(“ANNOUNCEMENT”) (国家税务总局关于纳税人资产重组有关增值税问题的公告), ISSUED BY SAT

SAT published the announcement on VAT issues relating to taxpayers' asset reorganization. According to the Announcement, where a taxpayer transfers on several occasions all or a part of tangible assets, and the rights and liabilities connected to those assets through merger, division, sale, and replacement in the context of an asset reorganization process, if the final transferee is the same entity or individual, those transfers of assets are exempt from VAT provided that the transferor submits an asset reorganization program as well as other documents and materials to the competent tax department.

Date of issue: November 19, 2013. Effective date: December 1, 2013.