SECTION THREE SOLELY STATE-OWNED COMPANIES

　　Article 64 The term "solely State-owned companies" used in this law refers to the limited liability companies established solely by State authorized investment institution or department.

　　Companies designated by the State Council to produce special products or belonging to a special trade as set should be solely State- owned.

　　Article 65 The articles of association of a solely State-owned company shall be formulated by the State authorized investment institution or department in accordance with the law or by the board of directors and be submitted to the investment institution or department concerned authorized by the State for approval.

　　Article 66 A solely State-owned company shall not set up the meeting of shareholders but the board of directors which is empowered by the investment organization or department authorized by the State to exercise part of the powers and functions of the meeting of shareholder and decide on major matters concerning the company. But merger, division, dissolution or the increase or decrease of capital and issuing of bonds shall be determined by the investment institution or department concerned authorized by the State.

　　Article 67 The State authorized investment institution or department shall supervise over and manage the assets of the solely State-owned company according to law or administrative decrees.

　　Article 68 The board of directors of a solely State-owned company shall exercise its powers and functions according to the provisions of Article 46 and Article 66 of this law. The term of office of the board of directors shall be three years.

　　The board of directors shall be made up of three to nine persons, who are subject to the appointment or replacement by the investment institution or department authorized by the State according to the term of office for the board of directors. Workers in the company should elect through democratic processes representatives to the board of directors.

　　The board of directors shall have a chairman or may have a vice- chairmen if necessary. The chairman and vice-chairmen of the board shall be designated from among the directors by the investment institution or department authorized by the State.

　　The chairman of the board is the legal representative of the company.

　　Article 69 A solely State-owned company shall have a manager who shall be subject to the appointment or dismissal by the board of directors and exercises the powers according to the provisions of Article 50 of this law.

　　With the consent of the investment institution or department authorized by the State, a member of the board may concurrently serve as the manager of the company.

　　Article 70 Chairman, vice-chairmen or directors of the board and the manager of a solely State-owned company may not serve concurrently as officers of other limited liability companies, joint stock companies limited or other business organizations without the consent of the investment institution or department authorized by the State.

　　Article 71 In transferring the assets of a solely State-owned company, the procedures of examination and approval and transfer shall be completed by the investment institution or department authorized by the State according to law or administrative decrees.

　　Article 72 Large solely State-owned companies with sound operational and management system and in good operational conditions may be authorized by the State Council to exercise rights as the owners of the assets.