2．The bank or its headquarters shall be qualified as the marker of the interbank foreign exchange market; or the bank has been rated Level-A for more than 1 time and has never been rated under Level-B in the evaluations of compliance of requirements on foreign exchange control in recent 3 years.

3．The bank shall conduct pre-registration with its Shanghai branch for the provision of foreign exchange settlements of the commodity derivative transactions.

4．When processing a commodity derivative transaction for an enterprise, the bank shall verify whether the enterprise has real experiences in conducting such transactions and whether it leverages proper hedging methods, and shall truthfully disclose risk information to the enterprise and let it take charge.

5．In case of the exchange rate exposure and foreign exchange gains and losses caused by overseas settlements of the commodity derivative transactions processed by the bank, the enterprise shall purchase the foreign exchange with the bank, which shall be included into the bank’s closing of the positions formed through the foreign exchange purchases and sales. The SAFE Shanghai shall administrate the annual volume of the foreign exchange settlements provided by the bank.

6．The bank shall record the aforementioned settlements in its foreign exchange settlement statement, under the item of “240/440 other investments”; the trading party shall be noted as “the bank itself”.

7．The bank shall report the commodity derivative transactions and the related foreign exchange settlements to the SAFE Shanghai on a regular basis.

Chapter V Supplementary Provisions

Article 19 The SAFE Shanghai shall conduct off-site monitoring over the foreign exchange balance of the trade in goods of the enterprises in the PFTZ, carry out on-site inspections on abnormal or suspicious situations, and adopt a categorized management approach based on the results of on-site inspections.

Article 20 In case that any disequilibrium of the international balance occurs or may occur, the SAFE Shanghai may carry out applicable interim regulations.

Article 21 The SAFE Shanghai may, in accordance with the national macro-control policies, the foreign exchange balance and the development of innovative business, gradually improve the innovative business.

Article 22 The SAFE Shanghai shall supervise and inspect the entities in the PFTZ in accordance with relevant laws and regulations. Any violations of the Regulations of the People’s Republic of China on Foreign Exchange Administration and these provisions shall result in suspension of innovative business and punishment in accordance with that Regulations and other relevant provisions.

Article 23 These Detailed Rules shall come into force as of the day of issue. Situations not mentioned herein shall be handled in accordance with the Administrative Measures for Foreign Exchange in Special Customs Supervision Zones and other current provisions on foreign exchange administration.

The Shanghai Branch of the State Administration for Foreign Exchange

February 28, 2014