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                                                                     EXHIBIT 1.1

                             ARTICLES OF ASSOCIATION

                                       OF

                        GUANGSHEN RAILWAY COMPANY LIMITED

(Approved by Special Resolution passed by the shareholder's general meeting held
                               on March 14, 1996)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                             Held on June 24, 1997)
       (Amended by Special Resolution Adopted at the Interim Shareholders'
                    General Meeting Held on February 8, 2001)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                              Held on June 28,2002)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                             Held on June 10, 2004)
       (Amended by Special Resolution Adopted at the Interim Shareholders'
                   General Meeting Held on December 30, 2004)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                              Held on May 12, 2004)

                                 March 14, 1996

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                                Table of Contents

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CHAPTER 1:  GENERAL PROVISIONS...............................................................................    1
CHAPTER 2:  PURPOSES AND SCOPE OF BUSINESS...................................................................    2
CHAPTER 3:  SHARES AND REGISTERED CAPITAL....................................................................    3
CHAPTER 4:  REDUCTION OF CAPITAL AND REPURCHASE OF SHARES....................................................    5
CHAPTER 5:  FINANCIAL ASSISTANCE FOR ACQUISITION OF the company's SHARES.....................................    7
CHAPTER 6:  SHARE CERTIFICATES AND REGISTER OF SHAREHOLDERS..................................................    8
CHAPTER 7:  SHAREHOLDERS' RIGHTS AND OBLIGATIONS.............................................................   12
CHAPTER 8:  SHAREHOLDERS' GENERAL MEETINGS...................................................................   15
CHAPTER 9:  SPECIAL PROCEDURES FOR VOTING BY A CLASS OF SHAREHOLDERS.........................................   23
CHAPTER 10: BOARD OF DIRECTORS...............................................................................   25
CHAPTER 11: SECRETARY OF THE BOARD OF DIRECTORS..............................................................   29
CHAPTER 12: GENERAL MANAGER..................................................................................   29
CHAPTER 13: SUPERVISORY COMMITTEE............................................................................   30
CHAPTER 14: THE QUALIFICATIONS AND DUTIES OF THE DIRECTORS, SUPERVISORS, GENERAL MANAGER, DEPUTY GENERAL
            MANAGERS AND OTHER SENIOR ADMINISTRATIVE OFFICERS OF THE COMPANY.................................   32
CHAPTER 15: FINANCIAL AND ACCOUNTING SYSTEMS AND PROFIT DISTRIBUTION.........................................   39
CHAPTER 16: APPOINTMENT OF ACCOUNTING FIRM...................................................................   42
CHAPTER 17: INSURANCE........................................................................................   45
CHAPTER 18: LABOUR AND PERSONNEL MANAGEMENT SYSTEMS..........................................................   45
CHAPTER 19: TRADE UNION......................................................................................   45
CHAPTER 20: MERGER AND DIVISION OF THE COMPANY...............................................................   45
CHAPTER 21: DISSOLUTION AND LIQUIDATION......................................................................   47
CHAPTER 22: PROCEDURES FOR AMENDMENT OF THE COMPANY'S ARTICLES OF ASSOCIATION................................   49
CHAPTER 23: SETTLEMENT OF DISPUTES...........................................................................   49
CHAPTER 24: SUPPLEMENTARY....................................................................................   51
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                           ARTICLES OF ASSOCIATION OF
                        GUANGSHEN RAILWAY COMPANY LIMITED

   (Approved by Special Resolution passed by the shareholders' general meeting
                             held on March 14, 1996)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                             Held on June 24, 1997)
       (Amended by Special Resolution Adopted at the Interim Shareholders'
                    General Meeting Held on February 8, 2001)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                              Held on June 28,2002)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                             Held on June 10, 2004)
       (Amended by Special Resolution Adopted at the Interim Shareholders'
                   General Meeting Held on December 30, 2004)
   (Amended by Special Resolution Adopted at the Shareholders' General Meeting
                              Held on May 12, 2004)

                          CHAPTER 1: GENERAL PROVISIONS

Article 1.        The Company is a joint stock limited company established in
                  accordance with the "Company Law of the People's Republic of
                  China" (the "Company Law"), "State Council's Special
                  Regulations Regarding the Issue of Shares Overseas and the
                  Listing of Shares Overseas by Companies Limited by Shares"
                  (the "Special Regulations") and other relevant laws and
                  regulations of the State.

                  The Company was established by way of promotion with the
                  approval under the document "Ti Gai Sheng" [1995] No.151 of
                  the Peoples' Republic of China's State Commission for
                  Restructuring the Economic System. It is registered with and
                  has obtained a business licence from the Administration Bureau
                  of Industry and Commerce of Shenzhen, Guangdong Province, the
                  PRC on the sixth (6) day of March 1996. The number of the
                  Company's business licence is Shen Si Zi N12183.

                  The promoter of the Company is Guangzhou Railway (Group)
                  Company.

Article 2.        The Company's registered name in Chinese is [CHINESE NAME] and
                  in English is: GUANGSHEN RAILWAY COMPANY LIMITED

Article 3.        The Company's address : No. 1052, Heping Road, Shenzhen, China
                  Zip Code              : 518010
                  Telephone             : (0755) 25584891
                  Facsimile             : (0755) 25591480

Article 4.        The Company's legal representative is the Chairman of the
                  board of directors of the Company.

Article 5.        The Company is a joint stock limited company in perpetual
                  existence.

Article 6.        In accordance with the Company Law, the Special
                  Regulations, "Mandatory Provisions for the Articles of
                  Association of Companies to be Listed Outside China" (the
                  "Mandatory Provisions") and other relevant laws and
                  administrative regulations of the State, the Company held a
                  shareholders' general meeting on 14 March 1996 to amend the
                  Company's articles of association which were approved by
                  shareholders' general meeting on 22 January 1996 (the
                  "Original Articles of Association") and to formulate these
                  articles of association of the Company.

Article 7.        The Original Articles of Association have taken effect
                  since the completion of registration formalities with the
                  Administration Bureau of Industry and Commerce of Shenzhen,
                  Guangdong Province, the PRC.

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                  These articles of association of the Company will take effect
                  after it is approved by the Securities Committee of the State
                  Council and the companies approving department authorized by
                  the State Council. The Original Articles of Association of the
                  Company will be replaced by these articles of association of
                  the Company when the latter take effect.

                  The Company shall, within the period stipulated by laws or
                  administrative regulations, process the registration of
                  changing of mandatory registered items due to the amendment of
                  the Original Articles of Association.

Article 8.        From the date of these articles of association becoming
                  effective, these articles of association constitute a legally
                  binding document regulating the Company's organisation and
                  activities, and the rights and obligations between the Company
                  and each shareholder and among the shareholders inter se.

Article 9.        These articles of association are binding on the Company
                  and its shareholders, directors, supervisors, general manager,
                  deputy general managers and other senior administrative
                  officers of the Company; all of whom are entitled to claim
                  rights concerning the affairs of the Company in accordance
                  with these articles of association.

                  These articles of association are actionable by a shareholder
                  against the Company and vice versa, by shareholders against
                  each other and by a shareholder against the directors,
                  supervisors, general manager, deputy general managers and
                  other senior administrative officers of the Company.

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

Article 10.       The Company may invest in other limited liability
                  companies or joint stock limited companies. The Company's
                  liabilities to an investee company shall be limited to the
                  amount of its capital contribution to the investee company.

                  Upon approval of the companies approving department authorized
                  by the State Council, the Company may, according to its need
                  of operation and management, operate as a holding company as
                  prescribed in the second paragraph of Article 12 of the
                  Company Law.

Article 11.       On condition of compliance with applicable laws and
                  administrative regulations of the People's Republic of China
                  ("PRC"), the Company has the power to raise and borrow money
                  which power includes without limitation the issue of
                  debentures, the charging or pledging of part or whole of the
                  Company's business or properties and other rights permitted by
                  PRC laws and administrative regulations.

               CHAPTER 2: PURPOSES AND SCOPE OF BUSINESS

Article 12.       The business purposes of the Company are: to utilise the
                  public funding in and outside the country for the purpose of
                  improving the Company's standard of technology, the standard
                  of the equipment, the quality of the service, to improve the
                  Company's market competitiveness, to ensure the safety of
                  railway

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                  transportation, to accelerate the development of the railway
                  transportation business, to become a first class international
                  railway transportation enterprise and to let the shareholders
                  have a reasonable financial benefit as well as a satisfactory
                  return on capital.

Article 13.       The scope of business of the Company shall comply with
                  those items approved by the companies registration authority.
                  The scope of business of the Company includes railway
                  passenger and freight transportation services; technical
                  services for railway facilities; engaging in domestic
                  commercial activities, materials supply (not including
                  monopolized commodities), establishing various enterprises
                  (specific items to be reported separately).

Article 14.       The Company may, according to its ability to develop, and
                  upon the approval by special resolution adopted by the
                  shareholders' general meeting and the approval of the relevant
                  state governing authority, adjust its scope of business or
                  investment orientation and method etc.

                CHAPTER 3: SHARES AND REGISTERED CAPITAL

Article 15.       There must, at all times, be ordinary shares in the
                  Company. Subject to the approval of the companies approving
                  department authorized by the State Council, the Company may,
                  according to its requirements, create other classes of shares.

Article 16.       The shares issued by the Company shall have a par value of
                  Renminbi one yuan.

                  The Renminbi referred to in the preceding paragraph is the
                  legal currency of the People's Republic of China.

Article 17.       Subject to the approval of the securities authority of the
                  State Council, the Company may issue and offer shares to
                  domestic investors or foreign investors for subscription.

                  Foreign investors referred to in the preceding paragraph mean
                  those investors of foreign countries and regions of Hong Kong,
                  Macau and Taiwan who subscribe for shares issued by the
                  Company. Domestic investors means those investors within the
                  territory of the PRC (excluding investors of the regions
                  referred to in the preceding sentence) who subscribe for
                  shares issued by the Company.

Article 18.       Shares issued by the Company to domestic investors for
                  subscription in Renminbi shall be referred to as
                  "Domestic-Invested Shares". Shares issued by the Company to
                  foreign investors for subscription in foreign currencies shall
                  be referred to as "Foreign-Invested Shares". Foreign-Invested
                  Shares which are listed overseas are called "Overseas-Listed
                  Foreign-Invested Shares".

                  The foreign currencies referred to in the preceding paragraph
                  mean the legal currencies (apart from Renminbi) of other
                  countries or districts which are recognized by the foreign
                  exchange control authority of the State and can be used to pay
                  the Company for the share price.

Article 19.       Overseas-Listed Foreign-Invested Shares issued by the
                  Company and listed in Hong Kong shall be called "H Shares". H
                  Shares are shares which have been

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                  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 20.       Subject to the approval of companies approving department
                  authorized by the State Council, the Company may issue
                  2,904,250,000 shares to Guangzhou Railway (Group) Company (the
                  "Promoter") on the establishment of the Company.

Article 21.       The Company made its first increase of capital after its
                  incorporation by issuing 1,431,300,000 H shares, including
                  those by the exercise of over-allotment options.

                  Upon the increase of capital by issuing shares as referred to
                  in the preceding paragraph, the share capital structure of the
                  Company is: 4,335,550,000 ordinary shares, out of which
                  2,904,250,000 shares are held by the Promoter, representing
                  66.99% of the total ordinary shares, and 1,431,300,000 shares
                  are held by holders of H Share, representing 33.01% of the
                  total ordinary shares.

Article 22.       Upon approval by the securities governing authority of the
                  State Council of the proposal to issue Overseas-Listed
                  Foreign-Invested Shares and Domestic-Invested Shares, the
                  Company's board of directors may make implementing
                  arrangements for separate issues.

