shares, it shall issue a notice to convene a shareholders'
                general meeting as soon as possible. Any alterations to the
                original motion shall have the consent of the proposing
                shareholders. After the issue of the notice, the board of
                directors shall not propose any new motions or change or defer
                the time for holding the shareholders' general meeting without
                the consent of the proposing shareholders.

Article 32      If the board of directors fails to issue a notice to convene a
                meeting within thirty days upon receipt of a written request
                from shareholders individually or jointly holding more than
                10% of the Company's voting shares, the proposing shareholders
                may convene a shareholders' extraordinary general meeting
                themselves within four months after the board of directors has
                received such request. Where the proposing shareholders decide
                to convene such a meeting themselves, it shall notify the
                board of directors in writing, and shall issue a notice to
                convene the meeting after reporting to the branch of the
                securities regulatory authority of the State Council of the
                locality of the Company and the stock exchanges on which the
                Company's shares are listed. The notice of the meeting shall
                comply with the general requirements for notices of meetings
                and shall also satisfy the following requirements:

                (1)   new contents shall not be added to a motion, otherwise
                      the proposing shareholders shall resubmit a request to
                      convene a shareholders' general meeting to the board of
                      directors;

                (2)   the meeting shall be held at the offices of the Company.

Article 33      After the issue of the notice of a meeting, the convenors of
                the meeting shall not put forward any new motion which is not
                set out in the notice.

                Where a shareholder who has the largest shareholding of the
                Company intends to put forward a new motion on profit
                distribution at an AGM, such shareholder shall, not less than
                ten days before the date of the AGM, submit the motion to the
                board of directors to enable it to make an announcement,
                failing which the shareholder is not entitled to put forward
                the motion at the AGM.

Article 34      Shareholders and authorised proxies intending to attend a
                shareholders' general meeting shall deliver to the Company
                their written replies concerning their attendance at such
                meeting twenty days before the date of the meeting.

                The Company shall, based on the written replies which it
                receives from the shareholders twenty days before the date of
                the shareholders' general meeting, calculate the number of
                voting shares represented by the shareholders and the
                authorised proxies who intend to attend the meeting. If the
                number of voting shares represented by the shareholders who
                intend to attend the meeting amount to more than one-half of
                the Company's total voting shares, the Company may hold the
                shareholders' general meeting; if not, then the Company shall,
                within five days, notify the shareholders again by way of
                public announcement the matters to be considered at, and the
                place and date for, the meeting. The Company may then hold the
                shareholders' general meeting after publication of such
                announcement.

Article 35      After the convenors of a meeting have issued the notice of the
                shareholders' general meeting, the shareholders' general
                meeting shall not be convened at an earlier date, nor shall it
                be postponed without reasons. Where a shareholders' general
                meeting has to be postponed for special reasons, the convenors
                of the meeting shall publish a postponement notice at least
                five working days before the original date of the
                shareholders' general meeting. The convenors of the meeting
                shall state the relevant reasons and the date for convening
                the meeting after the postponement in the postponement notice.

Article 36      Where the Company postpones the shareholders' general meeting,
                it shall not change the shareholding registration date for the
                shareholders who are entitled to attend the shareholders'
                general meeting according to the original notice.

Article 37      The Company shall post all information relating to the
                shareholders' general meeting on the website of the Shanghai
                Stock Exchange at least five working days before the date of
                the meeting according to the requirements of the Shanghai
                Stock Exchange.

Section 3       Registration of a Meeting

Article 38      A shareholder may attend the shareholders' general meeting in
                person or appoint a proxy to attend and vote on his behalf.
                Directors, supervisors, secretary to the board of directors
                and the PRC lawyer(s) engaged by the Company shall attend the
                meeting. The president, vice-president, Chief Financial
                Officer of the Company and persons invited by the board of
                directors may also attend the meeting.

                In order to ensure the solemnity and proper order of the
                shareholders' general meeting, the Company shall have the
                right to refuse persons other than those stated above to enter
                into the venue.

Article 39      The Company shall be responsible for preparing an attendance
                register, which will be signed by the personnel attending the
                meeting. The attendance register shall set out the names of
                persons present at the meeting (and/or names of units),
                identification document numbers, information confirming the
                identities of the shareholders (such as shareholder account
                numbers), the number of voting shares held or represented,
                names of the proxies (or names of the units) and so on.

Article 40      The contents of registration for the shareholders or proxies
                attending the shareholders' general meeting shall include:

                (1)   confirmation of the identity as a shareholder or proxy;

                (2)   request to speak and contents of the text (if any);

                (3)   collecting the voting slips according to the number of
                      shares held/represented by the shareholders or proxies;

                (4)   registering new motions (if any).

Article 41      The instrument appointing a proxy of a shareholder shall be in
                writing. Such written instrument shall state the following:

                (1)   the name of the authorised proxy of the shareholder;

                (2)   the number of shares of the principal represented by the
                      authorised proxy;

                (3)   whether or not the proxy has any voting right;

                (4)   an indication to vote for or against each and every
                      matter included in the agenda;

                (5)   whether or not the proxy has voting rights in respect of
                      the provisional motion which may be included in the
                      agenda of the AGM; and, if this is the case, specific
                      instructions as to the type of voting rights to be
                      exercised;

                (6)   the date of issue and validity period of the proxy form;

                (7)   the signature (or seal) of the principal or its agent
                      appointed in writing; if the principal is a legal person
                      shareholder, the proxy form shall bear the seal of the
                      legal person unit, or signed by its director or an agent
                      duly appointed by it.

                The proxy form shall state clearly that the proxy shall be
                entitled to vote at his discretion in the absence of specific
                instructions from the shareholder.

Article 42      The proxy form shall be lodged with the Company's premises or
                such other place as specified in the notice convening the
                meeting at least twenty-four hours prior to the relevant
                meeting for which the proxy is appointed to vote or
                twenty-four hours prior to the scheduled voting time. Where
                the proxy form is signed by a person authorised by the
                principal, the power of attorney or other authorisation
                documents shall be notarised. The notarised power of attorney
                and other authorisation documents, together with the proxy
                form, shall be lodged with the Company's premises or such
                other place as specified in the notice convening the meeting.

Article 43      Shareholders attending a shareholders' general meeting shall
                fulfil registration procedures. Shareholders shall produce the
                following documents for registration purposes:

                (1)   Natural person shareholders: an individual shareholder
                      shall produce his identification documents and provide
                      information enabling the Company to confirm his identity
                      as a shareholder. Where a proxy is appointed to attend
                      the meeting, the proxy shall produce his own
                      identification documents and the proxy form, and provide
                      the Company with information enabling the Company to
                      confirm the identity of his principal as a shareholder.

                (2)   Legal person shareholders: if a legal representative is
                      appointed to attend the meeting, the legal
                      representative shall produce his identification
                      documents and proof of his qualification as a legal
                      representative, and he shall provide the Company with
                      the information enabling the Company to confirm the
                      identity of the legal person shareholder. Where a proxy
                      is appointed to attend the meeting, the proxy shall
                      produce his own identification documents, the proxy form
                      issued by the legal representative of the legal person
                      shareholder pursuant to law, or a notarised copy of a
                      resolution on authorisation adopted by the board of
                      directors of the legal person shareholder or other
                      decision-making organs, and shall provide information
                      enabling the Company to confirm the identity of the
                      principal as a legal person shareholder.

Article 44      Where a shareholder or a proxy requests to speak at the
                shareholders' general meeting, he shall register with the
                Company prior to the meeting. The number of speakers shall be
                limited to ten. If there are more than ten speakers, the first
                ten shareholders who have the largest shareholdings shall have
                the right to speak in an order according to their
                shareholdings.

Article 45      Where an AGM is convened, the supervisory committee and
                shareholders individually or jointly holding more than 5% of
                the Company's voting shares shall be entitled to propose new
                motions to the Company for registration. For the new motions
                put forward by the shareholders, it is for the chairman of the
                meeting to decide according to Article 23 of these Rules
                whether or not to include the same in the agenda. Where an
                extraordinary general meeting is convened, no new motions are
                allowed to be registered with the Company, and the chairman
                shall not add such new motions to the agenda of the meeting.

Section 4       Convening a Meeting

Article 46      A shareholders' general meeting shall be chaired by the
                Chairman of the board of directors, who shall act as the
                chairman of the meeting. If the Chairman is unable to attend
                the meeting, the Vice Chairman shall act as the chairman of
                the meeting.

                If both the Chairman and Vice Chairman are unable to attend
                the meeting and the Chairman has not appointed another
                director to act as the chairman of the meeting, the board of
                directors may appoint a director of the Company to take the
                chair. If the board of directors fails to do so, the
                shareholders present at the meeting may choose a person to act
                as the chairman. If, for any reason, the shareholders cannot
                elect a chairman, the shareholder (including a proxy) holding
                the largest number of voting shares shall be the chairman of
                the meeting.

Article 47      Where shareholders individually or jointly holding more than
                10% of the Company's voting shares of their own motion decide
                to convene an extraordinary general meeting, the board of
                directors and secretary to the board of directors shall
                earnestly perform their duties. Directors and supervisors
                shall attend the meeting, and the secretary to the board of
                directors must attend the meeting to ensure the meeting is
                held in proper order. The meeting shall be presided over by
                the Chairman, who shall also act as the chairman of the
                meeting. If the Chairman is unable to attend the meeting for
                any reason, the Vice Chairman shall act as the chairman of the
                meeting. If both the Chairman and Vice Chairman are unable to
                attend the meeting and the Chairman has not designated a
                person to act as chairman of the meeting, the board of
                directors may designate a director of the Company to so act.
                If the board of directors is unable to designate a director to
                chair the shareholders' general meeting, the proposing
                shareholder shall take the chair after filing a report with
                the branch of the securities regulatory authority of the State
                Council of the locality of the Company.

Article 48      The chairman shall declare that the meeting commences at the
                scheduled time after he has been informed that the
                participants are in compliance with legal requirements and new
                motions and speakers are registered. In any of the following
                circumstances, the meeting may be declared to commence later
                than the time scheduled:

                (1)   when any equipment of the venue is out of order so that
                      the meeting cannot proceed as usual;

                (2)   when any matters of material importance take place
                      affecting the proceeding of the meeting.

Article 49      After the chairman of the meeting has declared the official
                commencement of the meeting, he shall firstly announce that
                the number of shareholders attending the meeting and the
                number of shares represented by such shareholders are in
                compliance with the legal requirements. Subsequently he shall
                read out the agenda as stated in the notice of the meeting,
                and shall inquire whether any person present at the meeting
                has any objection to the voting order of the motions. If an
                AGM is convened, the chairman of the meeting shall also
                inquire whether the supervisory committee or the shareholders
                individually or jointly holding more than 5% of the Company's
                voting shares need to put forward new motions. Where a new
                motion is put forward by a shareholder, the chairman of the
                meeting shall decide whether to accept the motion according to
                Article 23 of these Rules.

