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                                                                   Exhibit 10.12







               ZHUHAI CITY STATE-OWNED LAND USE RIGHTS ASSIGNMENT

                  Zhu-Gui-Guo-Tu-He-Zi [Bonded] (2000) No. 003









                                    CONTRACT









                                  May 16, 2000


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                 STATE-OWNED LAND USE RIGHTS ASSIGNMENT CONTRACT

                  1. THE TWO CONCERNED PARTIES TO THIS CONTRACT


First Party (Assignor):    Zhuhai Bonded Area Management Committee
Legal Representative:      Li Xiang               Title:  Director
Address: Wanzai Hongwan, Zhuhai City, Guangdong Province
Postal Code:      519000            Telephone: 756-8825123


Second Party (Assignee):   OPLINK COMMUNICATIONS INC.
Legal Representative:      Liu Yanliang         Title:   Chairman of the Board
Address:          3475 North First Street       Telephone: 0756--3315530
                  San Jose, CA 95134, USA

         In accordance with the PEOPLE'S REPUBLIC OF CHINA STATE LAND
ADMINISTRATION ACT, the PEOPLE'S REPUBLIC OF CHINA URBAN REAL ESTATE
ADMINISTRATION ACT, and regulations of Guangdong Province and Zhuhai City
concerning state-owned land use rights, the two parties have concluded this
contract based on the principles of equity and mutual benefit.

         The land price contained in this contract is comprised of two parts:
land use rights assignment funds (i.e., compensated land use fees) and land
development cost funds (including land requisition compensation fees,
dismantling and moving compensation fees for buildings on the land, labor
resettlement compensation fees, municipal government facility matching fees and
land "six connections, one flat" development fees). The ratios thereof are 30%
and 70%.

         "Six connections and one flat": Electricity, telecommunications, water,
sewage, water drainage, roads, and leveled land.


                            2. LAND AND INTENDED USE

         1. Industrial-use land

         (1) First Party assigns the state-owned land use rights for land with
an area of 96794.30 square meters (this plot of land does not include
subterranean resources, buried objects and municipal government public
facilities) located in the Zhuhai Bonded Area (see Attachment 1) for the use of
Second Party (the formal red-line drawings shall be the standard for coordinates
and area).

         2. Land for Matching Residential Use

         (1) First Party assigns the state-owned land use rights for a plot of
land (this land does not include subterranean resources, buried objects and
municipal government public facilities) with area of 46849.35 square meters (see
Attachment 2) located outside the north gate of the Zhuhai Bonded Area for use
of Second Party (the formal red-line drawing shall be the standard for
coordinates and area).

         (2) The intended use for this plot of land is: only to serve as land
for the matching residence of Second Party's employees. If Second Party changes
to other use, First Party has the right to recover the land.
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         3. The total area of land for high technology industrial use and
matching residential use is 143643.66 square meters. Hereinafter, this shall be
referred to as "the Land."


                        3. LAND PRICE AND PAYMENT METHOD

         1. First Party agrees to assign the land use rights for the Land to
Second Party at RMB 100 YUAN for each square meter of used land area, when the
plot ratio is 1.0 or less than 1.0; if the plot ratio exceeds 1.0, fees for the
excess building area shall be charged at 80% of the land price.

         Plot ratio is calculated as follows: Total building area of buildings
on the ground surface divided by area of used land

         Land price calculation formula:

         Land price payable = (Total area of used land + area of buildings in
excess of 1.0 plot ratio x 80%) x basic land price. Because Second Party's plot
ratio is 1.0 or less than 1.0, the total land price payable by Second Party is
RMB 14,364,366 YUAN. Spelled out: RENMINBI Fourteen Million Three Hundred
Sixty-four Thousand Three Hundred Sixty-six YUAN exactly.

         2. Payment method: Whereas Second Party plans to develop the Land in
three stages, with developed land area in the first stage totaling 45000 square
meters (of which the developed land area for industrial use shall be 30000
square meters, and the developed land area for matching residential use shall be
15000 square meters); developed land area in the second stage shall total 45000
square meters (of which the developed land area for industrial use shall be
30000 square meters, and the developed land area for matching residential use
shall be 15000 square meters); developed land area in the third stage shall
total 53643.66 square meters (of which the developed land area for industrial
use shall be 36794.30 square meters, and the developed land area for matching
residential use shall be 16849.36 square meters); First Party agrees that Second
Party shall make payment in full of the land price for the Land in three
payments within 25 months of the date on which this contract takes effect, i.e.
by June 17, 2002. Specific payments shall be as follows:

         (1) Down payment: Within 30 days of the signing and taking effect of
this contract, i.e. by June 17, 2000, Second Party must pay to First Party the
land price for the land to be developed in the first stage of RMB 4,500,000 YUAN
(Four Million Five Hundred Thousand), as well as 20% of the land price for land
to be developed in the second stage (RMB 900,000 YUAN) and 20% of the land price
for land to be developed in the third stage (RMB 1,072,873.20 YUAN) for a total
of RMB 1,972,873.20 YUAN, to serve as a deposit for the land price for the
second and third stages. Thus, the down payment shall total RMB 6,472,873.20
YUAN. (Spelled out: Six Million Four Hundred Seventy-two Thousand Eight Hundred
Seventy-three YUAN and Twenty FEN)

         (2) Second payment: Within 13 months of the signing and taking effect
of this contract, i.e. by June 17, 2001, Second Party must pay to First Party
80% of the land price for the land to be developed in the second stage, i.e. RMB
3,600,000 YUAN. (Spelled out: Three Million Six Hundred Thousand YUAN exactly)

         (3) Third payment: Within 25 months of the signing and taking effect of
this contract, i.e. by June 17, 2002, Second Party must pay to First Party 80%
of the land price for the land to be developed in the third stage, i.e. RMB
4,291,492.80 YUAN. (Spelled out: Four Million Two Hundred Ninety-one Thousand
Four Hundred Ninety-two YUAN and 80 FEN)
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         3. First Party shall provide to Second Party red-line drawings and
construction land planning permits and construction land approvals for the used
land within 15 days after Second Party has paid the down payment in full.

         4. In the event that Second Party fails to pay the land price on
schedule in accordance with the contract, in addition to being unable to enjoy
the benefits stipulated in the preceding paragraph, an amount equivalent to 1.5%
of the owed land price shall be charged each month. Additionally, if First
Party's letter demanding payment is ineffective, First Party has the right to
rescind this contract and recover the land, shall not refund any land price
already paid, and may demand breach of contract damages. If First Party defaults
under this contract, then First Party must return in lump sum land price amounts
already paid by Second Party and assume corresponding breach of contract
liability.

         5. In addition to the payment of the land price as set forth in the
preceding paragraphs of this contract, Second Party must also pay deed taxes in
accordance with national and municipal government regulations.

         6. In accordance with applicable municipal government regulations, no
land use tariffs will be assessed.


                    4. TERM OF ASSIGNMENT OF LAND USE RIGHTS

         1. The term of assignment for the industrial use land of the Land is
fifty years, and the term of assignment for the matching residential use land is
seventy years, calculated beginning from the date on which the "Construction Use
Land Approval Document" was issued. If Second Party needs to extend or shorten
the term of use, it may be extended or shortened upon approval, whereupon the
land price shall be correspondingly adjusted in accordance with the extended or
shortened term.

         2. Prior to the expiration of the term of use confirmed above, the use
rights for the Land obtained by Second Party will not be recovered;

In accordance with the related laws and regulations of the state, urban
planning and social and public benefit needs, the land use rights for the Land
may be recovered in advance according to legal procedures, and corresponding
compensation shall be given in accordance with Second Party's actual term of use
and actual Land development circumstances.


                          5. CONSTRUCTION REQUIREMENTS

         1. First Party shall provide permanent "six connections and one flat"
matching land facilities, but, because First Party is currently in the process
of constructing municipal government facilities, upon completed payment of the
down payment on the part of Second Party, First Party shall (1) within 90
fair-weather working days (excluding natural disasters), turn over to Second
Party complete industrial use land that has three connections and one flat and
is developable and usable; (2) within 120 fair-weather working days (excluding
natural disasters), turn over to Second Party complete matching residential land
that has three connections and one flat and is developable and usable, in order
to satisfy the temporary water, electricity and road connection needs for
production and construction, and shall offer Second Party coordination and
assistance with respect to development thereof.

         2. Construction requirements for the Land shall be based on the
"Construction Design Essentials" issued by First Party, which must not be
arbitrarily modified; if Second Party requires modification, Second Party must
report such changes to First Party for new approval; in the event that such
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modifications involve changes to the intended use of the Land and the plot
ratio, Second Party must further execute a modification agreement to the land
use rights assignment contract with First Party, and correspondingly adjust the
land price.

