G/SCM/Q2/CHN/70  
 
13 April 2017  
(17-2038) Page: 1/11 
Committee on Subsidies and  
Countervailing Measures  Original: English  
 
 SUBSIDIES  
QUESTIONS  FROM THE UNITED STAT ES AND THE EUROPEAN UNION TO CHINA  
PURSUANT TO ARTICLE 25.8 OF THE AGREEMEN T 
The following communication, dated 12 April 2017 , is being ci rculated at the request of the 
Delegation s of the United States and the Europe an Union.  
 
_______________  
 
 
At the previous meeting of the Committee on Subsidies and Countervailing Measures, China stated 
that it had only provided subsidies to its steel companies under three programs, and that each 
program was not "specific " under Art icle 2 of the Agreement on Subsidies and Countervailing 
Measures (Subsidies Agreement).1 Information generally under the heading of "government 
subsidies " or "government grants " in the annual reports of several large steel companies in China 
lists numerous  programs, some of which appear to be subject to the notification obligation under 
Article 25 of the Subsidies Agreement.  Please explain why the programs listed below have not 
been notified ( i.e. why each program is not subject to the Article 25 notificati on requirement) or 
provide the following information for each program:  
 
a. Current status of the measure or programme;  
b. The name of any implementing measures or programmes under which the subsidy is 
provided, the agency/agencies responsible for implementing a nd overseeing the subsidy 
(along with a discussion of their respective roles where there is more than one agency 
involved), and the policy objective and/or purpose of the subsidy;  
c. A description of the subsidy provided under the implementing measure or pro gramme, 
including the amount of the subsidy and the form of the subsidy, e.g. grants, loans, tax 
concessions, etc.;  
d. Duration of the subsidy and/or any other time -limits attached to it;  
e. Eligibility criteria for the subsidy, including any export contingency  or domestic content 
requirements;  
f. The source of the subsidy ( e.g. central government funding, sub -central government 
funding, central government and local government cost -sharing, etc.); and  
g. An explanation of whether China has (1) published all measures  relating to the subsidy 
in an official journal dedicated to the publication of all laws, regulations or other 
measures pertaining to or affecting trade in goods, services, trade -related intellectual 
property rights and the control of foreign exchange, and  (2) made available a translation 
of those measures into one or more of the official languages of the WTO, as required by 
paragraph 334 of the Working Party Report (WT/ACC/CHN/49) accompanying the 
Protocol on the Accession of the People 's Republic of China  (WT/L/432). If China has not 
done so, please provide legal citations for the measures and identify where  the measures  
can be found.  
                                                
1 G/SCM/M/99 at paras. 173, 179.  G/SCM/Q2/CHN/70  
 
- 2 - 
 
   
1.  Hebei Iron & Steel Company  
 
Description  2011 (RMB)2 2012 (RMB)3 2013 (RMB)4 2014 (RMB)5 
Electricity Demand 
Inspection  and 
Management Project 
Special Fund  146,874.96  197,232.00  197,232.16  122,890.81  
Polluted Water Treatment 
Special Fund  291,666.71  359,469.68  359,469.69  244,696.96  
Vanadium and Titanium 
Resource Integrated Use 
Renovation Project 
Subsidized Interest Fund  312,500.04  406,249.99  406,249.99  270,833.32  
Water Expenses  62,499.96  81,250.02  81,250.02  54,166.68  
Vanadium and Titanium 
Expansion and Renovation 
Fund 500,000.00  545,455.00  545,454.55  377,622.38  
Energy Saving Renovation  
Integrated Utilization 
Fund 228,66 6.66 270,242.00  270,242.42  176,885.95  
Environmental Protection  
Special Fund  125,000.00  159,090.91  159,090.91  110,139.86  
Vanadium Technology 
Innovation Fund  - 43,333.00  43,333.33  30,952.38  
Vanadium Project 
Technology Research 
Center One -Time 
Government  - 1,000,000.00  - - 
Aluminum and Vanadium 
Atypical Medium Green 
Production Processes Key 
Technology  - 180,000.00  - - 
National Technology 
Support Plan Special Fund   - 1,602,000.00  - - 
Poisonous Industrial 
Waste Process Treatment 
Equipment and Resources 
Technology Development 
Fund  - 150,000.00  - - 
Aluminum Iron  New 
Three - Step Steelmaking 
Technology  - 1,500,000.00  - - 
Environmental Protection 
Subsidy Fund  - 200,000.00  - - 
Hebei Province Invention 
Patent Application Subsidy 
Funding  - 10,500.00  - - 
Leting County Bureau of 
Finance Strengthening 
Coastal County Award  - 200,000.00  - 50,000.00  
Energy Saving Technology 
Renovation Award  500,000.00  2,060,000.00  135,641.03  1,242,819.25  
Online Monitoring 
Equipment Subsidy  - 198,180.00  - - 
Energy Saving Project 
Award Income  9,340,000.00  6,510,000.00  - - 
Public Finance Special 
Appropriations  - 6,000,000.00  - - 
Energy Management 
Center Project  500,000.00  2,500,000.00  3,000,000.00  3,000,000.00  
                                                
