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STATE COUNCIL'S OFFICIAL REPLY CONCERNING THE RENAMING OF THE MARITIME ARBITRATION COMMISSION AS THE CHINA MARITIME ARBITRATION COMMISSION AND THE AMENDMENT OF ITS ARBITRATION RULES

    China Council for the Promotion of International Trade:

    The State Council approves the renaming of the Maritime Arbitration
Commission of your Council as the China Maritime Arbitration Commission. The
existing relationship of its subordination remains unchanged.

    The Arbitration Rules of the China Maritime Arbitration Commission shall
be amended by your Council in accordance with China's laws and the
international treaties concluded or acceded to by China and with reference to
international practice, and then promulgated for implementation after adoption
by your Council. Hereafter, any amendments to the Arbitration Rules shall be
made by your Council's own decision.

CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES (Adopted on
September 12, 1988 at the Third Session of the First National Congress of the
China Council for the Promotion of International Trade (China Chamber of
International Commerce))
Chapter I  General Provisions

    Section 1  Jurisdiction

    Article 1  The China Maritime Arbitration Commission (hereinafter referred
to as the Arbitration Commission) independently and impartially settles
maritime disputes by means of arbitration so as to protect the justified
rights and interests of the parties and promote shipping industry and foreign
economic and trade development.

    Article 2  Upon receiving written application of one of the disputing
parties and in accordance with written agreement concluded between the
parties, prior or subsequent to the occurrence of dispute, to refer their
dispute to the Arbitration Commission for arbitration, the Arbitration
Commission takes cognizance of:

    (1) disputes regarding remuneration for salvage services rendered by
sea-going vessels to each other or by a sea-going vessel to a river craft and
vice versa;

    (2) disputes arising from collisions between sea-going vessels or between
sea-going vessels and river craft or from damages caused by sea-going vessels
to harbour structures or installations;

    (3) disputes arising from chartering, agency, towage, raising, sale,
repairing and building of or in respect of sea-going vessel, carriage by sea
in virtue of contracts of affreightment, bills of lading or other shipping
documents, and marine insurance;

    (4) disputes regarding pollution damages to marine environmcnt;

    (5) other maritime disputes submitted for arbitration by agreement between
the parties.

    An arbitration agreement means the arbitration clause stipulated by the
parties in their contract, or agreements in writing concluded in other forms
to submit disputes for arbitration.

    The Arbitration Commission has power to decide on the validity of
arbitration agreement and the jurisdiction over arbitration cases.

    Section 2  Organization

    Article 3  The Arbitration Commission is composed of Chairman,
Vice-Chairmen and Commission members.

    The Chairman performs functions and duties given by these Rules and any
Vice-Chairman, if authorized by the Chairman, may perform the functions and
duties of the Chairman.

    Under the Arbitration Commission, a Secretariat is established to handle
the day-to-day work of the Arbitration Commission.

    Article 4  The Arbitration Commission maintains a panel of arbitrators.
The arbitrators are selected and appointed by the China Council for the
Promotion of International Trade (China Chamber of International Commerce)
from among Chinese and foreign persons with relevant expertise and practical
experience.

    Article 5  The Arbitration Commission is located in Beijing. The
Arbitration Commission may, according to the requirement of development of
arbitration business, establish sub-commissions in other places within the
territory of China.
Chapter II  Arbitration Proceedings

    Section 1  Application for Arbitration, Defence and Counterclaims

    Article 6  The Claimant must submit his Application for Arbitation to the
Arbitration Commission in accordance with the following requirements:

    (1) an Application for Arbitration in writing must be submitted to the
Arbitration Commission. The following must be specified in the Application for
Arbitration:

    (a) the name and address of the Claimant and those of the Respondent;

    (b) the arbitration agreement relied upon by the Claimant;

    (c) the Claimant's claim and the facts and evidence on which his claim is
based.

    The Application for Arbitration shall be signed by the Claimant and/or the
attorney authorized by the Claimant.

    (2) when submitting an Application for Arbitration to the Arbitration
Commission, relevant documentary evidence on which the Claimant's claim is
based shall accompany the Application for Arbitration.

    (3) the Claimant shall appoint an arbitrator from among the Panel of
Arbitrators of the Arbitration Commission or authorize the Chairman of the
Arbitration Commission to make an appointment on his behalf.

    (4) the Claimant shall pay an arbitration fee in advance to the
Arbitration Commission according to the Arbitration Fee Schedule attached to
these Rules.

    Article 7  After receipt of the Application for Arbitration and its
attachments and when the Arbitration Commission, after examination, deems that
the Claimant has completed the formalities required for arbitration, the
Arbitration Commission shall immediately mail to the Respondent one copy each
of the Claimant's Application for Arbitration and its attachments as well as
the Arbitration Rules and the Panel of Arbitrators of the Arbitration
Commission.

    Article 8  The Respondent shall, within 20 days after receipt of the
Application for Arbitration, appoint an arbitrator from among the Panel of
Arbitrators of the Arbitration Commission, or authorize the Chairman of the
Arbitration Commission to make an appointment on his behalf and shall, within
45 days after receipt of the Application for Arbitration, submit his defence
and relevant documentary evidence to the Arbitration Commission.

