Laws of the People's Republic of China

The Ministry of Finance

Measures for the Administration of Financial Interest-subsidy Fund concerning Infrastructure Project Loan of State-level Economic and Technological Development Zone in Middle and Western Regions

Cai Jian[2005] No.223

June 2, 2005

Chapter I General Principles

Article 1

For the purpose of strengthening the administration of interest-subsidy fund of central finance concerning infrastructure project loan of state-level economic and technological development in middle and western regions, improving the efficiency of financial funds utilization, further bringing into play its policy support and guidance, in accordance with the provisions of the Interim Measures for the Administration of Interest-subsidy Fund of Central Finance, Measures for the Administration of the Financial Interest-subsidy Fund concerning Infrastructure Project Loan of State-level Economic and Technological Development Zone in Middle and Western Regions( hereinafter referred to as the Measures) is hereby formulated.

Article 2

The "state-level economic and technological development zone in middle and western regions" as stated in the Measures refers to the state-level economic and technological development zone established with the approval of the State Council, including:

Inner Mongolia, Guangxi, Chongqing, Sichuan, Yunnan, Guizhou, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang, Hebei, Shanxi, Jilin, Heilongjiang, Anhui, Jiangxi, Henan, Hubei, Hunan, Hainan, Liaoning, Dalian (province, autonomous region, municipality directly under the central government, city directly under State planning). The "infrastructure project loan" as stated in the Measures refers to the infrastructure project loan offered by various kinds of banks and used for the construction of infrastructure in the abovementioned development zones.

Article 3

The "infrastructure project" as stated in the Measures refers to:

(1)

the items such as roadway, bridge, tunnels and etc. in the development zone;

(2)

the facilities for the treatment of sewage, house refuse in the development zone;

(3)

the infrastructure such as power supply, heat supply, natural gas supply, water supply and communication network and etc;

(4)

other projects in the development zone.

The above projects shall be taken as the proof for prior arrangement of interest-subsidy fund.

Article 4

The "interest-subsidy fund" as stated in the Measures refers to the interest-subsidy fund arranged by central finance budget as specially used for the construction of infrastructure project (hereinafter referred to as items) in state-level economic and technological development zone in middle and western regions.

Chapter II Means and Scopes of Interest-subsidy

Article 5

Interest-subsidy fund shall observe the principle of prepayment-and-subsidy, i.e. the project units shall apply for subsidy to financial authorities by holding the interest payment bill issued by the relevant lending bank.

Article 6

Scope of subsidy: the loans of infrastructure projects under construction which have been settled in state-level economic and technological development zone and had its loan interest calculated may be declared for interest-subsidy in accordance with the relevant provisions.

Article 7

Calculation of interest-subsidy capital: interest-subsidy capital shall be calculated and determined by interest-subsidy projects in accordance with the balance of loans, subsidy rate of that year and amount of paid interest of that year.

Article 8

Term of interest-subsidy: interest subsidy shall be undertaken in accordance with the term of the projects under construction. The term of interest subsidy enjoyed by all projects shall not exceed five years. In accordance with the characteristics of infrastructure project in the development zone, for the term of project construction no more than three years, the interest subsidy shall be conducted in accordance with the term of project construction; for the term of project construction no less than three years, it shall be undertaken in accordance with the requirement for that no more than five years.

Article 9

Standard and time of interest subsidy: the interest subsidy rate of financial subsidy shall be decided annually within the range of 3% by the Ministry of Finance in accordance with the budget control indicator of annual interest subsidy, current period of loan interest rate of the projects and the requirement of projects upon interest-subsidy fund. Time of interest subsidy shall be ranged from September 21 of the previous year to September 20 of the current year.

Chapter III Declaration, Examination and Transmission

Article 10

The infrastructure project in accordance wit the provisions of the Measures shall be declared by that project unit for interest subsidy.

Article 11

The declaration for interest subsidy by project unit shall be conducted by filling the declaration form concerning loan interest subsidy for infrastructure construction which is made in duplicate and attached by project document of ratification, loan contract, and certificate for fully-funded loan and bank attestation interest bill and etc. in accordance with the relevant requirement (see attached form 1) and submitted to the financial sectors of development zone upon receiving the comment of the lending bank thereof.

