Some companies recently received the notice for random check from the local market supervision administrative bureau (hereinafter referred as “MSA”). it is true that the local MSA is conducting the random check whether the annual report made by the company itself is true or not. Shanghai Dongjin will introduce the points for such company random check.

Q1: What is the legal basis?

A1: “Interim Measures for Random Inspection on Information Publicized by Enterprises” issued by the State Administration for Industry and Commerce in Year 2014 and “The Notice of the State Administration for Industry in Respect of Handling the Random Check on the Information Publicized by Enterprises in Year 2016”.

Q2: What company will be checked?

A2: The local MSA will have a lucky-draw and choose around 3% companies from which have been completed the filing annual report.

Q3: What is the procedure?

A3: The local MSA will firstly send the company a random check notice in written form. Then, the local MSA will entrust a local CPA firm to conduct the check in details.

Q4: What documents should be provided?

A4: Business license; the special license (if any and whether it is valid); the financial reports in the recent two years as well as the annual audit report; the articles of association.

Q5: What bad result if the company found the company information is false from its annual report?

A5: If during the random company check, the company was found hard to be contacted, had the false information, or not cooperate with the check positively, the company will be put on the abnormal operation list. It will bring restriction on operation of the company, as well as the legal representative and shareholder.

Dongjin comments: the company should deal with such government check properly and avoid leaving the bad record. We have wild experience on this matter. If you have any questions, please send the email to me.

Ms. Jojo Hu

TEL: 0086-21-68868335 ext 324 / FAX: 0086-21-68868021

Email: jojohu@shanghaiinvest.com