                  The Company's proposal to issue separately Overseas-Listed
                  Foreign-Invested Shares, and Domestic-Invested Shares pursuant
                  to the preceding paragraph may be implemented within fifteen
                  (15) months from the date of the approval of Securities
                  Committee of the State Council.

Article 23.       In respect of the total number of shares as stated in a
                  shares issuing proposal, where the Company shall separately
                  issue Overseas-Listed Foreign-Invested Shares and
                  Domestic-Invested Shares, these respective shares shall be
                  fully subscribed for at their respective offerings. If the
                  shares cannot be fully subscribed for at their offerings due
                  to some special circumstances, then subject to the approval of
                  the Securities Committee of the State Council the shares may
                  be issued by installments.

Article 24.       The Company's registered capital is Renminbi 4,335,550,000.

Article 25.       The Company may, based on its requirements for operation
                  and development and in accordance with the relevant provisions
                  of these articles of association, approve an increase of
                  capital.

                  The Company may increase its capital in the following ways:

                  (1)   offering new shares to non-specially-designated
                        investors for subscription;

                  (2)   placing new shares to its existing shareholders;

                  (3)   distributing new shares to its existing shareholders;

                  (4)   any other ways permitted by laws and administrative
                        regulations.

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                  The Company's increase of capital by issuing new shares shall,
                  after being approved in accordance with the provisions of
                  these articles of association, be conducted in accordance with
                  the procedures stipulated by relevant laws and administrative
                  regulations of the State.

Article 26.       Unless otherwise provided by law or administrative
                  regulation, shares in the Company are freely transferable and
                  are not subject to any lien.

            CHAPTER 4: REDUCTION OF CAPITAL AND REPURCHASE OF SHARES

Article 27.       In accordance with the provisions of these articles of
                  association, the Company may reduce its registered capital.

Article 28.       When the Company reduces its registered capital, it must
                  draw up a balance sheet and an inventory of assets.

                  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 a notice in a newspaper at least three times
                  within thirty (30) days of the date of such resolution. A
                  creditor has the right within thirty (30) days of receiving
                  the notice from the Company or, in the case of a creditor who
                  does not receive the notice, within ninety (90) days of the
                  date of the first public notice, to demand the Company to
                  repay its debts or provide a corresponding guarantee for such
                  debt.

                  The Company's registered capital after reduction shall not be
                  less than the statutory minimum amount.

Article 29.       The Company may, with approval according to the procedures
                  provided in these articles of association and subject to the
                  approval of the relevant governing authority of the State,
                  repurchase its issued shares under the following
                  circumstances:

                  (1)   cancellation of shares for the reduction of its capital;

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

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

Article 30.       The Company may, with the approval of the relevant State
                  governing authority for repurchasing its shares, conduct the
                  repurchase in one of the following ways:

                  (1)   making a pro rata general offer of repurchase to all its
                        shareholders;

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

                  (3)   repurchase by an off-market agreement.

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Article 31.       Where the Company repurchases its shares by an off-market
                  agreement, the prior sanction of shareholders' general meeting
                  shall be obtained in accordance with these articles of
                  association. The Company may release or vary a contract so
                  entered into by the Company or waive its rights therein with
                  the prior approval of shareholders' general meeting obtained
                  in the same manner.

                  A contract to repurchase shares referred to in the preceding
                  paragraph includes (without limitation) an agreement to become
                  obliged to repurchase or an acquisition of the right to
                  repurchase shares of the Company.

                  The Company shall not assign the contract for repurchasing its
                  shares or any rights therein.

Article 32.       Shares repurchased in accordance with law by the Company
                  shall be cancelled within the period prescribed by laws and
                  administrative regulations, and the Company shall apply to the
                  original companies registration authority for registration of
                  the change of its registered capital.

                  The amount of the Company's registered capital shall be
                  reduced by the aggregate par value of those cancelled shares.

Article 33.       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 of the Company at
                        par value, payment shall be made out of book surplus
                        distributable profits of the Company or out of proceeds
                        of a fresh 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 distributable
                        profits of the Company or out of the proceeds of a fresh
                        issue of shares made for that purpose. Payment of the
                        portion in excess of the par value shall be effected as
                        follows:

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

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

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                  (3)   payment by the Company in consideration of the following
                        shall be made out of the Company's distributable
                        profits:

                        (i)   acquisition of rights to repurchase shares of the
                              Company;

                        (ii)  variation of any contract to repurchase shares of
                              the Company;

                        (iii) release of any of the Company's obligations under
                              any contract to repurchase shares of the Company;

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

     CHAPTER 5: FINANCIAL ASSISTANCE FOR ACQUISITION OF THE COMPANY'S SHARES

Article 34.       The Company and its subsidiaries shall not, by any means
                  at any time, provide any kind of financial assistance to a
                  person who is acquiring or is proposing to acquire shares in
                  the Company. The said acquirer of shares of the Company
                  includes a person who directly or indirectly incurs any
                  obligations due to the acquisition of shares in the Company.

                  The Company and its subsidiaries shall not, by any means at
                  any time, provide financial assistance to the said obligor as
                  referred to in the preceding paragraph for the purpose of
                  reducing or discharging the obligations assumed by that
                  person.

                  This Article shall not apply to the circumstances specified in
                  Article 36 of this Chapter.

Article 35.       For the purpose of this Chapter, "financial assistance"
                  includes (without limitation) the following meanings:

                  (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),
                        or compensation (other than compensation in respect of
                        the Company's own default) or release or waiver of any
                        rights;

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

                  (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.

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                  For the purpose of this Chapter, "incurring any obligations"
                  includes the incurring of obligations by the obligor through
                  changing of the obligor's financial position by way of
                  contract or the making of arrangement (whether enforceable or
                  not, and whether made on its own account or with any other
                  person), or by any other means.

Article 36.       The following, shall not be deemed to be activities prohibited
                  by Article 34 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
                        in giving the financial assistance is not for the
                        acquisition of shares in the Company, or the giving of
                        the financial assistance is an incidental part of some
                        overall plan of the Company;

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

                  (3)   the allotment of bonus shares as dividends;

                  (4)   a reduction of registered capital, a repurchase of
                        shares of the Company or a reorganization of the share
                        capital structure of the Company effected in accordance
                        with these articles of association;

                  (5)   the lending of money by the Company within its scope of
                        business for its normal business activities (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 of the Company);

                  (6)   the provision of money by the Company for contributions
                        to staff and workers' shares 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 of the Company).

           CHAPTER 6: SHARE CERTIFICATES AND REGISTER OF SHAREHOLDERS

Article 37.       Share certificates of the Company shall be in registered form.

                  The following items shall be stated on the share certificate
                  of the Company:

                  (1)   the Company's name;

                  (2)   the date of registration of the Company;

                  (3)   the class of the share certificate, the par value and
                        the number of shares represented by the share
                        certificate;

                  (4)   the serial number of the share certificate;

                  (5)   other items required to be stated by the stock exchange
                        on which the Company's shares are listed.

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Article 38.       Share certificates of the Company shall be signed by the
                  Chairman of the Company's board of directors. Where the stock
                  exchange on which the Company's shares are listed requires
                  other senior administrative officer(s) of the Company to sign
                  on the share certificates, the share certificates shall also
                  be signed by such senior administrative officer(s). The share
                  certificates shall take effect after being sealed or printed
                  with the special seal for securities of the Company. The share
                  certificates shall only be sealed with the Company's special
                  seal for securities under the authorization of the board of
                  directors. The signatures of the Chairman of board of
                  directors or other senior administrative officer(s) of the
                  Company may be printed in mechanical form.

Article 39.       The Company shall keep a register of its shareholders and
                  enter in the register 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 or payable on the shares of each
                        shareholder;

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

                  (5)   the date on which each person was entered in the
                        register as a shareholder;

                  (6)   the date on which any shareholder ceased to be a
                        shareholder.

                  Unless contrary evidence is shown, the register of
                  shareholders shall be sufficient evidence of the shareholders'
                  shareholdings in the Company.

Article 40.       The Company may, in accordance with the mutual understanding
                  and agreements between the securities governing authority 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 share register.

                  The original share register for holders of H Shares shall be
                  maintained in Hong Kong.

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

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

Article 41.       The Company shall have a complete register of shareholders
                  which shall comprise the following:

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                  (1)   a part of the shareholders' register maintained at the
                        Company's address other than those parts mentioned in
                        sub-paragraphs (2) and (3) of this Article;

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

                  (3)   any other parts of the shareholders' register maintained
                        at such other places as the board of directors may
                        consider necessary for the purpose of listing the shares
                        of the Company.

Article 42.       Different parts of the shareholders' register 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 the fully paid-up H Shares can be freely transferred in
                  accordance with these articles of association. However, the
                  board of directors may refuse to recognise any instrument of
                  transfer without giving any reason, unless:

                  (1)   a fee (for each instrument of transfer) of two dollars
                        and fifty cents Hong Kong dollars or any higher fee as
                        agreed by the Stock Exchange has been paid to the
                        Company for registration of any transfer instrument or
                        any other document which is related to or will affect
                        ownership of the shares;

                  (2)   the instrument of transfer only involves H Shares;

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

                  (4)   the relevant share certificate and upon the reasonable
                        request of the board of directors any evidence in
                        relation to the right of the transferor to transfer the
                        shares have been submitted;

                  (5)   if it is intended to transfer the shares to joint
                        owners, then the maximum number of joint owners shall
                        not exceed four (4);

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

                        The alteration and rectification of each part of the
                        shareholders' register shall be carried out in
                        accordance with the laws of the place where the register
                        is maintained.

                        If the Company refuses to register, any transfer of
                        shares, the Company shall within two months of the
                        formal application for the transfer provide the
                        transferor and the transferee with a notice of refusal
                        to register such transfer.

Article 43.       No changes in the shareholders' register due to the transfer
                  of shares may be made within thirty (30) days before the date
                  of a shareholder' general meeting or within five (5) days
                  before the record date for the Company's distribution of
                  dividends.

Article 44.       Where the Company decides to convene a shareholders' general
                  meeting distribute dividends, liquidate or carry out other
                  activities which would require

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                  the determination of shareholdings, the board of directors
                  shall fix a record date for the purpose of determining
                  shareholdings. A person who is registered in the register as
                  shareholders of the Company at the end of the record date
                  shall be a shareholder of the Company.

Article 45.       Any person aggrieved and claiming to be entitled to have his
                  name (title) to be entered in or removed from the register of
                  shareholders may apply to a court of competent jurisdiction
                  for rectification of the register.

Article 46.       Any person who is a registered shareholder on the register
                  of shareholders or who claims to be entitled to have his name
                  (title) entered into 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, apply
                  to the Company for a replacement new share certificate in
                  respect of such shares (the "Relevant Shares").

                  If a shareholder of Domestic-Invested Shares loses his share
                  certificate and applies for a replacement new certificate, it
                  shall be dealt with in accordance with article 150 of the
                  Company Law.

                  If a shareholder of Overseas-Listed Foreign-Shares loses his
                  share certificate and applies for a replacement new share
                  certificate, it may be dealt with in accordance with the law
                  of the place where the original register of holders of
                  Overseas-Listed Foreign-Invested Shares is maintained, rules
                  of the stock exchange or other relevant regulations.

                  If a shareholder of H Shares loses his share certificate, the
                  issue of a replacement new share certificate shall comply with
                  the following requirements:

                  (1)   The applicant shall submit an application in a standard
                        form prescribed by the Company and accompanied by a
                        notarial certificate or a statutory declaration (i)
                        stating the grounds upon which the application is made
                        and the circumstances and the evidence of the loss of
                        share certificate; and (ii) declaring that no other
                        person is entitled to have his name entered in respect
                        of the Relevant Shares.