    Article 9  The Respondent shall file with the Arbitration Commission his
counter-claim, if any, in connection with the case taken cognizance of by the
Arbitration Commission, within the time limit as specified in Article 8 for
the submission of his defence. The Respondent must state, in his
counter-claim, his claim and the facts and evidence on which his claim is
based and attach relevant documentary evidence to his counter-claim.

    When filing a counter-claim, the Respondent must pay an arbitration fee in
advance according to the Arbitration Fee Schedule attached to these
Arbitration Rules.

    Article 10  The Arbitration Commission has discretion to ask the
Respondent to pay in advance a part of arbitration fees when it deems it
necessary.

    Article 11  When submitting an Application for Arbitration, defence,
counter-claim, relevant documentary evidence and other documents to the
Arbitration Commission, the parties shall provide duplicate copies as many as
the number of the other party/parties and the arbitrators, of whom the
arbitration tribunal is composed.

    Article 12  The parties may authorize attorneys to confer with the
Arbitration Commission on matters relating to arbitration. Such attorneys may
be citizens of China or foreign citizens. The authorized attorney must produce
a Power of Attorney to the Arbitration Commission.

    Article 13  The Arbitration Commission may, pursuant to the request of the
parties and in accordance with the Chinese law, apply to the Chinese court in
the place where the property of the Respondent(s) is or in the place where the
arbitration institution is located for a decision in respect of taking
preservative measures.

    Section 2  Composition of Arbitration Tribunal

    Article 14  After each of the two parties has chosen one arbitrator from
among the Panel of Arbitrators of the Arbitration Commission or the Chairman
of the Arbitration Commission has made such an appointment under the
authorization by the party/parties, the Chairman of the Arbitration Commission
shall appoint a third arbitrator from among the Panel of Arbitrators of the
Arbitration Commission as the presiding arbitrator to form an arbitration
tribunal to hear the case.

    Article 15  Both parties may jointly appoint or authorize the Chairman of
the Arbitration Commission to appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission as a sole arbitrator to form an
arbitration tribunal to hear the case alone.

    If both parties have agreed on the appointment of a sole arbitrator to
hear their case alone but failed to agree on the choice of such a sole
arbitrator within 20 days as from the date on which the Respondent receives
the Application for Arbitration or as from the date on which both parties
reach an agreement to have their case heard by a sole arbitrator, the Chairman
of the Arbitration Commission shall appoint the sole arbitrator.

    Article 16  If the Respondent fails to appoint and fails to authorize the
Chairman of the Arbitration Commission to appoint an arbitrator according to
Article 8 of these Rules, the Chairman of the Arbitration Commission has the
power to appoint an arbitrator for the Respondent.

    Article 17  When there are two or more Claimants and/or Respondents in an
arbitration case, the Claimants' side and/or the Respondents' side shall each,
through consultation, appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission. If the Claimants' side fails to
make such appointment at the time when the Claimants submit their Application
for Arbitration and/or Respondenls' side is unable to appoint one arbitrator
within 20 days as from the date on which the last Respondent receives the
Application for Arbitration, the appointment shall be made by the Chairman of
the Arbitration Commission.

    Article 18  Any appointed arbitrator having personal interest in the case
shall himself request the Arbitration Commission for withdrawal from his
office and the parties have the right to make a request in writing to the
Arbitration Commission for a withdrawal of the arbitrator from his office.

    Article 19  A party who intends to challenge an arbitrator must put
forward his challenge before the first oral hearing of the case. If the
grounds for challenge come out or become aware of after the first oral
hearing, the challenge may be raised before the conclusion of the last hearing.

    Article 20  The Chairman of the Arbitration Commission shall decide on the
challenge.

    Article 21  If an arbitrator cannot perform his duty due to withdrawal or
other reasons, a substituted arbitrator shall be appointed in accordance with
the procedure pursuant to which the original arbitrator was appointed.

    Section 3  Hearing

    Article 22  The arbitration tribunal shall hold oral hearings to hear the
case. However, at the request of the parties or with their consent, oral
hearings may be omitted and the arbitration tribunal may examine the case and
make an award on the basis of documents only.

    Article 23  The date of oral hearing shall be decided by the arbitration
tribunal in consultation with the Secretariat of the Arbitration Commission
and the notice of hearing shall be communicated to the parties 30 days before
the date of hearing. A party having justified reasons may request for
postponement of the date of hearing. But his request must be communicated to
the Secretariat of the Arbitration Commission 12 days before the date of
hearing unless unforeseeable special circumstances occur. The Seretariat shall
inform the arbitration tribunal of his request and the arbitration tribunal
shall decide thereon, in consultation with the Secretariat.

    Article 24  The cases taken cognizance of by the Arbitration Commission
shall be heard in the place where the Arbitration Commission is located and
may, with the approval of the Chairman of the Commission, be heard in other
places.

    Article 25  The arbitration tribunal shall not hear cases in open
sessions. If both parties request hearings in open sessions, the arbitration
tribunal shall decide thereon.

    Article 26  The parties shall give evidence for the facts on which their
claim or defence is based. The arbitration tribunal may, if it deems it
necessary, make investigation and collect evidence on its own initiative.

    Article 27  The evidence shall be examined and approved by the arbitration
tribunal.

    Article 28  The arbitration tribunal may consult experts or appoint
appraisers for the clarification of special questions relating to the cases.
Such experts and appraisers may be Chinese or foreign organizations or
citizens.

    Article 29  Should one of the parties or his attorney fail to appear at
the hearing, the arbitration tribunal may proceed with the hearing and make an
award by default.

