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                                                                     Exhibit 1.1

                           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, 2005)
       (Amended by Special Resolution Adopted at the Shareholders' General
                         Meeting Held on May 11, 2006)
       (Amended by Special Resolution Adopted at the Shareholders' General
                         Meeting Held on June 28, 2007)
       (Amended by Special Resolution Adopted at the Shareholders' General
                         Meeting Held on June 26, 2008)

                          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 License 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 License is 4403011022106.

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

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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"),Guidelines for Articles of
Association of Listed Companies, other relevant laws, administrative regulations
and regulatory documents of the State, the articles of association adopted on 22
January 1996 and the amended articles of association approved at the respective
shareholders' general meetings held on 14 March 1996, 24 June 1997, 8 February
2001, 28 June 2002, 10 June 2004, 30 December 2004, 12 May 2005, 11 May 2006 and
28 June 2007 (referred to as the "Original Articles of Association"), the
Company formulates these articles of association of the Company on June 26, 2008
(hereinafter referred to as the "Articles of Association of the Company" or
"Articles of Association").

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.

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.

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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 organization 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.

Other senior administrative officers referred to in the first paragraph of this
article include chief accountant, chief economist, chief engineer and secretary
of the board of directors.

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.

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 utilize 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 transportation, to accelerate the development of the railway
transportation business, to become a first class international railway
transportation enterprise and to let the

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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 company's registration authority. The scope of business of the
Company includes railway passenger and freight transportation services;
technical services for railway facilities; domestic freight agency services,
leasing of railway equipment, manufacturing and maintenance of machinery,
examination, maintenance, transformation, leasing and installation of railway
instruments and equipment, management services for construction of railway
projects, leasing of self-owned properties, maintenance and installation of
water and electricity facilities, property management, warehousing, loading and
unloading services, railway ticket agency services, advertising, domestic trade,
materials supply (not including monopolized commodities) and 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 mean those investors within the
territory of the PRC (excluding investors of

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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".

Domestic-Invested Shares include shares issued to the promoter by the Company
upon its establishment and shares issued to the public in the PRC after its
establishment. 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
recognised 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 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.

Subsequent to 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, of which 2,904,250,000 shares are held by the
Promoter, representing 66.99 per cent of the total number of ordinary shares,
and 1,431,300,000 shares are held by holders of H Shares, representing 33.01 per
cent of the total number of ordinary shares.

The first issuance of 2,747,987,000 Renminbi-denominated ordinary shares to the
public in the PRC on 13 December 2006 by the Company was approved by China
Securities Regulatory Commission on 6 December 2006, and such shares are listed
on the Shanghai Stock Exchange on 22 December 2006.

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Subsequent to the increase of capital by issuing shares to the public in the PRC
as referred to in the preceding paragraph, the share capital structure of the
Company is: 7,083,537,000 ordinary shares, of which 2,904,250,000 shares are
held by the Promoter, 2,747,987,000 shares are held by public shareholders in
the PRC and 1,431,300,000 shares are held by holders of H Shares, representing
41.0 per cent, 38.8 per cent and 20.2 per cent of the total number of ordinary
shares, respectively.

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.
Subsequent to the increase in capital by issuing of shares to the public in the
PRC as referred to in Article 21, the Company's registered capital is Renminbi
7,083,537,000.

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 in 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;

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(4) transferring public welfare funds to increase capital;

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

The Company's increase in 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 The Company does not accept shares of the Company as the subject of a
pledge.

ARTICLE 28 Shares of the Company held by the Promoter shall not be transferred
within one year from the date of establishment of the Company. Shares of the
Company held by the Promoter before the public offering of the Company shall not
be transferred within one year from the date of trading of shares of the Company
at a domestic stock exchange.

The directors, supervisors, general manager, deputy general managers and other
senior management shall report to the Company on a regular basis as to the
Company's shares held by them during their terms of office. They may not
transfer the shares of the Company held by them during their terms of office and
within six months from the termination of their office.

ARTICLE 29 Where a shareholder of the Company holding 5 per cent or more of the
shares carrying the right to vote pledges the shares held, he/she shall report
to the Company in writing within three working days from the date on which the
event occurs.

ARTICLE 30 Where a shareholder of the Company holding 5 per cent or more of the
shares carrying the right to vote sells the shares held within six months from
the date of acquisition of the shares or acquires shares of the Company again
within six months from the date of sale of the shares, the profits arising from
such transactions shall belong to the Company.

The provision in the preceding paragraph is applicable to the directors,
supervisors, general manager, deputy general managers and other senior
management of the Company.

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Where the board do not execute in accordance with the provision in the first
paragraph of this article, the shareholders shall have the right to ask the
board to execute within 30 days. Where the board fail to execute within the
above-mentioned period, the shareholders shall have the right to bring a suit
directly before a people's court in his/her name for the interests of the
Company.

Where the board does not execute in accordance with the provision in the first
paragraph, the directors liable for the matter shall bear joint responsibility
in accordance with the law.

In the event that the regulatory authorities of the place where the
Overseas-Listed Foreign-Invested Shares are listed have different requirements,
such requirement shall prevail.

ARTICLE 31 In accordance with the provisions of these articles of association,
the Company may reduce its registered capital.

ARTICLE 32 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 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 forty-five
(45) days of the date of the 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 33 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 capital reduction;

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

(3) paying shares to its employees as bonus;

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(4) repurchasing, upon request, any shares held by any shareholder who is
opposed to the Company's resolution for merger or spin-off at a shareholders'
general meeting of the Company.