         3. Second Party shall begin construction to develop the Land within the
Begin Construction Deadline as stipulated in the "Construction Land Approval
Document." In the event of failure to begin construction and development for one
year after the Begin Construction and Development deadline has expired, First
Party may assess an idle land fee equivalent to 3% of the original total
assignment land price; in the event of failure to begin construction and
development for two years after the Begin Construction and Development deadline
has expired, First Party may recover the land use rights for the Land without
compensation. If the beginning of construction and development is delayed as the
result of natural disaster or other FORCE MAJEURE factors, Second Party shall
present written application, and, upon approval by First Party, shall be
permitted to extend the deadline in accordance with such approval.

         4. Under the precondition of not damaging the facilities constructed by
Second Party on the Land or the normal production of Second Party, Second Party
consents to the construction or pass-through of municipal government facilities
within the used land red-line area on the part of the government in accordance
with overall urban planning, without requiring the payment of any compensation
to Second Party. If the facilities constructed by Second Party on the Land or
Second Party's normal operations are damaged, Second Party is entitled to claim
damages from the government.

         (1)  Municipal government electricity, telecommunications, power
              cables, power cable ditches;
         (2)  Municipal government water supply and drainage and sewage
              pipelines;
         (3)  Municipal government planned roads, etc.

         5. Second Party agrees to simultaneously construct the following public
benefit projects within the used land red-line area, and agrees to provide them
for use free of charge.

         (1)          None                    ;
            ----------------------------------
         (2)          None                    ;
            ----------------------------------

             6. TRANSFER, LEASE AND HYPOTHECATION OF LAND USE RIGHTS

         Transfer, lease and hypothecation of land use rights shall be handled
in accordance with the GUANGDONG PROVINCE SPECIAL ECONOMIC REGION LAND
ADMINISTRATION ORDINANCE.

         1. The following conditions must exist simultaneously in the event of
transfer (including sale, exchange or gifting) of land use rights:

         (1)  All land prices are paid in full;
         (2)  Land use certificate has been obtained;
         (3)  Apart from the land price, capital invested in development and
              construction has reached 25% or more of the total investment
              amount stipulated in the contract.

         2. In the event of transfer, lease or hypothecation of land use rights,
the two concerned parties must execute a contract, until [sic?] First Party
completes modification procedures, and taxes and fees are paid in accordance
with government regulations.

         3. In the event of transfer, lease or hypothecation of land use rights,
neither party may violate the rights, obligations or effective term stipulated
in the contract. If such violations occur, such transfers,
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leases or hypothecations shall be invalid, and the Zhuhai Municipal State Land
Planning Bureau shall administer corresponding penalties until the land use
rights for the Land are recovered.


                         7. EXPIRATION OF LAND USE TERM

         1. When the land use term expires, in the event that the user of the
land requires continued use of the land, said user should apply to renew the
term one year prior to expiration. Unless the Land is recovered based on social
or public benefit needs, this will generally be approved. In the event renewal
is approved, Second Party must execute a new Land Use Rights Assignment Contract
with First Party, pay land prices and complete land use rights registration
procedures.

         2. When the land use term expires, in the event that the user of the
land has not applied for renewal or, despite having applied for renewal, has not
obtained approval in accordance with regulations, the land use rights shall be
recovered by the state without compensation. The user of the land shall turn in
the land use certificate, and shall complete cancellation procedures and
registration.


                                    8. OTHER

         1. This contract shall take effect beginning on the date on which the
two parties have signed and affixed their seals to it. Default on the part of
either party under the contract shall be handled in accordance with the related
laws of China, and economic losses incurred by the observant party shall be
compensated. If disputes arise between the two parties as the result of the
contract, said disputes shall be resolved through friendly negotiations. Should
negotiations fail to resolve such disputes, suit may be filed with the People's
Court, or the disputes may be turned over to the China International Economic
Trade Arbitration Commission for resolution through arbitration.

         2. The building density for industrial-use land in industrial projects
shall be 40% or lower. The building density for matching residential-use land
shall be 35% or lower.

         3. Supplementary contracts shall be executed by the two parties based
on the principles of sincerity and openness with respect to matters not covered
in this contract. Supplementary contracts shall have equal legal effect with
this contract.

         4. There are eight identical copies of this contract, two to be held by
each of the two parties, and four copies for the files of the Zhuhai City State
Land Planning Bureau.
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         First Party:      Zhuhai Bonded Area Management Committee
                           (seal) Zhuhai Bonded Area Management Committee

                           Legal Representative: /s/  Li Xiang

         Second Party:     OPLINK COMMUNICATIONS, INC.
                           -------------------------------

                           (seal)

                           Legal Representative: Liu Yanliang


                  Signed May 16, 2000 at HONG KONG.