                Where the board of directors or chairman of the meeting
                decides not to include the motion of the supervisory committee
                or shareholders into the agenda of the AGM, explanations and
                statements shall be given at such AGM.

                At an extraordinary general meeting, no person shall be
                allowed to request for discussion of new motions not set out
                in the notice of the shareholders' general meeting.

Article 50      After the chairman of the meeting has made inquires regarding
                the agenda, he shall read out the motions or appoint another
                person to read out the motions, and shall explain the motions
                according to the following requirements if necessary:

                (1)   Where the motion is put forward by the board of
                      directors, the motion shall be explained by the Chairman
                      or other persons designated by the Chairman;

                (2)   Where the motion is put forward by the supervisory
                      committee or shareholders individually or jointly
                      holding more than 5% of the Company's voting shares, the
                      motion shall be explained by the person putting forward
                      the motion or its legal representative or lawful and
                      valid proxy.

Article 51      Motions included in the agenda shall be examined before
                voting. Reasonable time shall be given at the shareholders'
                general meeting for each motion to be discussed, and the
                chairman of the meeting shall orally ask the shareholders
                attending the meeting whether they have completed the
                examination procedures. Examination procedures shall be
                regarded as completed if there are no objections by
                shareholders attending the meeting.

Article 52      No shareholder shall speak for more than twice at the meeting
                without the consent of the chairman. A shareholder is allowed
                to speak for no more than five minutes for the first time, and
                no more than three minutes for the second time.

                When a shareholder requests to speak, he shall only do so if
                he does not interrupt report which is being made by the
                meeting reporter or speeches which are being made by other
                shareholders.

Article 53      Shareholders may query the Company at the shareholders'
                general meeting. The chairman of the meeting shall direct the
                directors or supervisors to answer such queries unless they
                relates to the Company's business secret and shall not be
                disclosed at the meeting.

Section 5       Voting and Resolution

Article 54      Shareholders' general meeting shall resolve on any specific
                motions.

Article 55      Matters not included in the notice convening the shareholders'
                extraordinary general meeting shall not be resolved on at such
                a meeting. In approving the motions included in the notice of
                an extraordinary general meeting, no alteration shall be made
                to the relevant motions in respect of the following matters:

                (1)   increase or reduction of the registered capital of the
                      Company;

                (2)   issuance of bonds of the Company;

                (3)   division, merger, dissolution and liquidation of the
                      Company;

                (4)   amendment to the Articles of Association;

                (5)   profits distribution plans and loss recovery plans of
                      the Company;

                (6)   appointment and removal of a member of the board of
                      directors and the supervisory committee;

                (7)   changing the use of proceeds from a share offer;

                (8)   the entering into of a connected transaction which
                      requires the approval of the shareholders in general
                      meetings;

                (9)   acquisition or sale of assets which requires the
                      approval of the shareholders in general meetings;

                (10)  changing the accounting firm engaged.

                Any alteration in respect of the contents of the above motions
                shall be deemed to be a new motion and shall not be voted on
                at that shareholders' general meeting.

                Shareholders' general meetings shall resolve on all motions
                included in the agenda one by one, and shall not for any
                reason cause delay in considering, or fail to consider, such
                motions. Where different motions are put forward at the annual
                general meeting for the same matter, such motions shall be
                resolved on in the order of time in which they are put
                forward.

Article 56      The chairman of the meeting is obliged to request the
                shareholders to approve the motions by open ballot at the
                general meeting.

                Each shareholder or proxy shall exercise his voting rights in
                accordance with the number of voting shares represented by
                him. Except for the circumstances where cumulative voting
                system is applicable to the election of directors in
                accordance with the Articles of Association, each share shall
                carry one voting right.

Article 57      Resolutions in respect of the election of directors shall be
                passed by a way of cumulative voting at shareholders' general
                meeting in accordance with the Articles of Association. The
                details of the cumulative voting system are as follows:

                (1)   Where the number of directors to be elected is more than
                      two, the cumulative voting system must be adopted.

                (2)   Where cumulative voting system is adopted, each of the
                      shares held by a shareholder shall carry the same number
                      of votes as the number of directors to be elected.

                (3)   The notice of a shareholders' general meeting shall
                      notify the shareholders that a cumulative voting system
                      will be adopted for the election of directors. The
                      convenors of the shareholders' general meeting shall
                      prepare ballots suitable for cumulative voting, and
                      shall give explanations in writing regarding the
                      cumulative voting system, the completion of the ballots
                      and the methods of counting the votes.

                (4)   In casting his votes for the director candidates at a
                      shareholders' general meeting, a shareholder may
                      exercise his voting rights by spreading his votes evenly
                      and cast for each of the candidates the number of votes
                      corresponding to the number of shares he holds; or he
                      may focus his votes on one candidate and cast for a
                      particular candidate the total number of votes carried
                      by all of his shares while the number of voting rights
                      carried by each of his shares is the same as the number
                      of directors to be elected; or he may spread his votes
                      over several candidates and cast for each of them part
                      of the total number of votes carried by the shares he
                      holds while the number of voting rights carried by each
                      of his shares is the same as the number of directors to
                      be elected.

                (5)   Upon the exercise of his voting rights by focusing his
                      votes on one or several of the candidates while the
                      number of voting rights carried by each of his shares is
                      the same as the number of directors to be elected, a
                      shareholder shall not have any right to vote for any
                      other candidates.

                (6)   Where the total number of votes cast by a shareholder
                      for one or several of the candidates is in excess of the
                      number of votes carried by the total number of shares
                      held by him, the votes cast by the shareholder shall be
                      invalid, and the shareholder shall be deemed to have
                      waived his voting rights. Where the total number of
                      votes cast for one or several candidates by a
                      shareholder is less than the number of votes carried by
                      the total number of shares held by such a shareholder,
                      the votes cast by the shareholder shall be valid, and
                      the voting rights attached to the shortfall between the
                      votes actually cast and the votes which the shareholder
                      is entitled to cast shall be deemed to have been waived
                      by the shareholder.

                (7)   Where the number of approval votes won by a director
                      candidate exceeds one-half of the total voting rights
                      (to be calculated according to the total number of
                      shares if the cumulative voting is not adopted)
                      represented by the shareholders present at the
                      shareholders' general meeting and the approval votes
                      exceeds the objection votes, the candidate shall be the
                      elected director candidate. If the number of the elected
                      director candidates exceeds the total number of
                      directors to be elected, those candidates who win the
                      largest number of approval votes shall be elected as
                      directors (however, if the elected director candidates
                      whose approval votes are comparatively fewer win the
                      same number of approval votes, and the election of such
                      candidates as directors will give rise to the number of
                      directors elected exceeding the number of directors to
                      be elected, such candidates shall be deemed as having
                      not been elected); if the number of directors elected at
                      a shareholders' general meeting is less than the number
                      of directors to be elected, a new round of voting shall
                      be carried out for the purpose of filling such
                      directorship vacancies, until all the directors to be
                      elected are validly elected.

                (8)   Where a new round of voting is carried out according to
                      the provisions of paragraph (7) of this Article at the
                      shareholders' general meeting, the number of votes
                      casted by the shareholders in the cumulative voting
                      shall be re-counted according to the number of directors
                      to be elected in the new round of voting.

Article 58      In examining the motions on the election of directors and
                supervisors at a shareholders' general meeting, shareholders
                shall vote on the candidates for the office of directors or
                supervisors one by one.

Article 59      Resolutions of a shareholders' general meeting shall be
                divided into ordinary resolutions and special resolutions.

                (1)   Ordinary resolutions

                      (i)   Ordinary resolutions shall be passed by votes
                            representing more than one-half of the voting
                            rights represented by the shareholders (including
                            proxies) present at the meeting.

                      (ii)  The following matters shall be approved by
                            ordinary resolutions at shareholders' general
                            meetings:

                            (a)    work reports of the board of directors and
                                   the supervisory committee;

                            (b)    profit distribution plans and loss recovery
                                   plans formulated by the board of directors;

                            (c)    appointment and removal of members of the
                                   board of directors and members of the
                                   supervisory committee, their remuneration
                                   and manner of payment and their liability
                                   insurance;

                            (d)    annual preliminary and final budgets,
                                   balance sheets and profit and loss accounts
                                   and other financial statements of the
                                   Company;

                            (e)    annual reports of the Company;

                            (f)    matters other than those which are required
                                   by laws and regulations or by the Articles
                                   of Association to be passed by special
                                   resolutions.

                (2)   Special resolutions

                      (i)   Special resolutions shall be passed by votes
                            representing more than two-thirds of the voting
                            rights represented by the shareholders (including
                            proxies) present at the meeting.

                      (ii)  The following matters shall be approved by special
                            resolutions at a shareholders' general meetings:

                            (a)    increase or reduction in share capital and
                                   the issue of shares of any class, warrants
                                   and other similar securities;

                            (b)    issue of bonds of the Company;

                            (c)    division, merger, dissolution and
                                   liquidation of the Company;

                            (d)    repurchase of shares of the Company;

                            (e)    amendment to the Articles of Association,
                                   the Rules and Procedures for the
                                   Shareholders' General Meetings, the Rules
                                   and Procedures for the Board of Directors'
                                   Meetings and the Rules and Procedures for
                                   the Supervisors' Meetings;

                            (f)    any other matters approved by an ordinary
                                   resolution by the shareholders at a general
                                   meeting which may have material impacts on
                                   the Company and accordingly should be
                                   passed by special resolutions.

Article 60      As far as any matter relating to sub-paragraphs (2) to (8),
                (11) to (12) of Article 25 of these Rules, the affected class
                shareholders, whether or not such shareholders originally have
                the right to vote at shareholders' general meetings, shall
                have the right to vote at the class meetings. However,
                interested shareholder(s) shall not be entitled to vote at
                such class meetings.

                "(An) interested shareholder(s)", as such term is used in the
                preceding paragraph, means:

                (1)   in the case of a repurchase of shares by way of a
                      general offer to all shareholders of the Company or by
                      way of public dealing on a stock exchange pursuant to
                      Article 29 of the Articles of Association, an interested
                      shareholder is a controlling shareholder within the
                      meaning of Article 55 of the Articles of Association;

                (2)   in the case of a repurchase of shares by an off-market
                      agreement pursuant to Article 29 of the Articles of
                      Association, a holder of the shares to which the
                      proposed agreement relates;

                (3)   in the case of a restructuring of the Company, a
                      shareholder who assumes a relatively lower proportion of
                      obligation than the obligations imposed on shareholders
                      of that class under the proposed restructuring or who
                      has an interest in the proposed restructuring which is
                      different from the general interests of the shareholders
                      of that class.