                  (2)   Before the Company decides to issue the replacement new
                        share certificate, no statement 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 has been received.

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

                  (4)   The Company shall have, prior to publication of its
                        intention to issue a replacement new share certificate,
                        delivered to the stock exchange on which its shares are
                        listed a copy of the notice to be published and may
                        publish the notice upon receiving 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 Stock Exchange for a period
                        of 90 days.

                                       11

<PAGE>

                        In the case of an application 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
                        shall not have received from any person notice of any
                        disagreement to such application, the Company may issue
                        a replacement new share certificate to the applicant
                        accordingly.

                  (6)   Where the Company issues a replacement new share
                        certificate under this Article, it shall forthwith
                        cancel the original share certificate and enter the
                        cancellation and issue in the register of shareholders
                        accordingly.

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

Article 47.       Where the Company issues a replacement new share certificate
                  pursuant to these articles of association, the name (title) of
                  a bona fide purchaser gaining possession of such new share
                  certificate or the person who is subsequently entered in the
                  register of shareholders as holder of such shares (if he is a
                  bona fide purchaser) shall not be removed from the register of
                  shareholders.

Article 48.       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 issue of the new share certificate, unless
                  the claimant proves that the Company has acted deceitfully.

                 CHAPTER 7: SHAREHOLDERS' RIGHTS AND OBLIGATIONS

Article 49.       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 bear obligations
                  according to the class and proportion of the shares held by
                  him; shareholders who hold shares of the same class shall
                  enjoy the same rights and bear the same obligations.

Article 50.       The ordinary shareholders of the Company shall enjoy the
                  following rights:

                  (1)   the right to dividends and other distributions in
                        proportion to number of shares held;

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

                  (3)   the right of supervisory management over the Company's
                        business operations, and the right to present proposals
                        or enquiries;

                                       12

<PAGE>

                  (4)   the right to transfer shares in accordance with laws,
                        administrative regulations and provisions of these
                        articles of association;

                  (5)   the right to obtain relevant information in accordance
                        with the provisions of these articles of association,
                        including:

                        (i)   the right to obtain a copy of these articles of
                              association, subject to payment of the cost of
                              such copy;

                        (ii)  the right to inspect and copy, subject to payment
                              of a reasonable charge:

                              (a)   all parts of the register of shareholders;

                              (b)   personal particulars of each of the
                                    Company's directors, supervisors, general
                                    manager, deputy general managers and other
                                    senior administrative officers, inclining:

                                    (aa)  present name and alias and any former
                                          name or alias;

                                    (bb)  principal address (residence);

                                    (cc)  nationality;

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

                                    (ee)  identification document and its
                                          number;

                              (c)   state of the Company's share capital;

                              (d)   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 end of last
                                    accounting year and the aggregate amount
                                    paid by the Company for this purpose; and

                              (e)   minutes of shareholders' general meetings;

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

                  (7)   other rights conferred by laws, administrative
                        regulations and these articles of association.

Article 51.       The ordinary shareholders of the Company shall assume the
                  following obligations:

                  (1)   to abide by these articles of association;

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

                                       13

<PAGE>

                  (3)   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 as agreed by the subscriber of
                  the relevant shares on subscription.

Article 52.       In addition to the obligations imposed by laws and
                  administrative regulations or required by the listing rules of
                  the stock exchange on which shares of the Company 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 the shareholders generally or of some of the
                  shareholders of the Company:

                  (1)   to relieve a director or supervisor of his duty to act
                        honestly in the best interests of the Company;

                  (2)   to approve the expropriation by a director or supervisor
                        (for his own benefit or for the benefit of another
                        person), in any guise, of the Company's assets,
                        including (without limitation) opportunities 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 rights of other shareholders
                        including (without limitation) rights to distributions
                        and voting rights save pursuant to a restructuring
                        submitted to the shareholders' general meeting for
                        approval in accordance with these articles of
                        association.

Article 53.       For the purpose of the foregoing Article, a "controlling
                  shareholder" means a person who satisfies any one of the
                  following conditions:

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

                  (2)   he alone or acting in concert with others has the power
                        to exercise or to control the exercise of 30 per cent or
                        more of the voting rights in the Company;

                  (3)   he alone or acting in concert with others holds 30 per
                        cent or more of the outstanding shares of the Company;

                  (4)   he alone or acting in concert with others in any other
                        manner controls the Company in fact.

Article 54.       Subject to the compliance of relevant laws, regulations and
                  rules, where the Company intends to issue preference shares,
                  the rights and obligations of holders of such shares shall be
                  resolved upon by the shareholders in general meeting.

                                       14

<PAGE>

               CHAPTER 8: SHAREHOLDERS' GENERAL MEETINGS

Article 55.       The shareholders' general meeting is the organ of authority of
                  the Company and shall exercise its functions and powers in
                  accordance with law.

Article 56.       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 decide on matters
                        relating to the remuneration of directors;

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

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

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

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

                  (7)   to examine and approve the Company's profit distribution
                        plans and plans for making up losses;

                  (8)   to decide on increases or reductions in the Company's
                        registered capital;

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

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

                  (11)  to decide on the appointment, dismissal and
                        disengagement of the accounting firm of the Company;

                  (12)  to amend these articles of association;

                  (13)  to consider motions raised by shareholders who represent
                        5 per cent or more of the total shares of the Company
                        carrying the right to vote;

                  (14)  to decide on other matters which require resolutions of
                        the shareholders in general meeting according to
                        relevant laws, administrative regulations and provisions
                        of these articles of association;

                  (15)  to decide on matters which the board of directors may be
                        delegated or authorized to deal with by the shareholders
                        in general meeting.

                                       15

<PAGE>

Article 57.       The Company shall not, without the prior approval of
                  shareholders in general meeting, enter into any contract with
                  any person other than a director, supervisor; general manager,
                  deputy general manager or other senior administrative officer
                  whereby the management and administration of the whole or any
                  substantial part of the business of the Company is to be
                  handed over to such person.

Article 58.       Shareholders' general meetings are divided into annual general
                  meetings and interim general meetings. Shareholders' general
                  meetings shall be convened by the board of directors. Annual
                  general meetings are held once every year and within six (6)
                  months from the end of the preceding financial year.

                  Under any of the following circumstances, the board of
                  directors shall convene an interim general meeting within two
                  (2) months:

                  (1)   when the number of directors is less than the number of
                        directors required by the Company law or two-thirds of
                        the number of directors specified in these articles of
                        association;

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

                  (3)   when the shareholder(s) holding 10 per cent or more of
                        the Company's outstanding shares carrying voting rights
                        request(s) in writing the convening of an interim
                        general meeting;

                  (4)   when deemed necessary by the board of directors or as
                        requested by the supervisory committee.

Article 59.       When the company convenes a shareholders' general meeting,
                  written notice of the meeting shall be given forty-five (45)
                  days before the date of the meeting to notify all of the
                  shareholders in the share register of the matters to be
                  considered and the date and the place of the meeting. A
                  shareholder who intends to attend the meeting shall deliver
                  his written reply concerning the attendance of the meeting to
                  the Company twenty (20) days before the date of the meeting.

Article 60.       When the Company convenes a shareholders' annual general
                  meeting, shareholders holding 5 per cent or more of the total
                  voting shares of the Company shall have the right to propose
                  new motions in writing, and the Company shall place those
                  matters in the proposed motions within the scope of functions
                  and powers of the shareholders' general meeting on the agenda.

Article 61.       The Company shall, based on the written replies received
                  twenty (20) days before the date of the shareholders' general
                  meeting from the shareholders, calculate the number of voting
                  shares represented by the shareholders who intend to attend
                  the meeting. If the number of voting shares represented by the
                  shareholders who intend to attend the meeting reaches one half
                  or more of the Company's total voting shares, the Company may
                  hold the meeting; if not, then the Company shall within five
                  (5) days notify the shareholders again by public notice of the
                  matters to be considered, the place and date for, the meeting.
                  The Company may then hold the meeting after such publication
                  of notice.

                  A shareholders' interim general meeting shall not decide on
                  any matter not stated in the notice of meeting.

                                       16
<PAGE>

Article 62.       A notice of meeting of shareholders shall meet the following
                  requirements:

                  (1)   be in writing;

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

                  (3)   state the matters to be discussed at the meeting;

                  (4)   provide such information and explanation as are
                        necessary for the shareholders to make an informed
                        decision on the proposals put before them. Without
                        limiting the generality of the foregoing, where a
                        proposal is made to amalgamate the Company with another,
                        to repurchase shares, to reorganize the share capital,
                        or to restructure the Company in any other way, the
                        terms of the proposed transaction must be provided in
                        detail together with copies of the proposed agreement,
                        if any, and the cause and effect of such proposal must
                        be properly explained;

                  (5)   contain a disclosure of the nature and extent, if any,
                        of the material interests of any director, supervisor,
                        general manager, deputy general manager or other senior
                        administrative officer in the proposed transaction and
                        the effect of the proposed transaction on them in their
                        capacity as shareholders in so far as it is different
                        from the effect on the interests of the shareholders of
                        the same class;

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

                  (7)   contain conspicuously a statement that a shareholder
                        entitled to attend and vote is entitled to appoint one
                        or more proxies to attend and vote instead of him and
                        that a proxy need not be a shareholder;

                  (8)   specify the time and place for lodging proxy forms for
                        the relevant meeting.

Article 63.       Notice of shareholders' general meeting shall be served on the
                  shareholders (whether or not entitled to vote at the meeting)
                  by delivery or prepaid airmail to their addresses as shown in
                  the register of shareholders. For the holders of
                  Domestic-Invested Shares, notice of the meetings may be issued
                  by way of public notice.

                  The public notice referred to in the preceding paragraph shall
                  be published in one or more newspapers designated by the
                  securities governing authority of the State Council within the
                  interval between forty-five (45) days and fifty (50) days
                  before the date of the meeting; after the publication of
                  notice, the holders of Domestic-Invested Shares shall be
                  deemed to have received the notice of the relevant
                  shareholders' general meeting.

Article 64.       The accidental omission to give notice of a meeting to, or the
                  failure to receive the notice of a meeting by, any person
                  entitled to receive notice shall not invalidate the meeting
                  and the resolutions made at that meeting.

Article 65.       Any shareholder entitled to attend and vote at the
                  shareholders' general meeting shall be entitled to appoint one
                  or more other persons (whether a shareholder or not) as his
                  proxies to attend and vote on his behalf, and a proxy so
                  appointed

                                       17
<PAGE>

                  shall be entitled to exercise the following rights pursuant to
                  the authorization from that shareholder:

                  (1)   the shareholder's 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 proxy may
                        only vote on a poll.

Article 66.       The instrument appointing a proxy shall be in writing under
                  the hand of the appointer or his attorney duly authorized in
                  writing, or if the appointer is a legal entity, either under
                  seal or under the hand of a director or attorney duly
                  authorized.

Article 67.       The instrument appointing a voting proxy and, if such
                  instrument is signed by a person under a power of attorney or
                  other authority on behalf of the appointer, a notarially
                  certified copy of that power of attorney or other authority
                  shall be deposited at the address of the Company or at such
                  other place as is specified for that purpose in the notice
                  convening the meeting, not less than twenty-four (24) hours
                  before the time for holding the meeting at which the proxy
                  propose to vote or the time appointed for the passing of the
                  resolution.

