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                                                                    Exhibit 10.5

              SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION

                            INDEMNIFICATION AGREEMENT

     This Indemnification Agreement ("Agreement") is entered into as of the
      day of        , 2004 by and between Semiconductor Manufacturing
-----        -------
International Corporation, a Cayman Islands company (the "Company"), and
                 ("Indemnitee").
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                                    RECITALS

     A. The Company and Indemnitee recognize the continued difficulty in
obtaining liability insurance for its directors, officers, employees, agents and
fiduciaries, the significant increases in the cost of such insurance and the
general reductions in the coverage of such insurance.

     B. The Company and Indemnitee further recognize the substantial increase in
corporate litigation in general, subjecting directors, officers, employees,
agents and fiduciaries to expensive litigation risks while the availability and
coverage of liability insurance has become severely limited.

     C. The Company desires to attract and retain the services of highly
qualified individuals, such as Indemnitee, to serve the Company and, in part, in
order to induce Indemnitee to continue to provide services to the Company,
wishes to provide for the indemnification and advancing of expenses to
Indemnitee to the maximum extent permitted by law.

     D. In view of the considerations set forth above, the Company desires that
Indemnitee be indemnified by the Company as set forth herein.

     NOW, THEREFORE, the Company and Indemnitee hereby agree as follows:

     1.   Indemnification.

          (a) General Right to Indemnification. The Company shall indemnify
Indemnitee to the fullest extent permitted by Applicable Law (as defined in
Section 9(g) hereof) if Indemnitee was or is or becomes a party to or witness or
other participant in, or is threatened to be made a party to or witness or other
participant in, any threatened, pending or completed action, suit, proceeding or
alternative dispute resolution mechanism, or any hearing, inquiry or
investigation that Indemnitee in good faith believes might lead to the
institution of any such action, suit, proceeding or alternative dispute
resolution mechanism, whether civil, criminal, administrative, investigative or
other (hereinafter a "Claim"), by reason of (or arising in whole or in part out
of) any event or occurrence related to the fact that Indemnitee is or was a
director, officer, employee, agent or fiduciary of the Company, or any
subsidiary of the Company, or is or was serving at the request of the Company as
a director, officer, employee, agent or fiduciary of another corporation,
partnership, joint venture, trust or other enterprise, or by reason of any
action or inaction on the part of Indemnitee while serving in such capacity
(hereinafter an "Indemnifiable Event"), and the Indemnitee shall be indemnified
and held harmless by the Company to the fullest extent permitted by law, against
any and all costs, charges, expenses, liabilities, losses, (including attorneys'
fees and expenses and all other costs, expenses and

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obligations (including any travel related expenses) incurred in connection with
investigating, defending, being a witness in or participating in (including on
appeal), or preparing to defend, be a witness in or participate in, any such
action, suit, proceeding, alternative dispute resolution mechanism, hearing,
inquiry or investigation), judgments, fines, penalties and amounts paid in
settlement (if such settlement is approved in advance by the Company, which
approval shall not be unreasonably withheld) of such Claim and any federal,
state, local or foreign taxes imposed on Indemnitee as a result of the actual or
deemed receipt of any payments under this Agreement (collectively, hereinafter
"Expenses"), including all interest, assessments and other charges paid or
payable in connection with or in respect of such Expenses. Such indemnification
shall continue as to the Indemnitee when the Indemnitee ceases to be a director,
officer, employee, agent or fiduciary of the Company or any subsidiary of the
Company (or to serve another entity at the request of the Company) and shall
inure to the benefit of the Indemnitee's heirs, personal representatives and
estate. Such payment of Expenses shall be made by the Company as soon as
practicable but in any event no later than twenty days after written demand by
Indemnitee therefor is presented to the Company.