Article 61      Resolutions of a class of shareholders shall be passed by
                votes representing more than two-thirds of the voting rights
                of shareholders of that class represented at the relevant
                meeting who, according to Article 62, are entitled to vote at
                the meeting. The special procedures for approval by a class of
                shareholders shall not apply in the following circumstance:
                where the Company issues, upon the approval by special
                resolution of its shareholders in a general meeting, either
                separately or concurrently once every twelve months, not more
                than 20% of each of its existing issued Domestic-Invested
                Shares and Overseas-Listed Foreign-Invested Shares.

Article 62      Where a connected transaction is being considered at a
                shareholders' general meeting, the connected shareholders
                shall abstain from voting, and the voting rights represented
                by the shares held by them shall not be counted towards the
                total number of valid votes. The voting result of the
                non-connected shareholders shall be fully disclosed in the
                announcement in relation to the resolutions passed at the
                shareholders' general meeting.

Article 63      Shareholders (and proxies) shall complete their ballot papers
                carefully as instructed and put the ballot papers into the
                ballot box. Any ballot paper containing uncompleted parts,
                false information, illegible writing and any uncast paper
                shall be deemed to be an abstention of voting by the
                shareholder, and such ballot papers shall not be regarded as
                valid votes.

Article 64      Prior to voting, the shareholders present at a shareholders'
                general meeting shall nominate at least one supervisor and two
                shareholders to act as counting officers. Such counting
                officers shall count all the votes cast on site and sign the
                counting statistical sheet.

                If the votes for and against a resolution are equal, the
                chairman of the meeting shall be entitled to cast one more
                vote.

Article 65      The chairman of the meeting shall be responsible for deciding
                whether or not a resolution is duly passed according to the
                results of the votes counting. The chairman's decision, which
                shall be final and conclusive, shall be announced at the
                meeting and recorded in the minutes of the meeting.

Article 66      A shareholders' general meeting shall be recorded by the
                minutes of the meeting, which shall be signed by the directors
                present at the meeting and the minutes-taking officer. If no
                director is present at the meeting, the shareholder or the
                shareholder's proxy chairing the meeting together with the
                minutes-taking officer shall sign the minutes. The minutes of
                the meeting shall record the following matters:

                (1)   the number of voting shares represented by the
                      shareholders present at the meeting, and the percentage
                      of such shares out of the total number of shares of the
                      Company;

                (2)   the date and place of the meeting;

                (3)   the name of the person chairing the meeting and the
                      agenda of the meeting;

                (4)   the main points regarding the matters made by each
                      person who speaks at the meeting;

                (5)   the voting result of each matter considered;

                (6)   the inquiries and suggestions of the shareholders and
                      the answers to these inquiries or statement made by the
                      directors and supervisors;

                (7)   other matters which according to the opinions of the
                      shareholders' general meeting and the provisions of the
                      Articles of Association shall be recorded in the minutes
                      of the meeting.

Article 67      The board of directors of the Company shall retain (a) PRC
                lawyer(s) to attend the shareholders' general meeting in
                accordance with law to enable him(them) to give legal opinions
                on the following matters, and shall publish these legal
                opinions together with the resolutions of the shareholders'
                general meeting:

                (1)   whether the procedures for convening and holding the
                      shareholders' general meeting comply with the relevant
                      laws and regulations as well as the Articles of
                      Association;

                (2)   verification of the legality and validity of the
                      eligibility of the participants of the meeting;

                (3)   verification of the eligibility of the shareholders who
                      put forward new motions at the shareholders' annual
                      general meeting;

                (4)   whether the voting procedures of the shareholders'
                      general meeting are lawful and valid;

                (5)   the issue of any legal advice on any other matters
                      requested by the Company.

                Where the shareholders' extraordinary general meeting is
                chaired by the shareholders proposing the holding of such a
                meeting, the proposing shareholders shall, in accordance with
                law, retain (a) lawyer(s) to give witness legal opinions
                according to the provisions as set out above, and the
                procedures for convening such a meeting shall also comply with
                relevant laws, regulations and this Article.

Section 6       Adjournment of a Meeting

Article 68      The board of directors of the Company shall ensure that a
                shareholders' general meeting is held continuously within
                reasonable office hours, until the resolutions are finally
                voted on.

Article 69      If, in the course of the meeting, disputes arising out of the
                identity of any shareholder or the results of the calculation
                of the votes and so on cannot be resolved on site in such a
                way that the order of the meeting is affected and the meeting
                cannot proceed as usual, the chairman shall declare an
                adjournment of the meeting.

                If the foregoing circumstances cease to exist, the chairman of
                the meeting shall notify the shareholders of the resumption of
                the meeting as soon as possible.

Article 70      Where a shareholders' general meeting is adjourned for more
                than one working day due to force majeure or any other
                extraordinary reasons, and the meeting cannot be convened
                properly or no resolution is passed, the board of directors of
                the Company shall give explanations to the stock exchanges on
                which the Company's shares are listed and make a proper
                announcement. The board of directors of the Company is obliged
                to take all necessary measures to resume the shareholders'
                general meeting as soon as possible.

Section 7       Post-meeting Affairs and Announcement

Article 71      The secretary to the board of directors shall be responsible
                for submitting the minutes of the meeting and the resolutions
                passed at the meeting and other relevant documentation to the
                relevant regulatory authorities in accordance with laws,
                regulations, the requirements of the securities regulatory
                authority of the State Council and the stock exchanges on
                which the Company's shares are listed after the meeting. He
                shall also be responsible for handling the announcement to be
                published in the designated media.

Article 72      The announcement of the resolutions of the shareholders'
                general meeting shall state the number of the shareholders (or
                the proxies) present at the meeting, the number of shares held
                by them (or nominees) and the percentage of such shares out of
                the total voting shares of the Company, the method of voting
                and the voting result of each motion. The resolutions on the
                motions shall state the names of the proposing shareholders,
                the percentage of shares held and the details of the motions.
                Where a shareholder's motion is not included in the agenda of
                an AGM, the details of the motion and the statement made by
                the board of directors or the chairman at the AGM shall be
                published together with the resolutions of the AGM.

                Where the board of directors or the chairman of the meeting
                decides not to include the motions put forward by the
                supervisory committee or the shareholders in the agenda of the
                AGM, explanations and statements shall be given at such a
                meeting. Such statements and details of the motions shall,
                together with the resolutions of the AGM, be published after
                the conclusion of the AGM.

                Where a resolution of the meeting is not adopted, or a
                resolution passed at the previous shareholders' general
                meeting is changed at the current shareholders' general
                meeting, the board of directors shall give an explanation in
                relation to the resolutions of the current shareholders'
                general meeting.

                The announcement of resolutions passed at shareholders'
                general meetings shall be published in designated newspapers
                and on the Company's website.

Article 73      The secretary to the board of directors shall be responsible
                for keeping written information such as the register of
                attendees, power of attorney, voting statistical sheet,
                minutes of the meeting, legal opinions endorsed by lawyer(s)
                and announcements of resolutions.

                       CHAPTER 5 SUPPLEMENTARY ARTICLES

Article 74      These Rules shall come into effect upon the adoption by the
                shareholders' general meeting by a special resolution and the
                approval by the relevant authorities in accordance with law.

Article 75      Any amendment to these Rules shall be proposed by the board of
                directors in the form of an amendment proposal, and shall be
                submitted to the shareholders' general meeting for approval by
                a special resolution.

Article 76      The right to interpret these Rules shall rest with the board
                of directors.

Article 77      Where any relevant matters are not covered in these Rules or
                where these Rules fail to comply with the relevant laws,
                administrative rules and other relevant regulatory documents
                as promulgated from time to time, those laws, administrative
                rules and other relevant regulatory documents shall prevail.


    APPENDIX III RULES AND PROCEDURES FOR THE BOARD OF DIRECTORS' MEETINGS

                         CHAPTER 1 GENERAL PROVISIONS

Article 1       In order to ensure that the board of directors of China
                Petroleum & Chemical Corporation (the "Company") fulfils the
                duties and responsibilities conferred by all shareholders of
                the Company, conducts discussions efficiently, makes
                scientific, immediate and prudent decisions and standardizes
                the operation of the board of directors, these Rules are
                formulated according to the "Company Law of the People's
                Republic of China" (the "Company Law"), "Mandatory Provisions
                for the Articles of Association of Companies to be Listed
                Overseas", "Guidelines for the Articles of Association of
                Listed Companies", "Standards for the Governance of Listed
                Companies" and other governing regulations of the places of
                the Company's listings inside and outside the PRC and the
                Articles of Association of China Petroleum & Chemical
                Corporation ("Articles of Association").

      CHAPTER 2 FUNCTIONS, POWERS AND AUTHORITY OF THE BOARD OF DIRECTORS

Article 2       The board of directors is accountable to the shareholders'
                general meetings and shall exercise the following functions
                and powers:

                (1)   to be responsible for convening shareholders' general
                      meetings and to report on its work to the shareholders'
                      general meetings;

                (2)   to implement the resolutions passed at shareholders' in
                      general meetings;

                (3)   to determine the Company's business plans and investment
                      proposals;

                (4)   to formulate the Company's annual preliminary and final
                      financial budgets;

                (5)   to formulate the Company's profit distribution proposals
                      and loss recovery proposals;

                (6)   to formulate proposals for the credit and financial
                      policies of the Company, the increase or reduction of
                      the registered capital of the Company and for the issue
                      of debentures and securities of any kinds (including but
                      without limitation to the debentures of the Company) and
                      the listing or repurchase of the shares of the Company;

                (7)   to draw up plans for significant acquisition or disposal
                      proposals, the merger, division or dissolution of the
                      Company;

                (8)   to determine the risks investment and security
                      (including pledging of assets) of the Company according
                      to the authority given in the shareholders' general
                      meeting;

                (9)   to decide on the Company's internal management
                      structure;

                (10)  to appoint or remove the Company's president and to
                      appoint or remove the vice-president and Chief Financial
                      Officer of the Company according to the recommendations
                      of the president; to appoint or remove the secretary of
                      the board of directors and to decide on their
                      remuneration;

                (11)  to appoint or replace the members of the board of
                      directors and the supervisory committee of its
                      wholly-owned subsidiaries; to appoint, replace or
                      recommend the shareholders' proxies, directors
                      (candidates) and supervisors (candidates) of its
                      subsidiaries which are controlled or invested by the
                      Company;

                (12)  to determine the establishment of the Company's branch
                      offices;

                (13)  to formulate proposals for any amendment of the
                      Company's Articles of Association and its appendices;

                (14)  to formulate the Company's basic management system;

                (15)  to manage the disclosure of information of the Company;

                (16)  to propose in a shareholders' general meeting to engage
                      or replace the accounting firm which undertakes auditing
                      work of the Company;

                (17)  to listen to the president's work report and check the
                      president's work;

                (18)  to determine important matters and administrative
                      matters of the Company other than those which should be
                      determined by resolution of a shareholders' general
                      meeting of the Company except for matters as specified
                      by law, administrative rules, regulations of the
                      competent government department(s) and the Articles of
                      Association, and to sign other important agreements;

                (19)  to exercise any other powers stipulated by laws,
                      administrative rules, regulations of the competent
                      government department(s) or the Articles of Association,
                      and any other functions and powers conferred by the
                      shareholders' in general meetings.

