EXHIBIT 12(a)(1)
THE CHINA FUND, INC.
CODE OF CONDUCT FOR PRINCIPAL EXECUTIVE AND
SENIOR FINANCIAL OFFICERS
I. COVERED OFFICERS/PURPOSE OF THE CODE
This Code of Conduct (the "Code") shall apply to the China Fund, Inc.'s
(the "Fund") Principal Executive Officer, Principal Financial Officer,
Controller, Principal Accounting Officer and persons performing similar
functions (the "Covered Officers," each of whom is named in Exhibit A attached
hereto) for the purpose of promoting:
o honest and ethical conduct, including the ethical handling of
actual or apparent conflicts of interest between personal and
professional relationships;
o full, fair, accurate, timely and understandable disclosure in
reports and documents that the Fund files with, or submits to,
the Securities and Exchange Commission ("SEC") and in other
public communications made by the Fund;
o compliance with applicable laws and governmental rules and
regulations;
o the prompt internal reporting of violations of the Code to an
appropriate person or persons identified in the Code; and
o accountability for adherence to the Code.
Each Covered Officer should adhere to a high standard of business ethics and
should be sensitive to situations that may give rise to actual as well as
apparent conflicts of interest.
II. COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS
OF INTEREST
OVERVIEW. A "conflict of interest" occurs when a Covered Officer's
private interest interferes with the interests of, or his service to, the Fund.
For example, a conflict of interest would arise if a Covered Officer, or a
member of his family, receives improper personal benefits as a result of his
position with the Fund. Covered Officers must avoid conduct that conflicts, or
appears to conflict, with their duties to the Fund. All Covered Officers should
conduct themselves such that a reasonable observer would have no grounds for
belief that a conflict of interest exists. Covered Officers are not permitted to
self-deal or otherwise to use their positions with the Fund to further their own
or any other related person's business opportunities.
This Code does not, and is not intended to, repeat or replace the
programs and procedures or codes of ethics of the Fund's investment adviser or
distributor.
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Although typically not presenting an opportunity for improper personal
benefit, conflicts may arise from, or as a result of, the contractual
relationship between the Fund and its service providers, including investment
adviser or administrator, of which the Covered Officers may be officers or
employees. As a result, this Code recognizes that the Covered Officers will, in
the normal course of their duties (whether formally for the Fund, the investment
adviser or administrator, or other service providers), be involved in
establishing policies and implementing decisions that will have different
effects on the service providers and the Fund. The participation of the Covered
Officers in such activities is inherent in the contractual relationship between
the Fund and its service providers and is consistent with the performance by the
Covered Officers of their duties as officers of the Fund. Thus, if performed in
conformity with the provisions of the Investment Company Act of 1940, as amended
("Investment Company Act") and the Investment Advisers Act of 1940, as amended
("Investment Advisers Act"), such activities will be deemed to have been handled
ethically. In addition, it is recognized by the Fund's Board of Directors (the
"Board") that the Covered Officers may also be officers or employees of one or
more other investment companies covered by other codes.
The following list provides examples of conflicts of interest under the
Code, but Covered Officers should keep in mind that these examples are not
exhaustive. The overarching principle is that the personal interest of a Covered
Officer should not be placed improperly before the interest of the Fund.
* * * *
Each Covered Officer must not:
o use his personal influence or personal relationship improperly
to influence investment decisions or financial reporting by
the Fund whereby the Covered Officer would benefit personally
to the detriment of the Fund;
o cause the Fund to take action, or fail to take action, for the
individual personal benefit of the Covered Officer rather than
the benefit of the Fund; or
o retaliate against any other Covered Officer or any employee of
the Fund or its affiliated persons for reports of potential
violations by the Fund of applicable rules and regulations
that are made in good faith.
Each Covered Officer must discuss certain material conflict of
interest situations with the Fund's Audit Committee. Examples
of such situations include:
o service as a Director, general partner, or officer of any
unaffiliated business organization. This rule does not apply
to charitable, civic, religious, public, political, or social
organizations, the activities of which do not conflict with
the interests of the Fund;
o the receipt of any non-nominal gifts;
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o the receipt of any entertainment from any company with which
the Fund has current or prospective business dealings unless
such entertainment is business-related, reasonable in cost,
appropriate as to time and place, and not so frequent as raise
any question of impropriety;
o any ownership interest in, or any consulting or employment
relationship with, any of the Fund's service providers, other
than its investment adviser, administrator, transfer agent,
custodian or any affiliated person thereof; and
o a direct or indirect financial interest in commissions,
transaction charges or spreads paid by the Fund for effecting
portfolio transactions or for selling or redeeming shares
other than an interest arising from the Covered Officer's
employment, such as compensation or equity ownership.