2 Hebei Iron & Steel Company 2011 Annual Report at pp. 115 -116. 
3 Hebei Iron & Steel Company 2012 Annual Report at pp. 119 -120. 
4 Hebei Iron & Steel Company 2014 Annual Report at pp. 140 -143. 
5 Id. G/SCM/Q2/CHN/70  
 
- 3 - 
 
  Description  2011 (RMB)2 2012 (RMB)3 2013 (RMB)4 2014 (RMB)5 
Provincial Finance 
Department Academic 
Subsidized Funding  - 30,000.0 0 - - 
Chines Academy of 
Science and Technology 
(CAST) Forum Financial 
Appropriation  - 215,000.00  - 5,000.00  
Provincial Appropriation 
for Steelmaking Research 
Institute Research 
Expenditures  - 125,000.00  359,340.60  5,317.80  
Adjusting Steelmaking 
Institu te Industry Upgrade 
Project  - 454,319.00  2,047,423.49  14,134.91  
Energy Saving and 
Emission Reduction Award  18,000,000.00  9,000,000.00  - - 
Wealthy Citizen Strong 
County Top Honor  300,000.00  - - - 
Environmental Project 
Special Fund  1,000,000.00  - - - 
Electricity Demand Special 
Fund 3,000,000.00  - - - 
Online Inspection Subsidy 
Fund 198,180.00  - - - 
Energy Conservation 
Demonstration Project 
Support Fund  8,100,000.00  - - - 
Reduced Energy Usage 
Award  34,980,000.00  - - - 
City Water and Industrial 
Waste Wat er Processing 
Project  5,000,000.00  - - - 
Northern District Sintered 
Ring Cooling Residual 
Heat Project  350,000.00  - 350,000.00  350,000.00  
Hebei Intellectual Property 
Rights Expense  35,000.00  - - - 
Industry and Information 
Technology Department of 
Hebei Award  50,000.00  - - - 
Vanadium Product 
Technology Innovation 
Subsidy  180,000.00  - - - 
Department of Finance 
Elimination Outdated 
Capacity Subsidy  2,510,000.00  - - - 
Energy Conservation 
Technology Modification 
Award Fund  25,050,000.00  - - - 
Environment al Protection 
Management Award Fund  10,000,000.00  - - - 
Wind Machine, Water 
Pump, and Green Lighting 
Electricity Conservation 
Project  - - - 26,923.08  
Oxidized Pellets 
Desulfurization Project  - - - 32,500.00  
Ring Sintering Machine 
Fume Desulfurization 
Process  - - - 172,058.83  
Desulfurization Project 
Atmospheric Pollution 
Management Funds  - - - 38,333.33  
Fume Particle 
Management Fund  - - - 205,882.35  G/SCM/Q2/CHN/70  
 