Article 3       The necessary conditions for the board of directors to perform
                its duties shall include the following:

                The president shall provide the directors with necessary
                information and data, enabling the board of directors to make
                scientific, immediate and prudent decisions.

                A director may require the president or, through the
                president, require the relevant departments of the Company to
                provide information and explanations which are necessary for
                him to make scientific, immediate and prudent decisions.

                Where the independent directors think necessary, they may
                engage (an) independent institution(s) to provide independent
                opinions to be relied upon by them in making decisions. The
                fees incurred in the engagement of such (an) independent
                institution(s) shall be borne by the Company.

Article 4       The board of directors shall examine and resolve on the
                matters which the board of directors is required by laws,
                administrative rules, regulations of the competent government
                department(s) and the Articles of Association to submit to the
                shareholders in general meetings for determination (including
                matters proposed by two or more than half of the independent
                directors).

                The board of directors shall examine the provisional motions
                put forward by the shareholders individually or jointly
                holding more than 5% of the Company's voting shares at the
                shareholders' annual general meeting (the "AGM") according to
                the standard of "relevance" as set out in the Rules and
                Procedures for the Shareholders' General Meetings, and to
                decide whether to submit the provisional motions to the AGM
                for examination.

Article 5       In order to ensure and increase the stability and efficiency
                of the daily operation of the Company, the board of directors
                shall explicitly authorise, on a partial basis, the chairman,
                other one or more directors or the president to exercise its
                functions and powers on investment plans, assets disposals,
                external guarantees, the credit and financial policies and the
                internal management structure of the Company according to the
                provisions of the Articles of Association and the
                authorisation of the shareholders' general meeting.

Article 6       The powers and authority of the board of directors on
                investments shall include the following:

                (1)   The board of directors shall be responsible for
                      conducting preliminary examination of the medium and
                      long-term investment plans proposed by the president,
                      and shall submit them to the shareholders' general
                      meetings for approval.

                (2)   The board of directors shall be responsible for
                      conducting preliminary examination of the annual
                      investment plans proposed by the president, and shall
                      submit them to the shareholders' general meetings for
                      approval. The board of directors may make adjustments of
                      not more than 15% of the amount of the capital
                      expenditure for the current year as approved at the
                      shareholders' general meeting. The chairman of the board
                      of directors is authorised to make adjustments of not
                      more than of not more than 8% of the amount of the
                      capital expenditure for the current year as approved at
                      the shareholders' general meeting.

                (3)   Individual project investments (including but not
                      limited to exploration and development, fixed assets,
                      external shareholdings) shall be approved by the board
                      of directors if the investment amounts are not more than
                      5% of the latest audited net asset value of the Company.
                      The Chairman of the board of directors is authorised to
                      examine and approve projects if the investment amount is
                      not more than 3% of the latest audited net asset value
                      of the Company.

                (4)   Where the Company uses its own assets to make risky
                      investment in areas not related to the business of the
                      Company (including but not limited to debentures,
                      futures, shares), risky investments shall be approved by
                      the board of directors if the amount of the individual
                      investment is not more than 1% of the latest audited net
                      asset value of the Company. The chairman of the board of
                      directors is authorised to examine and approve projects
                      if the investment amount is not more than 0.5% of the
                      latest audited net asset value of the Company.

Article 7       The powers and authority of the board of directors on asset
                disposals shall include the following:

                (1)   When the Company acquires or sells assets, it has to
                      take into account of the following four testing indices:
                      (i) total asset ratio: the total amount of the assets to
                      be acquired or sold (according to the latest audited
                      financial report, valuation report or capital
                      verification report) divided by the latest audited total
                      asset value of the Company; (ii) net profit (loss) ratio
                      of the acquisition: the absolute value of the net profit
                      or loss relating to the assets to be acquired (according
                      to the audited financial report of the preceding year)
                      divided by the absolute value of the audited net profit
                      or loss of the Company for the preceding year; (iii) net
                      profit (loss) ratio of the sale: the absolute value of
                      the net profit or loss relating to the assets to be sold
                      (according to the audited financial report of the
                      preceding year) or the absolute value of the profit or
                      loss arising from such transaction divided by the
                      absolute value of the audited net profit or loss of the
                      Company for the preceding year; (iv) transaction amount
                      ratio: the transaction amount (taking into account of
                      the assumed liabilities and costs, etc) of the acquired
                      assets divided by the total amount of the latest audited
                      net asset value of the Company.

                      The board of directors shall examine and approve
                      projects with a ratio of less than 50% according to all
                      the above four testing indices. The chairman of the
                      board of directors is authorised to examine and approve
                      projects with a ratio of less than 10% according to all
                      the above four testing indices.

                (2)   In disposing of fixed assets, where the total value of
                      the expected value of the fixed assets to be disposed of
                      and the value of the fixed assets which have been
                      disposed of in the four months prior to such proposed
                      disposal does not exceed 33% of the value of the fixed
                      assets as shown in the latest balance sheet considered
                      by the shareholders' general meeting, the board of
                      directors shall examine and approve such disposal, and
                      the Chairman of the beard of directors is authorised to
                      examine and approve those fixed asset disposals of less
                      than 10%.

                (3)   As regards others (including but not limited to the
                      entering into, varying and termination of important
                      contracts relating to entrustment of operation,
                      entrusted operation, entrusted financial management,
                      contracting and leasing), the relevant amount or the
                      amount accumulate in twelve months shall be calculated
                      according to one of four testing indices referred to in
                      paragraph (1) of this Article.

                Projects with a ratio of not more than 5% according to all the
                above four testing indices shall be examined and approved by
                the board of directors. The chairman of the board of directors
                is authorised to examine and approve projects with a ratio of
                not more than 1% according to all the above four testing
                indices.

Article 8       The powers and authority of the board of directors on debt
                liabilities shall include the following:

                (1)   The board of directors shall examine and approve the
                      amount of the long-term loans for the current year
                      according to the annual investment plan as approved by
                      the shareholders' general meeting. The chairman of the
                      board of directors is authorised to make adjustments of
                      not more than 10% of the total amount of the long-term
                      loans for the current year as approved by the board of
                      directors. Within the total amount of the long-term
                      loans as approved by the board of directors, the
                      chairman of the board of directors is authorised to
                      approve and sign the contract for every single long-term
                      loan for the amount exceeding RMB1 billion, and the
                      president is authorised to approve and sign the contract
                      for every single long-term loan for the amount not
                      exceeding RMB1 billion.

                (2)   Within the total amount of the working capital loans for
                      the current year as approved by the board of directors,
                      the Chairman of the board of directors is authorised to
                      sign the overall short-term loan facility contracts for
                      raising working capitals required by the operation and
                      management of the Company according to the demand of the
                      Company. Within the amount limit as fixed by these loan
                      facility contracts, the chairman of the board of
                      directors is authorised to approve and sign the working
                      capital short-term loan contracts where the amount of
                      one single loan exceeds RMB1 billion, and the president
                      is authorised to approve and sign the working capital
                      short-term loan contracts where the amount of one single
                      loan does not exceed RMB1 billion.

                (3)   The Company shall not provide any guarantees for its
                      shareholders, controlling subsidiaries of its
                      shareholders, subsidiary enterprises of shareholders or
                      personal liability. If the Company provides guarantees
                      to others, the guaranteed person shall provide
                      counter-guarantee to the Company or take other necessary
                      risk preventive measures.

                      If the guarantee amount does not exceed 5% of the latest
                      audited net asset value of the Company, such guarantees
                      shall be examined and approved by the board of
                      directors. The chairman of the board of directors is
                      authorised to approve and sign the external guarantee
                      contracts the guaranteed amount of which does not exceed
                      1% of the latest audited net asset value of the Company
                      but more than RMB100 million. The president is
                      authorised to approve and sign the external guarantee
                      contracts the guaranteed amount of which does not exceed
                      RMB100 million.

Article 9       If, when applying the relevant standards as set out above, the
                approving offices of any investment, asset disposal and
                external guarantee matters as referred to above include the
                board of directors, chairman of the board of directors and/or
                president, such matters shall be submitted to the approving
                offices of the highest level for approval. If the above
                investment, asset disposal and loan matters constitute
                connected transactions according to the regulatory
                stipulations of the places where the Company is listed, the
                relevant matters shall be dealt with according to the relevant
                stipulations.

Article 10      The board of directors authorises the chairman to determine
                the following matters: (1) internal management structure of
                the Company; (2) the establishment of branch offices by the
                Company; (3) to appoint or replace the members of the board of
                directors and the members of the supervisory committee of the
                wholly-owned subsidiaries of the Company; and (4) to appoint,
                replace or recommend the shareholders' representatives,
                director (candidates) and supervisors (candidates) of the
                subsidiaries which are controlled or invested by the Company.

     CHAPTER 3    COMPOSITION OF THE BOARD OF DIRECTORS AND ITS SUBORDINATED
                  OFFICES

Article 11      The board of directors shall consist of thirteen directors.
                The board of directors shall have one chairman and one
                vice-chairman.

Article 12      The board of directors shall establish strategic
                decision-making sub-committee, auditing sub-committee,
                remuneration and evaluation sub-committee and other special
                committees. These special committees shall conduct research on
                specific matters and provide opinions and suggestions on these
                matters to the board of directors for the reference.

                Members of the special committees shall be directors of the
                Company. The majority of the membership of the auditing
                sub-committee, and remuneration and evaluation sub-committee
                shall consist of the independent directors, who shall also act
                as convenors. The auditing sub-committee shall have at least
                one independent director who is also an accounting
                professional.

Article 13      The major responsibilities of the strategic decision-making
                sub-committee shall be to conduct research and put forward
                proposals on the long-term development strategy and
                significant investment decisions of the Company.

Article 14      The major responsibilities of the auditing sub-committee
                shall include the following:

                (1)   to propose the appointment or replacement of the
                      external auditor of the Company;

                (2)   to oversee the Company's internal auditing system and
                      its implementation;

                (3)   to be responsible for the communication between the
                      internal auditing department of the Company and the
                      external auditor;

                (4)   to examine and approve the Company's financial
                      information and it disclosure;

                (5)   to examine the internal control system of the Company.