                  If the appointor is a legal person, its legal representative
                  or such person as is authorized by resolution of its board of
                  directors or other governing body may attend at any meeting of
                  shareholders of the Company as a representative of the
                  appointor.

Article 68.       Any form issued to a shareholder by the board of directors of
                  the Company for use by him for appointing a proxy shall be
                  such as to enable the shareholder, according to his free will,
                  to 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 instructions
                  by the shareholder the proxy may vote as he thinks fit.

Article 69.       A vote given in accordance with the terms of an instrument of
                  proxy shall be valid notwithstanding the death or loss of
                  capacity of the appointor or revocation of the proxy or of the
                  authority under which the proxy was executed, or the transfer
                  of the shares in respect of which the proxy is given, provided
                  that no notice in writing of such death, incapacity,
                  revocation or transfer as aforesaid shall have been received
                  by the Company before the commencement of the meeting at which
                  the proxy is used.

Article 70.       A proxy who attends a shareholders' general meeting on behalf
                  of a shareholder shall present his identification document.

                  If a shareholder who is a legal person appoints its legal
                  representative to attend the meeting, the legal representative
                  shall present his own identification document and a notarially
                  certified copy of the resolution or letter of authorization of
                  the board of directors or other governing body of the
                  appointor appointing such legal representative.

Article 71.       Resolutions of shareholders' general meetings shall be divided
                  into ordinary resolutions and special resolutions.

                                       18
<PAGE>

                  To adopt an ordinary resolution, votes representing more than
                  one half of the voting rights represented by the shareholders
                  (including proxies) present at the meeting must be exercised
                  in favour of the resolution in order for it to be passed.

                  To adopt a special resolution, votes representing more than
                  two-thirds of the voting rights represented by the
                  shareholders (including proxies) present at the meeting must
                  be exercised in favour of the resolution in order for it to be
                  passed.

                  The shareholders (including proxies) present at the meeting
                  shall expressly state their agreement with or objection to
                  every matter to be determined by voting. If a shareholder
                  abstains from voting or casts an abstention vote, the Company
                  shall disregard such vote as a voting share when counting the
                  result of voting.

Article 72.       When shareholders (including proxies) vote at the
                  shareholders' general meeting, they shall exercise their
                  voting rights according to the number of voting shares that
                  they represent. Each share shall carry one voting right.

                  Where any shareholder is , under the Rules Governing the
                  Listing of Securities on The Stock Exchange of Hong Kong
                  Limited, required to abstain from voting on a particular
                  resolution or restricted to voting only in favour of or
                  against any particular resolution, any votes cast by or on
                  behalf of such shareholder in contravention of such
                  requirement or restriction shall not be counted.

Article 73.       At any general meeting of shareholders, a resolution shall be
                  decided on a show of hands unless a poll is (before or after
                  any vote by show of hands) demanded:

                  (1)   by the chairman of the meeting;

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

                  (3)   by one or more shareholders present in person or by
                        proxy and individually or collectively representing 10
                        per cent or more of all shares carrying the right to
                        vote at the meeting.

                  Unless a poll be so demanded, a declaration by the chairman
                  that a resolution has on a show of hands been carried
                  unanimously, and, an entry to that effect in the minutes of
                  the meeting shall be conclusive evidence of the fact without
                  proof of the number or proportion of the votes recorded in
                  favour of or against such resolution.

                  The demand for a poll may be withdrawn by the person who makes
                  such demand.

Article 74.       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 75.       On a poll taken at a meeting, a shareholder (including proxy)
                  entitled to two or more votes need not cast all his votes in
                  the same way.

                                       19
<PAGE>

Article 76.       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 be entitled to one additional vote.

Article 77.       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)   plans formulated by the board of directors for
                        distribution of profits and for making up losses;

                  (3)   removal of the members of the board of directors and
                        members of the supervisory committee, their remuneration
                        and method of payment;

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

                  (5)   matters other than those required by the laws and
                        administrative regulations or by these articles of
                        association to be adopted by special resolutions.

Article 78.       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)   amendments to these Articles of Association;

                  (5)   any other matters considered by the shareholders'
                        general meeting, 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 a special resolution.

                                       20
<PAGE>

Article 79.       Shareholders requisitioning the convening of interim general
                  meetings of shareholders or class meetings shall abide by the
                  following procedures:

                  (1)   Two or more shareholders holding in aggregate 10 per
                        cent or more of the shares carrying the right to vote at
                        the meeting sought to be held shall sign one or more
                        counterpart requisitions stating the object of the
                        meeting and requiring the board of directors to convene
                        a shareholders' interim general meeting or a class
                        meeting thereof. The board of directors shall as soon as
                        possible proceed to convene the interim general meeting
                        of shareholders or a class meeting thereof after
                        receiving the requisition.

                        The amount of shareholders referred to above shall be
                        calculated as at the date of the deposit of the
                        requisition.

                  (2)   If the board of directors fails to issue a notice of
                        such a meeting within thirty (30) days from the date of
                        the receipt of the requisition, the requisitionists may
                        themselves convene such a meeting in a manner as similar
                        as possible as that in which shareholders' meetings are
                        to be convened by the board of directors within four (4)
                        months from the date of receipt of the requisition by
                        the board of directors.

                  Any reasonable expenses incurred by the requisitionists by
                  reason of the failure of the board of directors to duly
                  convene a meeting shall be repaid to the requisitionists by
                  the Company and any sum so repaid shall be set off against
                  sums owed by the Company to the directors in default.

                                       21
<PAGE>

Article 80.       The Chairman of the board of directors shall convene and take
                  the chair of every shareholders' general meeting. If the
                  Chairman is unable to attend the meeting for any reason, the
                  vice-chairman of the board of directors shall convene and take
                  the chair of the meeting. If both the Chairman and vice
                  chairman of the board of directors are unable to attend the
                  meeting, then the board of directors may designate a director
                  of the Company to convene and take the chair of the meeting.
                  If no chairman of the meeting has been so designated,
                  shareholders present shall choose one person to be the
                  chairman of the meeting. If for any reason, the shareholders
                  shall fail to elect a chairman, then the shareholder
                  (including proxy) present in person or by proxy and holding
                  the largest number of shares carrying the right to vote
                  thereat shall be the chairman of the meeting.

Article 81.       The chairman of the meeting shall be responsible for the
                  determination of whether a resolution is passed. His decision,
                  which is final and conclusive, shall be announced at the
                  meeting and recorded in the minute book.

Article 82.       If the chairman of the meeting has any doubt as to the result
                  of a resolution put to the vote of the meeting, he may have
                  the votes counted. If the chairman of the meeting fails to
                  have the votes counted, any shareholder who is present in
                  person or by proxy and who objects to the result announced by
                  the chairman of the meeting may demand that the votes be
                  counted immediately after the declaration of the result, the
                  chairman of the meeting shall have the votes counted
                  immediately.

Article 83.       If votes are counted at a shareholder' general meeting, the
                  result of the count shall be recorded in the minute book.

Article 84.       Minutes shall be made in respect of all resolutions passed at
                  a shareholders' general meeting and signed by directors
                  present at the meeting. The minutes, shareholders' attendance
                  lists and proxy forms shall be kept at the Company's legal
                  address.

Article 85.       Copies of the minutes of proceedings of any shareholders'
                  general meeting shall, during business hours of the Company,
                  be open for inspection by any shareholder without charge. If a
                  shareholder demands from the Company a copy of such minutes,
                  the Company shall send a copy of such minutes to him within
                  seven (7) days after having received reasonable charges.

                                       22
<PAGE>

      CHAPTER 9 : SPECIAL PROCEDURES FOR VOTING BY A CLASS OF SHAREHOLDERS

Article 86.       Those shareholders who hold different types of shares are
                  different classes of shareholders.

                  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 shareholders of
                  different classes.

                  A class of shareholders shall, in accordance with laws,
                  administrative regulations and these articles of association,
                  enjoy rights and bear obligations.

Article 87.       Rights conferred on any class of shareholders in the capacity
                  of shareholders ("class rights") may not be varied or
                  abrogated unless approved by a special resolution of
                  shareholders in general meeting and by holders of shares of
                  that class at a separate meeting conducted in accordance with
                  Articles 89 to 93.

Article 88.       The following circumstances shall be deemed to be variation or
                  abrogation of the class rights of a class:

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

                  (2)   to effect an exchange of all or part of the shares of
                        such class into shares of another class or to effect an
                        exchange or create a right of exchange of all or part of
                        the shares of another class into the shares of such
                        class;

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

                  (4)   to reduce or remove a dividend preference or a
                        liquidation preference attached to shares of such class;

                  (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 such class;

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

                  (7)   to create a new class of shares having voting or equity
                        right or other privileges equal or superior to those of
                        the shares of such class;

                  (8)   to restrict the transfer or ownership of the shares of
                        such class or add to such restriction;

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

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

                                       23
<PAGE>

                  (11)  to restructure the Company where the proposed
                        restructuring will result in different classes of
                        shareholders bearing a disproportionate burden of such
                        proposed restructuring;

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

Article 89.       Shareholders of the affected class, whether or not otherwise
                  having the right to vote at shareholders' general meetings,
                  shall nevertheless have the right to vote at class meetings in
                  respect of matters concerning sub-paragraphs (2) to (8), (11)
                  and (12) of Article 88, but interested shareholder(s) shall
                  not be entitled to vote at class meetings.

                  The meaning of "interested shareholder(s)" as mentioned in the
                  preceding paragraph is:

                  (1)   in the case of a repurchase of shares by offers to all
                        shareholders or public dealing on a stock exchange under
                        Article 30, a "controlling shareholder" within the
                        meaning of Article 53;

                  (2)   in the case of a repurchase of share by an off-market
                        contract under Article 30, a holder of the shares to
                        which the proposed contract relates;

                  (3)   in the case of a restructuring of the Company, a
                        shareholder within a class who bears less than a
                        proportionate obligation imposed on that class under the
                        proposed restructuring or who has an interest different
                        from the interest of shareholders of that class.

Article 90.       Resolutions of a class meeting of shareholders shall be passed
                  only by votes representing more than two-thirds of the voting
                  rights of shareholders of that class represented at the
                  relevant meeting in accordance with Article 89.

                  Where any shareholder is, under the Rules Governing the
                  Listing of Securities on The Stock Exchange of Hong Kong
                  Limited, required to abstain from voting on a particular
                  resolution in a class meeting or restricted to voting only in
                  favour of or against any particular resolution in a class
                  meeting, any votes cast by or on behalf of such shareholder in
                  contravention of such requirement or restriction shall not be
                  counted.

Article 91.       Written notice of a class meeting shall be given forty-five
                  (45) days before the date of the class meeting to notify all
                  of the shareholders in the share register of the class of the
                  matters to be considered, the date and the place of the class
                  meeting. A shareholder who intends to attend the class meeting
                  shall deliver his written reply concerning attendance at the
                  class meeting to the Company twenty (20) days before the date
                  of the class meeting.

                  If the number of shares carrying voting rights at the meeting
                  represented by the shareholders who intend to attend the class
                  meeting reaches more than one half of the voting shares at the
                  class meeting, the Company may hold the class meeting; if not,
                  the Company shall within five (5) days notify the shareholders
                  again by public notice of the matters to be considered, the
                  date and the place for the class meeting. The Company may then
                  hold the class meeting after such publication of notice.

                                       24
<PAGE>

Article 92.       Notice of class meetings need only be served on shareholders
                  entitled to vote thereat.

                  Meetings of any class of shareholders shall be conducted in a
                  manner as similar as possible to that of general meetings of
                  shareholders. The provisions of these articles of association
                  relating to the manner to conduct any shareholders' general
                  meeting shall apply to any meeting of a class of shareholders.