- 4 - 
 
  Description  2011 (RMB)2 2012 (RMB)3 2013 (RMB)4 2014 (RMB)5 
Key Industry Rejuvenation 
and Technology 
Modification  - - - 1,512,000.00  
Oxidized Pellets Subsidy 
Fund - - - 5,000,000.00  
Provincial Allocation of 
"Giant Plan" Support 
Expense  - - 8,325.12  2,627.55  
Steelmaking Research 
Institute Construction 
Expense  - - 555,144.66  165,127.67  
Steelmaking Research 
Institute High Strength 
Steel Development and 
Application  - - - 29,134.00  
Steelmaking Research 
Institute No -ash Coal 
Prepared by Low Quality 
Change Coal Processor 
Project  - - 100,000.00  122,263.19  
Explosion Prevention 
Energy Conservation 
Subsidy  - - 46,800.00  - 
Energy Saving and 
Emission Reduction Funds  - - 480,000.00  - 
Strong Coastal County 
Outstanding Contribution 
Award  - - 200,000.00  - 
Environmental Waste 
Emission Expense Excess 
Collection Coordination 
Fund - - 132,120.00  - 
Large Taxpayer Award  - - 50,000.00  - 
Tax Benefits  - - 24,873,105.67  - 
Technology  Center "873 
Pollution Control via 
Vanadium Chromium High 
Efficiency Extraction of 
Particles High Chromium 
Vanadium Residue 
Sublytic Acid Method" 
Fund Allocation  - - - 180,000.00  
Technology Center 
"National Technology 
Project for Vanadium 
Titanium Materi al Cleaning 
and Production" Fund 
Allocation  - - - 1,975,8000.00  
Technology Center 
Equipment Renewal and 
Modification Subsidy 
Expenses  - - - 300,000.00  
Technology Center 
"Vanadium Manufacturing 
Waste Water Integrated 
Utilization Technology 
R&D and Applica tion" 
Fund Allocation  - - - 700,000.00  
Technology Center 
"HRB600(E) High Strength 
Anti-shock Steel R&D" 
Fund Allocation  - - - 800,000.00  G/SCM/Q2/CHN/70  
 
- 5 - 
 
  Description  2011 (RMB)2 2012 (RMB)3 2013 (RMB)4 2014 (RMB)5 
Technology Center 
"Vanadium (V) Oxide 
Cleaning Equipment 
Technology R&D and 
Production" Fund 
Allocation  - - - 800,000 .00 
Hebei Finance Department 
Allocation of First Batch of 
Talent Selection Fund  - - - 200,000.00  
2012 Energy Conservation 
Emission Reduction 
Evaluation Award Fund  - - - 50,000.00  
"Key Technology for 
Aluminum Vanadium 
Titanium Extra -
economical Quality G reen 
Manufacturing Technique" 
Fund Allocation  - - - 276,000.00  
Receipt of PRC MIIT 
Deepen Harmonization 
Special Fund  - - - 600,000.00  
Chengde City Finance 
Bureau Water 
Conservation Policy Fund 
Allocation  - - - 1,500,000.00  
National Technology 
Support Pl an Special Fund 
for Rare Earth High 
Efficiency Usage R&D 
Project Subsidy  - - 1,762,200.00  - 
City Finance Bureau Water 
Conservation Policy Fund  - - 1,000,000.00  - 
Pollution Control via 
Vanadium Chromium High 
Efficiency Extraction of 
Particles High Chromi um 
Vanadium Residue 
Sublytic Acid Method  - - 200,000.00  - 
Nonferrous Metal Industry 
Green Manufacturing 
Technology and 
Application Demonstration 
Project  - - 144,000.00  - 
R&D and Industrialized of 
Cold-rolled Plates Product 
for High Level Vehicles  - - 1,900,000.00  - 
Extra Fine Coal Particle 
and Ancillary Coal 
Smelting Technology  - - 300,000.00  - 
R&D Project for Corrosion 
Resistant Vessel Plates for 
Large Oil Tanker Storage   - - 2,200,000.00  - 
One-line Production and 
Retail Chain 
Informatization   - - 5,380,000.00  - 
435 Sinter Ring Machine 
Fume Dust Removal 
Environmental Protection 
Project  - - 13,000,000.00  - 
First Raw Material Area 
Environmental Protection 
Pollution Management 
Project  - - 24,000,000.00  - 
2013 Central Government 
Atmospheric Pollution 
Prevention Special Fund  - - - 41,000,000.00  G/SCM/Q2/CHN/70  
 
