Article 1

Subject to the Interim Measures of Tianjin Bohai Commodity Exchange for Trading Market Supervision and Administration, Jin Zheng Fa[2009] No.32 promulgated by the Tianjin People’s Government, and the Rules of Tianjin Bohai Commodity Exchange for Continuous Spot Trading Management made by the Tianjin Bohai Commodity Exchange, (henceforth the Exchange), the detailed clearing rules are stipulated herein to regulate the settlement of transactions in the Exchange, and to protect the legal rights and interests of market participants.

Article 2

Clearing refers to business activities concerning calculating and transferring traders’ margins, daily profits and losses, delivery payments, and other funds conducted by the Exchange subject to the results of transactions and related rules and regulations of the Exchange.

Article 3

The Exchange institutes a daily clearing system.

Article 4

The Exchange renders clearing services to approved traders only.

Article 5

The detailed rules herein are applicable to all clearing activities within the Exchange. The Exchange, designated service providers (members), traders as well as settlement banks designated by the Exchange, henceforth settlement banks, and their staff are bound to these rules.

Article 6

The clearing department is established by the Exchange. The clearing department is responsible for the unified clearing of transactions traded on the e-trading system of the Exchange. The clearing department calculates, transfers, and manages margins, daily profits and losses, delivery payments, and other funds. It is also responsible for clearing risk controls.

Article 7

The main responsibilities of the clearing department include:

To control clearing risks;

To register and compile clearing accounts for traders;

To handle funds transfer activities;

To summarize, record, and report the clearing consequences;

To handle margins, daily profits and losses, delivery payments, and other clearing-related business activities.

To safekeep clearing documents, clearing reports and other related certificates and accounting books;

To deal with other clearing-related business activities.

Article 8

All contracts matched through the e-trading system of the Exchange must be centrally settled and cleared through the clearing department.

Article 9

The clearing department and its staff must safeguard the confidential information of the Exchange and the traders.

Article 10

The Exchange opens a special clearing account in each settlement bank to calculate traders’ margins, delivery payments and other funds related to transactions.

Article 11

Traders shall open a capital account in a settlement bank to deposit and transfer funds.

Article 12

Transferring funds between the Exchange and its traders shall only be conducted between the Exchange’s special clearing account and traders’ capital accounts opened in the same settlement bank.

Article 13

Settlement banks are those designated by the Exchange to assist the Exchange with clearing business.

Article 14

The settlement banks shall sign cooperation agreements with the Exchange to clarify rights and obligations of both parties, and to discipline the business activities.

Article 15

The main responsibilities and business scope of the settlement banks are:

To open a special clearing account for the Exchange;

To open capital accounts for traders;

To provide financial services, which shall be in accordance with state laws, regulations, and policies, as requested by the Exchange and traders;

To assist the Exchange with managing traders’ funds transfer;

To assist the Exchange with funds transfer between different special clearing accounts of different settlement banks;

To cooperate with the Exchange to set up a data reconciliation system;

To safeguard the business secrets of the Exchange and traders.

Article 16

When applying for trading in the Exchange, traders are required to sign a tri-party agreement with the Exchange and the settlement banks, or a bilateral agreement with a settlement bank.

Article 17

The Exchange separately manages the funds that traders deposit in the Exchange’s special clearing accounts. One subsidiary ledger is available to each trader, and the deposits and withdrawals, profits and losses, margins, and transaction fees etc. are recorded in daily order.

Article 18

The Exchange shall collect margins from the buyer and the seller based on the last settlement price of the contracts that each trader holds at the end of the trading day. The specific rules applicable to the margin shall be in accordance with the rules and regulations of the Exchange and the e-trading contract agreements.

Article 19

The Exchange transfers funds among the traders according to their profits and losses. Daily profits and losses are calculated using the following formula:

Daily profits/losses =Σ[（Settlement Price–Purchasing Price）× Volume of Contracts Purchased]+ Σ[（Selling Price–Settlement Price）×Volume of Contracts Sold]+（Settlement Price – Settlement Price of the Previous Trading Day）×（Volume of Contracts Purchased in the Previous Trading Day-Volume of Contracts Sold in the Previous Trading Day）

Article 20

Settlement Price refers to the weighted average price of a listed commodity on a trading day. The settlement price shall be rounded to the nearest integer. If there is no trade of a listed commodity on a particular trading day, the settlement price of that commodity on the last trading day before that day shall be the settlement price of that day.

Article 21

When the market is closed, the Exchange calculates margins, daily profits and losses, delivery payments and other funds for each trader. If the remaining funds in a trader’s special clearing account on the Exchange are insufficient to pay the above items, the Exchange issues a margin call notification to the trader.

Article 22

If the remaining funds in a special clearing account of the Exchange are insufficient, before the next trading day starts, the account holder shall transfer funds into the account or self-transfer his contracts to meet the margin requirements. Otherwise, the Exchange will transfer the contracts on behalf of the traders until the margin requirements are met.

Article 23

Traders may transfer funds in accordance with their signed agreements with the Exchange. However, in any of the following situations, the Exchange is entitled to restrict the funds withdrawal:

Traders are involved in serious violation of the rules and regulations, or are put on file for investigation by the Exchange or related organizations;

Market risks are high as regarded by the Exchange;

Other situations the Exchange concludes as necessary for restriction of funds withdrawal.

Article 24

Traders shall acquire clearing data through the e-trading system after daily settlement.

Article 25

In the event that the Exchange fails to provide a clearing date due to irregularities, the Exchange shall notify traders and take appropriate measures to resolve the irregularities.

Article 26

Traders shall notify the Exchange of their dissent on clearing data in paper form 30 minutes before the opening of the market on the next trading day. If no dissent occurs within the stipulated time limit, it is deemed that traders accept the clearing data without reservation.

Article 27

The Exchange provides payment settlement services to traders. Delivery payment shall be settled by “payment upon receipt, and receipt before payment”. The seller shall receive and take payment and issue VAT invoices against the settlement price of any commodity for which delivery declaration is lodged and delivery matching is realized on the current day, and the buyer shall pay for the commodity at the settlement price of such commodity for which delivery declaration is lodged and delivery matching is realized on the current day.

Article 28

The buyer and the seller shall surrender the delivery commitment subject to the Exchange rules after successful matching of delivery declared. The rules of the Exchange and E-trading contract provisions shall apply to a specific rate of delivery commitment.

Article 29

Within the stipulated time limit, the Exchange shall collect the remaining payments other than the delivery commitment from the buyer. After the delivery is completed, the Exchange shall release the delivery commitment to the seller within the stipulated time limit.

Article 30

The Exchange shall collect transaction fees and delivery fees from traders subject to the standards. The rates of transaction fees and delivery fees are prescribed in the contract specifications.

Article 31

Traders shall actively work to enhance their fund management skills and abilities, and strictly follow the rules and regulations of the Exchange. Traders shall, in a timely manner, acquire and verify the clearing data, and properly preserve clearing files, vouchers, and account books for future inquires.

Article 32

The Exchange is responsible for the revision and interpretation of The Detailed Rules.

Article 33

The Detailed Rules shall be enforced and implemented as of the date of promulgation hereof.

Tianjin Bohai Commodity Exchange

December 15, 2009