Article 15      The major responsibilities of the remuneration and evaluation
                sub-committee shall include the following:

                (1)   to research on the criteria for the evaluation of
                      directors and the president, to conduct evaluation of
                      them and make necessary suggestions;

                (2)   to research on and review the policies and proposals in
                      respect of the remuneration of directors, supervisors,
                      president, vice-president, Chief Financial Officer and
                      secretary of the board of directors.

Article 16      The special committees of the board of directors shall
                formulate detailed working rules, which shall come into effect
                upon the submission to, and the approval of, the board of
                directors.

                 CHAPTER 4 SECRETARY OF THE BOARD OF DIRECTORS

Article 17      The Company shall have one secretary of the board of
                directors. The main duty of the secretary of the board of
                directors is to promote and improve the Company's corporate
                governance standards and properly deal with the matters
                regarding disclosure of information.

Article 18      The main duties of the secretary of the board of directors
                include:

                (1)   to organize and arrange for board meetings and
                      shareholders' general meetings, prepare the meeting
                      materials, handle the meeting related affairs, to be
                      responsible for record of meetings, ensure the accuracy
                      and completeness of records, keep the meeting documents
                      and records and take initiative to keep abreast of the
                      execution of the related resolutions; and submit reports
                      to the board of directors and put forward the proposals
                      for importance issues arising during the implementation;

                (2)   to ensure that the material issues concerning the
                      resolutions of the board of directors can be strictly
                      implemented in accordance with the specified procedures;
                      to participate and organize the consultation and
                      analysis on the decision-making matters of the board in
                      accordance with its requirements, and put forward the
                      related opinions and suggestions; to deal with the daily
                      matters of the board of directors and its related
                      committees if authorised;

                (3)   to be the contact person of the Company with the
                      securities regulatory authorities, be responsible for
                      organisation, preparation and timely submission of
                      related documents as required by the regulatory
                      authorities, and be responsible for related tasks
                      assigned by the regulatory authorities and to organise
                      and complete these tasks, and to ensure that the Company
                      prepares and submits the reports and other documents as
                      required by the regulatory authorities in accordance
                      with law;

                (4)   to be responsible for the co-ordination and organization
                      of the matters on disclosure of information of the
                      Company, establish and perfect the system concerning
                      information disclosure, participate in all related
                      meetings of the Company concerning information
                      disclosure, and keep abreast of the important business
                      policies and related information of the Company in a
                      timely manner;

                (5)   to be responsible for keeping confidential of the
                      sensitive materials concerning the share price of the
                      Company, and formulate effective and enforceable secrecy
                      systems and measures. For the divulgence of the
                      sensitive materials concerning the share price of the
                      Company due to various reasons, he shall take necessary
                      remedial measures, make timely explanation and
                      clarification, and notify the regulatory organizations
                      in the places where the shares of the Company are listed
                      as well as the securities regulatory authority of the
                      State Council;

                (6)   to be responsible for the co-ordination and organization
                      of market promotion, coordinate the visit and interview,
                      deal with the relationship with investors, maintain the
                      relationship with investors, intermediary organs and
                      news agencies, be responsible for the co-ordination and
                      explanation of the inquiries of the public, and ensure
                      the investors to obtain the information as disclosed by
                      the Company in a timely manner, organize and arrange the
                      promotion and advertising activities of the Company
                      inside and outside the PRC, prepare and work out the
                      summary report on market promotion and other important
                      visiting activities, and report the related matters to
                      the securities regulatory authorities of the State
                      Council; to establish effective communication channels
                      between the Company and its shareholders, including
                      designating a staff and/or establishing (a) special
                      office(s) to keep sufficient and necessary contacts with
                      the shareholders, and to relay, in a timely manner, all
                      the feedbacks including opinions and suggestions of the
                      shareholders to the board of directors or the
                       management team of the Company;

                (7)   to ensure the proper preparation of the register of
                      shareholders, to be responsible for the management and
                      proper maintenance of the materials concerning register
                      of shareholders, directors' register, quantity of shares
                      held by majority shareholders and record of shares held
                      by directors, as well as the name list of the
                      beneficiaries of the outstanding debentures of the
                      Company;

                (8)   to assist directors and the president to practically
                      implement the domestic and foreign laws, regulations,
                      the Company's Articles of Association and other
                      provisions in discharge of their duties and exercise of
                      their powers; be liable to remind directors and the
                      president timely on becoming aware that the Company
                      passes or may pass resolutions which may breach the
                      relevant regulations, and be entitled to report the
                      related matters to securities regulatory authorities of
                      the State Council and other regulatory authorities
                      according to the facts;

                (9)   to provide the related information necessary for the
                      supervisory committee of the Company and other approving
                      authorities to discharge their duties and to exercise
                      their powers, assist the investigation on the Chief
                      Financial Officer, directors and the president of the
                      Company concerning the performance of their fiduciary
                      duties;

                (10)  to ensure the complete organizational documents and
                      records of the Company are kept properly, and the
                      persons who have the rights of access to the relevant
                      documents and records of the Company obtain those
                      documents and records in a timely manner; and

                (11)  to discharge other duties and to exercise other powers
                      as conferred by the board of directors, as well as other
                      duties and powers as required by the listing rules of
                      the stock exchanges on which the Company's shares are
                      listed.

Article 19      The board of directors of the Company shall have a
                secretarial office, which shall be a daily working body
                assisting the secretary of the board of directors in
                performing his duties.

Article 20      The Company shall formulate the "Work Regulations for the
                Secretary of the Board", which shall set out detailed
                provisions in respect of the duties and responsibilities,
                roles, and the daily working body of the secretary of the
                board of directors. Those Regulations shall come into effect
                upon the submission to, and the approval of, the board of
                directors.

              CHAPTER 5 RULES OF THE BOARD OF DIRECTORS' MEETING

Article 21      The board of directors' meetings shall be divided into
                regular meetings and provisional meetings according to the
                regularity of such meetings.

Article 22      The regular meetings shall include the following:

                (1)   The board meetings approving financial reports of the
                      Company:

                      (i)   The annual results meetings

                            The annual results meetings shall be convened
                            within 120 days from the end of the accounting
                            year of the Company. The directors shall approve
                            the Company's annual reports and deal with other
                            relevant matters at such meetings. The timing of
                            such meetings shall ensure that the annual reports
                            of the Company will be despatched to the
                            shareholders within the time limit specified by
                            the relevant regulations and the Articles of
                            Association, and shall ensure that the preliminary
                            annual financial results of the Company will be
                            announced within the time limit specified by the
                            relevant regulations of the Company, and shall
                            ensure that the AGM will be convened within 180
                            days from the end of the accounting year of the
                            Company.

                      (ii)  The interim results meetings The interim results
                            meetings shall be convened within 60 days from the
                            end of the first six months of the accounting year
                            of the Company. The directors shall approve the
                            Company's interim reports and deal with other
                            relevant matters at such meetings.

                      (iii) The quarterly results meetings The quarterly
                            results meetings shall be held in the first month
                            of each of the second and fourth quarter of the
                            Gregorian calendar year. The directors shall
                            approve the Company's quarterly reports for the
                            preceding quarters at such meetings.

                (2)   The year-end review meetings

                      The year-end review meetings shall be convened in
                      December of each year. The directors shall listen to
                      and approve the president's report in respect of the
                      expected performance of the Company in the year and the
                      work arrangements for the following year at such
                      meetings.

Article 23      The chairman of the board of directors shall approve the
                issue of a notice convening the provisional board of
                directors' meeting within seven days in any one of the
                following events:

                (1)   where the chairman of the board of directors considers
                      necessary;

                (2)   where more than one-third of the directors propose in
                      their joint names;

                (3)   where more than one-half of the independent directors
                      propose in their joint names;

                (4)   where the supervisory committee proposes;

                (5)   where the president proposes.

Article 24      The board of directors' meetings shall be divided into
                meetings at which all directors must be physically present and
                meetings which the directors may authorise other directors to
                attend on their behalf, according to whether the directors are
                physically present at the meetings.
                The meetings which all directors must be physically present
                shall be held at least once every six months, and such
                meetings shall not be held by way of written resolutions or
                video-telephone meetings.

Article 25      The board of directors' meetings shall be divided into on-site
                meetings, video-telephone meetings and meetings by way of
                written resolutions.

                All the meetings of the board of directors may be held by the
                way of on-site meetings.

                The board of directors' meetings may be held by the way of
                video-telephone meetings, provided that the attending
                directors are able to hear clearly the director who speaks at
                the meeting and communicate amongst themselves. The meetings
                convened by this way shall be recorded and videotaped. In the
                event that the attending directors are unable to sign for the
                resolutions on site, they shall express their opinions orally
                during the meeting and shall complete the signing procedures
                as soon as practicable. The verbal voting by a director shall
                have the same effect as signing in the voting sheet, provided
                that there is no discrepancy between the opinions expressed by
                such director in completing signing procedure and the opinions
                orally expressed by him during the meeting.

                In the case of urgency (limiting to cases where an on-site
                meeting or a video-telephone meeting is impractical), and the
                matters to be examined are comparatively procedural and unique
                so that the a discussion of the motions proves to be
                unnecessary, the board of directors' meeting may be held by
                written resolutions, in which case the motions shall be passed
                by way of circulating the motions for directors' review.
                Unless otherwise expressed by the directors, signing on the
                written resolutions by the directors shall be sufficient
                evidence that they have agreed to the resolutions.

           CHAPTER 6 PROCEEDINGS OF THE BOARD OF DIRECTORS' MEETING

Article 26      Putting forward Motions

                The motions of the board of directors' meetings shall be put
                forward in the following circumstances:

                (1)   matters proposed by the directors;

                (2)   matters proposed by the supervisory committee;

                (3)   motions from the special committees of the board of
                      directors;

                (4)   matters proposed by the president;

                (5)   matters to be considered by the shareholders of the
                      subsidiaries controlled or invested by the Company in
                      their shareholders' meetings (shareholders' general
                      meetings).

Article 27      Collecting Motions

                The secretary of the board of directors shall be responsible
                for collecting the draft motions in respect of the matters to
                be considered at the meeting. Each person who puts forward the
                relevant motion(s) shall submit the motions and relevant
                explanatory materials before the date of the meeting. Motions
                concerning material connected transactions (which are
                determined according to the standards promulgated by the
                relevant regulatory authorities from time to time) shall first
                be approved by the independent directors. The relevant
                materials shall be submitted to the chairman of the board of
                directors after scrutinized by the secretary of the board of
                directors, who shall also set out the time, place and agenda
                of the meeting in the materials submitted.