Article 93.       The special procedures for voting at a class of shareholders
                  shall not apply to the following circumstances:

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

                  (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 Committee of the State Council.

                      CHAPTER 10 : BOARD OF DIRECTORS

Article 94.       The Company shall establish a board of directors. The board
                  shall consist of 9 directors. The board shall have one
                  Chairman.

Article 95.       Directors shall be elected at the shareholders' general
                  meeting and serve a term of 3 years. A director may serve
                  consecutive terms if re-elected upon the expiration of his
                  term.

                  The written notice of an intention to nominate a candidate of
                  director and that of a willingness to accept the nomination by
                  the candidate shall be delivered no earlier than the day after
                  the dispatch of the notice of the meeting for election of the
                  relevant director and end no later than 7 days prior to the
                  date of such meeting.

                  The Chairman of the board shall be elected and removed by the
                  approval of more than half of all the directors of the board.
                  The Chairman of the board shall serve a term of 3 years and
                  may serve consecutive terms if re-elected upon the expiration
                  of his term.

                  Subject to compliance with relevant laws and regulations, any
                  director may be removed by ordinary resolution before the
                  expiration of his term of office(but without prejudice to any
                  claim for damages under any contract).

                  The directors shall not be required to hold shares of the
                  Company.

                                       25
<PAGE>

Article 96.       The board of directors is responsible to the shareholders'
                  general meeting and exercises the following powers:

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

                  (2)   to implement the resolutions of the shareholders'
                        general meetings;

                  (3)   to decide on the Company's business plans and investment
                        plans;

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

                  (5)   to formulate the Company's profit distribution plans and
                        plan for making up losses;

                  (6)   to formulate proposals for increases or reductions in
                        the Company's registered capital and the issue of
                        debentures of the Company;

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

                  (8)   to decide on the establishment of the Company's internal
                        management structure;

                  (9)   to appoint or dismiss the Company's general manager, and
                        pursuant to the general manager's nominations to appoint
                        or dismiss the deputy general manager and other senior
                        administrative officer (including the financial officer)
                        of the Company and decide on their remuneration;

                  (10)  to establish the Company's basic management system;

                  (11)  to formulate proposals for any amendments of the
                        Company's articles of association;

                  (12)  to exercise any other powers conferred by these Articles
                        of Association or the shareholders' general meetings.

                  Except the board of directors' resolutions in respect of the
                  matters specified in sub-paragraphs (6), (7) and (11) of this
                  Article which shall be passed by more than two-thirds of the
                  directors, the board of directors' resolutions in respect of
                  all other matters may be passed by more than one half of the
                  directors.

                  The board of directors may formulate rules governing decision
                  making in respect of the financial and investment management
                  of the Company, the formulation of or amendment to such rules
                  shall be passed by more than two-thirds of the directors (at
                  least one of them shall be a non-executive director).

Article 97.       The board of directors shall not, without the prior approval
                  of shareholders in a general meeting, dispose or agree to
                  dispose of any fixed assets of the Company where the aggregate
                  of the amount or value of the consideration for the proposed
                  disposition, and the amount or value of the consideration for
                  any such disposition of any fixed assets of the Company that
                  has been completed in the period of four (4) months
                  immediately preceding the proposed disposition, exceeds 33 per
                  cent

                                       26
<PAGE>

                  of the value of the Company's fixed assets as shown in the
                  last balance sheet placed before the shareholders in general
                  meeting.

                  For the purpose of this Article, disposition includes an act
                  involving the transfer of an interest in assets but does not
                  include the provision of fixed asset by way of security.

                  The validity of a disposition of fixed assets by the Company
                  shall not be affected by the breach of the first paragraph of
                  this Article.

Article 98.       The board of directors shall carry out its duties in
                  compliance with the laws, administrative regulations, these
                  articles of association and resolutions of the shareholders'
                  general meetings.

Article 99.       The Chairman of the board of directors shall exercise the
                  following powers:

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

                  (2)   to check on the implementation of resolutions of the
                        board of directors;

                  (3)   to sign the securities certificates issued by the
                        Company;

                  (4)   to exercise other powers conferred by the board of
                        directors.

                  When the Chairman is unable to exercise his powers, the
                  Chairman may designate a director to exercise such powers on
                  the Chairman's behalf.

Article 100.      Meetings of the board of directors shall be held at least
                  twice every year and convened by the Chairman of the board of
                  directors. Notice of the meeting shall be served on all of the
                  directors ten (10) days before the date of the meeting. In
                  case of any urgent matters, upon requisition by the Chairman
                  or more than three directors or by the general manager, an
                  extraordinary meeting of the board of directors may be held.

Article 101.      Meetings of the board of directors shall be notified in the
                  following ways:

                  (1)   No notice of the regular meeting of the board of
                        directors shall be required, if the time and place of
                        regular meetings of the board of directors have been
                        fixed by the board of directors in advance.

                  (2)   Notice of the time and place of a meeting of the board
                        of directors for which the time and place have not
                        otherwise been set in advance by the board of directors
                        shall be sent by the Chairman to each of the directors
                        by telex, telegram, facsimile, EMS, registered mail or
                        personal delivery not less than ten (10) days before
                        such meeting.

                  (3)   Notice shall be written in Chinese and, where necessary,
                        in English also and shall include an agenda of the
                        relevant meeting of the board of directors. Any director
                        may waive his right to receive notice of any meeting of
                        the board of directors.

                                       27
<PAGE>

Article 102.      Notice of a meeting of the board of directors 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 103.      Any regular or extraordinary meeting of the board of directors
                  may be held by means of conference telephone or similar
                  communication equipment. So long as all directors
                  participating in such meeting can clearly hear and communicate
                  with each other, all such directors shall be deemed to be
                  present in person at such meeting.

Article 104.      A meeting of the board of directors shall be held only if more
                  than half of the directors (including any director present by
                  proxy as stipulated in Article 105 below) are present.

                  Each director shall have one vote. Unless otherwise provided
                  for in these articles of association, a resolution of the
                  board of directors must be passed by more than half of all the
                  directors.

                  Where there is a tie vote regarding a resolution , the
                  Chairman of the board of directors shall have a casting vote.

                  Where a director is interested in any resolution proposed at a
                  board meeting, such director shall not be present at such
                  meeting and shall not have the right to vote. Such director
                  shall not be counted in the quorum of such meeting.

Article 105.      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 make another director his proxy at the
                  meeting by a written power of attorney. The power of attorney
                  shall set out the scope of the authority.

                  A director acting as the proxy 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.

                  In respect of any matter requiring the resolution of any
                  extraordinary meeting of the board of directors, a resolution
                  approved in writing by at least such number of directors as
                  may be required pursuant to Article 96 of these articles of
                  association after the proposed resolution has been reduced
                  into writing and delivered to all directors, shall be deemed
                  to be a valid resolution and a board meeting shall be
                  dispensed with.

Article 106.      The board of directors shall keep minutes of resolutions on
                  matters discussed at meetings. The minutes shall be signed by
                  the directors present at the meeting and the person who
                  recorded the minutes. The directors shall be liable for the
                  resolutions of the board of directors. If a resolution of the
                  board of directors violates the law, administrative
                  regulations or these articles of association and results in
                  the Company sustaining serious losses, the directors
                  participating in the adoption of such resolution shall be
                  liable for compensating the Company. However, if it can be
                  proven that a director expressly objected to such resolution
                  when such resolution was voted on, and that such objection is
                  recorded in the minutes of the meeting, such director may be
                  released from such liability.

                                       28
<PAGE>

                 CHAPTER 11: SECRETARY OF THE BOARD OF DIRECTORS

Article 107.      The Company shall have a secretary of the board of directors
                  who shall be a senior administrative officer of the Company.

Article 108.      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 appointed by the board of
                  directors. His primary responsibilities are to ensure that:

                  (1)   the Company has complete organizational documents and
                        records;

                  (2)   the Company prepares and delivers in accordance with law
                        those reports and documents required by competent
                        authorities entitled thereto;

                  (3)   the Company's registers of shareholders are properly
                        maintained, and that persons entitled to the Company's
                        records and documents are furnished with such records
                        and documents without delay.

Article 109.      A director or other senior administrative officer of the
                  Company may hold the officer of the secretary of the board of
                  directors concurrently. The accountant(s) of the certified
                  public accounting firm retained by the Company shall not act
                  as the secretary of the board of directors.

                  Provided that where the office of secretary is held
                  concurrently by a director, and an act shall be done by a
                  director and a secretary separately, the person who holds the
                  office of director and secretary may not perform the act in
                  dual capacity.

                           CHAPTER 12: GENERAL MANAGER

Article 110.      The Company shall have one general manager, who shall be
                  appointed and dismissed by the board of directors. The Company
                  shall have a number of deputy general managers who should
                  assist the general manager in his work. The term of office of
                  the general manager and deputy general managers is three (3)
                  years and renewable upon re-election and reappointment.

Article 111.      The general manager shall be accountable to the board of
                  directors and exercise the following functions and powers:

                  (1)   to be in charge of the Company's production, operation
                        and management and to organize the implementation of the
                        resolutions of the board of directors;

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

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

                                       29
<PAGE>

                  (4)   to establish the Company's basic management system;

                  (5)   to formulate basic rules and regulations of the Company;

                  (6)   to propose the appointment or dismissal of the Company's
                        deputy general manager(s) and other senior
                        administrative officers (including the financial
                        officer);

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

                  (8)   to determine rewards and punishments, promotion and
                        demotion, increase and decrease of salaries,
                        recruitment, appointment, termination of employment and
                        dismissal of the staff and workers of the Company;

                  (9)   other powers conferred by these articles of association
                        and the board of directors.

Article 112.      The general manager and deputy general managers shall be
                  present at meetings of the board of directors. However, the
                  general manager and the deputy general manager shall have no
                  voting rights at the meetings unless they are also directors.

Article 113.      The general manager and deputy general managers shall not, in
                  exercising their powers, vary the resolutions of shareholders'
                  general meetings and those of the board of directors or exceed
                  the scope of their authorities.

Article 114.      The general manager and deputy general managers, in performing
                  their functions and powers shall act honestly and, diligently
                  and in accordance with laws, administrative regulations and
                  these articles of association.

                        CHAPTER 13: SUPERVISORY COMMITTEE

Article 115.      The Company shall have a supervisory committee.

Article 116.      The supervisory committee shall be composed of 5 to 7
                  supervisors. The term of office of supervisors shall be three
                  (3) years renewable upon re-election and re-appointment.

                  The supervisory committee shall have one chairman who is
                  subject to election or removal with the consent of two thirds
                  or more of the members of the supervisory committee. The term
                  of office of the chairman shall be three (3) years renewable
                  upon re-election and re-appointment.

Article 117.      The supervisory committee shall comprise of 5 representatives
                  of shareholders who shall be elected or removed by the
                  shareholders in general meeting and 2 representatives of staff
                  and workers of the Company who shall be elected or removed
                  democratically by the staff and workers.

Article 118.      The directors, general manager, deputy general managers and
                  financial controller shall not act concurrently as
                  supervisors.

                                       30
<PAGE>

Article 119.      Meetings of the supervisory committee shall be held at least
                  once a year, and shall be convened by the chairman of the
                  supervisory committee.

