Laws of the People's Republic of China

Reply of the Ministry of Finance and the State Administration of Taxation on the tax Exemption concerning the Franchise Royalties Collected by the International Olympic Committee

Cai Shui [2006] No.133 September 21, 2006

Beijing Municipal Bureau of Finance, state tax bureaus and local tax bureaus:

We have received your Request for the Tax Exemption on the Franchise Royalties Collected by the International Olympic Committee (Jing Cai Shui [2006] No.467), the reply is hereby given as follows:

A certain proportion of franchise royalties is collected by the International Olympic Committee on the franchise commodities exported by the domestic franchise enterprises of the host country of Olympic Games base on the export wholesale price. The franchise royalties fall into the incomes obtained by the International Olympic Committee within the territory of China and related to the 29th Olympic Games. In accordance with the provision of Paragraph 1, Article 2 of the Circular of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs on Several Issues Concerning the Tax Policies for the 29th Olympic Games (Cai Shui [2003] No.10), we hereby consent to exempt the relevant taxes from the aforesaid income gained by the International Olympic Games.