Decree of the Chairman of the People's Republic of China
No. 54

The "Law of the People's Republic of China on Enterprise Bankruptcy" has been approved on the 23rd meeting of the Tenth NPC Standing Committee of the People's Republic of China on August 27, 2006. It is now promulgated and shall come into effect as of June 1, 2007.

Hu Jintao, Chairman of the People's Republic of China
August 27, 2006

Law of the People's Republic of China on Enterprise Bankruptcy
(Approved on the 23rd meeting of the Tenth NPC Standing Committee of the People's Republic of China on August 27, 2006)

CONTENTS

Chapter I General Provisions
Chapter II The Submission and Acceptance of Bankruptcy Applications
Section 1 Application
Section 2 Acceptance
Chapter III Supervisor
Chapter IV Property of the Debtor
Chapter V Bankruptcy Fees and Charitable Debts
Chapter VI Claim Reporting
Chapter VII Creditors' Meetings
Section 1 General Provisions
Section Creditors' Committee
Chapter VIII Reorganization
Section 1 Application and Period of Reorganization
Section 2 Establishment and Approval of the Reorganization Plan
Section 3 Implementation of the Reorganization Plan
Chapter IX Settlement
Chapter X Bankruptcy Liquidations
Section 1 Bankruptcy Declaration
Section 2 Asset Realization and Allocation
Section 3 Closure of Bankruptcy Proceedings
Chapter XI Legal Liabilities
Chapter XII Supplementary Provisions

Chapter I General Provisions

Article 1 This Law is formulated for the purpose of regularizing the enterprise bankruptcy proceedings, settling claims and debts fairly, protecting legitimate rights and interests of the creditor and the debtor, and maintaining the order of the socialist market economy.

Article 2 This Law is applicable to the debt settlement of a legal entity which is unable to repay debts that are due and whose assets are not sufficient to repay all debts.
Legal entities with the aforesaid situations or lacking liquidity may be reorganized in accordance with this Law.