    Article 30  During hearings, the Secretariat of the Arbitration Commission
shall take records in writing and/or tape-recordings and the arbitration
tribunal may, if it deems it necessary, order the parties and/or their
attorneys, witnesses and/or other persons involved to sign the records taken.

    Article 31  If both parties reach a settlement by themselves of a case
under the cognizance of the Arbitration Commission, the Claimant shall timely
request for withdrawal of the case. Dismissal of the case shall be decided by
the Chairman of the Arbitration Commission before an arbitration tribunal is
formed and by the arbitration tribunal after the arbitration tribunal is set
up.

    If the party or the parties refer the dismissed case again to the
Arbitration Commission for arbitration, the Chairman of the Arbitration
Commission shall decide whether to accept the reference or not.

    Section 4  Award

    Article 32  The arbitration tribunal shall render an arbitral award within
45 days after the closing of examination and hearing.

    Article 33  Where a case is heard by an arbitration tribunal composed of
three arbitrators, the arbitral award shall be decided by the majority of the
arbitrators and the minority opinion can be written down in the record and
docketed into the file.

    Article 34  The arbitration tribunal shall state the reasons upon which
the arbitral award is based unless the award is made in accordance with the
Article 37. The arbitral award shall be signed by all or majority of the
arbitrators sitting in the arbitration tribunal and shall contain the date and
place on and in which the arbitral award is made.

    Article 35  The arbitration tribunal may, if it deems it necessary or the
parties so request and it agrees, make an interim, interlocutary or partial
award on any issue of the case at any time in the process of arbitration.

    Article 36  The arbitral award is final and neither party may bring a suit
before a law-court or make a request to another organization for revising the
arbitral award.

    Article 37  The Arbitration Commission and the arbitration tribunal may
conciliate cases under their cognizance. In case a settlement agreement is
reached through conciliation, the arbitration tribunal shall make an award in
accordance with the contents of the settlement agreement reached by and
between both parties.

    Article 38  The parties must automatically execute the arbitral award
within the time limit specified in the award. If no time limit is specified in
the award, the parties shall carry out the award immediately.

    In  case either party fails to execute the award, the other party may,
pursuant to the Chinese law, apply to the Chinese court for enforcement of the
award or, according to the 1958 Convention on the Recognition and Enforcement
of Foreign Arbitral Awards or other international treaties that China has
concluded or acceded to, apply to the foreign court which has jurisdiction for
enforcement of the award.

    Chapter III  Supplementary Provisions

    Article 39  The Chinese language is the official language of the
Arbitration Commission. At the hearing, if the parties or their attorneys or
witnesses are not familiar with the Chinese language, the Secretariat of the
Arbitration Commission may provide them or the parties may bring with them
their interpreters.

    The Secretariat of the Arbitration Commission may, if it deems it
necessary, ask the parties to hand in corresponding translation copies in
Chinese or other languages of the various documents and evidential materials
submitted by the parties.

    Article 40  Any written communication from the Arbitration Commission to
the parties is deemed to have been received if it is delivered to the
addressee personally or if it is delivered at his place of business, habitual
residence or mailing address; or if none of these can be found after making a
reasonable inquiry, a written communication is deemed to have been received if
it is sent to the addressee's last known place of business, habitual residence
or mailing address by registered letter or by any other means which provides
a record of the attempt to deliver it.

    Article 41  Apart from charging arbitration fees from the parties
according to the Arbitration Fee Schedule attached to these Rules, the
Arbitration Commission may collect from the parties other actual expenses
including arbitrators' remuneration and their travel and boarding expenses for
dealing with the case and the fees and expenses for expert, apraisers and
interpreters appointed by the arbitration tribunal, etc.

    Certain fees and actual expenses incurred may be collected by the
Arbitration Commission if a case is withdrawn after the parties have reached
by themselves a settlement agreement.

    Article 42  These Rules shall also apply to the cases of dispute taken
cognizance of by the Sub-Commissions of the Arbitration Commission. In the
arbitration proceedings conducted by the Sub-Commissions of the Arbitration
Commission, the functions and duties of the Chairman and the Secretariat of
the Arbitration Commission under these Rules shall be performed by the
Chairmen and the Secretariats of the Sub-Commissions.

    Article 43  These Rules shall come into force as of January 1, 1989.

    Arbitration Fee Schedule

    Amount of Claim (RMB)               Amount of Fee (RMB)

    100,000 Yuan or less              6% of the amount of claim, minimum 2,000

                                      Yuan

    100,000 Yuan to 500,000 Yuan      6,000 Yuan plus 4% of the excess over

                                      100,000  Yuan

    500,000 Yuan to 1,000,000 Yuan    22,000 Yuan plus 3% of the excess over

                                      500,000 Yuan

    1,000,000 Yuan to 5,000,000 Yuan  37,000 Yuan plus 1.5% of the excess over

                                      1,000,000 Yuan

    5,000,000 Yuan or more            97,000 Yuan plus 0.7% of the excess over

                                      5,000,000 Yuan

    If no amount of claim is stated when applying for arbitration, the amount
of arbitration fees shall be determined by the Secretariat of the Arbitration
Commission.

    If the arbitration fee is charged in foreign currency, an amount of
foreign currency equivalent to the corresponding RMB value specified in this
Schedule shall be paid.

CHINA MARITIME ARBITRATION COMMISSION ARBITRATION RULES
(Revised and adopted by China Council for the Promotion of International Trade
on September 4, 1995)

Chapter I  General Provisions

    Section 1  Jurisdiction

    Article 1  These Rules are formulated in accordance with the Arbitration
Law of the People's Republic of China, the provisions of relevant laws, and
the Decision, Circular and Official Reply of the State Council.

    Article 2  The China Maritime Arbitration Commission (formerly known as
Maritime Arbitration Commission of China Council for the Promotion of
International Trade, hereinafter referred to as the Arbitration Commission),
by means of arbitration, independently and impartially settles maritime
disputes arising from transportation, production and navigation conducted in
oceans, coastal waters and water areas adjacent to sea, either contractual or
non-contractual, so as to protect the justified rights and interests of the
parties and promote shipping industry at home and abroad and foreign economic
and trade development.

    The Arbitration Commission takes cognizance of the following cases of
maritime disputes:

    (1) disputes arising from salvage of vessels and general average;

    (2) disputes arising from collisions of vessels or from damages caused by
vessels to structures or installations at sea, in water areas adjacent to sea
or in harbours, or to sea-bed or underwater installations;

    (3) disputes arising from management, operation, chartering, mortgage,
agency, towage, raising, sale, repairing, building and dismantling of or in
respect of sea-going vessel/vessel on water, carriage by sea/water in virtue
of contracts of affreightment, bills of lading or other documents, and
marine/water insurance;

    (4) disputes regarding exploitation and utilization of marine resources
and pollution damages to marine environment;

    (5) disputes arising from agency contracts for carriage of goods,
contracts for the supply of vessel materials, contracts of employment of
foreign crew or contracts of fishing production or fishery;

    (6) other maritime disputes submitted for arbitration by agreement between
the parties.

    Article 3  The Arbitration Commission takes cognizance of cases upon
receiving written application of one of the disputing parties and in
accordance with written agreement concluded between the parties, prior or
subsequent to the occurrence of dispute, to refer their dispute to the
Arbitration Commission for arbitration.

    An arbitration agreement means the arbitration clause stipulated by the
parties in their contract, or an agreement in writing concluded in other forms
to submit disputes for arbitration.

    Article 4  The Arbitration Commission has power to decide on the existence
and validity of arbitration agreement and the jurisdiction over arbitration
cases. If the parties dispute over the validity of the arbitration agreement,
the people's court shall decide on the validity when one of the parties applies
to the Arbitration Commission for decision on the validity and another party
applies to the people's court for decision.

    Article 5  An arbitration clause in a contract should be deemed as a
clause separate and independent from other clauses of the contract, and an
arbitration agreement attached to a contract also be deemed as one part
separate and independent from other clauses of the contract. The
modification, rescission, termination, annulment or invalidity, existence or
not of such a contract cannot prejudice the effect of the arbitration clause
or arbitration agreement.

    Article 6  Defence to the arbitration agreement and/or the jurisdiction
over an arbitration case shall be submitted prior to the first hearing of the
arbitration tribunal; defence to the jurisdiction over a case examined on the
basis of documents only shall be submitted prior to the first substantial
defence.

    Article 7  If any party agrees to refer his dispute to the Arbitration
Commission, he is deemed to accept the arbitration under these Rules.

    Section 2  Organization

    Article 8  The Arbitration Commission has one Honorary Chairman and
Consultants.

    Article 9  The Arbitration Commission is composed of Chairman,
Vice-Chairmen and Commission members. The Chairman performs functions and
duties given by these Rules and any Vice-Chairman, if authorized by the
Chairman, may perform the functions and duties of the Chairman.

    Under the Arbitration Commission, a Secretariat is established to handle
the day-to-day work of the Arbitration Commission under the leadership of the
Secretary of the Arbitration Commission.

    Article 10  The Arbitration Commission maintains a panel of arbitrators.
The arbitrators are selected and appointed by the Arbitration Commission from
among Chinese and foreign persons with expertise and practical experience in
navigation, carriage by sea, foreign trade, insurance, law and other fields.

    Article 11  The Arbitration Commission is located in Beijing. The
Arbitration Commission may, according to the requirement of development of
arbitration business, establish sub-commissions in other places within the
territory of China.
Chapter II  Arbitration Proceedings

    Section 1  Application for Arbitration, Defence and Counterclaim

    Article 12  The arbitration proceedings commence from the date on which
the Arbitration Commission issues the Arbitration Notice.

    Article 13  When applying for arbitration, the Claimant must:

    (1) submit a written Application for Arbitration, in which the following
must be specified:

    (a) the name and domicile (and also the post code, telephone number,
telex, fax and telegram code, if any) of the Claimant and those of the
Respondent;

    (b) the arbitration agreement relied upon by the Claimant;

    (c) details of the case and points of the dispute;

    (d) the Claimant's claim and the facts and evidence on which his claim is
based.

    The Application for Arbitration shall be signed and/or sealed by the
Claimant and/or the attorney authorized by the Claimant.

    (2) when submitting an Application for Arbitration to the Arbitration
Commission, accompany the Application for Arbitration with relevant facts and
documentary evidence on which the Claimant's claim is based.

    (3) pay an arbitration fee in advance according to the Arbitration Fee
Schedule stated by the Arbitration Commission.