          (b) Reviewing Party. Notwithstanding the foregoing, (i) the
obligations of the Company under Section 1(a) shall be subject to the condition
that the Reviewing Party (as defined in Section 9(e) hereof) shall not have
determined (in a written opinion, in any case in which the Independent Legal
Counsel referred to in Section 1(c) hereof is involved) that Indemnitee would
not be permitted to be indemnified under Applicable Law, and (ii) the obligation
of the Company to make an advance payment of Expenses to Indemnitee pursuant to
Section 2(a) (an "Expense Advance") shall be subject to the condition that, if,
when and to the extent that the Reviewing Party determines that Indemnitee would
not be permitted to be so indemnified under Applicable Law, the Company shall be
entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse the
Company) for all such amounts theretofore paid; provided, however, that if
Indemnitee has commenced or thereafter commences legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee should be
indemnified under Applicable Law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under Applicable Law
shall not be binding and Indemnitee shall not be required to reimburse the
Company for any Expense Advance until a final judicial determination is made
with respect thereto (as to which all rights of appeal therefrom have been
exhausted or lapsed). The Indemnitee's obligation to reimburse the Company for
any Expense Advance shall be unsecured and no interest shall be charged thereon.
If there has not been a Change in Control (as defined in Section 9(c) hereof),
the Reviewing Party shall be selected by the Company's Board of Directors (the
"Board of Directors"), and if there has been such a Change in Control (other
than a Change in Control in which a majority of the members of the board of
directors of the surviving company consists of members of the Board of Directors
immediately prior to such Change in Control), the Reviewing Party shall be the
Independent Legal Counsel as selected in accordance with Section 1(c) hereof. If
there has been no determination by the Reviewing Party or if the Reviewing Party
determines that Indemnitee substantively would not be permitted to be
indemnified in whole or in part under Applicable Law, Indemnitee shall have the
right to commence litigation seeking an initial determination by the court or
challenging any such determination by the Reviewing Party or any aspect thereof,
including the legal or factual bases therefor, and the Company hereby consents
to service of process and to appear in any such proceeding. Any determination by
the Reviewing Party otherwise shall be conclusive and binding on the Company and
Indemnitee.

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          (c) Change in Control. The Company agrees that if there is a Change in
Control of the Company (other than a Change in Control in which a majority of
the members of the board of directors of the surviving company consists of
members of the Board of Directors immediately prior to such Change in Control)
then, with respect to all matters thereafter arising concerning the right of
Indemnitee to payments of Expenses and Expense Advances under this Agreement or
any other agreement or under the Company's Memorandum and Articles of
Association as now or hereafter in effect, Independent Legal Counsel (as defined
in Section 9(d) hereof) shall be selected by the Indemnitee and approved by the
Company (which approval shall not be unreasonably withheld or delayed). Such
counsel, among other things, shall render its written opinion to the Company and
Indemnitee as to whether and to what extent Indemnitee would be permitted to be
indemnified under Applicable Law, and the Company agrees to abide by such
opinion. The Company agrees to pay the reasonable fees and expenses of the
Independent Legal Counsel referred to above and to fully indemnify such counsel
against any and all expenses (including attorneys' fees and expenses), claims,
liabilities and damages arising out of or relating to this Agreement or its
engagement pursuant hereto.

          (d) Mandatory Payment of Expenses. Notwithstanding any other provision
of this Agreement other than Section 8 hereof, to the extent that Indemnitee has
been successful on the merits or otherwise, including, without limitation, the
dismissal of an action without prejudice, in defense of any action, suit,
proceeding, inquiry, alternative dispute resolution mechanism or investigation
referred to in Section (1)(a) hereof or in the defense of any Claim, issue or
matter covered by this Agreement, or in defense of any Claim, issue or matter
therein, Indemnitee shall be indemnified against all Expenses incurred by
Indemnitee or on Indemnitee's behalf in connection therewith.

     2.   Expenses; Indemnification Procedure.

          (a) Advancement of Expenses. The Company shall advance all Expenses
incurred by Indemnitee. The advances to be made hereunder shall be paid by the
Company to Indemnitee as soon as practicable but in any event no later than
twenty days after written demand by Indemnitee therefor to the Company.

          (b) Notice/Cooperation by Indemnitee. Indemnitee shall, as a condition
precedent to Indemnitee's right to be indemnified under this Agreement, give the
Company notice in writing as soon as practicable of any Claim made against
Indemnitee for which indemnification will or could be sought under this
Agreement, provided, however, that failure to provide such notice in accordance
with this Section 2(b) shall not affect Indemnitee's rights to receive any
Expenses or Expense Advances hereunder unless and except to the extent that the
Company did not otherwise receive notice of such Claim and such failure of
Indemnitee to provide such notice results in the forfeiture by the Company of
substantial rights and defenses. Notice to the Company shall be directed to the
Chief Executive Officer of the Company at the address shown on the signature
page of this Agreement (or such other address as the Company shall designate in
writing to Indemnitee). In addition, Indemnitee shall give the Company such
information (in the possession of, or reasonably obtainable without material
expense by, Indemnitee) and cooperation as it may reasonably require and as
shall be within Indemnitee's reasonable power and control.