Article 120.      The supervisory committee shall be accountable to the
                  shareholders' general meeting and exercise the following
                  powers in accordance with law:

                  (1)   to examine the Company's financial situation;

                  (2)   to supervise the directors, general manager, deputy
                        general managers and other senior administrative
                        officers to see whether their performance of duties in
                        the Company violates any laws, administrative
                        regulations or these articles of association;

                  (3)   to demand rectification from a director, the manager or
                        any other senior administrative officer when the acts of
                        such persons are harmful to the Company's interest;

                  (4)   to check the financial information such as the financial
                        reports, business reports and plans for distribution of
                        profits to be submitted by the board of directors to the
                        shareholders' general meetings and, should any queries
                        arise, to authorize, in the name of the Company, a
                        reexamination by the public certified accountants and
                        practising auditors of the Company;

                  (5)   to propose to convene a shareholders' interim general
                        meeting;

                  (6)   to represent the Company in negotiation with or bringing
                        an action against a director;

                  (7)   other functions and powers specified in these articles
                        of association.

                  Members of the supervisory committee shall be present at
                  meetings of the board of directors.

Article 121.      Resolutions of the supervisory committee shall be passed by
                  two-thirds or more of all of its members.

Article 122.      All reasonable fees incurred in respect of the engagement of
                  professionals such as lawyers, certified public accountants or
                  practising auditors as are required by the supervisory
                  committee in exercising its functions and powers shall be
                  borne by the Company.

Article 123.      A supervisor shall carry out his duties honestly and
                  faithfully in accordance with laws, administrative regulations
                  and these articles of association.

                                       31
<PAGE>

    CHAPTER 14: THE QUALIFICATIONS AND DUTIES OF THE DIRECTORS, SUPERVISORS,
            GENERAL MANAGER, DEPUTY GENERAL MANAGERS AND OTHER SENIOR
                     ADMINISTRATIVE OFFICERS OF THE COMPANY

Article 124.  A person may not serve as the director, supervisor, general
              manager, deputy general manager or any other senior administrative
              officer of the Company if any of the following circumstances
              apply:

              (1)  a person without capacity for civil conduct or with
                   restricted capacity for civil conduct;

              (2)  a person who has committed an offence of corruption, bribery,
                   infringement of property, misappropriation of property or
                   sabotaging the social economic order and has received a
                   sentence because of committing such offence; or who has been
                   deprived of his political rights because of committing an
                   offence, in each case where less than five (5) years have
                   elapsed since the date of the completion of implementation of
                   his sentence;

              (3)  a person who was previously the director, factory manager or
                   manager of a company or enterprise which entered into
                   insolvent liquidation because of mismanagement and was
                   personally liable for the insolvency of such company or
                   enterprise, where less than three (3) years have elapsed
                   since the date of the completion of the insolvency and
                   liquidation of such company or enterprise;

              (4)  a person who was previously the legal representative of a
                   company or enterprise which had its business licence revoked
                   due to a violation of the law and who was personally liable
                   for the revocation, where less than three (3) years have
                   elapsed since the date of the revocation of the business
                   licence;

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

              (6)  a person who is under criminal investigation or prosecution
                   by judicial organs for violation of the criminal law which is
                   not yet concluded;

              (7)  a person who is not eligible for enterprise leadership
                   according to laws and administrative regulations;

              (8)  a non-natural person;

              (9)  a person who is convicted of contravention of provisions of
                   relevant securities regulations by a relevant competent
                   authority, and such conviction involves a finding that he has
                   acted fraudulently or dishonestly, where less than five (5)
                   years has elapsed since the date of the conviction.

Article 125.  The validity of an act of the director, general manager, deputy
              general manager or other senior administrative officer on behalf
              of the Company is not, vis-a-vis a bona fide third party, affected
              by any irregularity in his office, election or any defect in his
              qualification.

                                       32

<PAGE>

Article 126.  In addition to the obligations imposed by laws, administrative
              regulations or required by the listing rules of the stock exchange
              on which shares of the Company are listed, each of the Company's
              directors, supervisors, general manager, deputy general other
              senior administrative offices owes the following obligations to
              each shareholder, in the exercise of the functions and powers the
              Company conferred on him:

              (1)  not to cause the Company to exceed the scope of business
                   stipulated in its business licence;

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

              (3)  not to expropriate in any guise the Company's property,
                   including (without limitation) usurpation of opportunities
                   advantageous to the Company;

              (4)  not to expropriate the individual rights of shareholders,
                   including (without limitation) rights to distribution and
                   voting rights, save pursuant to a restructuring of the
                   Company submitted to shareholders for approval in accordance
                   with these articles of association.

Article 127.  Each of the Company's directors, supervisors, general manager,
              deputy general manager and other senior administrative officers
              owes a duty, in the exercise of his powers and discharge of his
              duties, to exercise the care, diligence and skill that a
              reasonably prudent person would exercise in comparable
              circumstances.

Article 128.  Each of the Company's directors, supervisors, general manager,
              deputy general manager and other senior administrative officers
              shall exercise his powers or carry on his duties in accordance
              with the principle of fiduciary; and shall not put himself in a
              position where his duty and his interest may conflict. This
              principle includes (without limitation) discharging the following
              obligations:

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

              (2)  to exercise powers within the scope of his powers and not to
                   exceed those 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 general meeting, not to delegate the exercise of his
                   discretion;

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

              (5)  except in accordance with these articles of association or
                   with the informed consent of shareholders given in general
                   meeting, not to enter into any contract, transaction or
                   arrangement with the Company;

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

                                       33

<PAGE>

              (7)  not to exploit his position to accept bribes or other illegal
                   income or expropriate the Company's property by any means,
                   including (without limitation) opportunities advantageous to
                   the Company;

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

              (9)  to abide by these articles of association, execute his
                   official duties faithfully and protect the Company's
                   interests, and not to exploit his position and power in the
                   Company to advance his own private interests;

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

              (11) not to misappropriate the Company's funds or lend such funds
                   to others, not to open accounts in his own name or other
                   names for the deposit of the Company's assets and not to
                   provide a guarantee for debts of a shareholder of the Company
                   or other individual(s) with the Company's assets;

              (12) unless otherwise permitted by informed shareholders in
                   general meeting, to keep in confidence information acquired
                   by him in the course of and during his tenure and not to use
                   the information other than in furtherance of the interests of
                   the Company, save that disclosure of such information to the
                   court or other governmental authorities is permitted if:

                   (i)   disclosure is made under compulsion of law;

                   (ii)  the interests of the public require disclosure;

                   (iii) the interests of the relevant director, supervisor,
                         general manager, deputy general manager or other senior
                         administrative officer require disclosure.

Article 129.  Each director, supervisor, general manager, deputy general manager
              or other senior administrative officer of the Company shall not
              cause the following persons or institutions ("associates") to do
              what he is prohibited from doing:

              (1)  the spouse or minor child of that director, supervisor,
                   general manager, deputy general manager or other senior
                   administrative officer;

              (2)  a person acting in the capacity of trustee of that director,
                   supervisor, general manager, deputy general manager or other
                   senior administrative officer or any person referred to in
                   the preceding sub-paragraph (1);

              (3)  a person acting in the capacity of partner of that director,
                   supervisor, general manager, deputy general manager or other
                   senior administrative officer or any person referred to in
                   sub-paragraphs (1) and (2) of this Article;

                                       34

<PAGE>

              (4)  a company in which that director, supervisor, general
                   manager, deputy general manager or other senior
                   administrative officer, alone or jointly with one or more
                   persons referred to in sub-paragraphs (1), (2) and (3) of
                   this Article and other directors, supervisors, general
                   manager, deputy general managers and other senior
                   administrative officers have a de facto controlling interest;

              (5)  the directors, supervisors, general manager, deputy general
                   managers and other senior administrative officers of the
                   controlled company referred to in the preceding sub-paragraph
                   (4); and

              (6)  any associates as defined in the Rules Governing the Listing
                   of Securities on the Stock Exchange of Hong Kong limited.

Article 130.  The fiduciary duties of the directors, supervisors, general
              manager, deputy general managers and other senior administrative
              officers of the Company do not necessarily cease with the
              termination of their tenure. The duty of confidence in relation to
              trade secrets of the Company survives the termination of their
              tenure. Other duties may continue for such period as fairness may
              require depending on the time lapse between the termination and
              the act concerned and the circumstances under which the
              relationships between them and the Company are terminated.

Article 131.  Subject to Article 52, a director, supervisor, general manager,
              deputy general manager or other senior administrative officer of
              the Company may be relieved of liability for specific breaches of
              his duty by the informed consent of shareholders given at a
              general meeting.

                                       35

<PAGE>

Article 132.  Where a director, supervisor, general manager, deputy general
              manager or other senior administrative officer 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.

              Unless the interested director, supervisor, general manager,
              deputy general manager or other senior administrative officer
              discloses his interests in accordance with the preceding paragraph
              of this Article and the contract, transaction or arrangement is
              approved by the board of directors at a meeting in which the
              interested director, supervisor, general manager, deputy general
              manager or other senior administrative officer is not counted in
              the quorum and refrains from voting, a contract, transaction or
              arrangement in which that director, supervisor, general manager,
              deputy general manager or other senior administrative officer is
              materially interested is voidable at the instance of the Company
              except as against a bona fide party thereto acting without notice
              of the breach of duty by the interested director, supervisor,
              general manager, deputy general manager or other senior
              administrative officer.

              For the purposes of this Article, a director, supervisor, general
              manager, deputy general manager or other senior administrative
              officer of the Company is deemed to be interested in a contract,
              transaction or arrangement in which an associate of him is
              interested.

                                       36

<PAGE>

Article 133.  Where a director, supervisor, general manager, deputy general
              manager or other senior administrative officer of the Company
              gives to the board of directors a general notice in writing
              stating that, by reason of the facts specified in the notice, he
              is interested in contracts, transactions or arrangements of any
              description which may subsequently be made by the Company, that
              notice shall be deemed for the purposes of the preceding Article
              to be a sufficient declaration of his interests, so far as the
              content stated in such notice is concerned, provided that such
              general 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 on behalf of the
              Company.

Article 134.  The Company shall not in any manner pay taxes for or on behalf of
              a director, supervisor, general manager, deputy general manager or
              other senior administrative officer.

Article 135.  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, general manager, deputy general manager or
              other senior administrative officer of the Company or of the
              Company's holding company or any of their respective associates.
              However, the following transactions are not subject to such
              prohibition:

              (1)  the provision by the Company of a loan or a guarantee of a
                   loan to a company which is a subsidiary of the Company;

              (2)  the provision by the Company of a loan or a guarantee in
                   connection with the making of a loan or any other funds to
                   any of its directors, supervisors, general manager, deputy
                   general managers and other senior administrative officers 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 general
                   meeting;

              (3)  the Company may make a loan to or provide a guarantee in
                   connection with the making of a loan to any of the relevant
                   directors, supervisors, general manager, deputy general
                   managers and other senior administrative officers or their
                   respective associates in the ordinary course of its business
                   on normal commercial terms, provided that the ordinary course
                   of business of the Company includes the lending of money or
                   the giving of guarantees.

Article 136.  A loan made by the Company in breach of the preceding Article
              shall be forthwith repayable by the recipient of the loan
              regardless of the terms of the loan.

Article 137.  A guarantee for repayment of loan provided by the Company in
              breach of Article 135 shall not be enforceable against the
              Company, unless:

              (1)  when providing the guarantee in connection with a loan to an
                   associate of any of the directors, supervisors, general
                   manager, deputy general managers and other senior
                   administrative officers of the Company or of the Company's
                   holding company, the lender did not know the relevant
                   circumstances; or

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<PAGE>

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

Article 138.  For the purposes of the foregoing provisions of this Chapter, a
              "guarantee" includes an undertaking or property provided to secure
              the performance of obligations by the obligor.

Article 139.  In addition to any rights and remedies provided by the laws and
              administrative regulations, where a director, supervisor, general
              manager, deputy general manager or other senior administrative
              officer of the Company is in breach of his duties to the Company,
              the Company has a right to:

              (1)  claim damages from the director, supervisor, general manager,
                   deputy general manager or other senior administrative officer
                   in compensation for losses sustained by the Company as a
                   result of such breach;

              (2)  rescind any contract or transaction entered into by the
                   Company with the director, supervisor, general manager,
                   deputy general manager or other senior administrative officer
                   or with a third party (where such third party knows or should
                   know that there is such a breach of duties by such director,
                   supervisor, general manager, deputy general manager or other
                   senior administrative officer);

              (3)  demand the surrender of the profits made by the director,
                   supervisor, general manager, deputy general manager or other
                   senior administrative officer in breach of his duties;

              (4)  recover any monies received by the director, supervisor,
                   general manager, deputy general manager or other senior
                   administrative officer which should have been received by the
                   Company, including (without limitation) commissions; and

              (5)  demand a refund of the interest earned or which may have been
                   earned by the director, supervisor, general manager, deputy
                   general manager or other senior administrative officer on the
                   monies that should have been paid to the Company.

Article 140.  The Company shall, with the prior approval of shareholders in
              general meeting, enter into a contract in writing with a director
              or supervisor wherein his emoluments are stipulated. The aforesaid
              emoluments include:

              (1)  emoluments in respect of his service as director, supervisor
                   or senior administrative officer of the Company;

              (2)  emoluments in respect of his service as director, supervisor
                   or senior administrative officer 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.

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<PAGE>

              Except under a contract entered into in accordance with the
              foregoing, no proceedings may be brought by a director or
              supervisor against the Company for any benefit due to him in
              respect of the matters mentioned in this Article.

Article 141.  The contract concerning the emoluments of the directors or
              supervisors of the Company between the Company and its directors
              or supervisors should provide that in the event of a takeover of
              the Company, the Company's directors and supervisors shall,
              subject to the prior approval of the shareholders in general
              meeting, have the right to receive compensation or other payment
              in respect of his loss of office or retirement. A takeover of the
              Company referred to in this paragraph means 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" as stipulated in Article
                   53.

              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 the said offer made. The
              expenses incurred in distributing that sum pro rata amongst those
              persons shall be borne by the relevant director or supervisor and
              not paid out of that sum.

      CHAPTER 15: FINANCIAL AND ACCOUNTING SYSTEMS AND PROFIT DISTRIBUTION

Article 142.  The Company shall establish its financial and accounting systems
              and internal audit system in accordance with laws, administrative
              regulations and PRC accounting standards formulated by the finance
              regulatory department of the State Council.

Article 143.  At the end of each fiscal year, the Company shall prepare
              financial reports which shall be examined and verified as provided
              by law.

              The Company's financial reports shall include the following
              accounting statements and schedules:

              (1)  balance sheet;

              (2)  profit and loss statement;

              (3)  statement of financial changes;

              (4)  explanation of financial conditions;

              (5)  profit distribution statement.

Article 144.  The board of directors of the Company shall place before the
              shareholders at every annual general meeting such financial
              reports as are required by any laws, administrative regulations or
              directives promulgated by competent regional and central
              governmental authorities to be prepared by the Company.

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<PAGE>

Article 145.  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 obtain 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 before the date of
              every annual general meeting of shareholders.

Article 146.  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. When the Company is
              to distribute its after-tax profits, the lower of the after-tax
              profits as shown in the two financial statements shall be applied.

Article 147.  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 overseas place where the Company's shares are listed.

Article 148.  The Company shall publish its financial reports twice every fiscal
              year, that is, the interim financial report shall be published
              within sixty (60) days after the expiration of the first six (6)
              months of each fiscal year; the annual financial report shall be
              published within one hundred and twenty (120) days after the
              expiration of each fiscal year.

Article 149.  The Company shall not keep accounts other than those provided by
              law.

Article 150.  The Company shall implement an internal auditing system, and
              establish an internal auditing organization or provide internal
              auditing personnel to undertake the internal auditing and
              supervision over the Company's income and expenses and other
              economic activities under the leadership of the supervisory
              committee.

Article 151.  The Company's after-tax profit shall be allocated in accordance
              with the following order:

              (1)  making up for losses;

              (2)  allocation to the statutory common reserve fund;

              (3)  allocation to the statutory common welfare fund;

              (4)  allocation to the discretionary common reserve fund upon
                   approval by resolution of the shareholders' general meeting;

              (5)  payment of dividends in respect of ordinary shares.

                                       40

<PAGE>

              The board of directors shall, in accordance with the laws and
              administrative regulations of the State (if any) and the Company's
              operation and development requirements, determine the detail
              proportions of profit distributions in items (2) to (5) above and
              submit its determination to the shareholders' general meeting for
              approval.

Article 152.  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 153.  The common reserve fund of the Company shall be applied to the
              following purposes:

              (1)  making up losses;

              (2)  expansion of the Company's production and operation;

              (3)  transfer or increase of capital.

              When the Company converts its common reserve fund into its capital
              upon a resolution adopted in shareholders' general meeting, the
              Company shall either distribute new shares to each shareholder in
              proportion to the number of shares currently held by each
              shareholder, or increase the par value of each share, provided,
              however, that when the statutory common reserve fund is converted
              to capital, the balance of the statutory common reserve fund may
              not fall below 25 per cent of the registered capital.

Article 154.  The Company's statutory common welfare fund is used for the
              collective welfare of the Company's staff and workers.

Article 155.  The Company shall not declare dividend before making up its losses
              and allocating funds to the statutory common reserve fund and
              statutory common welfare fund.

Article 156.  Dividends shall be distributed in accordance with the proportion
              of shares held by shareholders.

              Unless otherwise resolved by the shareholders' general meeting,
              the Company apart from distributing annual dividends, may by its
              board of directors acting under the power conferred by the
              shareholders' general meeting, distribute interim dividends.
              Unless otherwise stipulated by laws or administrative regulations,
              the amount of interim dividends distributed shall not exceed 50
              per cent of the distributable profits as stated in the interim
              profits statement of the Company.

Article 157.  The Company may distribute dividends in the following forms:

              (1)  cash;

              (2)  shares.

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<PAGE>

Article 158.  Dividends or other payments declared by the Company to be payable
              to holders of Domestic-Invested Shares shall be declared and
              calculated in Renminbi, and paid in Renminbi; and those payable to
              holders of Overseas-Listed Foreign-Invested Shares shall be
              declared and calculated in Renminbi, and paid in the local
              currency at the place where such Foreign-Invested Shares are
              listed (if there is more than one place of listing, then the
              principal place of listing as determined by the board of
              directors).

              Foreign currency required by the Company for payment of dividends
              or other sums to holders of Foreign-Invested Shares shall be
              handled in accordance with the relevant foreign exchange control
              regulations of the State. If there is no applicable regulation,
              the applicable exchange rate shall be the average closing rate for
              the relevant foreign currency announced by the Peoples' Bank of
              China for the week prior to the announcement of the payment of
              dividend or other sums.

Article 159.  The Company shall, in accordance with the People's Republic of
              China's tax law, withhold and make payments on behalf of
              shareholders in respect of their tax payable on their dividends
              income.

Article 160.  The Company shall appoint on behalf of the holders of the
              Overseas-Listed Foreign-Invested shares receiving agents to
              receive on behalf of such shareholders dividends declared and all
              other monies owed by the Company in respect of their shares.

              The receiving agents appointed by the Company shall comply with
              the relevant requirements of the law of the place and relevant
              regulations of the stock exchange where the Company's shares are
              listed.

              The receiving agents appointed on behalf of holders of H Shares
              shall be a company registered as a trust company under the Trustee
              Ordinance of Hong Kong.

             CHAPTER 16: APPOINTMENT OF ACCOUNTING FIRM

Article 161.  The Company shall engage an independent accounting firm which is
              qualified under the relevant regulations of the State to audit the
              Company's annual financial report and review the Company's other
              financial reports.

              The first accounting firm of the Company may be engaged by the
              inaugural meeting of the Company before the first annual general
              meeting of shareholders and the accounting firm so appointed shall
              hold office until the conclusion of the first annual general
              meeting of shareholders.

              If the inaugural meeting fails to exercise its powers under the
              preceding paragraph, those powers shall be exercised by the board
              of directors.

Article 162.  The accounting firm engaged by the Company shall hold office from
              the conclusion of the annual general meeting of shareholders at
              which it is engaged until the conclusion of the next annual
              general meeting of shareholders.

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<PAGE>

Article 163.  The accounting firm appointed by the Company shall have the
              following rights:

              (1)  A right of access at any time to the books and records and
                   vouchers of the Company, and shall be entitled to require
                   from the directors, general manager, deputy general managers
                   and other senior administrative officers of the Company any
                   relevant information and explanation;

              (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 purposes of discharging
                   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 164.  Before the convening of the shareholders' general meeting, the
              board of directors may fill any casual vacancy in the office of an
              accounting firm, but while any such vacancy continues, the
              surviving or continuing firms, if any, may act.

Article 165.  The shareholders in general meeting may by ordinary resolution
              remove an accounting firm before the expiration of its term of
              office, notwithstanding the stipulations in the contract between
              the Company and the firm, but without prejudice to the firm's
              right to claim, if any, for damages in respect of such removal.

Article 166.  The remuneration of an accounting firm or the manner in which such
              firm is to be remunerated shall be determined by the shareholders
              in general meeting. The remuneration of an accounting firms
              appointed by the board of directors shall be determined by the
              board of directors.

Article 167.  The Company's appointment of, removal of and non reappointment of
              an accounting firm shall be resolved upon by shareholders in
              general meeting. The resolution of the shareholders' general
              meeting shall be filed with the securities governing authority of
              the State Council.

              Where it is proposed that any resolution be passed at a
              shareholders' general meeting concerning the appointment of an
              accounting firm which is not an incumbent firm to fill a casual
              vacancy in the office of the accounting firm; re appointment of a
              retiring accounting firm which was appointed by the board of
              directors of the Company to fill a casual vacancy; or removal of
              the accounting firm before the expiration of its term of office,
              the following provisions shall be complied with:

              (1)  A copy of the proposal shall be sent before notice of meeting
                   is given to the shareholders to the firm proposed to be
                   engaged or proposing to leave its post or which has left its
                   post in the relevant fiscal year (leaving includes leaving by
                   removal, resignation and retirement).

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<PAGE>

              (2)  If the firm leaving its post makes representations in writing
                   and requests the Company to notify the shareholders of such
                   representations, the Company shall, unless the
                   representations are received too late:

                   (i)   in any notice of the resolution given to shareholders,
                         state the fact of the representations having been made;
                         and

                   (ii)  attach a copy of the representations to the notice and
                         deliver it to the shareholders in the manner stipulated
                         in these articles of association.

              (3)  If the firm's representations are not sent in accordance with
                   the preceding sub-paragraph (2), the relevant firm may (in
                   addition to its right to be heard) require that the
                   representations be read out at the shareholders' general
                   meeting.

              (4)  An accounting firm which is leaving its post shall be
                   entitled to attend:

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

                   (ii)  the shareholders' general meeting held for the purpose
                         of filling the vacancy caused by its removal; and

                   (iii) the shareholders' general meeting convened due to its
                         resignation;

                   and to receive all notices of, and other communications
                   relating to, any such meetings, and to speak at any such
                   meeting in relation to matters concerning its role as the
                   former accounting firm of the Company.