III. DISCLOSURE AND COMPLIANCE
o Each Covered Officer will monitor the compliance of the Fund and the
Fund's service providers with federal or state statutes, regulations or
administrative procedures that affect the operation of the Fund.
o Each Covered Officer should not knowingly misrepresent, or cause others
to misrepresent, facts about the Fund to others, whether within or
outside the Fund, including to the Fund's Board, Fund's Audit Committee
and the Fund's independent auditors, and to governmental regulators and
self-regulators and self-regulatory organizations.
o Each Covered Officer should, to the extent appropriate within his or
her area of responsibility, consult with other officers and employees
of the Fund and its service providers with the goal of promoting full,
fair, accurate, timely and understandable disclosure in the reports and
documents the Fund files with, or submits to, the SEC and in other
public communications made by the Fund.
o It is the responsibility of each covered officer to promote and
encourage professional integrity in all aspects of the Fund's
operations.
IV. REPORTING AND ACCOUNTABILITY
Each Covered Officer must:
o upon adoption of this Code (or thereafter as applicable, upon
becoming a Covered Officer), sign and return a report in the
form of Exhibit B to the Fund's compliance officer affirming
that he or she has received, read, and understands the Code;
o annually sign and return a report in the form of Exhibit C to
the Fund's compliance officer as an affirmation that he or she
has complied with the requirements of the Code; and
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o notify the Fund's Audit Committee promptly if he or she knows
of any violation of this Code. Failure to do so is itself a
violation of this Code.
The Fund's Audit Committee is responsible for applying this Code to
specific situations in which questions are presented under it and has the
authority to interpret this Code in any particular situation including any
approvals or waivers sought by the Covered Persons.
The Audit Committee will follow these procedures in investigating and
enforcing this Code:
o The Audit Committee will take all appropriate actions to
investigate any potential violations reported to the
Committee.
o If, after such investigation, the Audit Committee believes
that no violation has occurred, the Audit Committee is not
required to take any further action.
o Any matter that the Audit Committee believes is a violation of
this Code will be reported to the full Board.
o If the Board concurs that a violation has occurred, it will
notify the appropriate personnel of the applicable service
provider and may dismiss the Covered Officer as an officer of
the Fund.
o The Audit Committee will be responsible for granting waivers
of provisions of this Code, as appropriate.
o Any changes to or waivers of this Code will, to the extent
required, be disclosed as provided by SEC rules.
V. OTHER POLICIES AND PROCEDURES
This Code shall be the sole code of ethics adopted by the Fund for
purposes of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules and
forms applicable to registered investment companies thereunder. Insofar as other
policies or procedures of the Fund, the Fund's investment adviser, principal
underwriter, or other service providers govern or purport to govern the behavior
or activities of the Covered Officers who are subject to this Code, they are
superseded by this Code to the extent that they overlap or conflict with the
provisions of this Code. The Fund's, investment adviser's and principal
underwriter's codes of ethics under Rule 17j-1 under the Investment Company Act
and the investment adviser's more detailed policies and procedures are separate
requirements applying to the Covered Officers and others, and are not part of
this Code.
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VI. AMENDMENTS
Any amendments to this Code, other than amendments to Exhibit A, must
be approved or ratified by a majority vote of the Board, including a majority of
Independent Directors.
VII. CONFIDENTIALITY
All reports and records prepared or maintained pursuant to this Code
will be considered confidential and shall be maintained and protected
accordingly. Except as otherwise required by law or this Code, such matters
shall not be disclosed to anyone other than the Fund's Board or Audit Committee.
VIII. INTERNAL USE
The Code is intended solely for the internal use by the Fund and does
not constitute an admission, by or on behalf of Fund, as to any fact,
circumstance, or legal conclusion.
Approved on: September 12, 2003
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EXHIBIT A
Persons Covered by this Code of Ethics:
TITLE NAME
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President, Chief Executive Officer and Principal Executive Officer Gary L. French
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Treasurer, Chief Financial Officer and Principal Financial Officer William C. Cox
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