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          (c) No Presumptions; Burden of Proof. For purposes of this Agreement,
the termination of any Claim by judgment, order, settlement (whether with or
without court approval) or conviction, or upon a plea of nolo contendere, or its
equivalent, shall not create a presumption that Indemnitee did not meet any
particular standard of conduct or have any particular belief or that a court has
determined that indemnification is not permitted by Applicable Law. In addition,
neither the failure of the Reviewing Party to have made a determination as to
whether Indemnitee has met any particular standard of conduct or had any
particular belief, nor an actual determination by the Reviewing Party that
Indemnitee has not met such standard of conduct or did not have such belief,
prior to the commencement of legal proceedings by Indemnitee to secure a
judicial determination that Indemnitee should be indemnified under Applicable
Law, shall be a defense to Indemnitee's claim or create a presumption that
Indemnitee has not met any particular standard of conduct or did not have any
particular belief. In connection with any determination by the Reviewing Party
or otherwise as to whether Indemnitee is entitled to be indemnified hereunder,
the burden of proof shall be on the Company to establish that Indemnitee is not
so entitled.

          (d) Notice to Insurers. If, at the time of the receipt by the Company
of a notice of a Claim pursuant to Section 2(b) hereof, the Company has
liability insurance in effect which may cover such Claim, the Company shall give
prompt notice of the commencement of such Claim to the insurers in accordance
with the procedures set forth in the respective policies. The Company shall
thereafter take all necessary or desirable action to cause such insurers to pay,
on behalf of Indemnitee, all amounts payable as a result of such action, suit,
proceeding, inquiry or investigation in accordance with the terms of such
policies, provided, however, that nothing contained in this Section 2(d) shall
excuse the Company from its obligations to pay Expenses or Expense Advances to
Indemnitee as provided herein.

          (e) Selection of Counsel. In the event the Company shall be obligated
hereunder to pay the Expenses of any Claim, the Company shall be entitled to
assume the defense of such Claim with counsel approved by Indemnitee, which
approval shall not be unreasonably withheld, upon the delivery to Indemnitee of
written notice of its election so to do. After delivery of such notice, approval
of such counsel by Indemnitee and the retention of such counsel by the Company,
the Company will not be liable to Indemnitee under this Agreement for any fees
of counsel subsequently incurred by Indemnitee with respect to the same Claim;
provided that, (i) Indemnitee shall have the right to employ Indemnitee's
counsel in any such Claim at Indemnitee's expense and (ii) if (A) the employment
of counsel by Indemnitee has been previously authorized by the Company, (B)
Indemnitee shall have reasonably concluded that there may be a conflict of
interest between the Company and Indemnitee in the conduct of any such defense,
or (C) the Company shall not continue to retain such counsel to defend such
Claim, then the reasonable fees and expenses of Indemnitee's counsel shall be at
the expense of the Company. The Company shall have the right to conduct such
defense as it sees fit in its sole discretion, including the right to settle any
claim against Indemnitee without the consent of the Indemnitee, provided,
however, that the Company shall not settle any Claim requiring the admission of
guilt or responsibility by Indemnitee without Indemnitee's prior written
consent, such consent to not be unreasonably withheld.

     3. Additional Indemnification Rights; Nonexclusivity.

          (a) Scope. The Company hereby agrees to indemnify Indemnitee to the
fullest extent permitted by Applicable Law,

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notwithstanding that such indemnification is not specifically authorized by the
other provisions of this Agreement, the Company's Memorandum and Articles of
Association or by statute. In the event of any change after the date of this
Agreement in any Applicable Law, statute or rule which expands the right of a
Delaware corporation to indemnify a member of its board of directors or an
officer, employee, agent or fiduciary, it is the intent of the parties hereto
that Indemnitee shall enjoy by this Agreement the greater benefits afforded by
such change to the extent such change is not inconsistent with the law of the
Cayman Islands. In the event of any change in any Applicable Law, statute or
rule which narrows the right of a Delaware corporation to indemnify a member of
its board of directors or an officer, employee, agent or fiduciary, such change,
to the extent not otherwise required by such law, statute or rule to be applied
to this Agreement, shall have no effect on this Agreement or the parties' rights
and obligations hereunder except as set forth in Section 8(a) hereof.

          (b) Nonexclusivity. The indemnification and advances provided by this
Agreement shall be in addition to any rights to which Indemnitee may be entitled
under the Company's Memorandum and Articles of Association, any agreement, any
vote of stockholders or disinterested directors, or otherwise. The
indemnification provided under this Agreement shall continue as to Indemnitee
for any action Indemnitee took or did not take while serving in an indemnified
capacity even though Indemnitee may have ceased to serve in such capacity.

     4. No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any Claim made against
Indemnitee to the extent Indemnitee has otherwise actually received payment
(under any insurance policy, Memorandum and Articles of Association or
otherwise) of the amounts otherwise indemnifiable hereunder.

     5. Partial Indemnification. If Indemnitee is entitled under any provision
of this Agreement to indemnification by the Company for some or a portion of
Expenses incurred in connection with any Claim, but not, however, for all of the
total amount thereof, the Company shall nevertheless indemnify Indemnitee for
the portion of such Expenses to which Indemnitee is entitled.

     6. Mutual Acknowledgment. Both the Company and Indemnitee acknowledge that
in certain instances, Federal law or applicable public policy may prohibit the
Company from indemnifying its directors, officers, employees, agents or
fiduciaries under this Agreement or otherwise. Indemnitee understands and
acknowledges that as long as the Company is subject to the informational
requirements of the U.S. Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Company may be required to undertake with the Securities
and Exchange Commission to submit the question of indemnification to a court in
certain circumstances for a determination of the Company's right under public
policy to indemnify Indemnitee.

     7. Liability Insurance. The Company shall, from time to time, make a good
faith determination of whether or not it is practicable to obtain and maintain a
policy or policies of insurance with reputable insurance companies providing the
officers and directors of the Company with coverage for losses from wrongful
acts, or to ensure the Company's performance of its indemnification obligations
under this Agreement. In all policies of directors' and officers'

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liability insurance, Indemnitee shall be named as an insured in such a manner as
to provide Indemnitee the same rights and benefits as are accorded to the most
favorably insured of the Company's directors, if Indemnitee is a director; or of
the Company's officers, if Indemnitee is not a director of the Company but is an
officer; or of the Company's key employees, if Indemnitee is not an officer or
director but is a key employee. Notwithstanding the foregoing, the Company shall
have no obligation to obtain or maintain such insurance if the Company
reasonably determines that such insurance is not reasonably available, if the
premium costs for such insurance are disproportionate to the amount of coverage
provided, if the coverage provided by such insurance is limited by exclusions so
as to provide an insufficient benefit, or if Indemnitee is covered by similar
insurance maintained by a subsidiary or parent of the Company. Among other
considerations, the Company will weigh the costs of obtaining such insurance
coverage against the protection afforded by such coverage.

     8. Exceptions. Any other provision herein to the contrary notwithstanding,
the Company shall not be obligated pursuant to the terms of this Agreement:

          (a) Excluded Action or Omissions. To indemnify Indemnitee for Expenses
resulting from acts, omissions or transactions for which Indemnitee is
prohibited from receiving indemnification under this Agreement, the Company's
Memorandum and Articles of Association, the law of the Cayman Islands, or
Applicable Law; provided, however, that notwithstanding any limitation set forth
in this Section 8(a) regarding the Company's obligation to provide
indemnification and subject to Section 1(b), Indemnitee shall be entitled under
Section 2 to receive Expense Advances hereunder with respect to any such Claim
unless and until a court having jurisdiction over the Claim shall have made a
final judicial determination (as to which all rights of appeal therefrom have
been exhausted or lapsed) that Indemnitee has engaged in acts, omissions or
transactions for which Indemnitee is prohibited from receiving indemnification
under this Agreement or Applicable Law.

          (b) Claims Initiated by Indemnitee. To indemnify or advance Expenses
to Indemnitee with respect to Claims initiated or brought voluntarily by
Indemnitee and not by way of defense, counterclaim or crossclaim, except (i)
with respect to actions or proceedings brought to establish or enforce a right
to indemnification under this Agreement or any other agreement or insurance
policy or under the Company's Memorandum and Articles of Association now or
hereafter in effect relating to Claims for Indemnifiable Events, (ii) in
specific cases if the Board of Directors has approved the initiation or bringing
of such Claim, or (iii) as otherwise required under the law of the Cayman
Islands, regardless of whether Indemnitee ultimately is determined to be
entitled to such indemnification, advance expense payment or insurance recovery,
as the case may be;

          (c) Lack of Good Faith. To indemnify Indemnitee for any expenses
incurred by Indemnitee with respect to any proceeding instituted by Indemnitee
to enforce or interpret this Agreement, if a court of competent jurisdiction in
a final non-appealable decision determines that each and every of the material
assertions made by Indemnitee in such proceeding was not made in good faith or
was frivolous;

          (d) Willful or Gross Negligence. To indemnify or advance Expenses to
Indemnitee with respect to any Claim for an Indemnifiable Event if a court of
competent

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jurisdiction in a final non-appealable decision determines that Indemnitee acted
in a manner that was willfully or grossly negligent.

          (e) Claims Under Section 16(b). To indemnify Indemnitee for expenses
and the payment of profits arising from the purchase and sale by Indemnitee of
securities in violation of Section 16(b) of the Exchange Act, or any similar
successor statute if the Company is subject to the informational requirements of
the Exchange Act and the provisions of Section 16(b) of the Exchange Act;
provided, however, that notwithstanding any limitation set forth in this Section
8(d) regarding the Company's obligation to provide indemnification and subject
to Section 1(b), Indemnitee shall be entitled under Section 2 to receive Expense
Advances hereunder with respect to any such Claim unless and until a court
having jurisdiction over the Claim shall have made a final judicial
determination (as to which all rights of appeal therefrom have been exhausted or
lapsed) that Indemnitee has violated said statute.

     9. Construction of Certain Phrases.

          (a) For purposes of this Agreement, references to the "Company" shall
include, in addition to the resulting corporation, any constituent corporation
(including any constituent of a constituent) absorbed in a consolidation or
merger or other transaction which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
employees, agents or fiduciaries, so that if Indemnitee is or was a director,
officer, employee, agent or fiduciary of such constituent corporation, or is or
was serving at the request of such constituent corporation as a director,
officer, employee, agent or fiduciary of another corporation, partnership, joint
venture, employee benefit plan, trust or other enterprise, Indemnitee shall
stand in the same position under the provisions of this Agreement with respect
to the resulting or surviving corporation as Indemnitee would have with respect
to such constituent corporation if its separate existence had continued.

          (b) For purposes of this Agreement, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include any
excise taxes assessed on Indemnitee with respect to an employee benefit plan;
and references to "serving at the request of the Company" shall include any
service as a director, officer, employee, agent or fiduciary of the Company
which imposes duties on, or involves services by, such director, officer,
employee, agent or fiduciary with respect to an employee benefit plan, its
participants or its beneficiaries; and if Indemnitee acted in good faith and in
a manner Indemnitee reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan, Indemnitee shall be
deemed to have acted in a manner "not opposed to the best interests of the
Company" as referred to in this Agreement.

          (c) For purposes of this Agreement a "Change in Control" shall be
deemed to have occurred if, on or after the date of this Agreement, (i) any
"person" (as such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than a trustee or other fiduciary holding securities under an employee
benefit plan of the Company acting in such capacity or a corporation owned
directly or indirectly by the stockholders of the Company in substantially the
same proportions as their ownership of stock of the Company, becomes the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing more than 50% of the
total voting power represented by the Company's

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then outstanding Voting Securities, (ii) during any period of two consecutive
years, individuals who at the beginning of such period constitute the Board of
Directors of the Company and any new director whose election by the Board of
Directors or nomination for election by the Company's stockholders was approved
by a vote of at least two thirds (2/3) of the directors then still in office who
either were directors at the beginning of the period or whose election or
nomination for election was previously so approved, cease for any reason to
constitute a majority thereof, or (iii) the stockholders of the Company approve
a merger, consolidation or other transaction of the Company with any other
corporation other than a merger, consolidation or other transaction which would
result in the Voting Securities of the Company outstanding immediately prior
thereto continuing to represent (either by remaining outstanding or by being
converted into Voting Securities of the surviving entity) at least 50% of the
total voting power represented by the Voting Securities of the Company or such
surviving entity outstanding immediately after such merger, consolidation or
other transaction, or the stockholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of (in one transaction or a series of related transactions) all or
substantially all of the Company's assets.

          (d) For purposes of this Agreement, "Independent Legal Counsel" shall
mean an attorney or firm of attorneys, selected in accordance with the
provisions of Section 1(c) hereof, who shall not have otherwise performed
services for the Company or Indemnitee within the last three years (other than
with respect to matters concerning the rights of Indemnitee under this
Agreement, or of other indemnitees under similar indemnity agreements).

          (e) For purposes of this Agreement, a "Reviewing Party" shall mean any
appropriate person or body consisting of a member or members of the Company's
Board of Directors or any other person or body appointed by the Board of
Directors who is not a party to the particular Claim for which Indemnitee is
seeking indemnification, or Independent Legal Counsel.

          (f) For purposes of this Agreement, "Voting Securities" shall mean any
securities of the Company that vote generally in the election of directors.

          (g) For the purposes of this Agreement, "Applicable Law" shall mean
the General Corporation Law of the State of Delaware or any Federal statute,
law, rule or regulation imposed on the parties by a Delaware court of law, in
each case to the extent not inconsistent with the law of the Cayman Islands.

     10. Period of Limitations. No legal action shall be brought and no cause of
action shall be asserted by or in the right of the Company against Indemnitee,
Indemnitee's estate, spouse, heirs, executors or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, and any claim or cause of action of the Company shall be
extinguished and deemed released unless asserted by the timely filing of a legal
action within such two-year period; provided, however, that if any shorter
period of limitations is otherwise applicable to any such cause of action, such
shorter period shall govern.

     11. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original.