- 6 - 
 
  Description  2011 (RMB)2 2012 (RMB)3 2013 (RMB)4 2014 (RMB)5 
Ring Sintering Machine 
Fume Desulfurization 
Project Financial Subsidy  - - - 3,000,000.00  
R&D on Manufacturing 
Technology for Steel used 
on New Generation 
Vehicles  - - - 330,000.00  
2014 City Level 
Environmenta l Protection 
Special Fund  - - - 5,000,000.00  
R&D for High Energy 
Welding of Steel in Ship 
Vessels  - - - 200,000.00  
Frequency Projects  - - - 500,000.00  
Tax Payment Award  - - - 130,000.00  
Total  120,760,388.33  33,997,322.00  84,286,423.63  70,904,110.30  
 
2.  Shougang Steel  
 
Description  20116 (RMB)  20127 (RMB)  20138 (RMB)  20149 (RMB)  
Government Interest 
Subsidy  258,900  127,966,182  32,265,999.00  12,791,400.00  
Construction of 
Infrastructure Funds  72,115,522  91,743,302  76,311,737.00  - 
Enterprise Developmen t 
Fund 3,635,481  55,531,140  9,516,982.23  29,612,444.21  
Electricity Subsidy  - 51,462,285  84,379,753.13  3,113,890.40  
Award Funds  5,932,800  40,399,852  44,310,514.98  83,084,575.21  
Enterprise Latent Potential 
Transformation Fund  - 30,000,000  - - 
Tax Rebate  38,784,968  23,175,305  8,391,367.85  8,469,890.50  
Environmental Protection 
Fund  7,787,383  18,719,039  14,170,479.85  11,262,655.13  
Subsidy for Losses from 
Demolition, Stopping 
Production and Stopping 
Business  45,188,903.40  16,556,083.21  8,646,723.40  7,146,7 23.40  
Rebate on Land Expenses  3,841,550  16,000,000  44,000,000.00  - 
Economic Development 
Financial Subsidy  25,436,450.22  11,734,522  15,391,882.20   
6,848,100.00  
Relocation Compensation 
Subsidy  - 10,000,000  1,000,000.00  319,248,688.03  
Cold-Rolled Sheet 
Production Line Interest 
Subsidy  27,000,000  9,000,000  - - 
Import Product Interest 
Subsidy  9,841,972  6,441,551  13,056,009.22  13,183,809.22  
Technology Research 
Financial Subsidy  1,700,000  4,156,400  5,166,316.67  41,203,948.76  
Technology Upgrading 
Fund 8,200 ,000 3,713,000  3,343,585.46  1,740,184.57  
Unemployment Subsidy 
and Insurance Subsidy  9,313,252  3,037,524  257,016.22  1,773,734.00  
Plate Bending Machine 
Project Fund  - 2,360,000  1,180,000.00  1,180,000.00  
Science and Technology 
Improvement Fund  2,342,156  1,010,000  - - 
Government Social 
Insurance Subsidy  9,544,141.50  577,500  - - 
                                                
