Government Incentives And Regulations

In light of the rapid growth of the Chinese economy and rising consumption of energy, the PRC government increasingly encourages the development and use of renewable energy resources. According to its “Eleventh Five-Year Plan,” the PRC government plans to increase the percentage of consumption for renewable energy resources in China by 2010. The PRC government expects that the renewable energy sector in China will experience rapid expansion in the next few years.

On November 30, 2004, the NDRC and the Ministry of Commerce jointly promulgated the revised Catalogue for Guiding Foreign Investment in Industries (the “Foreign Investment Catalogue”). The revised Foreign Investment Catalogue replaced the 2002 version with effect from January 1, 2005. The Foreign Investment Catalogue lists out those industries and economic activities in which foreign investment in China is encouraged, restricted or prohibited. Any projects not included in the Foreign Investment Catalogue are considered to be permitted under the relevant regulations.

Pursuant to the Foreign Investment Catalogue, the comprehensive utilization and disposal of exhaust gas, discharge liquid, waste residue, and the technology for recycling and comprehensive utilization of resources fall within the encouraged category. In this connection, our business, the manufacture and sale of biodiesel by utilizing used cooking oil and vegetable oil offal, falls within the encouraged category under the Foreign Investment Catalogue.

Press Relations