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     12. Binding Effect; Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the parties hereto and
their respective successors, assigns, including any direct or indirect successor
by purchase, merger, consolidation or otherwise to all or substantially all of
the business and/or assets of the Company, spouses, heirs, and personal and
legal representatives. The Company shall require and cause any successor
(whether direct or indirect by purchase, merger, consolidation or otherwise) to
all, substantially all, or a substantial part, of the business and/or assets of
the Company, by written agreement in form and substance satisfactory to
Indemnitee, expressly to assume and agree to perform this Agreement in the same
manner and to the same extent that the Company would be required to perform if
no such succession had taken place. This Agreement shall continue in effect with
respect to Claims relating to Indemnifiable Events regardless of whether
Indemnitee continues to serve as a director, officer, employee, agent or
fiduciary of the Company or of any other enterprise at the Company's request.

     13. Attorneys' Fees. In the event that any action is instituted by
Indemnitee under this Agreement or under any liability insurance policies
maintained by the Company to enforce or interpret any of the terms hereof or
thereof, Indemnitee shall be entitled to be paid all Expenses incurred by
Indemnitee with respect to such action, regardless of whether Indemnitee is
ultimately successful in such action, and shall be entitled to the advancement
of Expenses with respect to such action, unless, as a part of such action, a
court of competent jurisdiction over such action in a final non-appealable
decision determines that each and every of the material assertions made by
Indemnitee as a basis for such action was not made in good faith or was
frivolous. In the event of an action instituted by or in the name of the Company
under this Agreement to enforce or interpret any of the terms of this Agreement,
Indemnitee shall be entitled to be paid all Expenses incurred by Indemnitee in
defense of such action (including costs and expenses incurred with respect to
Indemnitee's counterclaims and cross-claims made in such action), and shall be
entitled to the advancement of Expenses with respect to such action, unless, as
a part of such action, a court having jurisdiction over such action in a final
non-appealable decision determines that each and every of Indemnitee's material
defenses to such action was made in bad faith or was frivolous.

     14. Notice. All notices and other communications required or permitted
hereunder shall be in writing, shall be effective when given, and shall in any
event be deemed to be given (a) five (5) days after deposit with the U.S. Postal
Service or other applicable postal service, if delivered by first class mail,
postage prepaid, (b) upon delivery, if delivered by hand, (c) one business day
after the business day of deposit with Federal Express or similar overnight
courier, freight prepaid, or (d) one day after the business day of delivery by
facsimile transmission, if delivered by facsimile transmission, with copy by
first class mail, postage prepaid, and shall be addressed if to Indemnitee, at
the Indemnitee's address as set forth beneath Indemnitee's signature to this
Agreement and if to the Company at the address of its principal corporate
offices (attention: Chief Executive Officer) or at such other address as such
party may designate by ten days' advance written notice to the other party
hereto.

     15. Consent to Jurisdiction; Agent for Service of Process. Each of the
parties hereto irrevocably (a) agrees that any legal suit, action or proceeding
arising out of or based upon this Agreement or the transactions contemplated
hereby may be instituted in any state or federal court in the State of New York
("New York Court"), (b) waives, to the fullest extent it may effectively

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do so, any objection which it may now or hereafter have to the laying of venue
of any such proceeding, and (c) submits to the exclusive jurisdiction of such
courts in any such suit, action or proceeding. Each of the parties hereto
irrevocably waives any immunity to jurisdiction to which it may otherwise be
entitled or become entitled (including sovereign immunity, immunity to
pre-judgment attachment, post-judgment attachment and execution) in any legal
suit, action or proceeding against it arising out of or based on this Agreement
or the transactions contemplated hereby which is instituted in any New York
Court or in any competent court in Hong Kong or the People's Republic of China.
The Company has appointed CT Corporation at 111 Eighth Avenue, New York, New
York 10011, as its authorized agent (the "Authorized Agent") upon whom process
may be served in any such action arising out of or based on this Agreement or
the transactions contemplated hereby which may be instituted in any New York
Court by Indemnitee, expressly consents to the jurisdiction of any such court in
respect of any such action, and waives any other requirements of or objections
to personal jurisdiction with respect thereto. Such appointment shall be
irrevocable unless and until the Board of Directors appoints another entity to
act as the Authorized Agent of the Company. The Company represents and warrants
that the Authorized Agent has agreed to act as such agent for service of process
and agrees to take any and all action, including the filing of any and all
documents and instruments, that may be necessary to continue such appointment in
full force and effect as aforesaid. Service of process upon the Authorized Agent
and written notice of such service to the Company, shall be deemed, in every
respect, effective service of process upon the Company.

