With a view to encouraging integrated circuit enterprises to reinforce their research and development, the state has set up a special fund for research and development of integrated circuit industry. The Interim Measures for the Management of the Special Fund for the Research and Development of Integrated Circuit Industry are hereby printed and distributed to you. Please make an announcement of the Interim Measures accordingly and take effective measures to inform all relevant enterprises within your respective areas.
Attachment: Interim Measures for the Management of the Special Fund for the Research and Development of Integrated Circuit Industry

二○○五年三月二十三日

The Ministry of Finance
The Ministry of Information Industry
The National Development and Reform Commission
March 23, 2005

Attachment:
Interim Measures for the Management of the Special Fund for the Research and Development of Integrated Circuit Industry
Chapter Ⅰ General Provisions
Article 1 With a view to supporting the development of the integrated circuit industry, regulating the management of the special fund for the research and development of the integrated circuit industry (hereinafter referred to as special fund for R&D), and making full use of the fund, the Measures are formulated according to relevant provisions of the Budget Law of the People’s Republic of China and the requirements of related industrial policies of the state.

Article 2 The term “special fund for R&D” in the Measures refers to the fund arranged by the central finance budget and exclusively used for supporting the research and development of the integrated circuit industry.

Article 3 The management and use of the special fund for R&D should abide by the following principles:
　　 （1） Being consistent with the guidelines of the state’s industrial policy;
　　 （2） Meeting the requirements as specified in the Guide to the Application for the special fund for R & D;
　　 （3） Leading the integrated circuit industry to accelerate the technological innovation and product development and to enhance the capacity of research and development and level of industrialization;
　　 （4） Promoting the combination of production, study and research, encouraging joint development;
　　 （5） Being propitious to cultivating, bringing in and awarding the talents of the integrated circuit industry;
　　 （6） Being scientific and efficient

Chapter Ⅱ Qualifications for Application
Article 4 An enterprise applying for the special fund for R & D should meet the following conditions:

(1) Being an independent legal person enterprise engaged in the design, manufacturing, packaging and test of integrated circuits, which is registered within the territory of the People’s Republic of China (excluding Hong Kong, Macao and Taiwan) and confirmed by the integrated circuit determination competent department;

(2) Having a research and development plan that meets the requirements as specified in the Guide to the Application for the special fund for R&D;

(3) Having the ability to carry out the R&D activities it applies for, and having sound internal management and financial systems;

(4) Running business under the law and paying taxes in accordance with relevant regulations.

Article 5 An enterprise applying for the special fund for R&D should provide the following materials:

(1) An application report for the special fund for R&D;
(2) A copy of its business license
(3) A qualification certification;
(4) Its financial statements of the last two years audited by a legal intermediary institution;
(5) Other materials required by the Examination Committee.

Chapter Ⅲ Procedures for Application and Management
Article 6 The special fund for R&D shall be subject to the deliberation and official reply of the Examination Committee which will be constituted by the Ministry of Finance, the National Development and Reform Commission and the Ministry of Information Industry.

Article 7 The procedures for the application and management of the special fund for R&D are as follows:

(1) According to the requirements of the Examination Committee, the National Development and Reform Commission shall, together with the Ministry of Information Industry, organize experts to work out and issue a Guide to the Application for the special fund for R&D;

(2) In accordance with the requirements of the Guide to the Application for special fund for R&D, any enterprise that meets the qualifications for application can file an application to the Ministry of Information Industry (Website: WWW.ITFUND.GOV.CN; Address: No. 27 Courtyard, Wanshou Road, Beijing; Postcode: 100846);

(3) The Ministry of Information Industry shall collect and sort out the application materials, put forward a special fund for R&D arrangement plan upon deliberation, then submit the plan to the Examination Committee. After the plan is examined and approved by the Examination Committee, the Ministry of Finance shall issue a fund budget.

Chapter Ⅳ Aid Standard and Use of Fund

Article 8 The special fund for R&D shall be in the form of gratuitous aid. The amount of aid to a single research and development activity shall not exceed 50% of the cost of such an activity.

Article 9 The special fund for R &D shall not be used for any other purpose except for the research and development activities. The special fund for R &D can be used in the following aspects:

(1) The expenses for human resource, including the expense on cultivating, bringing in and awarding the integrated circuit talents;

(2) The expenses for special instruments and equipment;

(3) The expenses for the consultation and equivalent services of the research and development activities;

(4) The daily expenses directly incurred due to the research and development, such as the expenses on materials and supplies, etc;

(5) The indirect expenses directly incurred due to the research and development activities;

(6) The necessary expenses incurred due to the management of the special fund for R&D.

Chapter Ⅴ Supervision and Management
Article 10 The institution authorized by the Examination Committee shall sign an agreement with the enterprise which is granted an aid of the special fund for R&D.

Article 11 The Examination Committee shall supervise and manage the use of the special fund for R&D according to the provisions of the agreement, and the Ministry of Information Industry shall be responsible for the concrete work.

Chapter Ⅵ Supplementary Provisions
Article 12 At the end of a year, the Ministry of Information Industry shall prepare an annual final financial statement, and submit to the Ministry of Finance before the first day of March of the next year. Upon examination of the Examination Committee, the Ministry of Finance shall issue an official reply.

Article 13 Any enterprise granted an aid of the special fund for R&D should strictly comply with the relevant laws and administrative regulations of the state. The Examination Committee shall check and evaluate the performances of the special fund for R&D, and the Ministry of Information Industry shall organize the concrete work.

Article 14 The Measures shall be enforced 30 days after the date of promulgation.

Article 15 The power to interpret the Measures shall remain with the Ministry of Finance, the National Development and Reform Commission and the Ministry of Information Industry