Any repurchase of shares under items (1) to (3) of the foregoing paragraph shall
be approved by shareholders' general meeting of the Company. After repurchase of
the shares according to the foregoing paragraph by the Company, the shares
repurchased under item (1) shall be cancelled within ten days from the date of
the repurchase; and the shares repurchased under items (2) and (4) shall be
transferred or cancelled in six months.

The shares repurchased by the Company under item (3) of the first paragraph may
not exceed 5 per cent of the total of the Company's issued shares. Such
repurchase shall be financed by the Company's profit after tax. The shares so
repurchased shall be transferred to the employees within one year.

The Company shall not permit the shares of the Company being used as the object
of a mortgage.

In the event that the regulatory authorities at the place of listing of the
overseas-listed foreign shares have different requirements, such requirements
shall prevail.

ARTICLE 34 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.

ARTICLE 35 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.

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

ARTICLE 36 Shares which shall be cancelled according to the laws, regulations,
Articles of Association or resolution of shareholders' general meeting after the
repurchase in accordance with the law by the Company, shall be cancelled within
the period prescribed by the laws and administrative regulations, and the
Company shall apply to the original companies registration authority for
registration of the change in its registered capital.

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

ARTICLE 37 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;

(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;

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(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 38 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 40 of
this Chapter.

ARTICLE 39 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;

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

For the 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 40 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 41 Share certificates of the Company shall be in registered form. The
following items shall be stated on the share certificate of the Company:

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(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.

ARTICLE 42 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 43 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 44 The Company may, in accordance with the mutual understanding and
agreements between the securities governing authority of the State

<PAGE>

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 45 The Company shall have a complete register of shareholders which
shall comprise the following:

(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 46 Different parts of the share 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 Domestic-Invested Shares and H Shares can be freely
transferred in accordance with provisions of the laws and regulations and these
articles of association. However, where H Shares are transferred, 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 instrument of transfer

<PAGE>

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 holders, then the maximum
number of joint holders 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 share 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 47 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 48 Where the Company decides to convene a shareholders' general meeting
distribute dividends, liquidate or carry out other activities which would
require 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 49 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 50 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

<PAGE>

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
shares loses his share certificate and applies or a replacement of new
certificate, the Company shall process the application in accordance with
Article 144 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.

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;

<PAGE>

(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 51 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 52 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 53 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 54 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;

<PAGE>

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

(4) the right to transfer, give or pledge the shares held 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 laws, regulations and 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 free of charge, and copy subject to payment of a
reasonable charge:

(a) all parts of the share register;

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

(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;

(e) minutes of shareholders' general meetings;

(f) the latest audited financial reports and the directors', auditors' and
supervisors' reports thereon;

(g) special resolutions of the Company;

<PAGE>

(h) a copy of the latest annual financial report filed with the national
taxation department or other authorities in charge;

(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 55 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;

(3) except as stipulated under laws and regulations, withdrawal shall not be
made;

(4) other obligations imposed by laws, administrative regulations and these
articles of association.

Shareholders are not liable to make any further contribution to the share
capital other than as agreed by the subscriber of the relevant shares on
subscription.

ARTICLE 56 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 as a whole 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/her 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/her own
benefit or for the benefit of another person) of the individual rights

<PAGE>

of other shareholders including (without limitation) rights to distributions and
voting rights save pursuant to a corporate restructuring submitted to the
shareholders' general meeting for approval in accordance with these articles of
association.

In the flows of operating capital between the controlling shareholder and other
connected parties and the Company, appropriation of the Company's capital shall
be stringently restricted. The controlling shareholder and other connected
parties shall not request the Company to pay in advance salaries, benefits,
insurance, advertisement and other fees for them. Also, they may not bear the
costs and other expenses on behalf of one another.

The Company shall not directly or indirectly provide capital to the controlling
shareholder and other connected parties for use in the following ways:

(1) to lend capital of the Company to the controlling shareholder and other
connected parties for use whether at a consideration or at nil consideration;

(2) to extend entrusted loans to the connected parties through banks or non-bank
financial institutions;

(3) to entrust the controlling shareholder and other connected parties to
conduct investment activities;

(4) to issue a bill of acceptance without real transaction background for the
controlling shareholder and other connected parties;

(5) to pay off liability for the controlling shareholder and other connected
parties;

(6) other ways specified by China Securities Regulatory Commission.

ARTICLE 57 For the purpose of the foregoing Article, a "controlling shareholder"
means a shareholder who holds 50 per cent or more of the shares of the Company,
or in the case of less than 50 per cent, the voting rights represented by the
shares held by whom are sufficient to exert a significant influence upon the
resolutions of the general meeting.

ARTICLE 58 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.
<PAGE>

                    CHAPTER 8: SHAREHOLDERS' GENERAL MEETINGS

ARTICLE 59 The shareholders' general meeting is the organ of authority of the
Company and shall exercise its functions and powers in accordance with law.

ARTICLE 60 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 3 per cent or more
of the total shares of the Company carrying the right to vote;

<PAGE>

(14) to consider and approve the proposals for the establishment of strategy,
audit, nomination, remuneration, appraisal and other special committees of the
board of directors of the Company;

(15) 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;

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

ARTICLE 61 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 62 Shareholders' general meetings are divided into annual general
meetings and extraordinary general meetings. Shareholders' general meetings
shall be convened by the board of directors. Annual general meetings shall be
held once every year and within six (6) months from the end of the preceding
accounting year. In the event that the Company is not able to convene the annual
general meeting within the aforesaid prescribed period for any reasons, it shall
report to the relevant stock exchanges to explain the reasons and make an
announcement.