     16. Severability. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including, without limitations, each portion of this Agreement containing any
provision held to be invalid, void or otherwise unenforceable, that is not
itself invalid, void or unenforceable) shall be construed so as to give effect
to the intent manifested by the provision held invalid, illegal or
unenforceable.

     17. Choice of Law. This Agreement shall be governed by and its provisions
construed and enforced in accordance with the laws of the State of New York, as
applied to contracts between New York residents, entered into and to be
performed entirely within the State of New York, without regard to the conflict
of laws principles thereof.

     18. Subrogation. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee who shall execute all documents required and shall do all
acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.

     19. Amendment and Termination. Other than as provided herein, no amendment,
modification, termination or cancellation of this Agreement shall be effective
unless it is in writing signed by both the parties hereto. No waiver of any of
the provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provisions hereof (whether or not similar) nor shall such waiver
constitute a continuing waiver.

                                       10

<PAGE>

     20. Integration and Entire Agreement. This Agreement sets forth the entire
understanding between the parties hereto and supersedes and merges all previous
written and oral negotiations, commitments, understandings and agreements
relating to the subject matter hereof between the parties hereto.

     21. No Construction as Employment Agreement. Nothing contained in this
Agreement shall be construed as giving Indemnitee any right to be retained in
the employ of the Company or any of its subsidiaries.

                                       11

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.

                                           SEMICONDUCTOR MANUFACTURING
                                           INTERNATIONAL CORPORATION,
                                           a Cayman Islands company

                                           -------------------------------------
                                           Richard R. Chang
                                           President and Chief Executive Officer
                                           Address: 18 ZhangJiang Road
                                                    PuDong New Area
                                                    Shanghai, China 201203

AGREED TO AND ACCEPTED BY:

-------------------------------
(Signature of Indemnitee)

Name:

Address:
         -------------------------

         -------------------------

         -------------------------

                                       12<PAGE>

                                                                    Exhibit 10.7
[Company Logo]

[Company name in Chinese]

           18 ZhangJiang Rd., Pudong New Area, 201203 Shanghai, China

                  Tel: 86-21-5080-2000   Fax: 86-21-5080-2918

--------------------------------------------------------------------------------

                            CONDITIONS OF EMPLOYMENT

1.   APPOINTMENT
     -----------

     An appointment to the service of the Company is valid when the applicant
     has:-

     1.1  received a letter or contract of employment and confirmed his
          acceptance in writing:

     1.2  confirmed his acceptance of the Company's conditions of employment
          and disciplinary rules; and

     1.3  successfully passed a medical examination by a doctor appointed by the
          Company and an x-ray examination conducted by a Company nominee.
          Expenses of this examination will be borned by the Company.

     1.4  an approval for a work pass from the Shanghai Government. This is
          applicable if the applicant registered residency is not in Shanghai.

2.   PROBATION
     ---------

     An employee shall be required to serve a probationary period of six (6)
     months. No extension will be considered. During probation, employment may
     be terminated by either party giving two (2) weeks notice or pay in lieu
     (basic salary) without reason being assigned (except in dismissals by the
     Company for disciplinary reasons). All notice must be in writing whether
     given by the employer or employee.

     If an employee is found satisfactory for continued employment, he shall
     receive a letter confirming his appointment at the end of the probationary
     period.

3.   TERMINATION OF SERVICE
     ----------------------

     Except for dismissal by the Company due to disciplinary reasons, employment
     may be terminated at any time by either the employer or employee by giving
     one month notice period or pay In lieu (basic salary).

     However, in the event if the employee is joining a competitor's company,
     the Company do reserve the right to request the employee to leave the
     Company premises within 24 hours and to pay the Company for his notice
     period.

                                                                               1

<PAGE>

     All notice must be in writing whether given by the employer or employee.
     Application for annual leave during the notice period will be subjected to
     the approval of the employee's immediate supervisor. The Company reserves
     the right to insist that all outstanding leaves of an employee be consumed
     within his notice period.

     For employee on a fixed-term contract of employment, his notice period can
     be included as part of his contract period. However, if the notice period
     were to fall outside of the contract period (be it full or partial), no
     extension will be allowed of the existing employment contract. The employee
     must also pay in lieu of notice period that falls outside of the contract
     period.

4.   ANNUAL REVIEW
     -------------

     The annual salary adjustment will depend on performance during the review
     period. The annual performance and salary review cycle will be in the month
     of January of every calendar year per Company policy.

5.   PUBLIC HOLIDAYS
     ---------------

     Employee shall enjoy the gazette public holidays as designated by the
     government of the People's Republic of China

6.   ANNUAL LEAVE
     ------------

     The Company shall grant every employee paid annual leave as per Company
     Policy.

