Order of the State Council of the People's Republic of China  No. 432

Regulation on Electric Power Supervision

Chapter I General Provisions

Article 1 With a view to strengthening electric power supervision, regulating the supervision of electric power, and
improving the electric power supervisory system, the present Regulation is formulated.

Article 2 The tasks of electric power supervision are to maintain the order of the electric power market, to protect
the legal rights and interests of those who invest in, manage or consume the electric power and the public interests, to
guarantee the safe and stable operation of the electric power system and to promote the sound development of the electric
power industry.

Article 3 Electric power supervision shall be conducted in accordance with the law and in compliance with the principles
of openness, justness and efficiency.

Article 4 The electric power supervisory organ of the State Council shall perform the functions of electric power
supervision and administrative law enforcement pursuant to the present Regulation and the relevant provisions of the State
Council. The relevant departments of the State Council shall perform relevant supervisory functions and administrative law
enforcement functions in accordance with the laws, administrative regulations and the relevant provisions of the State Council.

Article 5 Any entity or individual shall have the right to inform the electric power supervisory organ and the relevant
government department of an offense that violates the present Regulation and the state provisions on electric power
supervision, and the electric power supervisory organ and other relevant government departments shall handle it without
delay, and shall grant a reward to the person who makes contributions to such information.

Chapter II Supervisory Organ

Article 6 The electric power supervisory organ of the State
Council may, according to the needs for performing functions,
set up representative offices upon the approval of the State
Council, and exercise unified leadership and administration on
the offices.
The representative offices of the electric power supervisory
organ of the State Council shall perform their supervisory
functions within the scope as authorized by the electric power
supervisory organ of the State Council.
Article 7 A functionary of the electric power supervisory
organ engaged in supervisory work shall have the professional
knowledge and experiences suitable for electric power
supervision.
Article 8 The functionaries of the electric power supervisory
organ engaged in supervisory work shall perform their duties
faithfully, handle affairs according to law, be impartial and
clean, and may not seek improper interests by taking
advantages of their posts or hold posts concurrently in the
electric power enterprise or the trading institution for
dispatching electric power.
Article 9 The electric power supervisory organ shall
establish a supervision responsibility system and a
supervision information disclosure system.
Article 10 When an electric power supervisory organ or any of
its supervisory functionaries performs electric power
supervisory functions, the departments and persons concerned
shall support and cooperate with them.
Article 11 The electric power supervisory organ shall be
subject to the supervision of the financial, supervisory and
auditing departments of the State Council.

Chapter III Supervisory Duties
Article 12 The electric power supervisory organ of the State
Council shall, within the scope of its official duties,
formulate and promulgate rules and regulations on electric
power supervision in accordance with the laws, administrative
regulations and the present Regulation.
Article 13 The electric power supervisory organ shall issue
and administer the electric power business license in
accordance with the relevant laws and the relevant provisions
of the State Council.
Article 14 The electric power supervisory organ shall,
pursuant to the relevant state provisions, exercise
supervision over the market share of power generation
enterprise in each electric power market.
Article 15 The electric power supervisory organ shall
exercise supervision over the implementation of relevant rules
and regulations during the course of incorporating power
plants into the power grid, the interconnection between grids
and the coordinated cooperation between power plants and power
grids.
Article 16 The electric power supervisory organ shall
exercise supervision over the fair and non-discriminatory
opening of the electric power market to the subjects that
engages in electric power transactions, and the electric power
transmission enterprises' fair opening of its grids.
Article 17 The electric power supervisory organ shall
exercise supervision over the implementation of the operation
rules on the electric power market by electric power
enterprises and the trading institution for dispatching
electric power, and the conditions on the implementation of
rules on dispatching electric power by the trading institution
for dispatching electric power.
Article 18 The electric power supervisory organ shall
exercise supervision over the supply of electric power by
power supply enterprises to consumers in light of the quality
and service of power supply as provided for by the State.
Article 19 The electric power supervisory organ shall be
specifically responsible for the supervision and
administration of electric power safety.
The electric power supervisory organ of the State Council
shall, in collaboration with the development and reform
department and the administrative department of work safety of
the State Council, work out prepared plans for handling
serious safety accidents of electric power generation and
establish a system for emergency treatment in serious safety
accidents of electric power generation.
Article 20 The competent department of price and the electric
power supervisory organ of the State Council shall exercise
supervision over electricity prices in accordance with the
laws, administrative regulations and the provisions of the
State Council.

Chapter IV Supervisory Measures
Article 21 The electric power supervisory organ pursuant to
its supervisory duties shall have the power to demand electric
power enterprises and the trading institutions for dispatching
electric power to submit documents and materials relating to
the supervision.
The electric power enterprise and the trading institutions
for dispatching electric power shall faithfully submit
relevant documents and materials.
Article 22 The electric power supervisory organ of the State
Council shall establish an electric power supervision
information system.
The electric power enterprises and the trading institutions
for dispatching electric power shall, in accordance with the
rules as prescribed by the electric power supervisory organ of
the State Council, connect supervision-related information
systems with the electric power supervision information
system.
Article 23 The electric power supervisory organ shall have
the right to order electric power enterprises and the trading
institutions for dispatching electric power to faithfully
disclose relevant information in accordance with the
regulations and rules on electric power supervision as
prescribed by the State.
Article 24 When the electric power supervisory organ performs
its duties according to law, it may take the following
measures to conduct spot inspection:
(1) Conducting inspection by entering into an electric power
enterprise or a trading institution for dispatching electric
power;
(2) Inquiring the working personnel of an electric power
enterprise or a trading institution for dispatching electric
power, and ask them to explain the relevant matters being
inspected;
(3) Examining and copying the documents and materials
relating to the matters being inspected, and sealing up for
keeping the documents and materials that may be displaced,
hidden or destroyed; or
(4) Correcting on the spot or requesting for making
corrections within a prescribed time limit if there is any
violation found during the course of inspection.
Article 25 A functionary engages in electric power
supervision shall produce his legitimate certificate when
conducting a spot inspection; if he fails to do so, any
electric power enterprise or any trading institution for
dispatching electric power shall be entitled to refuse the
inspection.
Article 26 Where an electric power plant is incorporated into
the power grid or the power grids are interconnected, and both
parties to the said incorporation or to the said
interconnection fail to reach an agreement and thus affecting
the normal electric power transaction, the electric power
supervisory organ shall carry out mediation between the
parties; if the mediation fails, the electric power
supervisory organ shall find a verdict.
Article 27 In case a generation safety accident occurs to an
electric power enterprise, the enterprise shall immediately
take measures to prevent the accident from deterioration and
report to the electric power supervisory organ and other
relevant departments. The electric power supervisory organ,
after receiving the report on the accident, shall take
treatment measures in light of the prepared plans for great
electric power generation safety accidents.
The electric power supervisory organ shall organize or
participate in the investigation and handling of electric
power generation safety accidents in accordance with the
relevant state provisions.
Article 28 In case an electric power enterprise or a trading
institution for dispatching electric power violates any of the
laws or administrative regulations on electric power
supervision or the rules on electric power supervision, or has
any act harmful to public interests, the electric power
supervisory organ may make public the said violation or act as
well as the treatment thereof.

Chapter V Legal Liabilities
Article 29 Any functionary of an electric power supervisory
organ who engages in supervisory work and is found to be under
any of the following circumstances shall be given an
administrative punishment; if a crime is constituted, he shall
be prosecuted for criminal liabilities according to law:
(1) Issuing electric power business license by violating the
relevant laws and provisions of the State Council;
(2) Failing to deal with any found act of illegal operation
of electric power businesses according to law;
(3) Failing to timely deal with any found violation or
exposure of violation; or
(4) Seeking improper interests by taking advantage of his
post.
In case a functionary of an electric power supervisory organ
engaged in supervision holds a post concurrently in an
electric power enterprise or a trading institution for
dispatching electric power, the electric power supervisory
organ shall order him to make corrections, confiscate his
incomes from the concurrent job. If he refuses to make
corrections, he shall be removed or dismissed.
Article 30 In the case of illegal operation of electric power
businesses without a license, the electric power supervisory
organ shall order it to make corrections and confiscate its
illegal gains and may impose on it a fine of less than five
times of its illegal gains; if a crime is constituted, it
shall be prosecuted for criminal liabilities according to law.
Article 31 An electric power enterprise that violates the
present Regulation and is found to be under any of the
following circumstances shall be ordered to make corrections
by the electric power supervisory organ. If it refuses to do
so, it shall be imposed on a fine of more than 100,000 Yuan
but less than 1,000,000 Yuan, and the principal and other
directly responsible personnel shall be punished according to
law; where the circumstances are serious, its electric power
business license may be revoked:
(1) Failing to observe the operation rules on the electric
power market;
(2) Failing to abide by any of the rules and regulations when
the power plants are incorporated into power grid or the power
grids are interconnected; or
(3) Failing to fairly and non-discriminatorily open the
electric power market to the subjects engaged in electric
power transactions, or failing to fairly open the power grid
in accordance with the provisions.
Article 32 An electric power supply enterprise that fails to
provide electric power supply services in accordance with the
prescribed quality and service standards of power supply shall
be ordered to make corrections and given a warning. Where the
circumstances are serious, the principal and other directly
responsible personnel shall be punished according to law.

Article 33 Where a trading institution for dispatching electric power violates the present Regulation by failing to
organize transactions according to the operation rules on the electric power market, it shall be ordered to make corrections
by the electric power supervisory organ. If it refuses to do so, it shall be imposed a fine of more than 100,000 Yuan but less than 1,000,000 Yuan, and the principal and other directly responsible personnel shall be punished according to law.
A functionary of a trading institution for dispatching electric power who reveals any inside information on electric
power transactions shall be ordered to make corrections by the electric power supervisory organ and given a punishment
according to law.

Article 34 Where any electric power enterprise or trading institution for dispatching electric power is found to be
under any of the following circumstances, it shall be ordered to make corrections. If it refuses to do so, it shall be
imposed a fine of more than 50,000 Yuan but less than 500,0000 Yuan, and the principal and directly responsible personnel
shall be punished according to law. If a crime is constituted, they shall be prosecuted for criminal liabilities according to
law:
(1) Refusing or obstructing the electric power supervisory organ or its functionaries from performing its or his duties;
(2) Offering false documents and materials or intentionally concealing documents and materials with important facts; or
(3) Failing to disclose relevant information in accordance with the regulations and rules of the State on electric power
supervision.

Article 35 The confiscate illegal gains and fines as prescribe by the present Regulation shall be turned over to
the state treasury in accordance with the relevant state provisions.

Chapter VI Supplementary Provisions

Article 36 Electric power enterprises shall pay electric power supervision fees pursuant to the relevant rules as
provided for by the administrative departments of price and finance of the State Council.

Article 37 The present Regulation shall go into effect as of May 1, 2005.
　

Bright Jon  Attorney-at-law  Fax: +86-512-53516040
email@coalw.cn