Under any of the following circumstances, the board of directors shall convene
an extraordinary 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 paid in 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 extraordinary general meeting;

(4) when deemed necessary by the board of directors;

(5) when requested by the supervisory committee.

<PAGE>

ARTICLE 63 When the company convenes a shareholders' general meeting, a written
notice of the meeting shall be given thirty (30) days before the date of the
meeting to notify all shareholders whose names are shown in the share register
of the matters to be considered and the date and venue 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. In the circumstances stipulated in Article 83, after
the notice of the meeting is given, an announcement of the notice of the meeting
shall be made within three (3) days after the determination of shareholding
structure.

ARTICLE 64 Shareholders who severally or jointly holding more than 3 per cent of
the Company's shares, are entitled to present a new proposal in written form to
the board of directors at an annual general meeting. The Company shall include
the matters in the proposal within the functions and powers of a shareholders'
general meeting in the agenda of the meeting.

ARTICLE 65 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.

An extraordinary general meeting shall not resolve any matter not stated in the
notice of such meeting.

ARTICLE 66 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

<PAGE>

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 67 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 regulatory authority within
the interval between forty-five (45) days and fifty (50) days before the date of
the meeting. After the publication of such notice, all holders of domestic
shares shall be deemed to have received the notice of the relevant shareholders'
general meeting.

ARTICLE 68 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 69 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 shall be entitled to exercise the following rights pursuant
to the authorization from that shareholder:

<PAGE>

(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.

The board of directors, independent directors and shareholders that meet certain
requirements may make a call to the shareholders for voting rights at the
shareholders' general meeting in accordance with relevant provisions.

ARTICLE 70 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 71 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 72 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 73 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

<PAGE>

by the Company before the commencement of the meeting at which the proxy is
used.

ARTICLE 74 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 75 Resolutions of shareholders' general meetings shall be divided into
ordinary resolutions and special resolutions.

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 casts an abstention vote or abstains from voting, or in
the case of failure to vote, mistaken or unidentified vote, the Company shall
disregard such vote as a voting share when counting the result of voting.

ARTICLE 76 When shareholders (including their 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.
Any share of the Company held by the Company does not carry any voting right.
However, when electing directors or supervisors, the number of voting rights
each share carries shall be the same with the number of directors or supervisors
to be elected. The voting rights of shareholders may be exercised collectively
in favor of one or several of the directors or supervisors.

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

<PAGE>

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 77 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 78 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 79 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.

ARTICLE 80 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 81 The following matters shall be resolved by an ordinary resolution at
a shareholders' general meeting:

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

<PAGE>

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

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

(2) the issue of debentures by the Company;

(3) the spin-off, merger, dissolution and liquidation of the Company;

(4) the amendments to these Articles of Association;

(5) the alternation of the form of the Company;

(6) the acquisition or sale of major assets or guarantees within one year
exceeding 30 per cent of the total assets of the Company;

(7) 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 would need to be adopted by a special resolution.

ARTICLE 83 Where the shareholders' general meeting is considering matters
related to a connection transaction, a connected shareholder shall not
participate in voting and the shares with voting rights which they represent
shall not be counted in the total number of valid votes. Announcement on the
resolutions passed at the shareholders' general meeting shall adequately
disclose the details of the unconnected shareholders' votes. If the connected
shareholders are unable to abstain from voting due to special reasons, they may
vote according to the normal procedures after the Company has obtained consent
of the competent

<PAGE>

authority. Detailed explanation shall be given in the announcement regarding the
resolutions passed at the general meeting.

A connected transaction referred to in the preceding paragraph refers to an
event whereby a transfer of resources or obligations takes place between
connected parties, regardless of whether a consideration is paid, for instance:

(1) the sale or purchase of merchandise;

(2) the sale or purchase of assets other than merchandise;

(3) outside investment, including entrust finance and entrust loans, etc;

(4) provision of financial assistance;

(5) provision of guarantees, excluding counter guarantees;

(6) lease-in/lease-out of assets;

(7) assets and business management trust;

(8) giving or being given assets;

(9) credit and debt restructuring;

(10) signing of License agreements;

(11) transfer or receipt of research and development projects;

(12) the provision or receipt of labour services;

(13) sale trust;

(14) joint investment by connected parties.

(15) other events whereby a transfer of resources or obligations takes place
through agreement, or other transactions deemed by securities exchange
institutions.

The following transactions with connected parties may be exempted from
resolution and disclosure as connected transactions without violating the
regulations, rules or codes formulated and/or implemented from time to time by
the regulatory authorities where its shares or securities are listed :

<PAGE>

(1) one party subscribes in cash for the shares, corporate bonds and debentures,
convertible bonds or other derivatives offered publicly by the other party;

(2) one party, as a member of a underwriting syndicate, underwrites the shares,
corporate bonds and debentures, convertible bonds or other derivatives offered
publicly by the other party;

(3) a connected party receives dividends, bonuses or remuneration in accordance
with a resolution of shareholders' general meeting of the other party;

(4) connected transactions arising from any party participating in public
biddings or auctions, etc;

(5) other transactions deemed by securities exchange institute.

A connected shareholder shall voluntarily abstain from voting and surrender his
voting rights in the shareholders' general meeting. In the event that a
connected shareholder does not voluntarily abstain from voting, the chairman of
the meeting shall request the connected shareholder to abstain from voting. In
case where the chairman needs to abstain from voting, the vice-chairman or other
directors shall request the chairman and other connected shareholders to abstain
from voting. Any shareholder who does not need to abstain from voting may
request connected shareholders to abstain from voting.

