Shandong Higher People’s Court,

We have received your Court’s Request for Instruction Regarding the Non-recognition and Non- enforcement of the arbitral award Rendered by International Chamber of Commerce with your reference number “[2007] Lu Min Si Ta Zi No. 12”. After deliberation, we reply as follows:

Given that the award was rendered by the arbitral tribunal of the International Chamber of Commerce (“ICC”), the judicial review shall be conducted under the 1958 Convention on the Recognition and Enforcement of Foreign Awards (“New York Convention”) to which China had acceded.

The arbitration clause in the joint venture contract of Jinan Hemofarm Pharmaceutical Company Limited (“Jinan-Hemofarm”) between Hemofarm DD (“Hemofarm”), MAG International Trade Company (“MAG”), Suram Media Corporation Limited (“Suram”) and Jinan Yongning Pharmaceutical Corporation Ltd. (“Yongning”) has no binding force upon the dispute between Yongning and the Jinan-Hemofarm regarding the lease contract, though it is binding upon the parties for disputes related to the joint venture. In the present case concerning the joint venture contract between Hemofarm, MAG, Suram and Yongning, the ICC International Arbitration Court rendered an arbitral award which contained decisions on matters beyond the scope of the submission to arbitration under the arbitration agreement in the joint venture contract. Furthermore, the ICC tribunal violated the judicial sovereignty of China and the jurisdiction of Chinese courts by arbitrating the disputes between Yongning and Jinan-Hemofarm concerning the lease contract, as a Chinese court had already made several civil orders concerning the disputes between Yongning and Jinan-Hemofarm and had made a civil ruling on the interim measures concerning Jinan-Hemofarm’s property.

According to the Article V(1)(c) and Article V(2)(b) of the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the Supreme People’s Court considered that ICC Award No. 13464/MS/JB/JEM in this case shall not be recognized and enforced.

We agree with your Court’s views and reply as above.