Telecommunications Regulations of the People's Republic of China

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Article 35. Telecommunications subscribers shall make full and timely payment of telecommunications fees in accordance with the time limits and methods agreed. If a telecommunications subscriber fails to pay telecommunications fees on time, a telecommunications operator shall have the right to demand payment of overdue telecommunications fees as well as to charge a default penalty for each day in an amount based on 0.3% of the fees due.

If a telecommunications subscriber does not pay telecommunications fees after the agreed 30-day payment deadline, a telecommunications operator may suspend telecommunications services provided to it. If the telecommunications subscriber still fails to pay overdue telecommunications fees and penalties within 60 days after suspension of service by the telecommunications operator, the telecommunications operator may terminate the provision of services and demand the amount payable and the penalties in accordance with law.

Mobile telecommunications operators may agree with telecommunications subscribers on the time and manner of payment of telecommunications fees without reference to the restriction of deadlines set forth in the previous paragraph.

Suspended telecommunications services shall be resumed within 48 hours after the telecommunications subscriber (who has delayed payment of telecommunications fees) has paid in full the telecommunications fees and penalties due.

Article 36. If normal telecommunications services are affected or may be affected by construction projects or the construction of networks of telecommunications operators, subscribers shall be notified promptly in accordance with the specified time limit and reports shall be submitted to the telecommunications administration authorities of the provinces, autonomous regions and municipalities directly under the central government.

In the case of suspension of telecommunications services due to reasons set forth in the previous paragraph, telecommunications operators shall reduce or waive the relevant fees paid by subscribers during the period of suspension of telecommunications services accordingly.

If any conditions set forth in the first paragraph of this Article occur and telecommunications operators fail to inform subscribers promptly, they shall indemnify the subscribers against the losses suffered by them as a result thereof.

Article 37. Telecommunications operators engaging in the domestic telephone business and the mobile phone business shall provide their subscribers with free telecommunications services of a public welfare nature such as phone numbers for reporting fire-related accidents, bandit-related incidents, medical emergencies and traffic accidents, and the availability of telephone lines shall be guaranteed.

Article 38. Telecommunications operators shall promptly provide connection services to group subscribers who require connection to their telecommunications networks through a trunk line on a fair and reasonable basis.

Without approval, telecommunications operators shall not suspend connection services on its own.

Article 39. Telecommunications operators shall establish sound internal service quality control systems, and they may formulate, announce and implement enterprise standards higher than the telecommunications service standards set forth in provisions of the State.

Telecommunications operators shall, using various means, listen extensively to the advice of telecommunications subscribers, accept supervision by the public and constantly enhance the quality of telecommunications services.

Article 40. If telecommunications services provided by a telecommunications operator fails to reach the standards of telecommunications services set forth in provisions of the State or the enterprise standards announced by such operator, or if a telecommunications subscriber raises objections to the payment of telecommunications fees, the telecommunications subscriber shall have the right to demand that the telecommunications operator resolve the matter. If the telecommunications operator refuses to resolve the matter or if the telecommunications subscriber is not satisfied with the resolution, the telecommunications subscriber shall have the right to lodge a complaint with the supervisory department for the information industry under the State Council or the telecommunications administration authorities of the provinces, autonomous regions and municipalities directly under the Central Government or other relevant departments. Departments receiving a complaint must handle it promptly and shall respond to the person lodging the complaint within 30 days from the date of receipt of the complaint.

If a telecommunications subscriber has an objection to the payment of domestic telephone fees, the telecommunications operator shall also provide without charge, at the request of the telecommunications subscriber, the basis for the domestic telephone charges and shall be obliged to carry out the necessary measures to assist the telecommunications subscriber in discovering the reasons.

Article 41. Telecommunications operators shall not commit the following acts in the course of providing telecommunications services:

(1) Restricting telecommunications subscribers in any manner in the use of services designated by them;

(2) Restricting telecommunications subscribers to purchasing telecommunications terminal equipment designated by them or rejecting the use of telecommunications terminal equipment with which telecommunications subscribers have equipped themselves and for which network access licenses have been procured;

(3) Altering without authorization or changing by means of disguise the fee rates, and increasing without authorization or increasing by means of disguise the fee rates in violation of the provisions of the State;

(4) Rejecting, delaying or terminating the provision of telecommunications services to telecommunications subscribers without a proper reason;

(5) Failing to perform undertakings made publicly to telecommunications subscribers or carrying out false promotion that is easily misleading;

(6) Causing difficulties for telecommunications subscribers by improper means or retaliating against telecommunications subscribers who lodge complaints.

Article 42. Telecommunications operators shall not commit the following acts in the course of conducting telecommunications businesses:

(1) Restricting telecommunications subscribers in any manner in selecting telecommunications services run by other telecommunications operators in accordance with law;

(2) Cross-subsidizing in an unreasonable manner the various businesses they conduct;

(3) Engaging in improper competition by providing telecommunications businesses or services at a price lower than the cost

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