Should a shareholder being requested to abstain from voting or other
shareholders object to the nature of the connected transaction and the
disclosure of interest, abstention from voting and surrender of voting rights in
the meeting arising therefrom, an extraordinary board meeting of the directors
who do not need to abstain from voting may be sought to resolve the matter. Such
resolution shall be final. Should the dissenter still have an objection, he may
file a complaint to the agency of the Securities Regulatory Commission or seek
to solve the case in other ways after the shareholders' general meeting."

ARTICLE 84 Shareholders calling for an extraordinary general meeting or a class
meeting shall follow the following procedures:

(1) Shareholder(s) severally or jointly holding for more than ninety (90)
consecutive days an aggregate of 10 per cent or more of the shares carrying the
right to vote at the proposed meeting may sign one or more written request(s)
requiring the board of directors to convene an extraordinary general meeting or
a class meeting and stating the object of the meeting

<PAGE>

therein. The board of directors shall as soon as possible proceed to convene the
extraordinary general meeting or a class meeting thereof after receiving such
request.

The number of shares held by the above shareholders shall be calculated as at
the date of such request, and evidence of holding the Company's shares for more
than ninety (90) consecutive days shall be provided to the Company.

(2) If the board of directors fails to issue a notice of such a meeting within
thirty (30) days from the date of receipt of such request, the supervisory
committee shall promptly convene an extraordinary general meeting or a class
meeting thereof. If the supervisory committee fails to issue a notice convening
such meeting within thirty (30) days, the shareholders making such request may
themselves convene such a meeting by such procedures 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 such request by the
board of directors.

Any expenses reasonably incurred by such shareholders as a result of convening
any such meeting due to the failure of the board of directors in convening such
meeting shall be repaid to such shareholders by the Company and any sum so
repaid shall be offset against any sum owed by the Company to the directors in
default.

ARTICLE 85 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 a
director of the Company shall be recommended by more than half of the members of
the board 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 86 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.

<PAGE>

ARTICLE 87 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 88 If votes are counted at a shareholders' general meeting, the result
of the count shall be recorded in the minutes of the meeting and signed by
directors present at the meeting. The minutes of the shareholders' general
meeting shall record the following matters:

(1) the number of shares carrying the right to vote attending the shareholders'
general meeting and its ratio to the total number of shares of the Company;

(2) the date and venue of the meeting;

(3) the name of the chairman of the meeting and the agenda;

(4) the key points of speech made by all speakers on each matter under
consideration;

(5) the voting result of each matter resolved;

(6) details of the queries and suggestions of shareholders and the responses or
explanations of the board of directors and supervisory committee;

(7) other matters that should be recorded in the minute book according to the
shareholders' general meeting and these articles of association. The minutes,
the signature book of shareholders attending the meeting and the proxy forms
shall be kept at the office of the Company.

The announcement on the resolutions of a shareholders' general meetings shall
include the number of voting social public shareholders, the total number of
shares they represent, the proportion in the number of social public shares and
the results of the resolution and disclose the shareholding and voting condition
of the top ten voting social public shareholders.

ARTICLE 89 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

<PAGE>

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.

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

ARTICLE 90 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 91 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 92 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;

<PAGE>

(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;

(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 93 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 94 Resolutions of a class meeting of shareholders shall be passed only
by votes representing more than two-thirds of the voting rights of

<PAGE>

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 95 A written notice of a class meeting shall be given forty-five (45)
days before the date of the class meeting to notify all shareholders whose names
are shown in the share register of the class of the matters to be considered,
the date and venue of the class meeting. A shareholder who intends to attend the
class meeting shall deliver his written reply concerning his 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.

ARTICLE 96 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 97 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;

<PAGE>

(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 98 The Company shall establish a board of directors. The board shall
consist of 9 directors. The board shall have one Chairman.

ARTICLE 99 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.

ARTICLE 100 The directors of the Company shall include independent directors and
at least one-third of the board members shall be independent directors.

An independent director is a director who does not act in other capacities in
the Company other than as a director, and who does not have any relationship
with the Company or its substantial shareholders which may affect the director
in making independent and objective judgement.

(1) The board of directors, supervisory committee of the Company or
shareholders, individually or jointly, holding 1 per cent or more of the issued
shares of the Company may nominate a candidate as independent

<PAGE>

director. Independent directors shall be elected at the shareholders' general
meeting.

Independent directors shall serve a term of 3 years. A director may serve
consecutive terms if re-elected upon the expiration of his term. However, an
independent director shall not consecutively hold the office for more than six
years.

(2) The board of directors may propose to the shareholders' general meeting to
remove any independent director who is absent from the board meetings for three
consecutive times. Except where a person shall not act as a director as
stipulated in the Company Law, an independent director shall not be removed
before expiration of office without reason. In the event of early removal from
office, the Company shall disclose the same as a special disclosure matter.
Should the independent director being removed from office consider the reason of
removal to be improper, a public statement may be made.

(3) An independent director may resign before the expiration of his term. The
independent director shall submit a written resignation to the board of
directors, and state any matter that is related to his resignation or which he
considers it necessary that the attention of the shareholders and creditors of
the Company should be drawn to. Should the resignation of the independent
director cause the ratio of independent directors in the board of directors of
the Company to fall below one-third, the resignation of the independent director
shall become effective after the vacancy is filled by the succeeding independent
director.