    Article 14  After receipt of the Application for Arbitration and its
attachments and if the Secretariat of the Arbitration Commission, after
examination, deems that the Claimant didn't complete the formalities required
for arbitration, the secretariat of the Arbitration Commission may require him
to complete them; if it deems that the Claimant has completed the formalities,
the Secretariat of the Arbitration Commission shall immediately issue an
Arbitration Notice to the Respondent and mail to him one copy each of the
Claimant's Application for Arbitration and its attachments as well as the
Arbitration Rules, the Panel of Arbitrators of the Arbitration Commission and
the Arbitration Fee Schedule of the Arbitration Commission, and, at same time,
also mail to the Claimant each copy of the Arbitration Notice, the Arbitration
Rules, the Panel of Arbitrators of the Arbitration Commission and the
Arbitration Fee Schedule of the Arbitration Commission.

    After issuing the Arbitration Notices to the Claimant and the Respondent,
the Arbitration Commission shall appoint a staff member from the Secretariat
of the Arbitration Commission to handle the work of the arbitration
proceedings for the arbitration case.

    Article 15  The Claimant and the Respondent shall, within 20 days after
receipt of the Arbitration Notice, respectively appoint an arbitrator from
among the Panel of Arbitrators of the Arbitration Commission, or authorize the
Chairman of the Arbitration Commission to make an appointment on his behalf.

    Article 16  The Respondent shall, within 45 days after receipt of the
Arbitration Notice, submit his defence and relevant documentary evidence to
the Secretariat of the Arbitration Commission.

    Article 17  The Respondent shall file with the Arbitration Commission his
counter-claim in writing, if any, within the time limit not exceeding 60 days
after receipt of the Arbitration Notice. The arbitration tribunal may make an
appropriate extension of the time limit when it so deems for justified reasons.

    When filing a counter-claim, the Respondent must state, in his written
counter-claim, his claim and the grounds as well as the facts and evidence on
which his claim and grounds are based and attach relevant documentary evidence
to his counter-claim.

    When filing a counter-claim, the Respondent must pay an arbitration fee in
advance according to the Arbitration Fee Schedule stated by the Arbitration
Commission.

    Article 18  The Claimant may request for modification to his claim, and
the Respondent may request for modification to his counter-claim. However, the
arbitration tribunal may reject such a request if it deems that the submission
of the request is late and so will affect the normal arbitration proceedings.

    Article 19  When submitting an Application for Arbitration, defence,
counter-claim, relevant documentary evidence and other documents to the
Arbitration Commission, one party shall provide five copies for each of the
documents. The copies shall be added correspondingly if the number of the
party/parties is more than two. Two of the five copies needn't be made if the
arbitration tribunal is composed of one arbitrator.

    Article 20  Failure by the Respondent to file his defence and/or failure
by the Claimant to file his defence to the Respondent's counter-claim, shall
not prevent the arbitration proceedings from being carried out.

    Article 21  The parties may authorize attorneys to confer with the
Arbitration Commission on matters relating to arbitration. The authorized
attorney must produce a Power of Attorney to the Arbitration Commission.

    Either citizens of China or foreign citizens may accept authorizations to
act as such attorneys.

    Article 22  If any of the parties applies for property preservation, the
Arbitration Commission shall refer the application to the maritime count in
the place where the defending party of the application has his domicile or in
the place where his property is located for a decision in respect of taking
preservative measures.

    If any of the parties applies for evidence preservation, the Arbitration
Commission shall refer the application to the maritime count in the place
where the evidence is located for a decision in respect of taking preservative
measures.

    Section 2  Composition of Arbitration Tribunal

    Article 23  Each of the two parties shall choose one arbitrator from among
the Panel of Arbitrators of the Arbitration Commission or the Chairman of the
Arbitration Commission shall make such an appointment under the authorization
by the party/parties. Both parties shall jointly appoint or authorize the
Chairman of the Arbitration Commission to appoint a third arbitrator from
among the Panel of Arbitrators of the Arbitration Commission. If both parties
fail to appoint and fail to authorize the Chairman of the Arbitration
Commission to appoint the third arbitrator within 20 days as from the date on
which the Respondent receives the Arbitration Notice, the Chairman of the
Arbitration Commission shall appoint the third arbitrator. The third
arbitrator is the presiding arbitrator who forms an arbitration tribunal with
the two appointed arbitrators to hear the case.

    Article 24  Both parties may jointly appoint or authorize the Chairman of
the Arbitration Commission to appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission as a sole arbitrator to form an
arbitration tribunal to hear the case alone.

    If both parties have agreed on the appointment of a sole arbitrator to
hear their case alone but failed to agree on the choice of such a sole
arbitrator within 20 days as from the date on which the Respondent receives
the Arbitration Notice, the Chairman of the Arbitration Commission shall
appoint the sole arbitrator.

    Article 25  If the Claimant or the Respondent fails to appoint and fails
to authorize the Chairman of the Arbitration Commission to appoint an
arbitrator according to Article 15 of these Rules, the Chairman of the
Arbitration Commission shall appoint an arbitrator for the Respondent.

    Article 26  When there are two or more Claimants and/or Respondents in an
arbitration case, the Claimants' side and/or the Respondents' side shall each,
through consultation, appoint or authorize the Chairman of the Arbitration
Commission to appoint one arbitrator from among the Panel of Arbitrators of
the Arbitration Commission. If the Claimants' side and/or the Respondents'
side fails to appoint and fails to authorize the Chairman of the Arbitration
Commission to appoint one arbitrator within 20 days after receipt of the
Arbitration Notice, the appointment shall be made by the Chairman of the
Arbitration Commission.