6 Shougang 2012 Annual Report at p. 81 -82. 
7 Id.   
8 Shougang 2014 Annual Report at p. 98.  
9 Id. G/SCM/Q2/CHN/70  
 
- 7 - 
 
  Description  20116 (RMB)  20127 (RMB)  20138 (RMB)  20149 (RMB)  
Stable Employment 
Subsidy  72,886,610  100,000  - - 
High-speed, Heavy Spring 
Steel Project Special  
Expense  13,400,000  - - - 
Relocation Appropriation 
Subsidy  8,097,487.85  - - - 
Reem ployment for 
Unemployed Subsidy  7,879,807.98  - - - 
Antidumping Special Fund  - - 3,045,200.00  - 
Distressed Enterprise 
Support  - - - 74,426,040.00  
Other  8,188,492.77  11,199,874.54  17,096,900.08  39,775,968.55  
Total  381,375,877.93  534,883,560.27  381,530,4 67.29  654,862,051.98  
 
3.  Chongqing Steel  
 
Description  2011 (RMB)10 2012 (RMB)11 2013 (RMB)12 2014 (RMB)13 
Protecting Environment 
Relocation Project Subsidy   2,000,000,000  - 506,983,000  
Amortization of 
Environment Control 
Special Project Allocation 
Amortiza tion  892,000  1,134,000  892,000  1,527,000  
Amortization  of Land  Loan 
Subsidies  724,000  482,000    
Relocation 
Reimbursements  202,000     
Finance Expense Special 
Subsidy  - - - 133,000,000  
Protecting Environment 
Energy Conservation 
Special Subsidy and New 
Product Development 
Special Subsidy  - - - 280,000,000  
Amortization of Residual 
Heat Electric Generation 
Project Subsidy  - - 3,040,000  1,312,000  
Other  2,703,000  - - 461,000  
Total Subsidies:  4,521,000  2,001,616,000  3,932,000  923,283,000  
 
                                                
10 Chongqing Steel 2012 Ann ual Report at p. 161.  
11 Id. 
12 Chongqing Steel 2014 Annual Report at p. 130.  
13 Id. G/SCM/Q2/CHN/70  
 
- 8 - 
 
  4.  Baoshan Iron  & Steel (subsidiary of Baosteel)  
 
Description  2011 (RMB)14 2012 (RMB)15 2013 (RMB)16 2014 (RMB)17 
Unspecified  485,817,570.33  - - - 
Work and Professional 
Training Financial Subsidy  - - - 31,503,257.00  
New High Technology 
Result Transformation 
Project Sub sidy Fund  - 
71,242,006.71  59,921,691.08  65,611,868.86  
Relocation Compensation  - 132,536,148.03  59,876,337.21  30,465,912.25  
Previous Year's and 
Technology Reformation 
Type Asset and Relevant 
Government Subsidy 
Allocation   - 
33,874,586.01  44,059, 169.32  47,015,363.76  
Land Foundation 
Construction Project Use 
Financial Fund  - - 
30,756,648.88  - 
Air Exhaust Management 
Subsidy  - 8,000,000.00  11,000,000.00  - 
Key Technology Innovation 
Project  - 150,185,356.10  - - 
Foreign Economic 
Technology C ooperation 
Special Fund  - 
139,950,000.00  -      
256,660,000.00  
Other Financial Subsidy  - 180,424,658.94  186290150.9  205934870.6  
Total  485,817,570.33  716,212,755.79  391,903,997.38  637,191,272.45  
 
5. Wuhan Iron & Steel (Group) Co. (2014)18 
 
Item  Amount 
incurred in 
current period  Amount incurred 
in previous 
period  Description  
Aggregate  539,831,277.36  744,560,198.80  - 
Compensation for urban 
factory relocation  - 129,897,834.53  - 
Financial interest discounts  41,624,323.71  95,689,400.32  Project subsi dies, 2013 loan interest 
discount for working capital for key 
enterprises in Hongshan District  
Financial subsidies and 
assistance  295,143,497.57  128,752,084.55  Profit -oriented financial subsidies, 
special funds  
Special funds for 
environmental project and  
energy saving and 
emission reduction 
projects  38,331,699.01  176,571,126.72  Cai Jian [2014] No. 622, special funds 
for environmental protection, smart 
projects to control smog and other 
pollutants.  
Subsidies for industrialized 
production technology  21,05 6,200.26  33,421,768.41  Yun Fa Gai high -tech [2014] No. 203, 
Yun Cai Qi [2013] No. 205   
Financial assistance for 
incumbent employees  72,219,600.00  58,361,627.00  Wu Ren She Fa [2013] No. 59,  E Ren 
She Gui [2013] No. 2, Wu Ren She Fa 
[2012] No. 86  
Taxabl e income return and 
subsidiaries  1,493,448.27  116,889,257.27  Technical tax break, tax return for 
business income, return of value added 
tax 
Rewards for phasing out 
backward production 
capacity  5,430,000.00  - Grants for phasing out backward 
production capa city 
Various governmental 
incentives  64,532,508.54  4,977,100.00  - 
 