Article 168.  Prior to the removal or the non-renewal of the appointment of the
              accounting firm, notice of such removal or non-renewal shall be
              given to the accounting firm and such firm shall be entitled to
              make representation at the shareholders' general meeting. Where
              the accounting firm proposes resigning its post, it shall make
              clear to the shareholders' 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 legal residence a written resignation notice which shall
              become effective on the date of such deposit or on such later date
              as may be stipulated in such notice and such notice shall include
              the following:

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

              (2)  a statement of any such circumstances.

              Where a written notice is deposited as provided for in the
              preceding subparagraph, the Company shall within fourteen (14)
              days thereof send a copy of the notice to the relevant governing
              authority. If the notice contains a statement under the preceding
              subparagraph (2), copies of such statement shall be placed at the
              Company for shareholders' inspection. The Company shall also send
              a copy

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<PAGE>

              of such statement by prepaid mail to every holder of
              Overseas-Listed Foreign-Invested Shares who is entitled to receive
              the issuer's financial status report at the address registered in
              the register of shareholders.

              Where the accounting firm's notice of resignation contains a
              statement of any circumstances which shall be accounted for to the
              shareholders or creditors of the Company, it may require the board
              of directors to convene a shareholders' interim general meeting
              for the purpose of receiving its explanation of the circumstances
              connected with its resignation.

                              CHAPTER 17: INSURANCE

Article 169.  The effecting, types of coverage, the insured amounts and periods
              of the Company's insurance shall be decided at a meeting of the
              board of directors based on the circumstances of the Company and
              the practices of similar industries in other countries and the
              practice and legal requirements in China.

             CHAPTER 18: LABOUR AND PERSONNEL MANAGEMENT SYSTEMS

Article 170.  The Company shall, in accordance with the relevant provisions of
              the Labour Law of the People's Republic of China and other
              relevant laws or regulations of the State, formulate its labour
              and personnel management systems which shall be appropriate to its
              particular circumstances.

                             CHAPTER 19: TRADE UNION

Article 171.  The Company shall establish trade union organizations and organise
              staff and workers to carry out trade union activities in
              accordance with the Trade Union Law of the People's Republic of
              China.

              The Company shall allocate funds to the trade union in accordance
              with the Trade Union Law of the People's Republic of China. Such
              fund shall be used by the trade union of the Company in accordance
              with the "Measures for the Management of Trade Union Funds"
              formulated by the All China Federation of Trade Unions.

             CHAPTER 20: MERGER AND DIVISION OF THE COMPANY

Article 172.  In the event of the merger or division of the Company, a plan
              shall be presented by the Company's board of directors and shall
              be approved in accordance with the procedures stipulated in these
              articles of association and then the relevant examining and
              approving formalities shall be processed as required by law. 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 that
              dissenting shareholder's shareholding at a fair price.

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<PAGE>

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

Article 173.  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 of the date of the Company's resolution to merge and shall
              publish a public notice in a newspaper at least three times within
              thirty (30) days of the date of the Company's resolution to merge.
              A creditor has the right within thirty (30) days of receiving such
              notice from the Company or, it fails to receive the notice, within
              ninety (90) days of the date of the first public notice, to demand
              that the Company pay off the debts owed to it or provide a
              corresponding guarantee therefor. Where the company fails to pay
              off its debts or provide corresponding guarantees therefor as
              demanded by its creditors, it may not be merged.

              Following the merger, rights in relation to debtors and
              indebtedness of each of the merged parties shall be assumed by the
              company which survives the merger or the newly established
              company.

Article 174.  When the Company is divided, its assets shall be split 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 of the date of the Company's
              resolution to divide and shall publish a public notice in a
              newspaper at least three times within thirty (30) days of the date
              of the Company's resolution to divide. A creditor has the right
              within thirty (30) days of receiving such notice from the Company
              or, if it fails to receive the notice, within ninety (90) days of
              the date of the first public notice to demand that the Company pay
              off the debts owed to that creditor or provide a corresponding
              guarantee therefor. Where the Company fails to pay off its debts
              or provide corresponding guarantees therefor as demanded by its
              creditors, it may not be divided.

              Debts of the Company prior to division are assumed by the
              post-division companies in accordance with the agreements entered
              into.

Article 175.  Where there is a change in any of the registered items of the
              Company as result of its merger or division, the Company shall
              carry out procedures necessary for changing its registered items
              with the companies registration authority in accordance with the
              law. In case of dissolution, the Company shall cancel its
              registration in accordance with the law. When a new company is
              established, its establishment shall be registered in accordance
              with the law.

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<PAGE>

                     CHAPTER 21: DISSOLUTION AND LIQUIDATION

Article 176.  The Company shall be dissolved and liquidated in accordance with
              the law upon the occurrence of any of the following events:

              (1)  a resolution for 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 due; and

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

Article 177.  A liquidation group shall be set up within fifteen (15) days of
              the resolution for dissolution of the Company passed by
              shareholders at a general meeting pursuant to sub-paragraph (1) of
              the preceding Article, and the composition of the liquidation
              group of the Company shall be determined by an ordinary resolution
              of shareholders at a general meeting. If a liquidation group to
              carry out liquidation procedures is not set up within the
              specified time limit, the creditors may apply to the People's
              Court to designate relevant persons to form a liquidation group in
              order to carry out liquidation procedures.

              Where the Company is dissolved under sub-paragraph (3) of the
              preceding Article, the People's Court shall in accordance with
              provisions of relevant laws organise the shareholders, relevant
              organizations and relevant professional personnel to establish a
              liquidation group to carry out liquidation procedures.

              Where the Company is dissolved under sub-paragraph (4) of the
              preceding Article, the relevant governing authorities shall
              organise the shareholders, relevant organisations and professional
              personnel to establish a liquidation group to carry out
              liquidation procedures.

Article 178.  Where the board of directors proposes to liquidate the Company due
              to causes other than where the Company has declared that it is
              insolvent, the board shall include a statement in its notice of
              the shareholders' general meeting to consider the proposal to the
              effect that, after making full inquiry into the status of the
              Company, the board of directors is of the opinion that the Company
              will be able to pay off its debts within twelve (12) months from
              the commencement of the liquidation.

              Except where the Company has declared that it is insolvent, the
              liquidation group shall be appointed or dismissed by ordinary
              resolution of shareholders at a general meeting.

              Upon the passing of the resolution by the shareholders at a
              general meeting for the liquidation of the Company, all functions
              and powers of the board of directors shall forthwith cease.

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<PAGE>

              The liquidation group 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
              its receipts and payments, 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 179.  The liquidation group shall within ten (10) days of its
              establishment send notices to creditors, and within sixty (60)
              days of its establishment publish a public notice in a newspaper
              at least three times. A creditor shall within thirty (30) days of
              receiving notice, or it fails to receive notice, within ninety
              (90) days of the date of the first public notice, declare its
              creditors' rights to the liquidation group.

              When declaring creditors' rights, the creditor shall provide an
              explanation of matters relevant to the creditor's rights and shall
              provide materials as evidence. The liquidation group shall carry
              out registration of creditors' rights.

Article 180.  During the liquidation period, the liquidation group shall
              exercise the following functions and powers:

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

              (2)  to send notices to creditors or notify them by public notice;

              (3)  to handle any relevant unfinished business matters of the
                   Company relating to the liquidation;

              (4)  to pay off all outstanding taxes;

              (5)  to settle claims and debts;

              (6)  to dispose of the assets remaining after the Company's debts
                   have been repaid;

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

Article 181.  After having sort out the Company's assets and prepared the
              balance sheet and an inventory of assets, the liquidation group
              shall formulate a liquidation plan and present it to a
              shareholders' general meeting or to the relevant governing
              authority for confirmation.

              To the extent that the Company's assets are sufficient to pay off
              its debts, they shall be used to pay all liquidation expenses,
              wages of staff and workers, labour insurance fees and outstanding
              taxes, and the Company's debts.

              The 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 and proportion of their shareholdings.

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

Article 182.  If after putting the Company's assets in order and preparing a
              balance sheet and an inventory of assets in connection with the
              liquidation of the Company

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<PAGE>

              resulting from dissolution, the liquidation group discovers that
              the Company's assets are insufficient to repay the Company's debts
              in full, the liquidation group 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 group shall turn over liquidation matters
              to the People's Court.

Article 183.  Following the completion of liquidation, the liquidation group
              shall present a report on liquidation and prepare a statement of
              the receipts and payments during the period of liquidation and
              financial books and records which shall be audited by Chinese
              registered accountant and submitted to the shareholders' general
              meeting or the relevant governing authority for confirmation.

              The liquidation group shall also within thirty (30) days after
              such confirmation, 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 notice relating to the termination of the Company.

 CHAPTER 22 : PROCEDURES FOR AMENDMENT OF THE COMPANY'S ARTICLES OF ASSOCIATION

Article 184.  The Company may amend its articles of association in accordance
              with the requirements of law, administrative regulation and its
              articles of association.

Article 185.  For the amendment of the Company's articles of association, the
              following procedures shall be followed:

              (1)  the board of directors shall, in accordance with provisions
                   of these articles of association, adopt a resolution to
                   propose the shareholders' general meeting to amend the
                   Company's articles of association, and formulate the draft
                   amendments to the articles of association;

              (2)  notice of the draft amendments to these articles of
                   association referred to in the preceding sub-paragraph shall
                   be sent to the Company's shareholders, and a shareholders'
                   general meeting shall be convened to vote on the contents of
                   the amendments;

              (3)  subject to the compliance of the relevant regulations of
                   these articles of association and the Mandatory Provisions, a
                   special resolution for approval of the draft amendments to
                   these articles of association shall be passed by shareholders
                   at a general meeting.

Article 186.  The amendments to the Company's articles of association involving
              the contents of the Mandatory Provisions shall become effective
              upon approvals by the Securities Committee of the State Council
              and the companies approving department authorized by the State
              Council. If there is any change relating to the registered
              particulars of the Company, application shall be made for
              registration of the changes in accordance with law.

                       CHAPTER 23: SETTLEMENT OF DISPUTES

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Article 187.  The Company shall act according to the following principles to
              settle disputes:

              (1)  Whenever any disputes or claims arising 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, general manager, deputy
                   general managers or other senior administrative officers; or
                   holders of the Overseas-Listed Foreign-Invested Shares and
                   holders of Domestic-Invested Shares, based on these articles
                   of association or any rights or obligations conferred or
                   imposed by the Company Law or any other relevant laws and
                   administrative regulations concerning the affairs of the
                   Company, 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
                   abide by the arbitration provided that such person is the
                   Company or the Company's shareholder, director, supervisor,
                   general manager, deputy general manager or other senior
                   administrative officer. Disputes in relation to the
                   definition of shareholders and disputes in relation to the
                   shareholders' register need not be resolved by arbitration.

              (2)  A claimant may elect arbitration at either the China
                   International Economic and Trade Arbitration Commission in
                   accordance with its Rules or the Hong Kong International
                   Arbitration Centre 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 arbitration at Hong Kong International
                   Arbitration Centre, 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 Centre.

              (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 People's Republic of China shall
                   apply, save as otherwise provided in laws and administrative
                   regulations.

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

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                            CHAPTER 24: SUPPLEMENTARY

Article 188.  Any reference in these articles of association to the publication
              of public notices in a newspaper shall be interpreted as requiring
              publication in such newspaper as designated or required in
              accordance with relevant laws, administrative regulations or rules
              and, if the relevant notice is required to be given to holder of H
              Shares, as also requiring the relevant notice to be published in
              such newspapers as may be required by the term "published in the
              newspapers" (as defined in the Rules Governing the Listing of
              Securities on the Stock Exchange).

Article 189.  In these articles of association, the meaning of an accounting
              firm is the same as that of "auditors".

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