    Article 27  Any appointed arbitrator having personal interest in the case
shall himself disclose the case to the Arbitration Commission and request for
withdrawal from his office.

    Article 28  If there is a suspicion of the fairness and independence of
any appointed arbitrator for justified reasons, any of the parties may make a
request in writing to the Arbitration Commission for a withdrawal of the
arbitrator from his office. However, he shall specify the facts and grounds on
which his request is based and shall bear the burden of proof.

    The request for challenging an arbitrator must be put forward in writing
before the first oral hearing of the case. If the grounds for challenge come
out or become aware of after the first oral hearing, the challenge may be
raised before the conclusion of the last hearing.

    Article 29  The Chairman of the Arbitration Commission shall decide on the
challenge.

    Article 30  If an arbitrator cannot perform his duty due to withdrawal or
other reasons such as death or dismissal, a substituted arbitrator shall be
appointed in accordance with the procedure pursuant to which the original
arbitrator was appointed.

    After the appointment of the substitute arbitrator, the arbitration
tribunal shall decide whether or not the arbitration proceedings having being
carried out partly or completely must begin anew.

    Section 3  Hearing

    Article 31  The arbitration tribunal shall hold oral hearings to hear the
case. However, at the request of the parties or with their consent, and when
the arbitration tribunal also deems that oral hearings may be omitted, the
arbitration tribunal may examine the case and make an award on the basis of
documents only.

    Article 32  The date of the first oral hearing shall be decided by the
arbitration tribunal in consultation with the Secretariat of the Arbitration
Commission and the Secretariat shall communicate the notice of hearing to the
parties 30 days before the date of hearing. A party having justified reasons
may request for postponement of the date of hearing. But his request must be
communicated to the Secretariat in writing 12 days before the date of
hearing. The arbitration tribunal shall decide on his request.

    Article 33  The dates of other oral hearings following the first may be
communicated to the parties without the deadline of 30 days before.

    Article 34  The cases taken cognizance of by the Arbitration Commission
shall be heard in Beijing and may, with the approval of the Secretary of the
Commission, be heard in other places.

    Article 35  The arbitration tribunal shall not hear cases in open
sessions. If both parties request hearings in open sessions, the arbitration
tribunal shall decide thereon.

    Article 36  Both parties and their attorneys, witnesses, arbitrators,
experts giving advice to the arbitration tribunal and its appointed
appraisers, related persons of the Secretariat of the Arbitration Commission
shall not disclose outside the information regarding the substantial contents
and the proceedings of cases not being heard in open sessions.

    Article 37  The parties shall give evidence for the facts on which their
claim, defence or counter-claim is based. The arbitration tribunal may, if it
deems it necessary, investigate facts and collect evidence on its own
initiative.

    Where the arbitration tribunal investigates facts and collects evidence on
its own initiative, if it deems it necessary to notify both parties to be
present on spot, it shall so notify the parties in time. The absence of one
party or both parties after such notification cannot prevent the arbitration
tribunal from investigating facts and collecting evidence on its own
initiative.

    Article 38  The arbitration tribunal may consult experts or appoint
appraisers for the clarification of special questions relating to the cases.
Such experts and appraisers may be Chinese or foreign organizations or
citizens.

    The arbitration tribunal has power to require the parties to, and the
parties have the obligation to, submit or present all relevant materials or
documents, property or goods to experts/appraisers for examination, inspection
and/or appraisal.

    Article 39  Duplicate copies of expert reports and appraisal reports shall
be submitted to both parties and both parties shall be given an opportunity to
put forward their opinions on such reports. If any of the parties requests
experts/appraisers to participate in the hearing of the case, with the consent
of the arbitration tribunal, experts/appraisers may appear at the hearing and
explain their reports when the arbitration tribunal deems it necessary and
appropriate.

    Article 40  The evidence provided by the parties shall be examined and
approved by the arbitration tribunal. The admissibility of expert reports and
appraisal reports shall depend on the decision of the arbitration tribunal.

    Article 41  Should one of the parties fails to appear at the hearing, the
arbitration tribunal may proceed with the hearing and make an award by default.

    Article 42  During hearings, the arbitration tribunal may take records in
writing and/or tape-recordings and the arbitration tribunal may, if it deems
it necessary, take main points of the hearing and order the parties and/or
their attorneys, witnesses and/or other persons involved to sign or seal the
records taken.

    Such records in writing and/or tape-recordings shall only be consulted by
the arbitration tribunal.

    Article 43  If the parties reach a settlement by themselves of an
arbitration case without hearings of the arbitration tribunal, they may either
request the arbitration tribunal to make an award according to the agreement
on settlement, or request for withdrawal of the case. Dismissal of the case
shall be decided by the Secretary of the Arbitration Commission before an
arbitration tribunal is formed and by the arbitration tribunal after the
arbitration tribunal is set up.

    If the party or the parties refer the dismissed case again to the
Arbitration Commission for arbitration, the Chairman of the Arbitration
Commission shall decide whether to accept the reference or not.

    Article 44  If one of the parties has known or should know violations of
these Rules or any clause or condition stipulated in the arbitration
agreement, and if he continues to participate in or carry out the arbitration
proceedings and fails to challenge these violations in writing promptly and
expressly, he shall be deemed as abandoning the right to challenge.