                                                
14 Baoshan 2011, Annual Report, p.126, Note 55  
15 Baoshan 2013, Annual Report, p.118, Note 57  
16 Id. 
17 Baoshan 2014 Annual Report, p.114, Note 59  
18 Wuhan Iron & Steel (Group) Co ., 2014 Annual Report, page 47  G/SCM/Q2/CHN/70  
 
- 9 - 
 
  6. Ansteel Group Corporation (2014)19 
 
Item  Amount in Current Year  Amount in Previous Year  
2014 Direct Electricity Purchasing Discount  68,433,528.08  - 
Military Industrial Product Line Du al 
Maintenance Fee  37,450,000.00  - 
Infrastructure Construction Subsidy  36,664,634.00  - 
Value -Added Tax Revenue Refund  25,070,140.11  - 
Bayuquan 5500mm -Wide Heavy Plate Steel for 
National Defense Use Project  20,000,000.00  20,000,000.00  
Demolition and Cle aring Compensation  17,234,851.84  5,857,000.47  
Science & Technology Grant Appropriation 
Transfer  11,893,579.92  6,537,775.22  
Strategic Emerging Industries Development 
Acceleration Fund  11,258,492.82   
Institution & Government Restructuring 
Subsidy  8,800,70 0.00 8,800,700.00  
Refund of Property Tax and Land Usage Tax  8,761,991.68   
Electroslag Remelting and Other Key Military 
Industrial -Use Steel Projects  6,900,000.00  6,900,000.00  
Flat Bulb Steel Subsidy income  6,514,286.00  22,830,000.00  
Ansteel Basic Const ruction Grant Appropriation 
for Key Metal Materials for Military Use  5,100,000.00  5,100,000.00  
Coal Chemical Processing and Coking Furnace 
Coal Gas Desulfurization Project  4,554,545.40  - 
Large -Scale, High -Pressure Water 
Dephosphorization Project, Heavy P late Hot 
Processing Furnace Renovation Project  4,500,000.00  4,500,000.00  
IMO Standard Corrosion -Resistant Steel  4,297,038.36  - 
Finance Bureau Production Expansion Fund  3,935,400.00  - 
Electricity Usage Award  3,769,794.00  1,438,065.00  
Two-Stage Sintering  Exhaust Desulfurization  3,666,666.68  3,666,666.68  
Sichuan Province Panzhihua Vanadium & 
Titanium Industrial Base Public Testing and 
Inspection Platform  3,500,000.00  - 
Wudu Tuanshan Road Slum District and Public 
Rental Housing Construction Project  3,300, 000.00  4,000,000.00  
External Wastewater Discharge Governance for 
Heavy Plate Lines  3,239,000.00  3,239,000.00  
Patents and Research & Development Subsidy 
Fund 3,199,976.00  2,706,560.00  
Jiangyou City Finance Bureau Appropriations 
for 2014 Industrial & Econ omic "Good Start" 
Incentive Fund  3,190,000.00  - 
Qingbaijiang District Finance Bureau Issuance 
of 2013 Industrial & Economic "Good Start" —
Industrial Electricity Usage Incentive Fund 
Award  2,940,000.00  - 
Ironworks West District Sintering Exhaust 
Desulfuri zation  2,933,333.32  9,044,444.43  
 
 
                                                
