The State Administration of Taxation has issued the Notice regarding the Policy of the Individual Income Tax on the Work-related Injury Insurance Treatment (the “Notice”) on May 3rd, 2012, which has retroactively become effective as of January 1st, 2011.

According to the Notice, the work-related injury insurance, which is obtained by the injured employee or his/her relatives according to the ´Regulations of the Work-related Injury Insurance´, is exempted from the individual income tax.

The State Administration of Taxation (“SAT”) .of the People's Republic of China (“PRC”) issued Notice on the Matters regarding Individual Income Tax with respect to the Implementation of the Tax Arrangements between the Mainland China and Hong Kong (and Macao) (hereinafter referred to as the "Notice") on April 26th, 2012, which addresses the double taxation problems in favor of the Hong Kong (and Macao) tax residents. The Notice takes effect from June 1st, 2012 (“Effective Date”) and applies to the income obtained after the Effective Date.

The key points of the Notice are as follows: