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 Commercial Behavior and Moral Rule Standard

1. Purpose 
The company expects to have highest moral standard. Any staff of the company shall follow the commercial behavior and moral rule standard. 
Regarding to the management, the following items shall be implemented: 
1.1 Strengthen transparent, upright and honest company culture; 
1.2 Guarantee that everyone in your organization completely follows these behaviors and rules. 
2. Range of application
It is applied to all staffs of the company, including management and senior financial officer. 

3. Responsibility 

4. Explanation of nouns
4.1 Bribe acceptance: it refers to the behavior of asking for properties of others by taking advantage of convenience of post, or receiving the properties of other illegally, and seeking gains for others. It also refers to the behavior of violating the regulation of the company, and receiving the kickback and commission under various titles in economic transaction. 
4.2 Bribery: it refers to the behavior of giving the properties to interested party to seek unjust benefit, such as the behavior of violating the company regulation, and giving properties, or kickback and commission under various titles to interested party in economic transaction. 

5. Work contents
I. Commercial activity
5.1 Interest conflict 
5.1.1 When the best interest of the company is judged, the staff shall prevent any individual behavior, investment and other activities from affecting the judgment. The staff shall not seek for individual interest by using the post or the relation in the company. The staff even avoids the possibility of the occurrence of this type of conflicts, for example, the following conditions may have potential interest conflict: Be inclined to provide the company business to relatives or friends; Use the information of private company, customer or supplier to obtain individual interest (including stock transaction based on this type of information) regardless of company staffs, relatives or friends; Have the financial interest in company suppliers, customers, or competitors exceeding the proper scope; get loan, debt guarantee, etc. from the company or third party due to the post of the staff in the company; or have or prepare to have competition with the company while being hired by the company. 
5.1.2 The interest conflict may also generate under other conditions. If your have question about the interest conflict, please refer to first section of “5.15 supervision and reporting of violation of moral rule”. 
5.1.3 In addition, as the management and senior financial officer, it is forcibly regulated that you shall prevent any investment, interest, etc. from affecting, being possible to affect, or appearing to affect you to independently judge the best interest of the company. 
5.1.4 Any behavior that may lead to the interest conflict shall be strictly prohibited. 

5.2 Present, bribe and kickback 
5.2.1 In addition to giving or receiving appropriate gifts in a regular business environment (including travel or entertainment), the staffs or their relatives shall not give gifts to or receive gifts from company customers and suppliers. In other cases, the gifts can only be given and received after the approval of the higher management of the staff. If giving or receiving gifts is made public, it will make the company or the staffs themselves in an awkward position, and in any case, it shall be absolutely avoided. 
5.2.2 Dealing with government official is usually different from dealing with ordinary individual. Many governments strictly prohibit their staffs from accepting the gifts of any kind, including banquet and entertainment. The staff must pay close attention to and strictly abide by these regulations. 
5.2.3 Any activities related to giving and collecting bribe or kickback shall be immediately terminated and reported to the relevant management personnel. The kickback or bribery includes any form of act that is intended to obtain better treatment by improper means. 
5.2.4 The involved amount of the above-mentioned gift/present given or received is ≥2,000 yuan, which belongs to the bribery or bribe acceptance behavior defined by the company. 
5.2.5 Management requirement involving in economic post The department involving in economic post (responsible staff of corresponding post) and the corresponding control measures are as follows: Work shift management

Note: 1. If there is promotion, the working period is calculated according to the term of office after the promotion; 
2. The managers, leaders above, and staffs of the same department cannot be shifted to the same department at the same time; 
3. The Human Resource Administration Center establishes and improves the record concerning the staffs on economic posts, informs the relevant departments and leaders about the list of staffs who need to be shifted within six months in May and November each year, and works with the principal of Business Dept. to perform the work shift together, 

5.3 Loan
The staff shall not ask for or accept the company loan or the salary paid in advance. 
5.4 The company property shall not be used or stolen 
5.4.1 All company staffs shall protect the company property, prevent from the loss or theft, and shall not use the company property for personal purpose. The company property includes confidential information, software, computer, office equipment and consumables. Within their own capabilities, the company staffs shall properly protect the company property and prevent these properties from misuse. When the communication systems of the company are used, these systems shall not be used to access or store: pornographic, obscene, sexually-related and profane materials; threatening or hostile materials; and the materials that violate company policies or violate laws and regulations. The staff can use the electronic communication system of the company for limited non-business purpose, for example: It is used under accidental circumstance; The work of the staff cannot be affected; The work efficiency cannot be reduced; The policy cannot be violated. 

5.5 Covering up of mistake and falsification of record 
The mistake shall not be covered up, and shall be reported and corrected immediately. The records of any company, customer or third party are strictly prohibited from falsification. 

5.6 Information protection of company, customer and supplier 
The staff shall not disclose the confidential information or copyright information of company, customer or supplier to others. In addition, the user shall take appropriate steps—including setting up security document, setting permission to computer or electronic media, or using appropriate processing strategy—to prevent the others from using these information without authorization. Copyright and/or confidential information includes: business model, price and market data, strategy, computer password, image, form, experimental study, related information, acceptance form, “existing, previous and potential” customers of company, supplier and staff information. 

5.7 Collection of competitive information
The staff shall not receive, use or publish the confidential information from competitor. If the competitive information is obtained, the staff shall not infringe the right of our competitor. The staff shall take special care when dealing with the information of existing and former customers and former staffs of the competitor. Do not actively ask for confidential or copyright information. Do not require the personnel to violate "non-competitive" or "confidential" agreement. If you are not clear about the above requirement, please consult the "Ministry of Law" for help. 

5.8 Software development
5.8.1 The staff involving in designing, developing, testing and maintaining the company software shall not use unauthorized third-party software to damage the integrity and legality of company products or obtain confidential information. 
5.8.2 The staff shall not possess, use or discuss the computer password, output, document or trade secret of copyrighted non-corporate organization, unless authorized by the agency. 
5.8.3 Do not intentionally copy or imitate the "likeness" of other softwares. 

5.9 Fair transaction
Any staffs of the company shall not manipulate or use privileged information, misrepresent the material data, or obtain unfair advantage in other unfair ways. It is specifically implemented according to Work Guideline for Fair Transaction Management. 

5.10 Fair competition law and antitrust law 
The company strictly complies with all applicable fair competition laws and antitrust laws. These laws attempt to ensure that the business is completely fair and equitable, and prevent the enterprise from reducing or inhibiting competition. If you determine which potential activity may lead to unfair competition or violate antitrust law, please consult “Legal Dept.” for help. 

5.11 Commercial record maintenance 
The company's business record shall be maintained in stages according to the regulation of procedure document or the special policy of Business Dept. in which the staff works. The record may be destroyed only after the valid period of preservation. In the case of pending, litigating, consulting to government, waiting for subpoena, or inquiring other information, this type of records shall not be abandoned or destroyed, whether or not the preservation period is passed. In addition, the staff shall never destroy, change or conceal any records for unfair reasons, or shall not attempt to affect or prevent any formal investigation by individual or in conjunction with others. 

5.12 Abandon of project
The commercial moral behavior rule is applicable to all company staffs and the members of board of directors. Any part of the specification shall not be abandoned, unless it is decided by the vote of the board of directors, or a designated committee determines that something contents need to be abandoned, and at the same time, it is necessary to ensure that the abandon of the project can protect the company, and the abandon is appropriate. 

II. Responsibility of staff
5.13 Moral rule 
5.13.1 Every colleague in the company, no matter where he or she is, shall be honest and upright when dealing with issues, without making any compromise. There is no difference between commercial morality and character morality, and both aspects shall maintain high standard. Regardless of local customs, the company staff shall support the highest moral standard. 
5.13.2 All staffs shall be honest and moral while dealing with colleague, customer, supplier and all third parties. Doing right thing means doing things right all the time. 
5.13.3 You shall respect the rights of your colleague, subordinate and third party. There shall be no discrimination, humiliation, defamation or other behaviors. Regardless of age, race, gender, sexuality, skin color, belief, religion, country of origin, marriage, or disability, everyone shall be granted with equal rights. 
5.13.4 The above problems cannot be caused by misleading or requirement of others. You are hoped to be able to report to management timely once there is or may be an illegal, dishonest and immoral situation while misleading or requiring by others. You will never be punished for reporting your finding and suspicion. 
5.13.5 The company always conducts the business following the laws and regulations of the country in which the business is operated. The commercial operation mode, custom, laws and regulations are different from country to country. When there is a conflict between the moral rules, customs, laws and regulations of these countries and the beliefs insisted by the company, the company seeks to be consistent with its own moral ideas. If the consistency cannot be solved according to the moral idea insisted by the company, the company will not carry out other activities in this aspect to avoid further upgrade of the conflict. These moral standards reflect “who we are” and “what kind of standard we choose”, so great attention shall be paid.  
5.13.6 The following statement can be referred to in the event of moral issue. If the staff violates the standard in the commercial behavior and moral rule standard of this section, he or she will be strictly rectified, and may eventually be dismissed. 

5.14 Compliance
5.14.1 Everyone in the company shall abide by applicable government laws and regulations in any writing form and thought form. 
5.14.2 If this rule, the commercial behavior and moral rule standard of the company, and/or any applicable laws are not followed, the responsible person will be required to make strict rectification, and even be dismissed immediately. 

5.15 Supervision and reporting of violation of moral rule
5.15.1 The behavior of the staff can strengthen the moral standard of the company and actively affect the colleague. If you are unable to prevent suspicious wrongdoing, or the wrongdoing is found after occurring, you shall report it to the management of appropriate level in the region in which you are located.  
5.15.2 If you are still skeptical after talking to the management, or feel uncomfortable after talking with the management (regardless of any reason), you can appeal through Work Guideline for Appeal Processing. 
5.15.3 Your telephone number, detailed record, and/or E-mail will be processed in confidence. Your loyalty and love to the company and the audit committee of the board of director of the company will ensure that you are free from retaliation. 

5.16 Accurate regular report
5.16.1 The staff of the company shall understand that: a comprehensive, fair, accurate, effective, and understandable regular report of the company is a legal requirement, and is critical to the success of the company business. Please insist on the responsibility of highest standard while preparing the report, and act in accordance with the following guidelines: All account records of the company, as well as the reports generated according to these records, the legal requirement related to each business shall be followed. All records shall fairly and accurately reflect the transaction or related events occurred. All records shall reflect the assets, liabilities, incomes and expenses of the company fairly and accurately by reasonable details. The account records of the company shall not contain any false or deliberately misleading contents. All transactions shall not be intentionally misclassified for accounting and all departments, or in the accounting period. All transactions shall be supported by accurate document with reasonable details and recorded by appropriate account No. at appropriate recording time. Internal accountant and independent accountant shall not conceal any information. The internal accounting control system of the company needs to be followed. 

5.17 Summary
5.17.1 Any staff is the defender of the moral rule of the company. Ask yourself as follows when something goes wrong: No matter from which aspect, is my behavior moral? Is it fully in compliance with the requirements of laws and regulations of the company? Is my behavior inappropriate? Will my behavior be questioned by my supervisor, colleague, customer, family, and the public? Do I want to fool people, including myself? Moreover, does it just prove the correctness of my actions? 
5.17.2 If the above issues cause your concern, please discuss with your local management before taking action. If you still feel that it is inappropriate, please report in accordance with the steps in "supervision and reporting of violation of moral rule" above. 
5.17.3 Any colleague who neglects or violates any moral standard of the company, or any manager who punishes the subordinate due to the maintenance to these moral standards by the subordinate will be strictly rectified, including immediate dismissal. We hope that you can share our belief that the moral observance is a correct behavior that will lead to successful business. This is also the most effective measure to ensure that the company is and remains a "world-class service" company. 

III. Management of moral rule
5.18 Responsibility for reporting
As a part of the commitment to moral and legal behavior of the company, the company requires all staffs to report any actual behaviors violating the laws and moral standards, suspicious violating behaviors, or the behaviors leaving such impression to people to the company, so as to take appropriate measure to investigate and handle the violating behaviors. The responsibility for reporting includes any situation that the staff suspects the existence but is unsure whether a violating behavior has indeed occurred. Failure to perform the responsibility for reporting is a behavior violating Commercial Behavior and Moral Rule Standard, may result in severe disciplinary punishment, and may include the termination of the labor contract. 
The company even implements this provision on the personnel who do not directly violate the moral and legal standards of the company because the staff who does not perform our moral and legal responsibilities at any time will generate adverse effect on the company and the staffs. The penalties and effects caused by illegal behaviors may bring huge loss to the company and related individuals. No one can tolerate this kind of behavior. Therefore, if anyone doubts or understands the violating behavior, he or she has the obligation of disclosing it to the company, his or her own. 

5.19 Understand which issue shall be reflected and when the issue is reflected 
The behavior that involves in or is suspected to involve in illegality, the behavior that violates Commercial Behavior and Moral Rule Standard, or the undetermined or suggested behavior that you have reason for believing that it will violate Commercial Behavior and Moral Rule Standard is report to management personnel. Your doubt as to whether or not the proper procedure is followed is reported to the management personnel, even if you are not sure whether the legal or moral standards are violated, and whenever you believe that the appropriate resource or training is not provided to prompt the staff to follow the legal standards applicable to the company, the management personnel shall be reported. 

If the staff discovers or suspects the behavior violating the standard, the consultation or report can be conducted in any of the following ways (optional): 
1. Call the morality line of the company, and the tel. No. is 18926576808;
2. Call the telephone of legal specialist: (0755)26021222-10503/(0512)33026888-52601; 
3. Detailed records (including corresponding documents) are sent to the E-mail of the company to leave relevant information, the address is: twsz@twsz.com, and the company will arrange specially-assigned person to manage the E-mail; 
4. Detailed records are directly sent by post (including corresponding documents), the address is: B411, Nanshan Medical Device Industrial Park, No. 1019, Nanhai Road, Nanshan District, Shenzhen, postcode: 518067; 
5. You can call the company or contact the board of directors of the company directly; 
6. More ways can be appealed through Work Guideline for Appeal Processing. 

5.20 Non-retaliation commitment
The company understands your concern about reporting issues and will not tolerate any discrimination or retaliation against anyone who report the issues about Commercial Behavior and Moral Rule Standard with a good faith, although the reporting of issues may not necessarily avoid the consequence caused by the fault of the reporter ( If it exists). The staff who attempts to retaliate can be punished by discipline. The maximum punishment includes termination of the labor contract. 

5.21 Report confidentially or anonymously
When the staff makes a report, it can be conducted anonymously. Human resource specialist of Shenzhen/Shanghai/Taicang initiates an investigation based on the reported clues. The supervisor and the superior department shall keep secrets to ensure the confidentiality and anonymity of the report of the staff. The reporting to observed or suspected behaviors violating laws or standards will be treated with caution. According to different circumstances, the investigation generally needs to be completed within seven working days to make a treatment suggestion. If the circumstances are serious and the situation is complex, it may be extended as appropriate. 

5.22 Complaint investigation and disciplinary punishment measure
The issues contained in Commercial Behavior and Moral Rule Standard are the most important issues for the company. We expect all staffs to abide by these rules in performing their duties in the company. 

The company can immediately conduct a thorough investigation to all reports about the behaviors that are alleged to violate Commercial Behavior and Moral Rule Standard. All information disclosed during investigation can be kept confidential, unless it is required for investigation and taking any remedial measure, or shall be disclosed in accordance with the regulations of relevant laws. If it is determined that the behavior violating Commercial Behavior and Moral Rule Standard is actually occurred, we will promptly take appropriate remedial measure based on the seriousness of the violation. This type of remedial measures may include disciplinary punishment, the maximum punishment includes the termination of labor contract, and in addition, reasonable measure can further be adopted to prevent any further behavior violating related policies. In the case of illegal behavior, the company will fully cooperate with relevant government units. If the company suffers the loss, the company may make claim against responsible individual or organization. 

5.23 The staff of the company shall strictly implement relevant laws and regulations as well as the requirement of Commercial Behavior and Moral Rule Standard, and follow the commercial moral rule of the company.
@ 2012 Gongjin Electronics