The financial sectors in the development zone shall, in accordance with the provisions in the Measures, examine earnestly the documents about interest subsidy submitted by the project units herein and fill the summary statement of financial interest subsidiary about infrastructure loan (see the attached form 2) and attached the relevant documents submitted by project units and submit them to the financial departments (or bureaus) of province (autonomous region, municipalities directly under the central government and city directly under state planning) who shall, after having examined the submitted project ratification documents, fill the summary statement of financial interest subsidiary about infrastructure loan( see the attached form 2) and attached the project document of ratification, loan contract, and certificate for fully-funded loan and bank attestation interest bill and opinions of the loan bank, after having received signature about comment of examination by the local financial supervisory attach¨¦ office of the Ministry of Finance, and submit them to the Administration of Finance for examination and approval. Without the documents of examination offered by the local financial supervisory attach¨¦ office of the Ministry of Finance, it will be dismissed by the Ministry of Finance. The declaration documents shall be listed in accordance with the category of projects rather than bundled together, otherwise, interest subsidiary will not be offered.

Article 12

The local financial supervisory attach¨¦ office in the relevant province (autonomous region, municipalities directly under the central government and city directly under state planning) of the Ministry of Finance shall be invited to strengthen the examination upon the authenticity of the documents concerning financial interest subsidiary of infrastructure submitted by local project unit in accordance with the scope and time limit of interest subsidiary prescribed in the Measures, and submit the written comment of the examination as well as documents concerning declaration of interest subsidiary to the Ministry of Finance within the prescribed time limit for reference in times of examination of interest subsidiary.

Article 13

The Ministry of Finance shall, after having examined the submit the documents about interest subsidiary and in accordance with the scale of the annual budget arrangement of capital interest subsidiary, verify the amount of subsidized interest project by project and transmit the budget in accordance with the relevant provisions. The Ministry of Finance shall not offer interest subsidiary for the projects not in line with the requirements or having exceeded the time limit for submission.

Article 14

The financial interest subsidiary shall be allocated to project unit via financial sectors.

Chapter IV Financial Treatment for Interest Subsidiary and Supervision Administration

Article 15

The project unit, after having received interest subsidiary, shall undertake the following:

The project under construction shall be netted off against cost of project; the completed project shall be netted off against financial cost.

Article 16

The financial departments (or bureaus) of province (autonomous region, municipalities directly under the central government and city directly under state planning) as well as financial sectors in the development zones shall undertake regular examinations upon the construction of infrastructure and the fulfillment of fund and coordinated with the related units to urge the projects to be constructed in accordance with the requirement of sound project and the completed projects to undertake completion settlement.

Article 17

Project units shall, strictly abiding by the proceedings such as the range of interest subsidiary, time limit of interest subsidiary, interest subsidiary ratio and etc., fill and submit the declaration form concerning interest subsidiary. As for the falsified projects, the Ministry of Finance has the power to cease or withdraw the interest subsidiary hereof and will investigate the responsibilities of the related units and personnel pursuant to law.

Article 18

The provincial financial authorities shall undertake regular supervision and examination upon the fulfillment of financial interest subsidiary to ensure the effectiveness hereof and inform the Ministry of Finance of the performance of interest subsidiary project and its fulfillment at the end of each year.

Article 19

Financial interest subsidiary refers to the special fund and shall guarantee the special utilization hereof. Any unit shall not withhold and embezzle financial interest subsidiary by any reason or any means. For those who violates the provision, responsibilities on relevant persons shall be investigates besides taking interest subsidiary over national finance.

Chapter V Supplementary Articles

Article 20

The Measures shall be interpreted by the Ministry of Finance.

Article 21

The Measures shall come into effect as of the date of its promulgation. Without the need of alteration, the measures for handling interest subsidiary annually will not be transmitted otherwise. Meanwhile, Notice of the Ministry of Finance on Printing and Issuing the Interim Measures for the Administration of the Financial Interest-subsidy Fund concerning Infrastructure Project Loan of State-level Economic and Technological Development Zone in Middle and Western Regions (Cai Jian [2001] No. 518) shall be abolished simultaneously.