    Article 45  If both parties wish to make a settlement through
conciliation, or if one of the parties so wishes, with the consent of the
other party, the arbitration tribunal may conciliate the case under its
cognizance during the arbitration proceedings.

    Article 46  The arbitration tribunal may conduct conciliation in any form
if it deems it appropriate.

    Article 47  If, in the process of the conciliation, any of the parties
requests for termination of the conciliation, or the arbitration tribunal
deems the conciliation not to be successful, the arbitration tribunal shall
give up the conciliation.

    Article 48  If, in the process of the conciliation, both parties reach a
settlement without hearings of the arbitration tribunal, such a settlement
shall be deemed as one reached through the conciliation of the arbitration
tribunal.

    Article 49  If a settlement is reached through conciliation of the
arbitration tribunal, both parties shall sign a written settlement agreement;
unless otherwise agreed on by the parties, the arbitration tribunal shall make
an award to close the case according to the contents of the written
settlement agreement agreed upon by and between the parties.

    Article 50  If no agreement is made through conciliation, any of the
parties may not, later in the arbitration proceedings, or in the litigation
proceedings, or in any other proceedings, place his claim, defence and/or
counter-claim on the basis of any statement, opinion, view or proposal which
the counter party or the arbitration tribunal issued, put forward, raised,
acknowledged and accepted or repudiated in the process of the conciliation.

    Section 4  Award

    Article 51  The arbitration tribunal shall render an arbitral award within
nine months as from the date of its composition. The Secretary of the
Arbitration Commission may, at the request of the arbitration tribunal,
approve the extension of the time period when it deems it really necessary and
justifiable.

    Article 52  The arbitration tribunal shall go by the facts, comply with
laws and contracts, take international practices into account and follow the
principle of equality and rationality, for the purpose of rendering the award
independently and impartially.

    Article 53  Where a case is heard by an arbitration tribunal composed of
three arbitrators, the arbitral award shall be decided by the unanimity or the
majority of the arbitrators and the minority opinion can be written down in
the record and docketed into the file.

    Where the arbitration tribunal cannot form the majority opinion, the
arbitral award shall be decided by the presiding arbitrator.

    Article 54  The arbitration tribunal shall state the claim, the disputing
facts, the reasons, the conclusion, the burden of the arbitration fee and the
date and the place in the arbitral award. The disputing facts and the reasons
for the arbitral award may be omitted if the parties agree upon the omission
or if the award is made in accordance with the settlement agreement agreed
upon by and between both parties.

    Article 55  The arbitral award shall be signed by majority of the
arbitrators sitting in the arbitration tribunal unless it is decided by the
presiding arbitrator or a sole arbitrator. The arbitrators holding different
opinions may or may not sign the arbitral award.

    The arbitrators shall refer the draft award to the Arbitration Commission
before affixing their signature. The Arbitration Commission may call the
arbitrators' attention to the matters in respect of the award's form but may
not interfere with the independence of the arbitrators to make the award.

    The arbitral award shall bear the seal of the Arbitration Commission.

    From the date on which the arbitral award is made, the arbitral award
takes effect.

    Article 56  The arbitration tribunal may, if it deems it necessary or the
parties so request and it agrees, make an interim, interlocutary or partial
award on any issue of the case at any time in the process of arbitration
before the final award is made. Failure to execute the interlocutary award by
any of the parties shall neither prevent the arbitration proceedings from
being carried out, nor the arbitration tribunal from rendering the final award.

    Article 57  The arbitration tribunal has power to decide in the arbitral
award on the arbitration fee and other expenses finally paid by either party
to the Arbitration Commission.

    Article 58  The arbitration tribunal has power to decide in the arbitral
award that the loser should indemnify part of the expenses the victor incurred
reasonable for settling the case. However, a maximum of the indemnities shall
not exceed 10% of the amount the victor wins.

    Article 59  The arbitral award is final and binding on both parties.
Neither party may bring a suit before a law-court or make a request to another
organization for revising the arbitral award.

    Article 60  Either party may, within 30 days as from the date of receiving
the arbitral award, request the arbitration tribunal in writing to correct
clerical, typing, calculation errors or other similar errors in the arbitral
award. If there are really such errors, the arbitration tribunal shall make a
written correction within 30 days as from the date of receiving the written
request. It may also make such a correction in writing on its own initiative
within 30 days as from the date of issuing the arbitral award. The written
correction shall be part of the arbitral award.

    Article 61  Either party may, within 30 days as from the date of receiving
the arbitral award, request the arbitration tribunal in writing to render a
supplementary award on matters omitted in the arbitral award.

    If there are really omissions, the arbitration tribunal shall render a
supplementary award within 30 days as from the date of receiving the written
request. It may also render such a supplementary award on its own initiative
within 30 days as from the date of issuing the arbitral award. The
supplementary award shall be part of the original arbitral award.

    Article 62  The parties must automatically execute the arbitral award
within the time limit specified in the award. If no time limit is specified in
the award, the parties shall carry out the award immediately.

    In case either party fails to execute the award, the other party may,
pursuant to the Chinese law, apply to the Chinese court for enforcement of the
award or, according to the 1958 Convention on the Recognition and Enforcement
of Foreign Arbitral Awards or other international treaties that China has
concluded or acceded to, apply to the foreign court which has jurisdiction for
enforcement of the award.
Chapter III  Summary Proceedings

    Article 63  Unless otherwise agreed upon by the parties, these summary
proceedings apply to all cases with the claiming amount not exceeding RMB
500,000 yuan or the cases with the claiming amount exceeding RMB 500,000 yuan
but when either party so requests in writing and the other party agrees in
writing.

    Article 64  When a party refers an Application for Arbitration to the
Arbitration Commission, and if, upon examination, the case falls within its
cognizance and these summary proceedings apply, the Secretariat of the
Arbitration Commission shall immediately issue Arbitration Notices to both
parties.

    Both parties shall jointly appoint or authorize the Chairman of the
Arbitration Commission to appoint one arbitrator from among the Panel of
Arbitrators of the Arbitration Commission as a sole arbitrator within 15 days
as from the date of receiving the Arbitration Notices unless they have made
such a appointment. If both parties fail to appoint or authorize the Chairman
of the Arbitration Commission to appoint a sole arbitrator within the time
limit, the Chairman of the Arbitration Commission shall immediately appoint a
sole arbitrator to form an arbitration tribunal to hear the case.

    Article 65  The Respondent shall, within 30 days as from the date of
receiving the Arbitration Notice, submit a defence and relevant documentary
evidence to the Arbitration Commission; his counter-claim and relevant
documentary evidence, if any, shall be submitted within the time limit.

    Article 66  The arbitration tribunal may hear the case in any form if it
deems it appropriate. It may decide to hold a hearing on the basis of written
materials and evidence submitted by the parties, or an oral hearing to examine
the case.

    Article 67  Any of the parties shall submit written materials and evidence
necessary for arbitration according to the requirements and the deadline
specified by the arbitration tribunal.

    Article 68  After the arbitration tribunal decides the date of hearing for
the case to be examined at an oral hearing, the Secretariat of the Arbitration
Commission shall communicate the date of hearing to the parties 15 days before.

    Article 69  If a case is decided to be examined at oral hearing, the
arbitration tribunal shall hold one oral hearing for the case. The arbitration
tribunal may decide to hold another one if really necessary.

    Article 70  In the process of these summary proceedings, failure by either
party to carry out these summary proceedings shall neither prevent the
proceedings from being carried out nor prejudice the power of the arbitration
tribunal to render an award.

    Article 71  These summary proceedings shall not be suspended when the
arbitration claim is modified or a counter-claim is filed.

    Article 72  The arbitration tribunal shall, if the case is examined at an
oral hearing, render an arbitral award within 30 days as from the date of
hearing, or within 90 days as from the date of its composition if the case is
examined on the basis of written materials and evidence. The Secretary of the
Arbitration Commission may extend the time periods at the request of the
arbitration tribunal and when he deems it really necessary and has justified
reasons.

    Article 73  In cases there are no provisions in this Chapter, relevant
provisions of other chapters in these Rules shall apply.
Chapter IV  Supplementary Provisions

    Article 74  The Chinese language is the official language of the
Arbitration Commission. If otherwise agreed upon by the parties, such an
agreement shall prevail.

    At the hearing, if the parties or their attorneys or witnesses require
language interpreters, the Secretariat of the Arbitration Commission may
provide them or the parties may bring with them their interpreters.

    The arbitration tribunal and/or the Secretariat of the Arbitration
Commission may, if it/they deem(s) it necessary, ask the parties to hand in
corresponding translation copies in Chinese or other languages of the various
documents and evidential materials submitted by the parties.

    Article 75  Any document, notice or material related to arbitration may be
sent to the parties and/or their attorneys by messenger, registered letter,
express airmail, fax, telex, telegram or any other means if the Secretariat of
the Arbitration Commission deems it appropriate.

    Article 76  Any written communication from the Arbitration Commission to
the parties and/or their attorneys is deemed to have been received if it is
delivered to the addressee personally or if it is delivered at his place of
business, habitual residence or mailing address; or if none of these can be
found after making a reasonable inquiry, a written communication is deemed to
have been received if it is sent to the addressee's last known place of
business, habitual residence or mailing address by registered letter or by any
other means which provides a record of the attempt to deliver it.

    Article 77  Apart from charging arbitration fees from the parties
according to the Arbitration Fee Schedule stated by the Arbitration
Commission, the Arbitration Commission may collect from the parties other
actual expenses added reasonably, including arbitrators' special remuneration
and their travel and boarding expenses for dealing with the case and the fees
and expenses for experts, appraisers and interpreters appointed by the
arbitration tribunal, etc.

    Arbitration fees and expenses incurred may be collected by the Arbitration
Commission according to the amount of work and actual expenses if a case is
withdrawn after the parties have reached by themselves a settlement agreement.

    Article 78  Both parties shall be deemed to agree upon arbitration by the
China Maritime Arbitration Commission if they stipulate in an arbitration
agreement or the arbitration clause of a contract for arbitration by the China
Maritime Arbitration Commission or by the Maritime Arbitration Commission of
China Council for the Promotion of International Trade, the former name of the
Arbitration Commission.

    Article 79  These Rules shall come into force as of October 1, 1995. Cases
taken cognizance of by the Arbitration Commission before the implementation of
these Rules shall be arbitrated under the arbitration rules which applied at
that time; these Rules may also apply if both parties so agree.

    Article 80  The Arbitration Commission shall be responsible for the
interpretation of these Rules.