7.   PAID SICK LEAVE
     ---------------

     The Company shall grant every employee paid sick leave as per Company
     Policy.

8.   COMPASSIONATE LEAVE
     -------------------

     The Company shall grant every employee paid compassionate leave per Company
     Policy.

9.   MEDICAL AND INSURANCE BENEFITS
     ------------------------------

     All employees shall be covered per Company policy.

10.  PAYMENT OF SALARIES
     -------------------

     Employees' salary shall be paid through their bank accounts on the 30th
     of each month. If such

                                                                               2

<PAGE>

     days fall on weekend or holidays, the salary will be credited on the
     previous business day.

11.  SHIFT PREMIUM
     -------------

     Shift allowance will be paid to employees who are on shift work in
     accordance with the Company's policy. Employee may be scheduled for normal
     office hours during the initial period of employment with the Company.

12.  TRAINING
     --------

     During the employment, the employee may be expected to undergo a period of
     training locally as well as in overseas locations. For all training, an
     employee must be willing to sign a bond. The details of the bond will be
     laid out in a separate contract. There will be no shift allowance or
     overtime claims for all training.

13.  BONUS
     -----

     13.1 Bonus schemes applicable to you will be per the Company's policies.

     13.2 The Company reserves the right to pay out bonuses depending on the
          Company's performance, the market situation, and the achievement of
          individual's performance targets.

14.  LIQUIDATED DAMAGES
     ------------------

     14.1 Within 6 months from the date of commencement of employment, should an
          employee terminate his service or is dismissed or terminated by the
          Company, he will be liable for payment of liquidated damages to the
          Company. The liquidated damages include the actual cost of
          airfares, shipment allowance and any other allowances provided to him
          by the Company upon his commencement of work.

     14.2 The employee will also be fully responsible for his own repatriation.

15.  TRANSFER
     --------

     An employee should carry out duties as may be assigned by the Company from
     time to time and may be transferred from one section, department, division,
     center, location or associated Company to another at the discretion of the
     Company.

16.  PART-TIME EMPLOYMENT
     --------------------

                                                                               3

<PAGE>

     An employee shall not participate, contribute to, take upon or engage in
     any part-time employment or any form of work or such activities deriving
     remuneration, reward or deriving any favor, gain or benefit without prior
     permission from the Management in writing. The Management shall not be
     bound to grant such permission.

17.  COMPANY INTEREST
     ----------------

     All employee shall act in the interest of the Company at all times and
     shall observe, adhere to and comply with the Company's established
     policies, rules, regulations and custom and shall safeguard the Company's
     property and confidential information.

     All employees are expected to observe a high level of business ethics.

18.  GIFTS AND GRATUITIES
     --------------------

     18.1 No employee or member of an employee's family shall accept any
          commission, fee or other benefits from any person or company that has
          a business relationship with the Company.

     18.2 No employee or member of an employee's family shall accept from any
          person or Company any gift or other benefits, which because of its
          nature or intention or for whatever reasons, might place the employee
          in a compromising position toward the giver of such gift, gain or put
          the employee in a conflicting position with the Company.

19.  INTERPRETATION
     --------------

     In this set of employment unless the context otherwise required, words
     importing the masculine gender include females and words in the singular
     include the plural.

20.  COMPLIANCE
     ----------

     All employees are required to comply with the Company's Policies and
     Procedures and abide by the Laws and Regulations of China and are not
     allowed to participate in any activities that interfere with the internal
     affairs of China.

                                                                               4

<PAGE>

21.  AMENDMENTS
     ----------

     The Company reserves the rights to change, modify, vary, alter or cease any
     benefit as well as the terms and conditions of employment as It deems fit.

22.  CONFLICTS AND DISPUTES
     ----------------------

     In the event of any disputes, controversies or conflicts, this Contract of
     Employment will prevail.

     All other terms and conditions of service not mentioned above will be
     administered in accordance with prevailing Company policies and practices.

--------------------------------------------------------------------------------

                               ACCEPTANCE OF OFFER

I, ______________________ of ID/ Passport # _________________________ have read
and hereby agree to the terms and conditions of service and accept your offer of
employment.

In the event that I should turn down this position offered to me before I
commence work. I agree to compensate Semiconductor Manufacturing International
 Corporation (SMIC) an equivalent sum of 1 month's basic salary as stated in my
offer of employment.

--------------------------------------    --------------------------------------
          Signature                                    Date Accepted

Note:  You are advised to uphold the confidentiality of your salary and not to
       discuss salary matters with anyone. Management takes a serious view of
       this matter and disciplinary action (which include dismissal) will be
       taken against staffs that breach this condition of service.

                                                                               5

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