(4) An independent director shall have the following special duties:

A. a connected transaction of which the total consideration accounts for more
than 5 per cent of the latest audited net asset value of the Company shall be
approved by the independent directors before submission to the board of the
directors for discussion;

B. to propose to the board of directors any engagement or removal of
accountants;

C. to propose to the board of directors the convening of an extraordinary
general meeting;

D. to propose the convening of a board meeting;

E. to engage external auditors or consultants independently;

<PAGE>

F. should a matter proposed for discussion at a shareholders' general meeting by
the board require independent financial report by an independent financial
adviser, the independent financial adviser shall be engaged by the independent
directors;

G. to make a call for voting rights to the shareholders before the shareholders'
general meeting;

H. to make independent opinions on significant events of the Company.

To exercise the above duties, independent directors shall obtain approval of
more than half of all independent directors.

ARTICLE 101 To ensure that the independent directors can effectively perform
their duties, the Company shall provide to the independent director with the
necessary working conditions as follows:

(1) The Company shall ensure that the independent directors enjoy equal rights
to information as other directors. In respect of any significant matter subject
to board decision, the Company shall give prior notice to the independent
directors within the prescribed time and provide them with adequate information
at the same time. Should the independent directors consider the information to
be inadequate, they may request for supplementary information. In the case where
2 or more independent directors consider the information to be inadequate or the
grounds to be unclear, they may propose jointly in writing to postpone the board
meeting or delay the discussion of the relevant matters by the board of the
directors. Such proposal shall be accepted by the board of directors.

(2) The Company shall provide the independent directors with the necessary
working conditions for the discharge of their duties. The secretary to the board
of directors of the Company shall actively assist the independent directors with
their discharge of duties, including briefing on the situation and provision of
materials, etc..

(3) When the independent directors perform their duties, the relevant staff of
the Company shall actively coordinate with them, and shall not refuse, hinder or
conceal, and shall not interfere with their independence in discharging their
duties. The Company shall make disclosure where the proposals of independent
directors are not accepted or their duties cannot be performed.

(4) The fees required for the engagement of intermediaries and discharge of
other duties by the independent directors shall be borne by the Company.

<PAGE>

(5) The Company shall offer appropriate allowances to the independent directors.
The budget for the level of allowances shall be formulated by the board of
directors and approved at a shareholders' general meeting. Apart from the above
allowances, the independent directors shall not obtain other additional or
undisclosed benefits from the Company and its substantial shareholders or an
institution in which the independent directors have interests and its staff.

(6) The Company may establish a compulsory liability insurance system of the
independent directors according to its needs.

ARTICLE 102 An independent director shall fulfill the following requirements:

(1) possesses the qualifications as an independent director of a listed company
in accordance with the laws, regulations and other related requirements;

(2) satisfies the criteria of independence as stipulated in laws, administrative
regulations and regulatory documents;

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

(4) possesses more than 5 years' working experience in practising law, finance
or possess other experience necessary for discharging the duties as an
independent director;

(5) other requirements as specified in these articles of association.

The following persons shall not act as an independent director:

(1) an employee of the Company or its subsidiaries and his/her direct relatives
and main social relations (direct relatives include spouse, parents and children
while main social relations include siblings, parents-in-law,
sons/daughters-in-law, spouses of siblings, siblings of spouse);

(2) a natural person shareholder holding, directly or indirectly, more than 1
per cent of the shares of the Company in issue or being a top 10 shareholder of
the Company and his/her direct relatives;

<PAGE>

(3) an employee of a corporate shareholder directly or indirectly holding more
than 5 per cent of the shares of the Company or an employee of any of the top 5
corporate shareholders, and his/her direct relatives;

(4) any person who falls within any of the above 3 categories in the most recent
year;

(5) any person who provides financial, legal, consultation services to the
Company or its subsidiaries or an employee of such relevant institutions;

(6) other persons stipulated by the law, rules and other regulations.

ARTICLE 103 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 formulate proposals for the establishment of strategy, audit, nomination,
remuneration, appraisal and other special committees of the board of directors;

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

(10) 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 management (including the financial controller) of the Company
and decide on their remunerations;

<PAGE>

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

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

(13) 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 (12) 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).

The directors connected with the subject of matters to be resolved at the
meeting of the board of directors shall not vote on such resolution either in
person or on behalf of any other director. The meeting of the board of directors
may be held with more than half of the unconnected directors attending the
meeting. The resolutions at the meeting of the board of directors shall be
approved by more than half of the unconnected directors except the special
resolutions that shall be passed by more than two thirds of the unconnected
directors as stipulated in these articles of association. Where the number of
unconnected directors attending the meeting of the board of directors is less
than three, the board shall submit the matter to the shareholders' general
meeting for consideration.

ARTICLE 104 The board of directors of the Company shall stringently control the
paying off of the Company's capital appropriated by a connected party with
non-cash assets. In the event that a connected party intends to pay off the
Company's capital appropriated by it with non-cash assets, the following
provisions shall be observed:

(1) the assets used for compensation shall belong to the same business system of
the Company. They should help enhance the Company's independence and core
competitiveness and minimize connected transactions. They shall not be assets
which have not yet been put into operation or have no objective and clear net
book values;

<PAGE>

(2) the Company shall engage intermediaries with relevant securities and futures
business qualifications to conduct a valuation on the assets which can be used
to pay off liabilities. The value of the assets or the audited net book values
of the assets to be used for paying off the liabilities shall be used to
determine the basis of pricing. However, the final consideration shall not
prejudice the interests of the Company, and shall be discounted after full
consideration is given to the present value of the capital appropriated;

(3) the independent directors shall express independent opinion on the proposal
of paying off of liabilities using assets by the connected party of the Company.
They may engage intermediaries with relevant securities and futures business
qualifications to issue an independent financial adviser report;

(4) the proposal of paying off of liabilities using assets by the connected
party of the Company shall be submitted to China Securities Regulatory
Commission for approval;

(5) the proposal of paying off of liabilities using assets by the connected
party of the Company shall be subject to consideration and approval at a
shareholders' general meeting in which the connected shareholders shall abstain
from voting.