19 Ansteel Group Corporation, 2014 Consolidated Financial Statement, page 105  G/SCM/Q2/CHN/70  
 
- 10 - 
 
  Additional Questions  
 
1.  The 2010 audit report of Hebei Group indicates that Hebei received 6.4 billion yuan from "Hebei 
SASAC ".20   
a. Please describe the nature and purpose of this investment.  
b. How did the Hebei SASAC evaluate  whether this investment was consistent with the 
usual investment  practice of private investors?  
c. Please provide a copy of the legal measure under which this capital injection was 
provided as it does not appear to be publicly available.   
2.  Under the section titled "Paid Up Capital " of Wuhan 's 2014 annual report, it is stated:  
In accordance with the "Ministry of Finance , State -owned Assets Supervision and 
Administration Commission Circular  on the 2014 Central Government State -owned 
Capital Management Budget ( Appropriation) for Wuhan Iron and Steel Group 
Corporation " (Cai Zi [2014] No. 37), our corporation has received 800 million yuan for 
"Overseas investment and foreign economic and technological cooperation expenses " 
as a paid -up capital in the amount of 800 ,000,000.00 yuan.21 
a. Please describe the nature and purpose of the overseas investment funded by the 
Capital Management Budget as described above.  Did the investment support the 
building of new capacity?  
b. How did the Ministry of Finance and the State -owned Assets Supervision and 
Administration Commission evaluate whether this investment was consistent with the 
usual investment  practice of private investors?  
c. Please provide a copy of the referenced legal measure as it does not appear to be 
publicly available.   
3.  Under the section titled "Consolidated Statement of Changes in Owner 's Equity " and a column 
in the table titled "Paid-In Capital " in Ansteel 's annual report, it is shown that Ansteel received 
2.8 billion yuan in 2014. The accompanying note states that:  
In accordance with the Notice of the Ministry of Finance and the State -Owned Assets 
Supervision and Administration Commission Regarding the Issuance of the Ansteel 
Group Corporation 2014 Central State -Owned Capital Management (Finance -Assets 
[2014] No. 85, t his group was instructed to expend 2,800,000,000.00 yuan on state -
owned economic restructuring for use in the continuing construction of the Anshan 
Region Iron Mine and the construction of new mines , as well as relocation, renovation, 
and redundant staff r esettlement projects related to the reduction of production 
capacity at Pangang Chengdu Steel & Vanadium Co., Ltd.; the above sum was added 
to the group 's paid -in capital.  22    
a. How did the Ministry of Finance and the State -owned Assets Supervision and 
Administration Commission evaluate whether this investment was consistent with the 
usual investment practice of private investors? What was the total amount of funding 
provided for the projects listed?  
b. Please provide a copy of the referenced legal measure as i t does not appear to be 
publicly available.   
4.  Under the section titled "Paid-In Capital " in Ansteel 's annual report, it is shown that Ansteel 
received a four billion y uan capital injection in 2010. The accompanying note states that:  
                                                
20 Hebei Group Audit Report (2010), pages 59 -63 
21 Wuhan Iron & Steel (Group) Co., 2014 Annual Report, page 44  
22 Ansteel Audit Report, Consolidated (2 014), page 87  G/SCM/Q2/CHN/70  
 
- 11 - 
 
  According to the "Ministry of Finance, Notice on the Allocation to Ansteel Group 
Corporation from the 2010 Central State Capital Operating Budget (Appropriation of 
Fund) " (Cai Qi [2010] No. 258), the Company acquired 4,000,000,000.00 yuan paid in 
capital from Central state capi tal operating budget for state -owned economy and 
industrial structure readjustment funds.23 
a. How did the Ministry of Finance evaluate whether this investment was consistent with 
the usual investment practice of private investors? What was the total amount of  funding 
provided for the projects listed?  
b. Please provide a copy of the referenced legal measure as it does not appear to be 
publicly available.   
__________  
                                                
23 Ansteel Audit Report, Consolidated (2010), page 66 .