Article 28      Convening the Meetings

                A board of directors' meeting shall be convened by the
                chairman of the board of directors, who shall also approve the
                issue of the notice convening the meeting. If the chairman of
                the board of directors is unable to convene the meeting due to
                special reasons, he shall designate the vice-chairman or other
                director(s) to convene the meeting. Where the chairman fails
                to convene a meeting with no reason or designate specific
                personnel to act on his behalf, a director chosen by the
                vice-chairman and one-half of the directors jointly shall
                convene the meeting. The convenors of the meeting shall be
                responsible for approving the issue of the notice of the
                meeting.

Article 29      Notice of the Meetings

                (1)   The notice of a board of directors' meeting shall be
                      delivered to all directors, supervisors and other
                      personnel attending the meeting before the date of the
                      meeting. The notice of the meeting shall generally set
                      out the following:

                      i.    the time and place of the meeting;

                      ii.   the duration of the meeting;

                      iii.  the agenda, reasons, subject matters and other
                            relevant particulars of the meeting;

                      iv.   the date of the issue of the notice.

                (2)   The board of directors' meetings shall be noticed
                      according to the following requirements and form:

                      i.    the notice of the meeting may be served on the
                            directors by courier, facsimile, electronic means,
                            telegraph or mail;

                      ii.   the notice of the board of directors' meeting
                            shall be delivered to the directors ten days
                            before the date of the meeting;

                      iii.  the notice shall be written in Chinese, if
                            necessary, the English version can be attached.

                Any director may waive the right to receive the notice of
                board meeting.

                Notice of a meeting shall be deemed to have been given to any
                director who attends the meeting without protesting against,
                before or at its commencement, any lack of notice.

Article 30      Communication before the Meetings

                After the issue of the notice of a meeting and before the date
                of the meeting, the secretary of the board of the directors
                shall be responsible for, and shall communicate and liaise
                with all supervisors, to seek their opinions or suggestions in
                respect of the motions of the meeting, and shall pass on these
                opinions or suggestions to the persons put forward the
                motions, so as to enable necessary amendments to be made to
                them. The secretary of the board of directors shall also, in a
                timely manner, arrange for the provision of the supplemental
                materials which are required for the directors to make
                decisions on the motions of the meeting, including the
                background information relating to the subject of the meeting
                and other information which will assist the directors in
                making scientific, immediate and prudent decisions.

                Where more than one-fourth of the directors or two external
                directors are of the opinion that the materials provided are
                insufficient or unclear, they may make a proposal jointly
                concerning the postponement of holding of the board meeting or
                the postponement of discussions on the part of the issues put
                forward by the board of directors, and the board of directors
                shall adopt such a proposal. Unless such a proposal is put
                forward during the meeting, the secretary of the board of
                directors shall serve a notice on the directors, supervisors
                and other personnel attending the meeting upon receiving a
                written request concerning the postponement of holding of the
                meeting or the postponement of discussions on part of the
                issues put forward by the board of directors.

Article 31      Attendance of the Meetings

                Meetings of the board shall be held only if more than half of
                the directors are present.

                Directors shall attend the meetings of the board of directors
                in person. Where a director is unable to attend a meeting for
                any reason, he may by a written power of attorney appoint
                another director to attend the meeting on his behalf (where an
                independent director is unable to attend in person, he shall
                appoint another independent director to attend on his behalf).
                The power of attorney shall set out the name of the attorney,
                the particulars and the scope of authorisation, duration of
                the validity of such authorisation, and shall be signed or
                sealed by the principal.

                In the event that an independent director does not attend the
                board of directors' meeting for three consecutive meetings,
                the board of directors may propose to the shareholders'
                general meeting to have such independent directors dismissed.

                The board of directors' meeting shall be chaired by the
                chairman of the board of directors. Where circumstances
                preclude the Chairman, he may designate the vice-chairman or
                other directors to act on his behalf. Where the chairman of
                the board fails to chair the meeting without reason or
                designate specific personnel to act on his behalf, a director
                chosen by the vice-chairman or more than half of the directors
                shall chair the meeting. Upon the expiry of the term of office
                of the directors and the re-election of the new directors at
                the shareholders' general meeting, the directors who obtains
                the largest number of votes at such re-election (if more than
                one, one shall be chosen amongst them) shall chair such
                meeting, at which the chairman of the new board of directors
                shall be elected.

Article 32      Examining the Motions

                The chairman of the meeting shall declare the commencement of
                the meeting as scheduled. The directors in presence shall
                reach an agreement on the agenda of the meeting thereafter.
                Where more than one-fourth of the directors or more than two
                external directors are of the opinion that the materials of
                the meeting are insufficient or unclear, they may make a
                proposal jointly concerning the postponement of holding of the
                board meeting or the postponement of discussions on the part
                of the issues put forward by the board of directors, and the
                board of directors shall adopt such a proposal.

                When an agreement is reached in respect of the agenda of the
                meeting by the directors present at the meeting, the chairman
                of the meeting shall direct the motions to be examined one by
                one. Persons who put forward the motions or their attorneys
                shall first report to the board of directors their work or
                make statements in respect of the motions.

                In reviewing the relevant proposals, motions and reports, in
                order to understand the main points and the background
                information of the motions in detail, the board of directors'
                meeting may require the heads of the departments which are
                responsible for handling the motions to attend the meeting to
                listen to and make inquiries of the relevant statements made
                at the meeting, so that proper decisions can be made at the
                meeting. If, in the course of the meeting, any motions
                examined are found to be unclear or infeasible, the board of
                directors shall require the departments which are responsible
                for handling the motions to give a statement at the meeting,
                and the motions can be returned to such departments for
                re-handling and their examination and approval shall be
                postponed.

                The independent directors shall give their independent
                opinions to the board of directors on the following matters:

                (1)   the nomination, appointment and removal of the
                      directors;

                (2)   the appointment and dismissal of the president,
                      vice-president, Chief Financial Officer and secretary of
                      the board of directors;

                (3)   the remuneration of the directors, the president,
                      vice-president, Chief Financial Officer and secretary of
                      the board of directors of the Company;

                (4)   the loans made by the Company to its shareholders, the
                      person in actual control of the Company or the
                      associated enterprises of the Company or other money
                      transfer between them, the amounts of which are
                      equivalent to or exceed the relevant thresholds of the
                      Company's material connected transactions (which shall
                      be determined in accordance with the standards
                      promulgated from time to time by the relevant regulatory
                      authorities) which must be examined by the board of
                      directors or shareholders' general meeting according to
                      law, and whether the Company has taken effective
                      measures to recover such debts;

                (5)   any matters which the independent shareholders consider
                      to be detrimental to the interests of minority
                      shareholders.

                An independent director shall give his opinion on the
                above-mentioned matters in the following manner:

                (1)   consent;

                (2)   opinion reserved and reasons;

                (3)   opposition and its reasons;

                (4)   no opinion can be expressed and the obstacles.

Article 33      Voting on the Motions

                In reviewing the motions at the board of directors' meeting,
                all attending directors shall deliver their opinions in
                respect of approval or objection to such motions or abstention
                from voting.

                The directors who are acting as proxies of others shall
                exercise the rights of voting within the authorisation.

                Where a director is not present at a board of directors'
                meeting and fails to appoint a proxy to act on his behalf,
                such director shall be deemed to have waived his rights to
                vote at the meeting.

                In reaching resolutions by the board of directors, except the
                following matters the resolutions of which shall be passed by
                the consent of more than two-thirds of the directors, the
                other matters shall be passed by the consent of more than
                one-half of the directors:

                (1)   to formulate proposals for the credit and financial
                      policies of the Company, the increase or reduction of
                      the registered capital of the Company and the issuance
                      of debentures and securities of any kind (including but
                      without limitation to the debentures of the Company) and
                      the listing or repurchase of the shares of the Company;

                (2)   to draw up plans for significant acquisition or disposal
                      proposals, the merger, division or dissolution of the
                      Company;

                (3)   to formulate proposals for any amendment to the
                      Company's Articles of Association.

                The resolutions of the board of directors may be decide on a
                poll or show of hands. Each director shall have one vote.
                Where the votes for an against a resolution are equal, the
                chairman of the board of directors is entitled to cast one
                more vote.

                In voting on the Company's connected transactions by the board
                of directors, the connected directors who have interests in
                the transactions shall abstain from voting. Where resolutions
                cannot be reached due to the abstention from voting of the
                connected directors, the relevant motions shall be submitted
                directly to the shareholders' general meeting for examination.

Article 34      Liability of Directors in respect of Resolutions of the Board
                of Directors' Meetings

                A written resolution of the board of directors shall not take
                effect as a resolution of the board of directors if it has not
                been formulated in accordance with the stipulated procedures,
                notwithstanding all the directors have already expressed their
                opinions in different ways. The directors shall be responsible
                for the resolutions passed at the meetings of the board of
                directors. Any director who votes for a resolution which
                contravenes the laws, administrative regulations or the
                Articles of Association thus causing serious damages to the
                Company shall be directly liable (including the compensation
                of damages) for all the loss incurred by the Company as a
                result. A director who votes against the resolution, and who
                has been proved as having expressed dissenting opinions on the
                resolution and such opinions are recorded in the minutes of
                the meeting can be exempt from liability. A director who
                waives his right of voting, or who fails to attend the meeting
                and fails to appoint a proxy to act on his behalf, cannot
                escape liability. A director who explicitly express his
                objection in the course of discussion but fails to cast an
                objection vote in the voting cannot escape liability.

Article 35      Resolutions of the Meeting

                In principle, the board of directors' meeting shall resolve on
                all the matters examined at the meeting. A resolution on the
                Company's connected transaction shall not be valid until it is
                signed by all directors. The independent directors' opinions
                shall be set out in the resolutions of the board of directors
                meetings.

Article 36      Minutes of the Meetings

                Minutes of the board of directors' meeting are proof of the
                resolutions on the matters examined at the meeting. Detailed
                minutes in respect of the matters examined at the meeting
                shall be recorded. The minutes of the board of directors'
                meeting shall state the following:

                (1)   the date, place, names of the convenors and chairman of
                      the meeting;

                (2)   the names of the attending directors and the names of
                      the present, the names of appointing directors and their
                      attorneys;

                (3)   the agenda of the meeting;

                (4)   the essential points of the directors' presentations
                      (for the written resolution meeting, the version
                      containing the directors' feedbacks in writing shall
                      prevail);

                (5)   the voting methods and outcome for each proposal (the
                      outcome of the voting shall set out the respective
                      number of assenting or dissenting votes or votes that
                      were waived);

                (6)   the directors' signature.

                The secretary of the board of directors shall take initiative
                to arrange for the matters examined at the meeting to be
                recorded. The minutes of each meeting shall be provided to the
                directors for review without delay. Those directors who wish
                to make supplementary revision on the minutes shall report
                their opinions on the revision to the chairman of the board of
                directors in written form within one week after the receipts
                of the minutes of the board meeting. After the minutes of
                board meeting are finally determined, the attending directors,
                the secretary of the board of directors and the minute-taking
                officer shall sign the minutes of the board meeting. The
                secretary of the board of directors shall deliver the complete
                duplicate of the minutes to all directors. The minutes of the
                board meeting, being an important document, shall be properly
                kept at the business address of the Company.