ARTICLE 105 All directors of the Company shall cautiously handle and stringently
control the risk of external debt. They shall be held responsible for the losses
resulting from an external guarantee given in violation of the regulations or an
irregular external guarantee in accordance with the laws. The controlling
shareholder and other connected parties shall not compel the Company to provide
a guarantee to third parties.

When providing external guarantee, the Company shall comply with the following
provisions:

(1) the subject of an external guarantee provided by the Company shall have a
bank credit rating of an AA grade and shall not have any bad credit record with
a bank;

(2) resolutions in respect of the Company's external guarantee shall be passed
by more than two-third of all directors; those beyond the authority of the board
of directors shall be proposed to a shareholders' general meeting for approval;

<PAGE>

(3) the guarantees provided for shareholders, effective controller and connected
parties thereof shall be considered and approved at the shareholders' general
meeting;

(4) no guarantee shall be directly or indirectly provided for debts of any party
whose asset-liability ratio is above 70 per cent;

(5) the total amount of external guarantees shall not exceed 5 per cent of the
net asset value as stated in the Company's consolidated financial statements for
the latest accounting year;

(6) the provision of a counter-guarantee shall be requested from the other party
in respect of an external guarantee, and the person providing the
counter-guarantee shall have actual ability to assume the obligations;

(7) the Company shall strictly observe the relevant provisions for the faithful
discharge of the obligations of information disclosure in respect of the
external guarantee. It should also honestly provide the information on all
external guarantees to the registered accountant as required.

Any external guarantee subject to approval at the shareholders' general meeting
shall be considered and approved at the meeting of the board of directors before
being submitted to the shareholders' general meeting. Where the resolution on
the guarantee provided for shareholders, effective controller or connected
parties thereof is being considered at the shareholders' general meeting, the
shareholder or the shareholder controlled by the effective controller shall not
vote on the resolution. The resolution shall be passed by more than half of the
voting rights represented by the other shareholders attending the shareholders'
general meeting.

The independent directors of the Company shall make specific statements in
respect of the Company's accumulated and current external guarantees and the
situation in respect of the compliance with the above provisions in the annual
report, and express independent opinion.

The board of directors shall set the boundaries for making risky investments
with the Company's assets, and establish stringent review and decision-making
procedures. Evaluation by relevant experts and professionals shall be organized
for significant investment projects, and approval shall be sought at a
shareholders' general meeting."

ARTICLE 106 The board of directors shall not, without the prior approval of
shareholders in a general meeting, dispose or agree to dispose of any

<PAGE>

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 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 107 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 108 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 109 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 directors ten (10) days before the date of the
meeting. Upon request of shareholders representing more than one-tenth of the
shares carrying the right to vote, or, one- third or more of the directors, the
Chairman, the supervisory committee or the general manager, an extraordinary
meeting of the board of directors may be convened. The Chairman shall convene
and preside at the extraordinary meeting of the board of directors within ten
(10) days from the receipt of such request.

<PAGE>

ARTICLE 110 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.

ARTICLE 111 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 112 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 113 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.

<PAGE>

ARTICLE 114 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 115 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.

                 CHAPTER 11: SECRETARY OF THE BOARD OF DIRECTORS

ARTICLE 116 The Company shall have a secretary of the board of directors who
shall be a senior administrative officer of the Company.

ARTICLE 117 The secretary to the board of directors of the Company 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:

(1) to organize and prepare for shareholders' general meetings and meetings of
the board of directors of the Company;

<PAGE>

(2) to keep documents and records of shareholders' general meetings and meetings
of the board of directors; to ensure that the Company prepares and delivers
those reports and documents required by any competent authorities in accordance
with the law, and that persons entitled to receive the Company's records and
documents receive such records and documents without delay;

(3) to maintain information of the shareholders of the Company and to ensure
that the Company's registers of shareholders are properly maintained;

(4) to handle information disclosure issues.

ARTICLE 118 A director or other senior administrative officer of the Company may
hold the office 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 119 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 120 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;

<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;

(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 121 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 122 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 123 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 124 The Company shall have a supervisory committee.

ARTICLE 125 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.
<PAGE>

ARTICLE 126 The supervisory committee shall comprise of representatives of
shareholders and representatives of staff and workers of the Company. The
proportion of the latter shall not be less than one-third of the supervisory
committee. Representatives of shareholders shall be elected or removed by the
shareholders at a general meeting. Representatives of staff and workers shall be
elected democratically by the staff and workers at a meeting of the
representatives of staff and workers, staff and workers' meeting or through
other channels.

ARTICLE 127 The directors, general manager, deputy general managers and other
senior administrative officers shall not act concurrently as supervisors.

ARTICLE 128 Meetings of the supervisory committee shall be held at least once
every six months, and shall be convened and presided by the chairman of the
supervisory committee. If the chairman cannot or fails to perform his/her
duties, the meeting of the supervisory committee shall be convened and presided
by one supervisor elected by over half the number of the supervisors.
Supervisor(s) may propose to convene extraordinary meetings of the supervisory
committee.

The supervisory committee shall record the decisions on the matters discussed,
which shall be signed by supervisors present at the meeting.

ARTICLE 129 The supervisory committee shall be accountable to the shareholders'
general meeting and shall exercise the following powers in accordance with the
law:

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

(2) to supervise the performance of duties of the directors, general manager,
deputy general managers and other senior management; to propose the dismissal of
directors, general manager, deputy general managers and other senior management
who have violated any law, administrative regulations, these Articles of
Association or resolutions of the shareholders' general meetings;

(3) to demand a director, general manager, deputy general manager or any other
senior management to rectify such breach when the acts of such persons are
harmful to the Company's interest;

(4) to propose the convening of shareholders' general meetings, and to convene
and chair the shareholders' general meetings if the board of directors fails to
perform this duty as stipulated in these Articles of Association;

<PAGE>

(5) to propose motions to shareholders' general meetings;

(6) to initiate legal proceedings against any director, general manager, deputy
general manager and other senior management in accordance with Article 152 of
the Company Law.

Supervisors may attend meetings of the board of directors and question or give
advice on the resolutions of the board of directors.

ARTICLE 130 Resolutions of the supervisory committee shall be passed by
two-thirds or more of all of its members.

ARTICLE 131 The supervisory committee may conduct investigation if they find the
operation of the Company unusual; and may engage professionals such as lawyers,
certified public accountants or practicing auditors to assist if necessary. All
reasonable fees so incurred shall be borne by the Company.

ARTICLE 132 A supervisor shall carry out his duties honestly and faithfully in
accordance with laws, administrative regulations and these articles of
association.

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

ARTICLE 133 A person may not serve as the director, supervisor, general manager,
deputy general manager or any other senior management of the Company under any
of the following circumstances:

(1) a person who has no civil capacity or has restricted civil capacity;

(2) a person who has committed an offence of corruption, bribery, embezzlement
of property, misappropriation of property or sabotaging the order of socialist
market economy and has received a criminal sentence because of committing such
an 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 the execution of his sentence;

(3) a person who was previously the director, factory manager or manager of a
company or enterprise which was insolvent and liquidated and who 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;

<PAGE>

(4) a person who was previously the legal representative of a company or
enterprise which had its business License revoked and was ordered to cease its
business due to 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 License of such company or enterprise;

(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 criminal law which is not yet concluded;

(7) a person who is not eligible for enterprise leadership under the
requirements of the laws and administrative regulations;

(8) not a 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 have elapsed since the date of the conviction.

Any election, appointment or engagement of a director, supervisor, general
manager, deputy general manager or any other senior management in violation of
the preceding paragraph shall be invalid.

The Company shall dismiss any director, supervisor, general manager, deputy
general manager or any other senior management who falls within any of the
circumstances set out in the first paragraph of this Article during his term of
office.

ARTICLE 134 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.

ARTICLE 135 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:

<PAGE>

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

(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 136 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 137 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;

<PAGE>

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

(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 138 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;

<PAGE>

(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;

(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 139 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 140 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.

ARTICLE 141 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

<PAGE>

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.

ARTICLE 142 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 143 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 144 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:

<PAGE>

(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 145 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 146 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

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

ARTICLE 147 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 148 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:

<PAGE>

(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 149 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.

Except under a contract entered into in accordance with the foregoing, no
proceedings may be brought by a director or supervisor against the

<PAGE>

Company for any benefit due to him in respect of the matters mentioned in this
Article.

ARTICLE 150 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.

ARTICLE 151 When any scenario set out in Article 147 of the Company Law appears
in an incumbent director and where the director is prohibited from participating
in the securities market by the China Securities Regulatory Commission, the
board of directors shall immediately suspend the relevant director's duties from
the date on which the board of directors becomes aware of the occurrence of such
event and shall propose to the shareholders' general meeting to dismiss such
director.

When any scenario set out in Article 147 of the Company Law appears in an
incumbent supervisor and where the supervisor is prohibited from participating
in the securities market by the China Securities Regulatory Commission, the
supervisory committee shall immediately suspend the relevant supervisor's duties
from the date on which the supervisory committee becomes aware of the occurrence
of such event and shall propose to the shareholders' general meeting to dismiss
such supervisor.

When any scenario set out in Article 147 of the Company Law appears in the
incumbent general manager, a deputy general manager or any other senior
administrative officers and where the incumbent general manager, the deputy
general manager or any other senior administrative officers is prohibited from
participating in the securities market by the China Securities Regulatory
Commission, the board of directors shall

<PAGE>

immediately suspend his or her duties from the date on which the board of
directors becomes aware of the occurrence of such event and shall convene a
board meeting to dismiss him or her.

CHAPTER 15: FINANCIAL AND ACCOUNTING SYSTEMS AND PROFIT DISTRIBUTION

ARTICLE 152 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 153 At the end of each accounting year, the Company shall prepare
financial reports which shall be audited by an accounting firm in accordance
with the law. The financial reports shall be prepared in accordance with the
laws, administrative regulations and the requirements of the finance department
of the State Council.

ARTICLE 154 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.

ARTICLE 155 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 156 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.

<PAGE>

ARTICLE 157 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 158 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 159 The Company shall not keep accounts other than those provided by
law.

ARTICLE 160 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
board of directors.

ARTICLE 161 The profit after tax of the Company shall be used in the following
manners:

(1) making up for losses;

(2) allocation to the statutory common reserve fund;

(3) allocation to the discretionary common reserve fund upon the approval of
shareholders at a general meeting;

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

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 proportions of profit distributions to items (3) and
(4) above subject to approval of shareholders at the general meeting.

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.

<PAGE>

ARTICLE 162 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 163 The common reserve fund of the Company shall be applied for the
following purposes:

(1) making up for losses;

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

(3) transfer or increase of capital.

When the Company converts its common reserve fund into capital upon the approval
of shareholders at a general meeting, the Company shall either issue 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 that the
statutory common reserve fund after the conversion may not fall below 25 per
cent of the registered capital before such conversion.

The capital common reserve fund may not be used to make up for losses.

ARTICLE 164 The Company may not distribute any dividend before making up for its
losses and allocating funds to the statutory common reserve fund.

ARTICLE 165 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 166 The Company may distribute dividends in the following forms:

(1) cash;

(2) shares.

<PAGE>

ARTICLE 167 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 168 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 169 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 170 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.

<PAGE>

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

ARTICLE 171 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.

ARTICLE 172 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 173 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 174 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 175 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 176 The Company's appointment of, removal of and non reappointment of an
accounting firm shall be resolved upon by shareholders in general

<PAGE>

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).

(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;

<PAGE>

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 177 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 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 178 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

<PAGE>

practices of similar industries in other countries and the practice and legal
requirements in China.

               CHAPTER 18: LABOUR AND PERSONNEL MANAGEMENT SYSTEMS

ARTICLE 179 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 180 The employees of the Company may establish a trade union to carry
out trade union activities and protect the legal interests of the employees in
accordance with the Trade Union Law of the People's Republic of China. The
Company shall provide the trade union with all necessary conditions for its
activities and 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.

The representatives of the trade union of the Company may, on behalf of the
employees of the Company, enter into any collective agreement with the Company
in relation to issues including wages, working hours, benefits, insurance, and
labor safety and health in accordance with the law. The Company shall seek
advice from the trade union before making any material decision on its reform
and operation and formulation of regulations and shall convene trade union
representatives' meeting or by other means to collect opinions and suggestions
of the employees.

According to the Constitution and other relevant laws, the Company exercises
democratic management through employees' representatives meeting or other means.

                 CHAPTER 20: MERGER AND DIVISION OF THE COMPANY

ARTICLE 181 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

<PAGE>

the shareholders who consent to the plan of merger or division to acquire that
dissenting shareholder's shareholding at a fair price.

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 182 The merger of the Company may be in the form of either acquisition
or establishment of a new company.

In the event of a merger of the Company, parties to the merger shall enter into
a merger agreement and prepare a balance sheet and a list of assets. The Company
shall notify its creditors within ten (10) days from the date of the Company's
resolution to merge and shall publish a public notice in a newspaper within
thirty (30) days from the date of the Company's resolution to merge. A creditor
has the right within thirty (30) days upon receipt of such notice from the
Company or, if no notice is received, within forty-five (45) days from the date
of the first public notice, to demand the Company to settle the debts owed to it
or to provide a corresponding guarantee.

Upon completion of the merger of the Company, debts and indebtedness of parties
to the merger shall be assumed by the company surviving the merger or the
company newly established for such purpose.

ARTICLE 183 In the event of a spin-off of the Company, its assets shall be split
accordingly.

In the event of a spin-off of the Company, parties to such spin-off shall enter
into a spin-off agreement and prepare a balance sheet and a list of assets. The
Company shall notify its creditors within ten (10) days from the date of the
Company's resolution in respect of such spin-off and shall publish a public
notice in a newspaper within thirty (30) days from the date of such resolution.

Unless a written agreement has been entered into by the Company and its
creditors in relation to the repayment of debts before the spin-off, companies
surviving such spin- off shall jointly assume the indebtedness of the Company
which has been incurred before such spin-off.

ARTICLE 184 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,

<PAGE>

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.

                     CHAPTER 21: DISSOLUTION AND LIQUIDATION

ARTICLE 185 The Company shall be dissolved upon the occurrence of any of the
following events:

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

(2) dissolution is necessary for the purpose of a merger or spin-off of the
Company;

(3) revocation of business License of the Company or the Company is ordered to
close down or is dissolved in accordance with the law;

(4) dissolution by the People's Court according to Article 183 of the Company
Law;

(5) the Company is unable to repay its due debts in full and is declared
bankrupt in accordance with the law.

ARTICLE 186 Where the Company is dissolved under sub-paragraphs (1), (3) and (4)
of the preceding Article, a liquidation committee shall be set up within fifteen
(15) days from the event of dissolution of the Company to commence the
liquidation. The composition of the liquidation committee of the Company shall
be determined by the directors or an ordinary resolution of shareholders'
general meeting. If no liquidation committee is set up within the prescribed
period to commence the liquidation, creditors may apply to the People's Court to
designate relevant persons to form a liquidation committee in order to carry out
the liquidation.

Where the Company is dissolved under sub-paragraph (5) of the preceding Article,
the People's Court shall in accordance with the provisions of the relevant laws
organise and establish a liquidation committee to carry out the liquidation.

ARTICLE 187 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

<PAGE>

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.

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 188 The liquidation committee shall within ten (10) days from its
establishment send notice to creditors, and within sixty (60) days from its
establishment publish a public notice in a newspaper. A creditor shall within
thirty (30) days upon receipt of such notice, or if no notice is received,
within forty-five (45) days from the date of the first public notice, declare
its creditor's rights to the liquidation committee.

When declaring creditor's rights, the creditor shall give details of the
creditor's rights together with the evidence thereof. The liquidation committee
shall register creditors' rights and no settlement can be made to the creditors
by the liquidation committee during the period for declaration of creditors'
rights.

ARTICLE 189 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;

<PAGE>

(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 190 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 191 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 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 192 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

<PAGE>

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

ARTICLE 194 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 195 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

ARTICLE 196 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

<PAGE>

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.

                            CHAPTER 24: SUPPLEMENTARY

ARTICLE 197 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

<PAGE>

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

ARTICLE 199 The right to interpret these articles of association shall reside in
the board of directors of the Company.