Proposed Amendments to the Articles of Association

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ZHEJIANG EXPRESSWAY CO., LTD
A joint stock limited company incorporated in the People's Republic of China with limited liability)
(Stock code: 0576)

ANNOUNCEMENT ON
PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION

Reference is made to the announcement of the Company dated 31 October 2017 in relation to the Board's recommendation to make amendments to the existing Articles. Terms defined in this announcement should have the same meaning when used herein. The proposed amendments are set out as follows.

Proposed amendments

Reasons for or basis of amendments

CHAPTER 19A PARTY COMMITTEE   Article 19A.1 This chapter is formulated to suit the needs of the development of socialistic market economy, establishing modern state-owned enterprise regulating system with Chinese characteristics, governing the organization and action of company, protecting the legal interests of investors, the Company and creditors, as well as pursuant to relevant laws, rules and regulations, including but not limited to, the Company Law of the People's Republic of China, the Enterprise State-owned Asset Law of the People's Republic of China, and the Articles of Association of the Chinese Communist Party (the "Party Articles").   Article 19A.2 These Articles of Association constitute a legal document that governs the organization and action of company, with binding power over investor, company, leading members of party organization (and disciplinary inspection organization), directors, supervisors, as well as senior management.   Article 19A.3 Pursuant to relevant rules under the Party Articles, the Company sets up organization of the Chinese Communist Party, carries out activities of the party. Party organization, acting as core of leadership and politic, sets direction, oversees overall situation, and ensures implementation. The Company establishes working organization of the party, providing sufficient staff for party affairs, ensures the funding needed for party organization works, and providing the necessary condition for party organization's activities.   Article 19A.4 The Company sets up Chinese Communist Party Commission of Zhejiang Expressway Co., Ltd. (the "Party Commission") and Chinese Communist Party Disciplinary Inspection Commission of Zhejiang Expressway Co., Ltd. (the "Disciplinary Commission").   Article 19A.5 Positions of secretary, deputy secretary and members of the Party Commission and the Disciplinary Commission are to be set up in accordance with directive given by higher level party organization, and to be elected or appointed pursuant to relevant rules under the Party Articles. Party Commission secretary and chairman of the Company should be assumed by the same person in principle. Qualified leading members of the Party Commission may assume positions within the board of directors, the supervisory committee, and the management through legal procedures. Likewise, qualified members of the board of directors, the supervisory committee, and the management may assume positions within the leading members of the Party Commission following relevant rules and procedures.   Article 19A.6 The Company sets up working organization for party affairs independently or jointly, providing party affairs working staff  no less than the average staffing level for internal organizations, with party affairs working staff enjoying the same t reatment as operation management s taff at the same level. The Company's Disciplinary Commission provides working staff to carry out disciplinary inspection works independently or jointly. At the same time, the Company should set up social organizations such as labor organization and communist youth league in accordance with law, safeguarding the legal interests of employees.   Article 19A.7 The organization structure and staff hiring quotas of the Party Commission should be incorporated into corporate management structure and staff hiring quotas, with working funds of party development works constituting part of corporate management cost.   Article 19A.8 The Party Commission of the Company shall discharge the following duties in accordance with the Party Articles and relevant rules:   1.        to supervise and ensure the principles and policies of the party and the country are implemented at the Company, including important strategic decisions from party central committee, the state council, the provincial party committee and the provincial government.   2.        to participate in major decisions of the Company, taking part in discussions on reform, development and stability of the Company, major operation management decisions, as well as major issues involving core interests of employees, supporting the board of directors, supervisory committee and management in discharging their responsibilities in accordance with law.   3.        to integrate the principle of party in charge of cadres with the board of directors' selection of management in accordance with law, as well as the management's power to select staff in accordance with law. The Party Commission of the Company should place checks on various personnel selection processes, including  standards  adopted, regulate procedures, participate in investigation and recommendation of candidates, ensuring the formation of a robust cadres team at the Company. The party organization should be resolute on the principle of party in charge of human resources, fully implement the strategy of bolstering enterprise with talents.   4.        to strengthen the supervision over management of the Company, enhance internal supervision system, integrate internal supervision resources, and improve supervision mechanism over power functioning.   5.        to strengthen party organization development, party member development and training management at the local level, fully exert fighting spirit of local party organization and exemplary  vanguard  role of party members.   6.        to discharge the main responsibility of constructing clean party and clean government, fight against corruption and support the works of the Disciplinary Commission.   7.        to lead the Company's works on ideology and politics, the united front, development of socialist culture and ethics, development of corporate culture, as well as organizations such as labor union and communist youth league.   8. to work on remaining issues that the Company's Party Commission should have participated in or decided upon.   Article 19A.9 The main procedures for the Company's Party Commission to participate in decision making:   1.        the Party Commission holds meetings to discuss major issues to be decided upon by the board of directors and management, providing advices and recommendations. The Party Commission can propose other major issues to the board of directors and the management for consideration should it believe that they need to be decided by the board of directors and management.   2.        members of the Party Commission who are also members of board of directors, the management, especially the chairman of the board and general manager, should communicate with other members of board of directors and management about the advices and recommendations from discussions held by the Party Commission before the subjects are formally presented to the board of directors or management.   3.        members of the Party Commission who are also members of board of directors and management should expressly convey the advices and recommendations from discussions held by the Party Commission during the decision making process of the board of directors and management, and report the decisions made to the Party Commission in a timely manner.   4.        the Party Commission must propose to repeal or delay any decision made by the board of directors or management should it find them contradicting with the courses, principles and policies of the party or the laws and regulations of the country, or that they may damage the legal interests of the country, the public, the enterprise and the employees. If the decision is not rectified, it must be reported to the higher level party organization in a timely manner.   5.        the decision making at the Company's Party Commission must reflect collective leadership, democratic centralism, individual consultation, and decision after group consultation. Major decisions should be reached after full consultation, going through scientific, democratic and legal processes. Article 19A.10 The Company can hold extraordinary board meeting upon proposal from the Party Commission. Article 19A.11 The board of directors and management should take note of advices of the Company's Party Commission prior to deciding on the Company's major issues. Article 19A.12 When provisions at other parts of these Articles of Association differ or conflict with provisions within this chapter, provisions within this chapter shall prevail.

The chapter "Party Committee" is added in accordance with the written notice f rom t he organization department of Zhejiang Provincial Party Committee and the party committee of the State-owned Assets Supervision and Administration Commission of Zhejiang Province, including Articles 19A.1 -- 19A.11.

On behalf of the Board         
Zhejiang Expressway Co., Ltd.
ZHAN Xiaozhang             
Chairman                    

Hangzhou, the PRC, November 1, 2017

As at the date of this announcement, the executive directors of the Company are: Mr. ZHAN Xiaozhang, Mr. CHENG Tao and Ms. LUO Jianhu; the non-executive directors of the Company are: Mr. WANG Dongjie, Mr. DAI Benmeng, and Mr. ZHOU Jianping; and the independent non-executive directors of the Company are: Mr. ZHOU Jun, Mr. PEI Ker-Wei and Ms. LEE Wai Tsang, Rosa.