           CHAPTER 7  DISCLOSURE OF INFORMATION RELATING TO THE BOARD
                      OF DIRECTORS' MEETING

Article 37      The board of directors of the Company shall strictly comply
                with the requirements of the regulatory authorities and the
                stock exchanges on which the Company's shares are listed in
                relation to the disclosure of information. It shall ensure
                that matters examined or resolutions passed at the board of
                directors' meeting which are discloseable are disclosed
                accurately and in a timely manner. Information relating to
                significant matters of the Company must be reported to the
                stock exchanges on which the Company's shares are listed at
                the earliest opportunity, and shall be submitted to relevant
                regulatory authorities for filing.

Article 38      Where a matter which requires the independent opinions of the
                independent directors is discloseable, the Company shall
                disclose such opinions in the relevant announcement. If the
                independent directors are of divergent views and cannot reach
                any consensus, the board of directors shall disclose the
                respective opinions of each of the independent directors.

Article 39      Regarding confidential information, the attendees of the
                meeting must keep such information confidential. Punishment
                shall be imposed on those who are in breach of this duty.

              CHAPTER 8    IMPLEMENTATION OF THE RESOLUTIONS OF THE
                           BOARD OF DIRECTORS' MEETING AND FEEDBACKS

Article 40      The following matters shall not be implemented until they
                are examined and preliminarily approved by the board of
                directors and submitted to the shareholders' general meeting
                for approval thereafter:

                (1)   the formulation of the Company's annual preliminary and
                      final financial budgets;

                (2)   the formulation of Company's profit distribution
                      proposals and loss recovery proposals;

                (3)   the increase or reduction of the registered capital of
                      the Company and the issue of debentures or other
                      securities, as well as the listing or repurchase of the
                      shares of the Company;

                (4)   the formulation of plans for merger, division or
                      dissolution of the Company;

                (5)   the formulation of proposals for any amendment to the
                      Articles of Associations; and

                (6)   proposal to be submitted to the shareholders in general
                      meeting for the appointment or replacement of the
                      accounting firm auditing the accounts of the Company.

Article 41      After resolutions are passed at a board of directors'
                meeting, the president shall implement the resolutions which
                fall within the scope of the authority of the president, or
                which the board of directors authorises the president to
                handle, and shall report the status of implementation to the
                board of directors.

Article 42      The chairman of the board shall have the power to, or
                authorize the vice-chairman or the directors to, urge, examine
                and supervise the implementation of the resolutions of the
                meeting.

Article 43      At each board of directors' meeting, the president shall
                deliver a written report to the meeting in relation to the
                status of implementation of the matters which, according to
                the resolutions of the previous meeting, must be implemented.

Article 44      Under the direction of the board of directors and the
                chairman, the secretary of the board of directors shall take
                initiative to obtain information in respect of the progress on
                the implementation of the resolutions, and shall, in a timely
                manner, report to and submit proposals to the board of
                directors and the chairman in relation to the important issues
                to be implemented.

                        CHAPTER 9 SUPPLEMENTAL ARTICLES

Article 45      Where these Rules fail to comply with relevant laws,
                regulations and other regulatory documents as promulgated from
                time to time, these laws, regulations and other regulatory
                documents shall prevail.

Article 46      Upon the unanimous consensus of all directors of the
                Company, the formulation of and the amendment to these Rules
                shall come into effect if they are adopted by the
                shareholders' general meeting by a special resolution and
                approved by the relevant authorities.

Article 47      The right to interpret these Rules shall vest with the board
                of directors.


        APPENDIX IV   RULES AND PROCEDURES FOR THE SUPERVISORS' MEETINGS

                         CHAPTER 1 GENERAL PROVISIONS

Article 1       In order to standardize the operation of the supervisory
                committee of China Petroleum & Chemical Corporation (the
                "Company"), to ensure the supervisory committee implementing
                the duties and responsibilities conferred by all shareholders
                of the Company, these Rules are formulated according to the
                "Company Law of the People's Republic of China" (the "Company
                law"), "Mandatory Provisions for the Articles of Association
                of Companies to be Listed Overseas", "Guidelines for the
                Articles of Association of Listed Companies", "Standards for
                the Governance of Listed Companies" and other relevant laws
                and regulations regulating listed companies inside and outside
                the PRC and the Articles of Association of China Petroleum &
                Chemical Corporation ("Articles of Association").

Article 2       The supervisory committee is accountable to the shareholders'
                general meetings. It shall be responsible for supervising the
                financial affairs of the Company and the lawfulness of the
                performance of their duties by the directors, president,
                vice-president, Chief Financial Officer and secretary of the
                board of directors of the Company so as to safeguard the
                legitimate interests of the Company and its shareholders.

Article 3       The Company shall take measures to ensure the supervisors'
                rights to know the Company's affairs, and provide them with
                necessary information and materials, so as to enable the
                supervisory committee to conduct effective supervision,
                inspection and evaluation of the financial status and
                management situation of the Company.

                The president shall report to the supervisory committee the
                entering into of, and the enforcement of, material contracts
                by the Company, the use of capitals and the profitability of
                the Company upon the request of the supervisory committee. The
                president shall ensure the truthfulness of such report.

          CHAPTER 2  COMPOSITION OF THE SUPERVISORY COMMITTEE AND ITS
                     ADMINISTRATIVE OFFICE

Article 4       The supervisory committee shall compose of twelve
                supervisors. Of which, eight of them shall be shareholder
                representatives (including those who are eligible to be
                external supervisors); four of them shall be representatives
                of workers and staff of the Company.

                The election and removal of the chairman of the supervisory
                committee shall be determined by two-thirds or more of the
                members of the supervisory committee.

Article 5       The term of the office of a supervisor shall be three years.
                The supervisors representing the shareholders shall be elected
                and removed by the shareholders' general meeting. The
                supervisors representing the workers and staff of the Company
                shall be elected and removed democratically by those workers
                and staff of the Company. The term of a supervisor is
                renewable upon re-election and re-appointment.

Article 6       Except for complying with the eligibility requirements as
                set out in the Company Law and the Articles of Association,
                the supervisors shall possess professional knowledge and work
                experience in the field of law or accounting.

Article 7       A supervisor may resign before the expiry of his term of
                office by submitting a written resignation letter to the
                supervisory committee.

                Provisions in respect of the resignation of directors as set
                out in the Articles of Association shall be applicable to the
                resignation of supervisors, including (but without limitation
                to) where a supervisor's resignation will result in the number
                of supervisors of the Company falling below the quorum as
                provided by law, the resignation letter of such supervisor
                shall not be effective until the vacancy created by his
                resignation has been filled.

Article 8       The supervisory committee shall have an administrative
                office responsible for handling daily affairs of the
                supervisory committee.

          CHAPTER 3 FUNCTIONS AND POWERS OF THE SUPERVISORY COMMITTEE

Article 9       The supervisory committee shall exercise the following
                functions and powers in accordance with law:

                (i)     to review the Company's financial position. Where
                        necessary, the supervisory committee may appoint
                        another accounting firm on behalf of the Company to
                        carry out independent audit;

                (ii)    to supervise the directors, president, vice-president,
                        Chief Financial Officer and secretary of the board of
                        directors of the Company in order to ensure that they
                        do not act in contravention of any law, regulation or
                        the Articles of Association in performing their
                        duties;

                (iii)   to demand the directors, president, vice-president,
                        Chief Financial Officer and secretary of the board of
                        directors of the Company who acts in a manner which is
                        harmful to the Company's interest to rectify such
                        acts, and report to the shareholders' general meeting
                        and relevant authorities of the State when necessary;

                (iv)    to check and inspect the financial information such as
                        the financial report, business report and plans for
                        distribution of profits to be submitted by the board
                        of directors to the shareholders' general meetings and
                        to authorize, in the Company's name, publicly
                        certified and practicing accountants to assist in
                        reviewing such information should any doubt arise in
                        respect thereof;

                (v)     to give opinions on the appointment of an accounting
                        firm of the Company;

                (vi)    to propose to convene an extraordinary general
                        meeting, and may put forward provisional motions at
                        the shareholders' annual general meeting;

                (vii)   to propose to convene provisional board meetings;

                (viii)  to represent the Company in negotiations with or in
                        bringing actions against a director;

                (ix)    other duties and powers provided for in the Articles
                        of Association.The supervisors shall attend meetings
                        of the board of directors.

Article 10      The supervisory committee shall declare the Company's
                supervisory report for the preceding year at the AGM. Such
                report shall include the following matters:

                (i)     the review of the Company's financial position;

                (ii)    the implementation of relevant laws, regulations,
                        Articles of Association and the resolutions of the
                        shareholders' general meetings by the directors,
                        president, vice-president, Chief Financial Officer and
                        secretary of the board of directors of the Company;

                (iii)   the evaluation of the performance of the directors,
                        president, vice-president, Chief Financial Officer and
                        secretary of the board of directors of the Company by
                        the supervisory committee, in particular the specific
                        opinions of the external supervisors;

                (iv)    other significant events which in the opinion of the
                        supervisory committee shall be reported to the
                        shareholders' general meeting.

                Where the supervisory committee thinks necessary, it may
                express its opinions on the motions examined at the
                shareholders' general meetings, and may submit an independent
                report to the shareholders' general meetings.

Article 11      All reasonable fees incurred in respect of the employment
                of professionals such as lawyers, certified public accountants
                or practicing auditors which are required by the supervisory
                committee in the exercise of its functions and powers shall be
                borne by the Company.

                The expenses incurred by the supervisors in attending the
                supervisors' meeting shall be borne by the Company. These
                expenses shall include the transport fares incurred by the
                supervisors in travelling from their own addresses to the
                places of the meetings, and fees for the accommodation and
                meals during the meeting.

Article 12      The chairman of the supervisory committee shall exercise
                the following functions and powers:

                (i)     to convene and chair the meetings of the supervisory
                        committee;

                (ii)    to organise and carry out the duties of the
                        supervisory committee;

                (iii)   to review and approve, and signing the reports of the
                        supervisory committee and other important documents;

                (iv)    to represent the supervisory committee to report to
                        the shareholders' general meetings;

                (v)     other duties that shall be performed by him in
                        accordance with law or the Articles of Association.

                Where special circumstances preclude the chairman from
                exercising his functions and powers, these functions and
                powers shall be exercised by a supervisor designated by him.

Article 13      In performing its duties, the supervisory committee may report
                to the board of directors and the shareholders general
                meetings the breach of laws and rules relating to the
                Company's financial affairs and the acts of the directors,
                president, vice-president, Chief Financial Officer and
                secretary of the board of directors of the Company which are
                in violation of laws, regulations or the Articles of
                Association. It may also directly report the same to the
                securities regulatory authorities of the State Council and
                other relevant authorities.

Article 14      A supervisor shall abide by the laws, regulations and the
                Articles of Association, and shall perform his duties
                faithfully and diligently.

                 CHAPTER 4 RULES OF THE SUPERVISORS' MEETINGS

Article 15      The supervisors' meetings shall be divided into regular
                meetings and provisional meetings according to the regularity
                of such meetings.

Article 16      The regular meetings shall be convened at least four times
                each year, including the interim results meeting, the annual
                results meeting, the year-end review and the arrangement
                meetings for supervisors financial management meetings.

                The interim results meetings shall be convened within sixty
                days from the end of the first six months of the accounting
                year of the Company. The supervisors shall listen to and
                approve the Company's interim reports and deal with other
                relevant matters at such meetings.

                The annual results meetings shall be convened within 120 days
                from the end of the accounting year of the Company. The
                supervisors shall listen to and approve the Company's annual
                reports and deal with other relevant matters at such meetings.

                The year-end review and arrangement meetings shall be convened
                in December of each year. The supervisors shall listen to and
                approve the president's report in respect of the expected
                performance of the Company in the year and the work
                arrangements for the following year at such meetings.

                The financial management meetings shall be convened within 30
                days from the end of the annual financial work meeting of the
                Company. The supervisors shall listen to and approve the
                report of the Company's financial department in respect of
                conducting the overall budget management and strengthening
                financial control by the Company.

Article 17      A provisional supervisors' meeting shall be convened in any
                one of the following events:

                (i)     here the chairman of the supervisory committee
                        considers necessary;

                (ii)    where more than two-thirds of the supervisors propose
                        in their joint names;

                (iii)   where the Company has suffered or is suffering loss of
                        substantial assets causing the shareholders' interests
                        to be damaged;

                (iv)    where the directors, president, vice-president, Chief
                        Financial Officer and secretary of the board of
                        directors of the Company act in a way which is in
                        contravention of laws, regulations or the Articles of
                        Association causing the Company's interests to be
                        seriously damaged.

Article 18      The supervisors' meetings shall be divided into on-site
                meetings, video-telephone meetings and meetings by way of
                written resolutions.

                All the meetings of the supervisory committee may be held by
                the way of on-site meeting.

                The meetings of the supervisory committee may be held by the
                way of video-telephone meetings, provided that the attending
                supervisors are able to hear clearly the supervisor who speaks
                at the meeting and communicate amongst themselves. In the
                event that the attending supervisors are unable to sign for
                the resolutions on site, they shall express their opinions
                orally during the meeting and shall complete the signing
                procedures as soon as practicable.

                Where an on-site meeting or a video-telephone meeting is
                impractical, the supervisors' meeting may be held by way of
                written resolutions, in which case details of the motions to
                be discussed and examined at the meeting, which are in the
                written form, shall be despatched to the supervisors for
                decision. Unless otherwise expressed by the supervisors,
                signing on the written resolutions by the supervisors shall be
                sufficient evidence that they have agreed to the resolutions.

Article 19      A supervisors' meeting shall be validly convened by the
                presence of not less than two-thirds of the supervisors.

                The supervisors shall be physically present at the
                supervisors' meetings. If for any reason a supervisor is
                unable to attend the meeting, he shall by written
                authorisation appoint another supervisor to act as his proxy
                to attend the meeting and exercise his functions and powers.
                The written authorisation shall state the name of the proxy,
                the scope of the authorisation, the authority of the proxy and
                the period of validity. It shall also be signed by the proxy
                or affix the seal of the proxy.

                In the event that a supervisor does not attend the
                supervisors' meeting in person for two consecutive meetings,
                he shall be deemed to be unable to perform his duties, and the
                shareholders' general meeting or the staff representative
                meeting shall dismiss such supervisor.

               CHAPTER 5 PROCEEDINGS OF THE SUPERVISORS' MEETING

Article 20      The supervisory committee shall put forward motions according
                to the matters to be examined by the board of directors and
                matters proposed by the supervisors.

Article 21      The administrative office of the supervisory committee shall
                be responsible for gathering the matters to be examined by the
                board of directors and the matters proposed by the
                supervisors, and shall submit these matters to the chairman of
                the supervisory committee in time. The chairman of the
                supervisory committee shall determine whether to submit these
                matters to the supervisory committee for review according to
                the importance and urgency of these matters.

Article 22      The chairman of the supervisory committee shall be responsible
                for convening the supervisors' meeting, and shall sign the
                notice of the meeting. Such notice shall state the date,
                place, duration, agenda, reasons and subject matters of the
                meeting and other relevant information, as well as the date of
                the issuance of such notice.

                The notice of a supervisors' meeting shall be delivered to the
                supervisors ten days before the date of the meeting. Any
                supervisor may waive his right to demand the notice of the
                meeting.

                The notice of the meeting may be served on the supervisors by
                courier, facsimile, telegraph or mail.

Article 23      After the issue of the notice of a meeting and before the date
                of the meeting, the administrative office of the supervisory
                committee shall be responsible for, and shall communicate and
                liaise with all supervisors, to seek their opinions or
                suggestions in respect of the motions of the meeting, so as to
                enable necessary amendments to be made to them.

                Where more than one-fourth of the members of the supervisors
                or two external supervisors are of the opinion that the
                information in respect of a specific motion is insufficient to
                allow judgment to be made, or the motion is not convincing,
                they may in their joint name propose to postpone the
                examination of such a motion, and the supervisory committee
                shall adopt such a proposal.

Article 24      The supervisors' meeting shall be chaired by the chairman of
                the committee. Where circumstances preclude the chairman to
                chair the meeting, he may designate a supervisor to chair the
                meeting. Upon the expiry of the term of office of the
                supervisory committee and the re-election of the new
                supervisors by the shareholders' general meeting, the
                supervisor who obtains the largest number of approval votes at
                such re-election (if more than one, one shall be chosen
                amongst them) shall chair such meeting, at which the chairman
                of the new supervisory committee shall be elected.

Article 25      The chairman of the meeting shall declare the commencement of
                the meeting as scheduled. The supervisors in presence shall
                reach an agreement on the agenda of the meeting thereafter.

                Where more than one-fourth of the supervisors or two external
                supervisors are of the opinion that the information in respect
                of one specific motion is insufficient to allow judgment to be
                made, or the motion is not convincing, they may in their joint
                name propose to postpone the examination of such a motion, and
                the chairman of the meeting shall adopt their proposal.

                Where an agreement is reached in respect of the agenda of the
                meeting by the supervisors present at the meeting, the
                chairman of the meeting shall direct the motions to be
                examined one by one.

Article 26      In reviewing the relevant motions and reports, the
                supervisors' meeting may require the directors, president,
                vice-president, Chief Financial Officer, secretary of the
                board of directors and the internal and external auditors of
                the Company to attend the meeting to give necessary
                explanations to the relevant matters, and to answer the
                questions which the supervisory committee is concerned with.

Article 27      In reviewing the motions at supervisors' meetings, all
                attending supervisors shall deliver their opinions in respect
                of approval or objection to such motions or abstention from
                voting.

                The supervisors who are acting as proxies of others shall
                exercise the rights of voting within the authorization.

                Where a supervisor is not present at a supervisors' meeting
                and fails to appoint a proxy to act on his behalf, such
                supervisor shall be deemed to have waived his rights to vote
                at the meeting.

Article 28      In principle, resolutions shall be made on the matters
                examined at the supervisors' meeting. Such resolutions shall
                be decided on a poll or show of hands. No resolution shall be
                effective unless approved by more than two-thirds of all the
                supervisors.

Article 29      Detailed minutes of a supervisors' meeting shall be recorded
                as proof of the resolutions on the matters examined at the
                meeting.

                The minutes of the meeting shall state the date and place of
                the meeting, name of the chairman of the meeting, names of the
                attending supervisors and names of the principals and proxies
                who have fulfilled the necessary procedures for attending the
                meeting, agenda of the meeting, main points of each
                supervisor's speech, the methods of voting for each matter to
                be resolved on and the voting result (the result shall state
                the number of votes for approval or objection to the motion or
                abstention).

                The administrative office of the supervisory committee shall
                designate staff to arrange for the matters examined at the
                meeting to be recorded. The minutes of each meeting shall be
                provided to the attending supervisors for review without
                delay. Supervisors present at the meeting and the
                minutes-taking officer shall sign the minutes of that meeting.
                A supervisor shall have the right to request an explanatory
                note be made for his speech at the meeting.

Article 30      Minutes of a supervisors' meeting and the resolutions passed
                at such meeting, being important documents, shall be properly
                kept by the administrative office of the supervisory committee
                at the Company's place of business.

   CHAPTER 6    DISCLOSURE OF INFORMATION RELATING TO THE SUPERVISORS' MEETING

Article 31      The supervisory committee shall strictly comply with the
                requirements of the regulatory authorities and the stock
                exchanges on which the Company's shares are listed in relation
                to the disclosure of information. It shall ensure that matters
                examined or resolutions passed at supervisors' meetings which
                are discloseable are disclosed accurately and in a timely
                manner.

Article 32      Regarding confidential information, the attendees of the
                meeting must keep such information confidential. Punishment
                shall be imposed on those who are in breach of this duty.

      CHAPTER 7 IMPLEMENTATION OF THE RESOLUTIONS OF THE SUPERVISORS'
                MEETING AND FEEDBACKS

Article 33      The supervisory committee may pass resolutions and make
                proposals to the board of directors and the shareholders'
                general meetings. These resolutions and proposals shall be
                implemented by the relevant departments of the Company under
                the direction of the board of directors.

Article 34      The administrative office of the supervisory committee shall,
                under the direction of the committee and its chairman, take
                initiative to obtain the information in respect of the
                implementation of the relevant resolutions, and shall report
                and make proposals to the supervisory committee and the
                chairman of the committee.

Article 35      Where resolutions concerning the proposals to convene a
                provisional board meeting or shareholders' extraordinary
                general meeting, or the submission of provisional motions to
                the AGM are passed by the supervisory committee, the
                supervisory committee shall, within a specified period, submit
                to the board of directors the subjects of such meetings and
                the detailed motions in writing, and shall ensure that the
                contents of the motions comply with relevant laws, regulations
                and the Articles of Association.

                       CHAPTER 8 SUPPLEMENTARY ARTICLES

Article 36      The right to interpret these Rules shall vest with the
                supervisory committee.

Article 37      Where these Rules fail to comply with relevant laws,
                regulations and other regulatory documents as promulgated from
                time to time, these laws, regulations and other regulatory
                documents shall prevail.

Source: OneCLE Business Contracts.